Terumo Corporation · TSE:4543

Terumo — FY2013 Earnings Presentation

29 slides from Terumo's earnings presentation, May 8, 2014

  1. Slide 1: Financial Results for the Fiscal Year Ending March 31, 2014 (FY2013)

    Financial Results for the Fiscal Year Ending March 31, 2014 (FY2013) Terumo Corporation May 8, 2014

  2. Slide 2: Highlights in FY2013

    Highlights in FY2013  Achieved increase both in sales and profit thanks to weaker yen Corporate  Fell short of profit guidance  Began to secure a foothold to improve profitability  Continued to improve quality management system at TCVS  Double digit growth in overseas Intervention Systems busin

  3. Slide 3: Increase in Sales and Profit Thanks to Weaker Yen

    Increase in Sales and Profit Thanks to Weaker Yen (billion yen) Excluding FY2012 FY2013 YoY% FX Net Sales 402.3 467.4 +16% +4% Gross Profit 205.7 (51.1%) 242.0 (51.8%) +18% +2% SG&A Expenses 125.4 (31.2%) 146.6 (31.4%) +17% R&D Expenses 27.1 (6.7%) 30.1 (6.4%) +11% Operating Income 53.2 (13.2%) 65.3

  4. Slide 4: Extraordinary Income or Loss

    Extraordinary Income or Loss (billion yen) Primary extraordinary income Settlement received 6.0 Primary extraordinary loss Impairment loss 15.4 Assets of unprofitable business Cardiac & Vascular 7.6 General Hospital 3.5 Etc. 2014/5/28 ©Terumo Corporation 4/29

  5. Slide 5: Operating Income Variance Analysis

    Operating Income Variance Analysis (billion yen) SG&A 4.4 R&D 0.5 10.9 Increased 4.1 expenses Price 1.2 erosion Device 1.4 G/P tax in US Others increment by sales increase 12.8 65.3 FX 53.2 FY2012 FY2013 2014/5/28 ©Terumo Corporation 5/29

  6. Slide 6: Net Sales by Business Segment

    Net Sales by Business Segment (billion yen) +6% ＊ +24% FY2012 FY2013 (+2%) (+7%) ( ) Excluding Foreign Exchange * Excluding Home Therapy +24% (+5%) ＊ 155.0 164.1 169.7 210.5 74.7 92.7 General Cardiac & Blood Hospital Vascular Management 2014/5/28 ©Terumo Corporation 6/29

  7. Slide 7: Operating Profit by Segment

    Operating Profit by Segment (billion yen) YoY% FY2012 FY2013 YoY% (Excl. FX) General Hospital 23.6 (15%) 20.8 (13%) -12% -16% Segment Cardiac & Vascular 29.1 (17%) 43.9 (21%) +51% +14% O/P Blood Management 13.8 (18%) 18.6 (20%) +35% +4% Others * 0.2 -1.7 - Operating Income (Excl. Amortization) 66.8

  8. Slide 8: General Hospital: Decline in Profit Despite Slight Increase in Sales

    General Hospital: Decline in Profit Despite Slight Increase in Sales (billion yen) YoY% FY2012 FY2013 YoY% (Excl. FX) Sales 155.0 164.1 +6% +2% Segment O/P 23.6 20.8 -12% -16% (%) (15%) (13%) Excluding Home Therapy  General Hospital Products: Decline in profit due to a delay of new products expansi

  9. Slide 9: Cardiac & Vascular: Increase in Sales and Profit

    Cardiac & Vascular: Increase in Sales and Profit (billion yen) YoY% FY2012 FY2013 YoY% (Excl. FX) Sales 169.7 210.6 +24% +7% Segment O/P 29.1 43.9 +51% +14% (%) (17%) (21%)  Interventional Systems: Sales, around access devices, in overseas market grew at double digits, and peripheral stent Misago l

  10. Slide 10: Blood Management: Expanded Even Under Challenging Environment

    Blood Management: Expanded Even Under Challenging Environment (billion yen) YoY% FY2012 FY2013 YoY% (Excl. FX) Sales 74.7 92.7 +24% +5% Segment O/P 13.8 18.6 +35% +4% (%) (18%) (20%)  Expanded business of highly value added products, such as automated blood component processing system (in EU) and t

  11. Slide 11: Fell Short of Profit Guidance

    Fell Short of Profit Guidance (billion yen) FY2013 FY2013 Guidance Result Operating Income 70.0 65.3 USD 100 yen USD 100 yen Average Exchange Rate EUR 134 yen EUR 134 yen  General Sales shortfall in JP and a delay of new products expansion - 3.5 BJPY Hospital  Cardiac & TCVS quality system improve

  12. Slide 12: Operating Cash Flow

    Operating Cash Flow Balance out growth investments, debt repayment, and return to shareholders (billion yen) Operating CF Investing & Financing CF 96.3 ▲78.9 3.6 2.9 15.4 Contri- Corpo- 5.4 bution of rate tax Increase Impair- securities and in 46.6 ment to retire- others working 39.9 loss ment capit

  13. Slide 13: FY2014 Guidance

    FY2014 Guidance Assumed average USD = 100 yen exchange rate EUR = 140 yen (billion yen) FY2014 YoY % Guidance Net Sales 488.0 +4% Operating Income 64.0 (13%) -2% Ordinary Income 62.0 -1% Net Income 37.5 +10% 2014/5/28 ©Terumo Corporation 13/29

  14. Slide 14: Operating Income Variance Analysis

    Operating Income Variance Analysis SG&A 11.5 (billion yen) 3.8 Plant productivity R&D JP reim- and cost 1.1 bursement 15.4 down Increased 6.2 expenses Other 1.8 G/P 3.5 FX increment by sales Price increase erosion 65.3 64.0 FY2013 FY2014 2014/5/28 ©Terumo Corporation 14/29

  15. Slide 15: Reference

    Reference 2014/5/28 ©Terumo Corporation 15/29

  16. Slide 16: Net Sales by Region

    Net Sales by Region (billion yen) Consolidated: +17% (+5%) ＊ FY2012 FY2013 ( ) Excluding Foreign Exchange * Excluding Home Therapy Japan Outside of Japan +29% 75.4 +3% ＊ +29% Europe (+6%) (+3%) 96.9 Americas +26% 87.9 (+5%) 111.0 ＊ +38% 17.4 China 183.2 189.0 216.4 278.3 (+13%) 24.1 Asia & +30% 35.6

  17. Slide 17: SG&A Expenses

    SG&A Expenses (billion yen) FY2012 * FY2013 YoY YoY% General Administrative 142.2 146.6 +4.4 +3% Total R&D Expenses 29.6 30.1 +0.5 +2% SG&A Expenses Total 171.8 176.7 +4.9 +3% * Value adjusted by excluding FX impact Enhance sales force in Americas (Interventional Systems and Neurovascular Intervent

  18. Slide 18: SG&A Expenses

    SG&A Expenses (billion yen) FY2012 FY2013 YoY YoY% Salaries & Wages 53.2 63.8 +10.6 +20% Sales Promotion 12.5 14.2 +1.7 +14% Logistical Costs 10.2 10.5 +0.3 +4% Depreciation & Amortization 18.3 22.7 +4.4 +25% Others 31.2 35.4 +4.2 +13% General Administrative Total 125.4 (31.2%) 146.6 (31.4%) +21.2 +

  19. Slide 19: FY2013: Net Sales and Growth by Region

    FY2013: Net Sales and Growth by Region (billion yen) Business Outside of Japan Japan Total Asia & G. Total Segment Europe Americas China Others General 125.8 38.3 12.3 8.8 1.3 15.9 164.1 Hospital ( 1%) ( 3%) (-3%) (-5%) (-1%) (12%) ( 2%) Cardiac & 49.5 161.1 59.0 65.4 19.0 17.7 210.6 Vascular ( 7%)

  20. Slide 20: Q4 Alone: Net Sales and Growth by Region

    Q4 Alone: Net Sales and Growth by Region (billion yen) Business Outside of Japan Japan Total Asia & G. Total Segment Europe Americas China Others General 30.1 10.0 3.7 2.2 0.4 3.8 40.2 Hospital ( 6%) (-1%) ( 2%) (-16%) ( 35%) ( 4%) ( 4%) Cardiac & 12.7 43.9 15.9 17.7 5.3 5.1 56.7 Vascular ( 10%) ( 8

  21. Slide 21: Profit Ratio, SG&A Expenses Ratio (Excluding FX)

    Profit Ratio, SG&A Expenses Ratio (Excluding FX) (%) Gross 51.1 52.0 51.5 51.5 Margin 48.9 39.2 39.3 SG&A 37.3 36.6 37.8 Expenses Ratio 14.7 14.9 13.7 11.8 Operating 9.7 Margin Q4 Q1 Q2 Q3 Q4 FY12 FY13 2014/5/28 ©Terumo Corporation 21/29

  22. Slide 22: Quarterly Results

    Quarterly Results (billion yen) Q4 FY12 Q1 FY13 Q2 FY13 Q3 FY13 Q4 FY13 (Jan-Mar) (Apr-Jun) (Jul-Sep) (Oct-Dec) (Jan-Mar) Net Sales 106.5 111.1 114.9 119.2 122.1 Gross 52.2 57.0 60.1 61.5 63.3 Profit (49.0%) (51.3%) (52.3%) (51.6%) (51.9%) SG&A 41.6 43.7 43.0 43.7 46.3 Expenses (39.1%) (39.3%) (37.4

  23. Slide 23: Profit Ratio, SG&A Expenses Ratio (Q Ave. Exchange Rate)

    Profit Ratio, SG&A Expenses Ratio (Q Ave. Exchange Rate) (%) Gross Margin 49.0 51.3 52.3 51.6 51.9 SG&A Expenses 39.1 39.3 37.4 36.7 37.9 Ratio 12.0 14.9 14.9 14.0 Operating 9.9 Margin Q4 Q1 Q2 Q3 Q4 FY2012 FY2013 2014/5/28 ©Terumo Corporation 23/29

  24. Slide 24: CAPEX, R&D Expenses

    CAPEX, R&D Expenses (billion yen) FY2013 FY2013 FY2014 YoY Guidance Result Guidance CAPEX 50.0 46.6 (93%) 42.0 -4.6 Depreciation & Amortization 37.0 39.9 (108%) 41.0 +1.1 R&D Expenses 30.0 30.1 (100%) 31.0 +0.9 %: Progress to guidance Depreciation & Amortization: Including intangibles CAPEX: Acquisi

  25. Slide 25: Foreign Exchange Sensitivity

    Foreign Exchange Sensitivity (billion yen / year) USD EUR Net Sales 1.8 0.7 Operating Income 0.3 0.4 2014/5/28 ©Terumo Corporation 25/29

  26. Slide 26: Changes of Quarterly Average Exchange Rates

    Changes of Quarterly Average Exchange Rates 141 JPY 137 129 131 130 122 EUR (FY2013) 105 EUR (FY2012) 110 103 98 USD (FY2013) 103 90 99 100 99 92 USD (FY2012) 80 79 81 70 Ｑ１ Ｑ２ Ｑ３ Ｑ４ 2014/5/28 ©Terumo Corporation 26/29

  27. Slide 27: Progress in FY2013 New Product Pipeline

    Progress in FY2013 New Product Pipeline Business Product Region Business Product Region Stent (above the knee) JP Automated blood component processing system (PRP method) EU EU Peripheral Balloon (below the knee) FY14 Automated blood component EU processing system (BC method) EU Stent (below the kne

  28. Slide 28: New Product Pipeline in FY2014

    New Product Pipeline in FY2014 Business Product Region Business Product Region Balloon (above the knee) US Automated blood component Peripheral processing system JP Balloon (below the knee) JP, US Blood Management Therapeutic apheresis system Neuro Coil assist stent US (Bone marrow stem cell and pol

  29. Slide 29: IR Contact

    IR Contact Terumo Corporation Corporate Communication (IR) Dept. E-mail: [email protected] Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not i

Terumo — FY2013 Earnings Presentation on 6ix