FY2019/12 Results Briefing (IFRS)€¦ · FOREX impact(*1) 18/12 Result US$1=¥110.36 RMB1=¥16.65 EUR1=¥130.01 CHF1=¥112.99 ... （Cash and cash equivalents） 54,039 58,686 4,647

Securities Code: 6268

The forecast data presented herein reflects assumed results based on conditions that are subject to change. Nabtesco Corporation does not make representations as to, or warrant, in whole or in part, the attainment or realization of any of the forecasted results presented in this document.Numerical figures presented herein are rounded down.

FY2019/12 Results Briefing(IFRS)

February 17 , 2020

21.925.3 32.0

3.46.7

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

2018/12 Results 2019/12 Results 2020/12 Plan

Summary of Annual Consolidated Results and Plan

2

Sales

O.P.

・Sales will grow again in FY2020 while a slight decrease in FY2019

*1 Component Solutions Segment *2 Transport Solutions Segment *3 Accessibility Solution Segment

O.P. increased due to disappearance of impairment loss for OVALO ,and ACB*3

sales increase while O.P decreased due to the sales decrease

Anticipate to increase O.P. in line with sales increase

・Plan to sales growth with profit

294.6 289.8 303.0

4.8 13.2

200.0

250.0

300.0

350.0

2018/12 Results 2019/12 Results 2020/12 Plan

(JPY billion)

Anticipate to increase sales due to demand increase for Precision Reduction Gears and stable demand for TRS*2

Sales decreased due to the demand decrease for CMP*1 while ACB*3 and TRS*2 were increased

(JPY billion)

Agenda

1. Annual Consolidated Results for FY2019/12

2. Forecast for FY2020/12

3

3. Progress in Mid-Term Management Plan(FY2017-2020)

Agenda



4


(JPY million)

2018/12 2019/12 2019/12 2019/12 YoY Plan

Full year result

Full year plan

As of Feb.8

Full year rev.plan

As of Oct. 31

Full year result Variation Variation

(A) (B) (C) (C-A) (C-B)Sales 294,626 313,000 288,500 289,808 -4,818 1,308

O.P. 21,889 30,000 24,100 25,320 3,431 1,220(OPM) 7.4% 9.6% 8.4% 8.7% 1.3pt 0.4pt

Finance Income and Cost -1,107 - - -205 902 -

Equity in earnings of affiliates 9,181 - - 2,864 -6,317 -

Income before tax 29,962 33.600 25,300 27,979 -1,983 2,679

Net profit*1 21,029 22,900 16,800 17,931 -3,098 1,131ROA 6.7% 6.6% 5.0% 5.3% -1.4pt 0.3ptROE 12.1% 12.3% 9.3% 9.8% -2.3pt 0.5pt

DPS(JPY Yen) 73 73(plan) 73(Plan) 73(Plan)

Payout ratio 43.0% 39.5%(plan) 53.9%(Plan) 50.5%(Plan)

Consolidated Result for FY2019/12

5

■FY2019/12 Results ended in line with the revised plan

*11Net profit attributable to owners of the parent

Remarks︓ +5.7Bn JPY in 2018 equity in

earnings of affiliates increased due to the capital increase of Harmonic Drive Systems

FY2018/12 Result vs. FY2019/12 Result by Segment

6

Sales O.PJPY billion

CMP: Sales decreased due to the weak investment demand in Precision Reduction Gears, as well asdecreased due to the weak market demand in Southeast Asia for Hydraulic Equipment.O.P. decreased due to the sales decrease.

TRS: Sales and O.P. increased due to increase for commercial Aircrafts Equipment sales and gradualmarket recovery in Marin Vessel Equipment.

ACB: Sales increased due to the robust demand for the Automatic Doors for buildings and Platformdoors in overseas and domestic.O.P. increased due to the sales increase and disappearance of PMI* cost in FY2018.

MFR : Sales and O.P. increased due to the strong demand for Packaging Machines.OVALO: O.P. increased due to disappearance of the impairment loss in FY2018.

■Increased O.P due to ACB and other businesses that filled in gap of the weak investment demand in CMP

294.6 289.8

2.1 4.0 1.112.1

0.0

100.0

200.0

300.0

2018/12

Results

CMP TRS ACB MFR 2019/12

Results

JPY billion

21.9 25.30.1 3.9 0.1 3.7

4.3 0.1

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

2018/12

Results

CMP TRS ACB MFR HQ OVALO 2019/12

Results

Impairment loss FY18 +5.2Bn yenImpairment loss FY19 - 1.3Bn yen

※Post merger integration

Analysis of Changes in Operating Profit by factors (FY2018/12 Result vs. FY2019/12 Result )

7

■Increased O.P. due to SG&A saving and other factors while the sales decrease

*1FOREX sensitivity in O. P. (This represents the effect to be expected on operating profit if the exchange rate fluctuates by one yen)︓ (US$) 76Million yen (RMB) 756Million yen (EUR) minimal (CHF) minimal

FOREX impact(*1)

18/12 Result US$1=¥110.36 RMB1=¥16.65 EUR1=¥130.01 CHF1=¥112.9919/12 Result US$1=¥109.24 RMB1=¥15.84 EUR1=¥122.15 CHF1=¥109.96

Foreximpact

*2 Except increased amount by the adoption of lease accounting standard (IFRS16).

21.925.3

0.8 1.83.9

1.8 0.7 0.6

0

10

20

30

2018/12Results（IFRS)

2019/12Results（IFRS)

Sales Decrease Productivity

Improvement

OVALOGoodwill

ImpairmentSG&A Reduction

Depreciation Increase*2

HR ,R&D Decrease

(JPY billion)Precision Reduction

Gears/Aircraft Equipmentproduction increase

Impairment lossFY18 +5.2Bn yenFY19 -1.2Bn yen

Balance sheet (2018/12 Result vs. 2019/12 Result )

8

■Right of use assets increased approx. 9 billion yen due to the implementation of lease accounting standard (IFRS 16)

（JPY million） 2018/12 Q4 2019/12 Q4 Variation(As of December 31, 2018) (As of December 31, 2019)

Assets 328,568 344,558 15,990

（Cash and cash equivalents） 54,039 58,686 4,647

（Trade receivable） 76,602 70,175 -6,427

（Inventories） 43,592 41,257 -2,334

（Tangible fixed assets） 80,573 87,083 6,510

(Right of use assets) 0 9,004 9,004

Liabilities 139,313 145,424 6,112

（Bonds and borrowings） 45,310 43,936 -1,375

Total equities 189,255 199,133 9,878

(Non-controlling interests) 10,553 11,735 1,182

Equity attributable to owners of parent 178,702 187,398 8,696

Ratio of equity attributable to owners of parent: 54.4% 54.4%

Agenda



9


Forecast for FY2020/12（IFRS）

10

■Anticipate to increase sales and O.P due to the stable demands for TRS and PackagingMachines, and the demand recovery of Precision Reduction Gears is expected from H2 2020.

*1 Net profit attributable to owners of the parent

(JPY million)

2019/12 2020/12 YOY YOY

Full year result Full year plan Variation Variation ratio

(A) (B) (B-A) (B-A)/A

Sales 289,808 303,000 13,192 4.6%

O.P. 25,320 32,000 6,680 26.4%

(OPM) 8.7% 10.6% 1.8pt -

Income before tax 27,979 34,000 6,021 21.5%

Net profit*1 17,931 23,100 5,169 28.8%

ROA 5.3% 6.5% 1.2pt -

ROE 9.8% 12.0% 2.2pt -

DPS(JPY Yen) 73(Plan) 82(Plan)

Payout ratio 50.5%(Plan) 44.1%(Plan)

Analysis of Changes in Operating Profit by factor (FY2019/12 Result vs. FY2020/12 Plan )

11

■O.P. increase due to improvement of each business segment and OVALO

FOREX impact(*1)

19/12 Results US$1= ¥109.24 RMB1= ¥15.84 EUR1= ¥122.15 CHF1= ¥109.9620/12 Plan US$1= ¥105.00 RMB1= ¥15.00 EUR1= ¥115.00 CHF1= ¥105.00

(*1)FOREX sensitivity in O. P. (This represents the effect to be expected on operating profit if the exchange rate fluctuates by one yen)︓ (US$) 57Millionyen (RMB) 815Millionyen (EUR) minimal (CHF) minimal

25.332.0

3.11.0 0.5 3.30.8 0.4

0

10

20

30

40

2019/12 Results（IFRS)

2020/12Plan（IFRS)

Sales Increase（*2）

Productivity Improve

OVALOimproveSGA（* 2）

Depreciation Increase

SGA saving

Investment for Precision ReductionGears productivity

improve

(JPY billion)

Forex Impact

Profitability improveFY2019 disappearance

of impairment loss1.3 Bn yen

Component Solutions Segment (CMP)

12

Result and Plan

Sales (JPY billion)

FY2019/12 Result vs. FY2020/12 Plan

■Sales is anticipated to increase due to the expectation of demand recovery in H2 for Precision Reduction Gears for the industrial robot. For Hydraulic Equipment is anticipated stable demand for China and demand recovery in Southeast Asia market.

Precision Reduction Gears︓Increase sales due to the auto related investment demand recovery. Hydraulic Equipment ︓Anticipate stable demand in China due to strong infrastructure

investment supported by Government, additionally anticipate to improve demand recovery in Southeast Asia.

O.P. by segment ︓Expansion of profits by increasing sales.

41.3 53.4 52.2 53.5

72.6 65.8 54.9 62.5

113.9 119.3107.2 116.0

Precision Reduction Gears Hydraulic Equipment Others

2017/12 2018/12 2019/12 2020/12Result Result Result Plan

O.P.(JPY billion) 20.4 20.2 15.9 18.3(OPM) 17.9% 16.9% 14.8% 15.8%

Transport Solutions Segment (TRS)

13

Result and plan

Anticipate sales increase due to projects increase in oversea for Railroad vehicle equipment and continuous recovery of Marine vessel equipment market.


12.6 7.8 5.9 9.48.5 9.8 10.8 12.211.0 14.6 14.2 14.118.9 18.5 22.8 23.4

27.9 31.2 30.3 31.2

79.1 81.9 84.0 90.3

Railroad Vehicle Equipment Aircraft Equipment Commercial Vehicle EquipmentMarine Vessel Equipment OthersSales (JPY billion)

*For Sales in and before 2017/12 are not comparable due to the method differences.

2017/12 2018/12 2019/12 2020/12Result* Result* Result Plan


Railroad Vehicle Equipment : Sales will increase due to oversea project increase while the continuous in between period for vehicle production in Japan continuously.

Aircraft Equipment : Sales remain the same level as FY2019 while the start of mass production for B777X.Commercial Vehicle Equipment : Sales remain the same level as FY2019 while the demand in Japan will become less demand.Marine Vessel Equipment : Sales growth is anticipated due to gradual market recovery.Others: Sales will increase due to full year mass production in OVALO GmbH.O.P.by segment : O.P. is anticipated to increase due to the elimination of the OVALO GmbH impairment loss and

sales increase.

Accessibility Solution Segment (ACB)

14

Result and Plan

■Sales will decrease due to low construction period during Olympic and Paralympic games in Tokyo, and the platform door in overseas will be in between demand


72.476.0

80.075.7

72.4

76.0

80.0

75.7

Automatic Doors



Sales (JPY billion）

Automatic Doors :Sales will decrease while the demand of the automatic door for buildings in oversea will remain robust, low construction period during Olympic and Paralympic games in Tokyo and the Platform doors projects in overseas will be in between period.

O.P. by segment : Anticipated to decrease by sales decrease.

Manufacturing Solutions Segment (MFR)

15

Result and Plan

■Sales and O.P will increase due to the overseas sales expansion for Packaging Machines.


Packaging Machines ︓Sales will increase due to the domestic market will remain stable and expect sales development for food and pet food market in overseas.

O.P︓ Anticipate to increase due to sales increase.

3.8 2.9 2.6 3.5

13.1 14.6 16.117.5

17.0 17.5 18.721.0

Packaging Machines OthersSales (JPY billion）



CAPEX, R&D and Depreciation

16

■Capital expenditure and R&D are in line with Mid-term plan level.- Plan to obtain new land in Shizuoka Pref.(5.7Billion yen) for Precision

Reduction Gears for preparation of future demand increase.- Invest environment-related continuously.

* Depreciation cost increased due to the adoption of lease accounting standard (IFRS16) from FY2019/12.

(JPY billion)2017/12 2018/12 2019/12 2020/12

2017-20Accumulated

2017-20Mid-term

planFull year result

Full year result

Full year result

Full yearplan

CAPEX 15.2 20.3 16.4 24.1 76.0 77.0

R&D 8.7 10.2 9.9 11.5 40.3 40.0

Depreciation 9.0 10.0 13.1* 13.5*

Consolidated Cash Flow

17

Maintaining positive free cash flow while invest CAPEX in growth area

14,892

27,997

15,104 12,952

27,597

19,949

8,746

27,73023,071 24,165

38,433 37,600

(6,155) (4,419)

(27,464)

(13,693)(8,064) (7,880)

(4,886)

(14,989)(20,186) (21,823) (20,086)

(24,500)

8,737

23,578

-12,359

-741

19,533

12,068

3,859

12,740

2,885 2,342

18,34713,100

-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

40,000

50,000 Operating Cash Flow Investment Cash Flow Free Cash Flow

2010/3 2011/3 2012/3 2013/3 2014/3 2015/3 2015/12*1 2016/12 2017/12 2018/12 2019/12 2020/12（Plan）

JGAAP IFRS*1 Please note that the estimates for FY2015/12 (Reference) were calculated for the period of 12 months to make comparisons with the result for FY2016/12 under the same

conditions.

（JPY million）

Agenda



18


19

Our commitments in the New Medium-term Management Plan

ROE : 15%Consolidated payout ratio:

35% or over

Focus on ESG

Medium-term management plan 〜ROE15%〜

20

■ While the situation to achieve ROE15% in FY2020 is difficult, aim to reach target with profits by business expansion as soon as possible

IFRSJGAAP

12.5% 12.2%12.6%

7.6%

13.0%

15.9%

9.8%

14.3%12.1%

6.5% 6.9% 7.4%

4.6%

7.6%9.0%

6.7%5.3%

6.5%

0.0%

5.0%

10.0%

15.0%

20.0%

2013/3 2014/3 2015/3 2015/12（9Months） 2016/12 2017/12 2018/12 2019/12 2020/12(Plan）

ROE

ROE(Actual value）

ROA

+2.8bn JPY extraordinary gains from Harmonic Drive Systems

+5.7bn JPY extraordinary gains due to capital increase of Harmonic Drive Systems ・Impairment losses in OVALO GmbH -5.2bn JPY

Actual Value

12.0%

11.220.4 20.2 15.9 18.3

13.3

8.4 2.0

5.8 10.2

5.15.2

4.6 8.6

7.51.52.0

2.52.6

3.0

-5.1 -6.5 -7.4 -7.5 -7.0

26.0

29.5

21.925.3

32.0

2016/12 2017/12 2018/12 2019/12 2020/12

Result Result Result Result PlanCMP TRS ACBMFR HQ CAGR 5%CAGR 13%

Growth in the period of Mid-term plan

21

■Realized continuous growth with profits during mid-term period however there is gap between original guidance projection and results

Sales O.PMid-term planned CAGR 8%Actual CAGR（Incl. FY2020 plan）5%

8% growth=330 billion JPY

Mid-term planned CAGR 13%Actual CAGR（Incl. FY2020 plan）5%

13％growth=42 billion JPYJPY billion

82.5113.9 119.3 107.2 116.0

81.479.1 81.9 84.0 90.3

64.6

72.4 76.0 80.075.716.4

17.0 17.5 18.7 21.0245.0

282.4 294.6 289.8303.0

2016/12 2017/12 2018/12 2019/12 2020/12

Result Result Result Result Plan

CMP TRS ACB

MFR CAGR 5% CAGR 8%

JPY billion

Changes of Business environments during Mid term plan

22

Business environments

Competitive environment

Businesses As of MTP setting Current

Precision reduction gear Keep robust growth

Weak demand from automotive CAPEX decrease due to the influence of U.S. China trade confliction

OVALO Sales accelerated to increase from FY2018

SOP delayed and sales will be accelerated from FY2020

Railroad vehicle equipment

Localization will be penetrated gradually for high speed train including the medium speed train.

Sales for medium speed train projects are limited, less than expectation

No major changesEach business segment keeps market share

Medium-term management plan 〜Consolidated pay out ratio 35% or higher〜

23

- Dividend to be increased in FY2020■Consolidated payout ratio 35% or higher

35.0%

¥34 ¥38 ¥44 ¥44 ¥50

¥72 ¥73 ¥73 ¥82

32.5% 32.2% 31.4%

49.5%

35.1% 35.3%

43.0%

50.5%

44.1%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

¥0

¥20

¥40

¥60

¥80

¥100

¥120

2013/3 2014/3 2015/3 2015/12（9 months）

2016/12 2017/12 2018/12 2019/12（Plan） 2020/12(Plan）

EPS Payout ratio

Medium-term management plan -Measures to Solve ESG Issues-

ESGTheme Materiality FY 2017/12 FY 2018/12 FY 2019/12 FY 2020/12

(Plan)

Gover-nance（G）

Strengthen CG

Promote risk management and compliance behavior

Ensure proactive dialogue with stakeholders

■Adopt Board Benefit Trust :BBT as a compensation plan

■Risk management on a company-wide basis

■Strengthen Anti-corruption and preventing bid rigging

■Enhance integrated reporting

■Revised CG basic policy

■Enhanced risk assessment

■Set local prevention rules of Anti-corruptionand bid rigging

■Abolished advisor system

■Globalized internal reporting system

■ESG Presentation for investors■Provided detailed ESG data book

■Enhance the ratio of Outside directors

■Compliance training by risk-based approach globally

■Review the Materiality

Social（S）

Provide safe and comfortableworkplaces

■Launch of the Business transformation division

■Implement Human rights due diligence

■Promote telework

■Return the benefits of higher productivity to employees

■Installed Systems（PPA, AI utilized）

■Promote the healthy management

■Promote working office innovation

■Transition to select-type carrier program

Environ-ment（E）

Countermeasuresfor climate change

Environmentally friendly manufacturing

■Set long-term CO2 reduction target

■Set environmental-related incentive system

■Promote Environmental-related investment（Solar panels）

■Endorsed recommendations of TCFD■Forward response on the Act on Rational Use and Appropriate Management of Fluorocarbons

■Promote the smart factory(Utilize renewable energy)

■Manage hazardous substances contained in products, and LCA

■ Themes of ESG measures are steadily implemented-G︓“Secure management transparencies,” ”Globalized Risk management/Compliance”

“Enhancement for disclosure of non-financial information “-S︓ “Upgrade organization empowerment ,” ”Enhance nurturing human resource”-E︓“Combating Climate Change ,” ”Reduction of environmental impact”

24

Inclusion in ESG Indices/ESG rating

25

2016 2017 2018 2019DJSI Asia Pacific ★

(2013〜) ★ ★ ★

DJSI World★ ★ ★ ★

FTSE4Good ★(2009〜) ★ ★ ★

FTSE Blossom Japan ★ ★ ★

MSCI ESG Leaders Indexes ★(2015〜) ★ ★ ★

MSCI Japan ESGSelect leaders ★ ★ ★

MSCI Japan Empowering Women (WIN) Select Index ★

S&P/JPX CarbonEfficient ★

CDP CLIMATE CHANGE ★ ★ ★

CDP WATER SECURITY ★

CDP SUPPLIER ENGAGEMENT LEADER ★ ★

26

Documents

FY2019/12 Results Briefing (IFRS)€¦ · FOREX impact(*1) 18/12 Result US$1=¥110.36 RMB1=¥16.65 EUR1=¥130.01 CHF1=¥112.99 ... （Cash and cash equivalents） 54,039 58,686 4,647