FY2015 Financial Results Briefing
May 27, 2016
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Disclaimer
■ This document was prepared solely for information purpose and does not constitute a solicitation for investment in the Company.
■ Although every efforts are made to ensure the accuracy of the information contained herein, the Company does not guarantee the completeness of such information.
■ The Company is not liable for any loss or damage whatsoever arising from the use of information contained herein.
■ Future business outlook presented in this document is based on information currently available to the Company and certain assumptions deemed to be reasonable. The actual performance may differ from those projected in the forward looking statements as a result of various factors and estimates may be changed without notice.
■ The information contained herein shall be used at your own discretion and responsibility.
■ The information contained herein shall not be duplicated, copied or otherwise reproduced in whole or in part without the permission of the Company.
Copyright (C) 2016 Toyo Seikan Group Holdings, Ltd. All rights reserved. 3
Contents
■ The figures shown are all in 100 million yen (rounded down to the minimum unit).
■ Earnings forecast for FY2016 does not incorporate the impact of business integrationwith Hokkan Holdings Limited.
1. FY2015 Actual
2. FY2016 Forecast
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1. FY2015 Actual
1-1 Major Events in FY2015
1-2 Consolidated Business Results
1-3 Operating Income Variance
1-4 Net Sales & Operating Income by Segment
1-5 Net Sales & Operating Income by Region
1-6 Consolidated Balance Sheet
1-7 Consolidated Cash Flows
1-8 Capital Investment & Depreciation
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1-1 Major Events in FY2015
As part of restructuring, Toyo Seikan Co., Ltd. implemented Early Retirement Incentive Program.Toyo Seikan also determined to consolidate production facilities.
As part of growth strategy, Toyo Kohan Co., Ltd. acquired FUJI TECHNICA & MIYAZUINC.Expand business into the automobile industry where growth and technological innovations continue and aim for expand further the mold business. The new company is included in consolidated accounting from Q4 FY2015 (Jan.-Mar. 2016).
Tokan Kogyo Co., Ltd. established the J/V with local partners to manufacture and sell beverage paper cups, etc. in Taiwan.TAIWAN TOKAN CORPORATION was established in Jun. 2015 and started operation from Dec. 2015.
Nippon Closures Co., Ltd. established the J/V with a local partner to manufacture and sell metal closures in India.NCC Crowns Private Limited was established in Dec. 2015 and operational start is scheduled in summer 2016.
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Profit increased significantly YoY due to solid demand in the domestic market and lower materials and energy costs.
1-2 Consolidated Business Results
【Exchange rate】FY2014 105yen/1US$ FY2015 121yen/1US$
(Unit: JPY 100 mil)
FY2014 FY2015 DifferencePercentage
change
Net sales 7,843 8,020 176 2.3%Operating income 150 323 172 114.5%Operating income ratio 1.9% 4.0% 2.1%
Ordinary income 238 266 28 11.8%Ordinary income ratio 3.0% 3.3% 0.3%
Extraordinary income 40 0-88 -81
36 100 64 178.2%
0.5% 1.3% 0.8%Net income ratio
Profit attributable to owners ofparent
Extraordinary losses
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1-3 Operating Income Variance (FY2014 vs. FY2015)
(Unit: JPY 100 mil)
DomesticDomestic OverseasOverseas
Overseas (↗)
Other costs(↗)
Depreciationand
Amortization(↘)
Materials &energy costs
(↘)
Net sales (↗)
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1-4 Net Sales & Operating Income by Segment
(Unit: JPY 100 mil)
Difference Difference
Net sales 7,843 8,020 176 Operating income 150 323 172
Packaging 6,651 6,836 185 Packaging 54 246 191(Composition) 85% 85% (Operating income ratio) 0.8% 3.6%
Steel plate related 586 544 -41 Steel plate related 24 11 -12(Composition) 7% 7% (Operating income ratio) 4.1% 2.0%
395 384 -11 41 32 -9
(Composition) 5% 5% (Operating income ratio) 10.4% 8.3%
Real estate related 60 69 8 Real estate related 35 41 6(Composition) 1% 1% (Operating income ratio) 58.3% 59.4%
Other 149 185 35 Other 9 11 2(Composition) 2% 2% (Operating income ratio) 6.0% 5.9%
Adjustments -14 -20 -6
FY2015
Functional materialsrelated
Functional materialsrelated
FY2014 FY2015 FY2014
* FUJI TECHNICA & MIYAZU INC. which became a consolidated subsidiary in Q4 FY2015 is included in “Other”.
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1-5 Net Sales & Operating Income by Region
(Unit: JPY 100 mil)
Difference Difference
Net sales 7,843 8,020 176 150 323 172
Japan 6,727 6,803 76 Japan 83 255 171(Composition) 86% 85% (Composition) 55% 79%
Asia 552 595 42 Asia 21 26 4(Composition) 7% 7% (Composition) 14% 8%
Other 563 621 58 Other 45 42 -3(Composition) 7% 8% (Composition) 30% 13%
0 -0Elimination or corporate
FY2014 FY2015 FY2014 FY2015
Operating income
* Stolle Machinery Company, LLC (Can Machinery Holdings, Inc. located in the U.S.) is included in “Other”.
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1-6 Consolidated Balance Sheet(Unit: JPY 100 mil)
FY2014 FY2015 Difference FY2014 FY2015 Difference
Current assets 5,246 5,550 304 Liabilities 4,271 4,464 193
Cash and deposits 1,477 1,691 214 Current liabilities 1,889 2,226 337
2,282 2,358 76 Short-term loanspayable
252 501 249
731 709 -22 Other 1,637 1,725 88
Other 756 792 36 Non-current liabilities 2,381 2,238 -143
Non-current assets 6,132 5,955 -177 Long-term loanspayable
1,406 1,323 -83
3,553 3,507 -46 Other 975 915 -60
Intangible assets 917 887 -30 Net assets 7,107 7,041 -66
1,661 1,560 -101 Shareholders’ equity 5,617 5,689 72
Other 1,489 1,352 -137
Total assets 11,378 11,506 128 11,378 11,506 128
Investments andother assets
Total liabilities andnet assets
Property, plant andequipment
Accounting title Accounting title
Notes and accountsreceivable-trade
Merchandise andfinished goods
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1-7 Consolidated Cash Flows(Unit: JPY 100 mil)
FY2014 FY2015
494 588
-536 -456
Free Cash Flow -42 132
191 95
Net increase (decrease) 29 -20
Balance at beginning ofcurrent period 1,273 1,452
1,452 1,660Balance at end ofcurrent period
Cash flows fromoperating activitiesCash flows frominvesting activities
Cash flows fromfinancing activities
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1-8 Capital Investment & Depreciation(Unit: JPY 100 mil)
Depreciation and amortization Capital investment
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2. FY2016 Full-year Forecast
2-1 Major Events in FY2016
2-2 Full-year Consolidated Earnings Forecast
2-3 Operating Income Variance
2-4 Net Sales & Operating Income by Segment
2-5 Net Sales & Operating Income by Region
2-6 Capital Investment & Depreciation
2-7 Dividend
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2-1 Major Events in FY2016
Defined 4th Mid-Term Management Plan (FY2016-FY2018)Three years covered under the Plan is defined as the phase to “solidify the foundation for growth”, and Toyo Seikan Group will promote profit improvement through restructuring and strive to achieve its growth strategies.
As part of restructuring, the Company agreed to integrate business with HokkanHoldings LimitedSigned MOU on Apr. 25. 2016 and will discuss towards completing the business integration in Apr. 2017.
【Future schedule】
■ Earnings forecast for FY2016 does not incorporate the impact of business integration with Hokkan Holdings Limited.
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2-2 Full-year Consolidated Earnings ForecastOperating revenue will be lower YoY due to factors including falling sales of packaging container-related machinery & equipment and beverage containers, and a decrease in yen-denominated revenue of overseas subsidiaries amid yen’s appreciation.
【Exchange rate】FY2015 121yen/1US$ FY2016 110yen/1US$
(Unit: JPY 100 mil)
FY2015 FY2016 DifferencePercentage
changeNet sales 8,020 7,700 -320 -4.0%
Operating income 323 280 -43 -13.4%
Operating income ratio 4.0% 3.6% -0.4%
Ordinary income 266 330 64 23.8%
Ordinary income ratio 3.3% 4.3% 1.0%Extraordinary income 0
-81
100 240 140 139.3%
1.3% 3.1% 1.8%
Profit attributable to owners ofparent
Net income ratio
Extraordinary losses
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2-3 Operating Income Variance (FY2015 vs. FY2016)
DomesticDomestic OverseasOverseas
(Unit: JPY 100 mil)
Net sales(↘) Overseas
(↘)
Depreciationand
amortization(↗)
Materials &energy costs
(↘) Other costs(↗)
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2-4 Net Sales & Operating Income by Segment
* FUJI TECHNICA & MIYAZU INC. which became a consolidated subsidiary in Q4 FY2015 is included in “Other”.
(Unit: JPY 100 mil)
Net sales 8,020 7,700 -320 Operating income 323 280 -43
Packaging 6,836 6,480 -356 Packaging 246 230 -16(Composition) 85% 84% (Operating income ratio) 3.6% 3.5%
Steel plate related 544 520 -24 Steel plate related 11 10 -1(Composition) 7% 7% (Operating income ratio) 2.0% 1.9%
384 360 -24 32 15 -17
(Composition) 5% 5% (Operating income ratio) 8.3% 4.2%
Real estate related 69 70 0 Real estate related 41 45 3(Composition) 1% 1% (Operating income ratio) 59.4% 64.3%
Other 185 270 84 Other 11 10 -1(Composition) 2% 3% (Operating income ratio) 5.9% 3.7%
Adjustments -20 -30 -9
FY2015 FY2016 Difference
Functional materialsrelated
Functional materialsrelated
FY2015 FY2016 Difference
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2-5 Net Sales & Operating Income by Region
* Stolle Machinery Company, LLC (Can Machinery Holdings, Inc. located in the U.S.) is included in “Other”.
(Unit: JPY 100 mil)
Net sales 8,020 7,700 -320 Operating income 323 280 -43
Japan 6,803 6,700 -103 Japan 255 240 -15(Composition) 85% 87% (Composition) 79% 86%
Asia 595 560 -35 Asia 26 30 3(Composition) 7% 7% (Composition) 8% 11%
Other 621 440 -181 Other 42 10 -32(Composition) 8% 6% (Composition) 13% 3%
Elimination or corporate -0 -0
FY2015 FY2016 Difference FY2015 FY2016 Difference
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2-6 Capital Investment & Depreciation
(Unit: JPY 100 mil)
Depreciation and amortization
Capital investment
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2-7 Dividend
Basic Policy on Shareholder Return and Profit Distribution
• Dividend: Pay dividends to shareholders in a stable and sustainable manner, based on a consolidated payout ratio of 20% or higher
• Retained earnings: Apply retained earnings to growing areas from the medium and long term perspectives while maintaining financial stability
• Purchase of treasury shares:Flexibly purchase in response to stock market conditions and financial circumstances
(Unit: Yen)
Dividend per shareQ2 7.00 7.00 7.00Q4 7.00 7.00 7.00
Annual 14.00 14.00 14.00
FY2014 FY2015 FY2016(Forecast)