日本酸素ホールディングス（4091） – FYE2022 Full-term Earnings Presentation

FYE2022 Full-termEarnings Presentation（Fiscal year ended March 31, 2022）May 20, 2022Tokyo （Japan）Important NoticeFor the purpose of this notice, “presentation” means this document, any oral presentation, any question and answer session and any written or oral material discussed or distributed by NIPPON SANSO Holdings Corporation (“NSHD”) regarding this presentation. This presentation (including any oral briefing and any question-and-answer in connection with it) is not intended to, and does not constitute, represent or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction. No shares or other securities are being offered to the public by means of this presentation. This presentation is being given (together with any further information which may be provided to the recipient) on the condition that it is for use by the recipient) on the condition that it is for use be the recipient for information purposes only (and not for the evaluation of any investment, acquisition, disposal or any other transaction). Any failure to comply with these restriction may constitute a violation of applicable securities laws. The companies in which NSHD directly and indirectly owns investments are separate entities. In this presentation, “NSHD” is sometimes used for convenience where references are made to NSHD and its subsidiaries in general. Likewise, the words “the Company”, “we”, ”us” and “our” are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies.●Forward-Looking StatementsThis presentation and any materials distributed in connection with this presentation may contain forward-looking statements, beliefs or opinions regarding NSHD’s future business, future position and results of operations, including estimates, forecasts, targets and plans for NSHD. Without limitation, forward-looking statements often include words such as “targets”, “plans”, “believes”, “hopes”, “continues”, “expects”, “aims”, “intends”, “ensures”, “will”, “may”, “should”, “would”, “could”, “anticipates”, “estimates”, “projects” or similar expressions or the negative thereof. These forward-looking statements are based on assumptions about many important factors, including the following, which could cause actual results to differ materially from those expressed or implied by the forward-looking statements: the economic circumstances surrounding NSHD’s global business, including general economic conditions here and abroad; competitive pressures and developments; changes to applicable laws and regulations; the success of or failure of product development programs; decisions of regulatory authorities and the timing thereof; fluctuations in interest and currency exchanges rates; claims or concerns regarding the safety or efficacy of marketed products or product candidates; the impact of health crises, like the novel COVID-19 pandemic, on NSHD and its customers and suppliers, including foreign governments in countries in which NSHD operates, or on other facets of its business; the timing and impact of PMI (post-merger integration) efforts with acquired companies; the ability to divest assets that are not core to NSHD’s operations and the timing of any such divestment(s); and other factors identified in NSHD’s most recent annual Consolidated Financial Statements on Japanese Securities relevant acts and exchange commission, available on NSHD’s website. NSHD dose not undertake to update any of the forward-looking statements contained in this presentation or any other forward-looking statements it may make, except as required by law or stock exchange rule. Past performance is not an indicator of future results and the results or statements of NSHD in this presentation may not be indicative of, and are not an estimate, forecast, guarantee or projection of NSHD’s future results.● Certain Non-IFRS Financial MeasuresThis presentation and materials distributed in connection with this presentation include certain financial measures not presented in accordance with International Financial Reporting Standards (“IFRS”), such as Core Operating Income, EPS (Earnings per share), Debt, Net Debt, Adjusted net D/E ratio and Free Cash Flow. NSHD’s management and executive officers evaluates results and makes operating and investment decisions using both IFRS and non-IFRS measures included in this presentation. These non-IFRS measures exclude certain income, cost and cash flow items which are included in, or are calculated differently from, the most closely comparable measures presented in accordance with IFRS. By including these non-IFRS measures, management and executive officers intends to provide investors with additional information to further analyze NSHD’s performance, core results and underlying trends. NSHD’s non-IFRS measures are not prepared in accordance with IFRS and such non-IFRS measures should be considered a supplement to, and not a substitute for, measures prepared in accordance with IFRS. Investors are encouraged to review the reconciliation of non-IFRS financial measures to their most directly comparable IFRS measure, which are on the part of our slide deck.● Financial informationNSHD’s financial statements are prepared in accordance with international Financial Reporting Standards (“IFRS”).2May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsNotes＜Forex rates＞● The following table shows Revenue, Operating income, and the effect of Forex rate changes on Revenue and Operating Income.The impact of Forex rate fluctuation is calculated by applying the average rate for the period under review to the period under review (the current period and the previous period).These disclosures are not in accordance with International Financial Reporting Standards (IFRS). However, we believe that these disclosures are useful analytical information for investors to understand the business conditions of the Group.● Presentation of overall business performance and segment performanceThe amounts shown are after offsetting and elimination of inter-segment transactions and do not include consumption tax etc.3May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFYE2023Full-termUnit：JPY1Q1st Half9MFull-term1Q1st Half9MFull-termAssumptionCurrency（Apr.-Jun.）（Apr.-Sep.）（Apr.-Dec.）（Apr.-Mar.）（Apr.-Jun.）（Apr.-Sep.）（Apr.-Dec.）（Apr.-Mar.）（Apr.-Mar.）USD107.38106.32105.54105.94109.76110.10111.45113.04115EUR118.74121.66122.61124.07132.44131.16130.96131.11125SGD76.2976.6776.9277.7682.4182.0182.7783.8382.7AUD71.6973.9174.7576.7184.1582.3382.6983.3382.2CNY15.1115.2015.3915.6517.0617.0717.3517.6517FYE2022Average Forex ratesFYE2021（Reference）Impact of devaluation by 1 JPY(Full-term basis)Unit：¥ bn.CurrencyRevenueCore Operating IncomeUSD+2.0+0.25EUR+1.6+0.2Currency sensitivityas rough indicationAgenda1.FYE2022 Overview2.FYE2023 Business Plan3.Financial Profile4. Q&A Session4May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsRepresentative Director, President CEOToshihiko HamadaExecutive Officer,Group Finance &Accounting Office, and CFOAlan Draper1. FYE2022Overview2. FYE2023Business Plan3. Financial Profile4. Q&A Session1. FYE2022 Overview5May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsRepresentative Director, President CEOToshihiko Hamada1. FYE2022 OverviewSummary: Progress toward Financial targetsSteady & Sustainable GrowthPromote financial soundnessExplore business opportunitiesSupported by solid economic recovery, all business segments increased Revenues and OI.● In the FYE2022, Revenue growth; +17.0%, and OI growth; +13.9% (Y/Y basis)Initiated sales price revisions, surcharges, cost recovery and cost reduction activities in response to upward pressure on energy and electricity costs.Invested in solid economically driven projects, systematical reduction of debt, and continued stable and reliable dividend payments to shareholder.● Adjusted net D/E ratio improved by 0.21 basis points from the previous year, and the annual dividend per share increased by JPY 4 or 13% from the previous full year.The financial soundness target of net adjusted D/E ratio below <1.0 set in Feb. 2019 achieved one year ahead of schedule.Established customer communication platforms and focal points to quickly support and react to customer demands.Global Carbon Neutrality (CN) team established to focus on CN opportunities and to prepare groundwork to demonstrate our Group’s cohesive and technical strengths.6May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results1. FYE2022 OverviewSummary of Consolidated financial results (FYE2022 Full-term)・Total Forex impact for FYE2021 : Positive impacts of ¥30.8bn. on revenue and Positive impacts of ¥3.9 bn. on core operating income.7May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFYE2021FYE2022FYE2022Full-termFull-termDifference％ ChangeFull-term forecast（Unit: ￥ bn.）（Announced on Feb. 2, 2022）Revenue818.2957.1+138.9+17.0%932.0Core operating income87.2102.7+15.5+17.7%101.0Core OI margin10.7%10.7%10.8%Non-recurring profit and loss1.5-1.5-3.00.0Operating income（IFRS）88.8101.1+12.3+13.9%101.0OI margin10.9%10.6%10.8%Income before income taxes77.791.6+13.9+17.9%91.055.264.1+8.9+16.1%67.0NI margin6.7%6.7%7.2%EPS（Unit: ￥）127.59148.13+20.54154.82Forex （Unit: ￥）USD105.94113.04110(average rate during the period) EUR124.07131.11130YoYNet income attributable to owners of the parent1. FYE2022 OverviewSegment Revenue (FYE2022 Full-term)*1 Reclassified：As a result of the reclassification of segment classifications in FYE2022, figure for FYE2021 has been restated based on the new segment classifications.8May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFull-term*1Full-termCompositionratioDifference% ChangeForex impact（Unit: ￥ bn.）Gas business in Japan341.9372.038.9%+30.1+8.8%+0.3Gas business in the U.S.189.9224.823.5%+34.9+18.3%+12.7Gas business in Europe160.0209.721.9%+49.7+31.1%+9.0Gas business in A&O*102.0123.512.9%+21.5+21.1%+8.4*A&O: Asia and Oceania.Thermos business23.926.82.8%+2.9+12.0%+0.2Adjustment0.20.10.0%-0.1－Consolidated total818.2957.1100.0%+138.9+17.0%+30.8YoYFYE2022FYE20211. FYE2022 OverviewSegment Income*2 (FYE2022 Full-term)*1 Reclassified：As a result of the reclassification of segment classifications in FYE2022, figure for FYE2021 has been restated based on the new segment classifications.*2 Segment Income：Represents core operating income, which is calculated as operating income excluding certain gains or losses attributable to non-recurring factors (non-recurring items).9May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFull-term *1Full-termCompositionratioDifference% ChangeForex impact（Unit: ￥ bn.）Gas business in Japan29.830.930.1%+1.1+3.5%+0.0 Segment OI margin8.7%8.3%Gas business in the U.S.23.127.326.6%+4.2+18.1%+1.5 Segment OI margin12.2%12.2%Gas business in Europe21.026.325.6%+5.3+25.2%+1.2 Segment OI margin13.1%12.5%Gas business in A&O8.912.812.5%+3.9+43.9%+1.0 Segment OI margin8.7%10.4%Thermos business5.16.46.3%+1.3+24.6%+0.0 Segment OI margin21.6%24.0%Adjustment-0.8-1.1-1.1%-0.3―Consolidated total87.2102.7100.0%+15.5+17.7%+3.9Core OI margin10.7%10.7%YoYFYE2022FYE2021Significant operating cash flows enabled sizable capital investment, shareholder dividends, and debt reduction1. FYE2022 OverviewCash flow (FYE2022 Full-term)Free cash flow*177.9（Unit：￥ bn.）148.75.676.591.051.31.9 2.493.613.810.4End of FYE2021cashOperatingcash flowCAPEX &Investmentsand loansOtherregarding investing activitiesLong-termDebt raising/repayment*2Short-termDebt raising/repayment*2DividendPaidduring termOther*3regarding financing activitiesOthers(Forex etc.)End of FYE2022cash*1 Free cash flow：Items reconstructed from consolidated statements of cash flows prepared in accordance with IFRS. Please refer to Appendix_P.29.*2 Long-term Debt and Short-term Debt raising/repayment：Represents cash incomed/paid.*3 Other：Indicates items such as cash lease obligations, acquisition of investments. 10May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results1. FYE2022Overview2. FYE2023Business Plan3. Financial Profile4. Q&A Session2. FYE2023 Business Plan11May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsRepresentative Director, President CEOToshihiko Hamada2. FYE2023 Business PlanSummary: Business environment awareness (Assumptions for forecast)We will continue to work, develop, and refine our business strategies to ensure achievement of performance targets identifiedin the final year of the NS Vision 2026.Uncertain business environment continuesCommitment to appropriate price revisionsOngoing search for business opportunitiesUncertain economic environment: sharp fluctuations in exchange rates; significant price fluctuations in crude oil, liquefied natural gas, and electricity; supply chain disruptions; and decades high inflation levels, etc.Business confidence in each region is expected to improve moderately in general compared to the FYE2022.● In the FYE2023, underlying revenue growth excluding currency effect, pass through, and surcharge up 2.5%, and OI growth to be 4.9% excluding currency effect (Y/Y basis).Proactive and quick price management to ensure increases in electricity / energy costs, which is a major industrial gas cost driver, are passed through to the customer.Promote service, reliability, scale, and availability of our products to existing customers, new customers, and potential customers.Constant pursuit of cost reduction, productivity improvement, and providing additional applications or technologies that foster close and sticky customer relationships.Seize business carbon neutral-related opportunities (including HyCO* projects) around the world.Focus our management resources to continue to build and grow business relationships with existing and potential customers.● From the FYE2023 onward, we will increase the production and manufacturing capacity of electronic material gasesas well as implement the Total Electronics strategy across the Group.* HyCO Business: A business that supplies Hydrogen(H2) and Carbon monoxide(CO) on-site to petroleum refining and petrochemical manufacturers.12May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results2. FYE2023 Business PlanSummary of Consolidated financial forecast• Total Forex impact for FYE2023 full-term : Negative impacts of ￥5.8 bn. on revenue and ￥0.7 bn. on core operating income.13May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFYE2022FYE2023Full-termFull-term forecastDifference% Change（Unit：￥ bn.）Revenue957.1950.0-7.1-0.7%Core Operating Income102.7107.0+4.3+4.2%Core OI margin10.7%11.3%Non-recurring profit and loss-1.50.5+2.0Operating Income（IFRS）101.1107.5+6.4+6.2%OI margin10.6%11.3%Income before income taxes91.697.0+5.4+5.9%Net income attributableto owners of the parent64.167.0+2.9+4.5%NI margin6.7%7.1%EPS（Unit: ￥ ）148.13154.82+6.69EBITDA margin20.4%21.0%ROCE after Tax4.8%5.0%Adjusted net D/E ratio0.940.86Forex（Unit: ￥ ）USD113.04115(average rate during the period) EUR131.11125YoY2. FYE2023 Business PlanSegment Business Initiatives by segmentAlthough there are different priorities and initiatives to be addressed, we will seek to achieve sustainable Operating Income growth through prompt and appropriate decision-making and quick actions by the heads of each business.Business Initiatives (Summary)Common InitiativesGas businessin Japan● Focus on electronics market● Improve quality of earningsGas businessin the U.S. ● Focus on Liquid CO2 and Dry Ice products● On-site project expansion (persistent sales activities)● Explore business opportunities in resilient markets such Gas businessin Europeas home care, healthcare, and food products● Leads Group in Carbon neutrality progressGas businessin A&O● Focus on electronics market● Aggressive capital investment to improve densityThermos business● Re-focus on main products; vacuum insulated mugs & sports bottles● Further advertise and expand homeware offerings14May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results● Carbon Neutrality Initiatives● Energy cost recovery● Seek and compete for global HyCO projects● Response to Inflation globally● Appointment & Promotion of People excellence across regions2. FYE2023 Business PlanIndustrial Gas business: Business characteristicOur team has decades of technical experience which enables us to provide proven gas solutions to a wide range of customers and to address customer problems, inefficiencies, and / or environmental concerns.MaterialsSteelmaking, non-ferrous refining, glass, ceramics, cement, paper, and other materialsChemicalsPetrochemical & chemical, rubber, plastics, and other organic materialsFabricationAutomobiles, construction machinery,bridge building, construction, and shipbuildingLife SciencesMedical, pharmaceutical, and biotechnologyFoodFood manufacturing and processingAgricultureAgriculture, fisheries, and forestryElectronics-relatedSemiconductors, LCDs, and photovoltaicsEnergyRechargeable batteries, reusable energy,photovoltaics, and new types of energy15May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results2. FYE2023 Business PlanIndustrial Gas business: Growth TrajectoryStep 1Sell only gas:Provide reliable industrial gases to our customers.→ Unless customers increase production volume, the industrial gas demand will not grow.Step 2Sell gas, plus equipment/services together:Provide customers with services and solutions to make the customer more efficient and productive→ Linking equipment offerings and industrial gas product provides a more comprehensive customer relationshipStep 3Sell products with “intangible assets" that are not easy for competitors to replicate:Proactively look to identify and propose cost effective solutions for our customers in areas in which they were not familiar with our technical capabilitiesCommunication is the key to our growth.16May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results2. FYE2023 Business PlanIndustrial Gas business: Contribute toward Carbon NeutralityOur stanceCarbon neutrality is an important global issue and currently many companies are in search of environmental footprint reduction. We will work aggressively and diligently with our customers to develop solutions over the Medium-term management plan which reduces our combined carbon footprint.The development process is on the same track as the one we have followed so far,and we will expedite the Carbon neutral movement.１Brush up contact points with customers and partners to gain recognition and interest2Maintain a network that connects relevant information* under a unified operation.3Resolve customer issues by leveraging our collective strength* Relevant information: Here, we refer to (1) Issues that customers want to solve and (2) optimal solutions that our products and services can be expected to contribute to solving (1).17May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsExercise our Group's collective strengthDevise/study/accumulate optimal solutions[Expansion of technology, knowledge, and experience]2. FYE2023 Business PlanIndustrial Gas business: Focus on CN-related effortsWe will work together to support and contribute to the reduction of GHG emissions for customers.Slogan for promoting Carbon neutral activities“We enable a carbon neutral world”１Greener combustionFive focus areas for the GroupHydrogen solutions2345CO2 CaptureCircular economyDigitalization18May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results2. FYE2023 Business PlanElectronics business: Seize an opportunityBusiness EnvironmentDemand trends: Demand for semiconductors for next-generation communications, IoT, data centers, and mobility is strong, and demand for electronic material gases is expected to remain firm.The impact of the COVID-19 infection: Fortunately, the impact on production activities remained limited.Competitors: Competitors are focusing on carrier gases and new materials, and introducing homogeneous and inexpensive commercial products.DX: Sharing customer quality requirements across the group and responding to increasingly sophisticated customer demandsCommercial Opportunities Gas: Aggressively expand sales by increasing production capacity for products in which we have strengths while broadening our product lineup.Engineering, facilities, and on-site: Developing our operations; Total Gas Center●●●●●●19May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results2. FYE2023 Business PlanThermos business: Adapting to the Change of MarketCorporate PhilosophyBrand conceptWe contribute and introduce new life style products that are agreeable to people and society and also environmentally friendly.In striving for rich, comfortable living, humanity has at points in time sacrificed environmental concerns to attain such pursuits. We at Thermos believe it is our mission to uphold both usability and environmental friendliness when it comes to our business, For that reason, as we work to contribute to energy-saving measures through our manufacturing capabilities -including our insulating technologies- we hope to provide the world with the king of value that will help bring about even more comfortable lifestyles.Thermos MagicWe create a comfortable human life with deliciousness, convenience by using our unique vacuum insulation technology. We continue to stick to develop the Only-one product that consumers realize the differences in deliciousness, convenience, and ideas.As a company that contributes to the healthy lives, we aim to be loved for a long time by people while being sincerely involved with the environment and society.We create product concepts and designs by listening to consumers‘ voices and considering the needs they are seeking, and with broad product lineup, we propose new lifestyles toward affluent living under new normal after/with COVID-19.20May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 results1. FYE2022Overview2. FYE2023Business Plan3. Financial Profile4. Q&A Session3. Financial Profile21May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsExecutive Officer,Group Finance &Accounting Office, and CFOAlan Draper3. Financial ProfileFinancial management｜Optimal Fund allocation● Allocate capital in accordance with the strategies and goals of the Medium-term management plan; NS Vision 2026.Basic Concept● Prioritize capital projects based on economic / financial returns, risk profile, customer / end market outlook.● Fast, nimble, and proactive response to business opportunities and customer inquiries.Financial soundnessLeverage Reduction― Reduction of financial expensesGrowth investmentInvestment for Growth driver― Achieve growth, profitability, and efficiencyShareholder ReturnsStable & business performance-linked― Fulfillment of shareholders‘ and investors' expectationsBudgetAdjusted net D/E Ratio(End of FYE2023)0.86Budget CAPEX and investment(Cash basis: ￥ bn.)104.4Budgetannual dividend(￥)3622May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFortifying the capital structureEconomies of scale / improve customer densityPursue group synergies and globalization effortsPrioritize and invest in projects with solid economic returns and earnings potentialSeek M&A opportunities that improve customer density, expand geographic presence,or enhance technical capabilities3. Financial ProfileCash flow forecast／DividendCash flow forecastDividend TrendLeveraging our strong cash generation to reduce debt and invest in the future while also returning profits to shareholders（Unit：￥ bn.）59.793.655.60.415.778.63.8Stable and reliable dividendDividend payout ratio27.1%24.3%23.9% 24.9%26.2%20.3%22.7% 23.5% 23.0% 23.3%（Unit：￥ ）3634Year-end dividendInterim dividend3028252320161213End of FYE2022cash（Actual）Free Cash flow*１Scheduled debt maturities*2AnnualdividendOtherregarding financing activitiesForex effect,and othersEnd of FYE2023cash（Forecast）2014.32015.32016.32017.32018.32019.32020.32021.32022.32023.3［Planned］［Estimated］*1 Free cash flow：Cash flows from operating activities + (Announced) Divesture Proceeds – CAPEX. Please refer to Appendix_P.29.*2 Scheduled debt maturities：Indicates cash paid (including Repayments of lease obligations)J-GAAP← →IFRS23May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsClosing remarks24May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsRepresentative Director, President CEOToshihiko HamadaQ&A SessionRepresentative Director, President CEOToshihiko HamadaMember of the Board,Representative Director and President of Taiyo Nippon Sanso CorporationKenji NagataRepresentative Director and President of Thermos K.K.Yuji KataokaSenior Executive Officer,Group Corporate Planning OfficeTsutomu MoroishiSenior Executive Officer,Group Sustainability Management Office, and CSO（Chief Sustainability Officer）Executive Officer,Group Finance &Accounting Office, and CFO（Chief Financial Officer）Takeshi MikiAlan DraperSenior General Manager,Corporate & Business Planning,Group Corporate Planning Office,Koichiro Kubo25May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsAppendix27May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultshttps://www.nipponsanso-hd.co.jp/en/ir/Published on May 11, 2022Revenue / Employee personnel by Segment （As of Match 31, 2022）JapanUSEuropeAsia & OceaniaThermosCorporate39%23%22%13%3%33%23%15%22%7%0.4%\957.1bn.19,398peopleCorporate PhilosophyGroup PhilosophyGroup Visionenhance human well-being and contribute to a more sustainable future.We aim to create social value through innovative gas solutions that increase industrial productivity,Proactive. Innovative. Collaborative. Making life better through gas technology.Main Core business Industrial Gas business 　　　　Electronics business　　　　　 　 　 Thermos businessFYE2023 Financial Forecast（IFRS)Revenue¥950.0bn.Net income attributable toowners of the parent¥67.0bn.Operating income¥107.5bn.EPS¥154.82NIPPON SANSO Holdings Group SummaryCorporate Information（As of March 31, 2022）Company NameNippon Sanso Holdings CorporationFoundedOctober 30, 1910Headquarters1-3-26 Koyama Shinagawa-ku, Tokyo 142-0062, JapanTEL81-3-5788-8500Representative Director, President CEORepresentative Toshihiko HamadaCommon stock37.3 billion yenStock information（As of March 31, 2022）Number of shares433,092,837Number of shareholders14,709Listed stock exchangesTokyo Stock Exchange Prime MarketTicker4091.TDistribution by share holders (%)0%10%20%30%40%50%60%70%80%90%100%Other Japanese Corporations5.55Japanese Financial Institutions18.20Foreign Institutions and Individuals15.84Japanese Indivisuals and others9.82MitsubishiChemical Holdings 50.59AppendixFree cash flow and Debt situation* This amount includes a decrease of ￥31.0 bn. due to the effect of foreign currency translation.29May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFYE2021FYE2022FYE2023（Unit：￥ bn.）Full-termFull-termDifference% changeFull-term budgetDifference% changeIncome before income taxes77.791.6+13.9+17.9%97.0+5.4+5.9%Depreciation and amortization86.392.4+6.192.6+0.2Changes in working capital 0.5-20.6-21.10.0+20.6Others-15.3-14.6+0.7-20.3-5.7Cash flows from operating activities149.2148.7-0.5-0.3%169.3+20.6+13.8%Capital expenditures-60.0-74.4-14.4-104.4-30.0Investments and loans-0.7-2.0-1.3－+2.0Others (asset sales, etc.)1.15.6+4.5-5.2-10.8Cash flows from investing activities-59.6-70.8-11.2-18.7%-109.6-38.8-54.7%Free cash flow89.577.9-11.6-13.0%59.7-18.2-23.4%(Debt situation）Net interest-bearing liabilities858.1835.5-22.6765.5-70.0*（Of which, hybrid financing amount）250.0250.0－250.0－Adjusted net D/E ratio1.150.94-0.210.86-0.08YoYBudget's YoYAppendixDebt/Equity PerformanceUndatedAdjustednet D/E ratio（Our indicators that have been disclosed）Financial managementnet D/E ratio（Our internal financial discipline indicator）Net D/E ratio（General net D/E ratio）End of FYE20221.33End of FYE20220.94Budget at the End of FYE2023（March 31, 2023）0.86End of FYE20220.97Net interest-bearing debtNet interest-bearing debt ― Equity-type debt*Total equity attributable to owners of parentTotal equity attributable to owners of parent + Equity-type debt*Net interest-bearing debt― Lease obligations ― Equity-type debt*Total equity attributable to owners of parent ― Other components of equity + Equity-type debt** Equity-type debt：Our internal name of amount which is 50% of the amount raised through hybrid financing (¥250 bn.) is accepted as "capital" by rating agencies.30May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsAppendixBusiness performance over the past five yearsRevenue（¥ bn.）Operating income（IFRS）（¥ bn.）646.2 740.3 850.2 818.2 957.1 OI margin9.3%9.0%11.0%10.9%10.6%93.9 88.8 101.1 59.8 66.8 Profit attributable to owners of the parent（¥ bn.）NI margin7.6%48.9 6.3%6.7%6.7%53.3 55.2 64.1 5.6%41.2 2018.32019.32020.32021.32022.32018.32019.32020.32021.32022.32018.32019.32020.32021.32022.3Net interest-bearing debts（¥ bn.）Capital expenditures（¥ bn.）Depreciation and amortization（¥ bn.）Hybrid Finance (HBF)Net debt excluding HBF1.54 1.45 Adjusted net D/E ratio*1.15 0.94 76.6 72.8 74.4 62.5 60.0 83.7 86.3 92.4 56.1 43.2 695.7 648.3 608.1 585.5 274.9 250.0 250.0 250.0 250.0 2018.32019.32020.32021.32022.32018.32019.32020.32021.32022.32018.32019.32020.32021.32022.3*Adjusted Net D/E Ratio: an indicator of safety (financial soundness) calculated in consideration of this partdue to 50% of the amount raised by HBF is permitted as “Equity" by rating agencies.*It’s recorded on a construction basis until FYE2019 and on a cash basis from FYE2020 onwards.31May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsGlossary: EBITDA Margin／ROCE after TaxAppendixEBITDA（Earnings Before Interest Taxes Depreciation and Amortization）Indicator that shows profitability based on Cash Flow, excluding theimpact of M&A and CAPEX.This indicator should not be considered in isolation from performanceindicators such as operating income and net income, which are indicatorsbased on IFRS, and should not be viewed as substitutes for theseindicators. This indicator should be given due consideration whencomparing them with similarly named financialindicators presented byother companies.ROCE after Tax（Return On Capital Employed after Tax ）=NOPAT(Net Operating Profit After Tax)（Interest-bearing debt + Total equity attributable to owners of parent）** The average of the amounts at the end of the comparative fiscal year s of the previous and current fiscal years is used.Indicator based on profitability and investment efficiencyThis indicator should not be considered in isolation from performanceindicators such as operating income and net income, which are indicatorsbased on IFRS, and should not be viewed as substitutes for theseindicators. This indicator should be given due consideration whenindicators presented bycomparing them with similarly named financialother companies.EBITDA marginand EBITDA（￥ bn.）EBITDAmargin16.0%16.5%20.5%21.2%174.1173.6103.2121.920.4%195.12018.32019.32020.32021.32022.3ROCE after Taxand NOPATROCE after Tax6.1%（￥ bn.）（Reference）ROCE and Core OI（￥ bn.）4.5%4.6%4.4%6.2%6.4%6.1%ROCE8.4%4.8%73.06.8%102.743.447.964.662.860.065.890.387.22018.32019.32020.32021.32022.32018.32019.32020.32021.32022.332May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsAppendixIndustrial gas supply systemAir Separation GasesStorage tank for liquid gasesAir Separation UnitAirOther GasesOxygenO2NitrogenN2Supply via pipelineOxygenO2NitrogenN2ArgonArTank truckTank truckSupply via Liquid gases formSupply via Liquid gases formRefining by-product gas from chemical factories and gas transported overseasCO2H2HeLPGasFilling stationFilling stationFlatbed truckFlatbed truckOn-siteMajor supply destination（Sector）SteelPetrochemicalRefineryWe’ve established production plants in the vicinity of the customer. A form of direct connection and constant supply of pipes.（Large-scale supply）BulkMajor supply destination（Sector）AutomobileShipbuildingConstructionmachineryPharmaceuticalMedicalManufacturingGlass/PaperFood/beverageLCPPhotovoltaicsSemiconductorWe’ve installed a storage tank for liquefied gas in the customer's premises. A form of supply according to the method of use of gas.（ Medium-scale supply）PackagedMajor supply destination（Sector）HomecareEngineeringdevelopmentAdvancedmedicineR&DSanitationConstruction/InstallationWe deliver filling containers (cylinders) to customers.A form of supply according to the method of use of gas.（ Small-scale supply）33May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsSupply via CylinderSupply via CylinderThermos products deliver what matters every time.As the leading manufacturer of convenient insulated product for over 100 years,Thermos is trusted by consumers to provide innovative portable containers that promote a safe and healthy lifestyle.Thermos delivers when it matters.At Thermos, We carefully choose the best available materials,and produce products with consistent quality and reliable performance.We ensure the excellence of our products by testing for quality.34May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsFor further information, please contact:Public Relations for mediaInvestor Relations for investorsPublic Relations, Group Human Resources & Corporate Secretariat OfficeTel：+81 (0)3-5788-8513E-mail：Nshd.info@nipponsanso-hd.co.jpInvestor Relations,Group Finance & Accounting OfficeTel: +81 (0)3-5788-8512E-mail：Nshd.ir@nipponsanso-hd.co.jpUpcoming IR eventsAnnual Shareholder meeting Q1 FYE2023 Earnings Callwww.nipponsanso-hd.co.jp/en/June 17, 2022July 29, 202235May 20, 2022 | NIPPON SANSO Holdings Analyst Conference presentation FYE2022 resultsNIPPON SANSO Holdings Corporation (Ticker:4091.T)Headquarters：1-3-26 Koyama Shinagawa-ku, Tokyo 142-0062, Japan© 2022 NIPPON SANSO Holdings Corporation All rights reserved