アネスト岩田（6381） – [Delayed]Supplementary Presentation Material of FY2021 Full-Year Financial Results

Supplementary Presentation Material of FY2021 Full-Year Financial Results ANEST IWATA CorporationMay 10, 2022Prime Market of the Tokyo Stock Exchange – Machinery Securities Code 6381 FY2021 financial highlightsOverseas markets contributed to increase in sales due to recovery from the Covid-19 pandemic and our measures. November’s revised values were exceeded.Sales: 42,337 million yen (up 6,748 million yen, or 19.0％, from last year)Operating income: 4,780 million yen (up 1,335 million yen, or 38.8％, from last year)Air energybusinessCoatingbusiness・Contribution from SCR, a subsidiary acquired in 2018, accelerated. Sales of general-purpose air compressors remained brisk, mainly in China, throughout the year.・Sales of vacuum pumps for semiconductor-related equipment grew.Sales: 25,015 million yen (up 4,149 million yen, or 19.9%, from last year)Operating income: 2,513 million yen (up 692 million yen, or 38.0%, from last year)Operating income ratio: 10.0％ (up 1.3 points from last year)・Sales of products, mainly spray guns, grew mainly in the United States and Europe.・Sales of coating systems were down as sales activities were restricted by Covid-19 last year.Sales: 17,321 million yen (up 2,599 million yen, or 17.7%, from last year)Operating income: 2,267 million yen (up 634 million yen, or 39.7%, from last year)Operating income ratio: 13.1％ (up 2.1 points from last year)(Notes) The operating income by business was calculated using our unique standards.2Highlights of FY2021 financial resultsSales and all income indicators have reached record highs since the company’s foundation in 1926.Overseas markets (particularly the market in China, where the results of operations of SCR, an acquired subsidiary, are steady) contributed to increase in sales. The impact of fluctuations in foreign exchange rates was 1.69 billion yen. The increase in the operating income ratio was due to the improved product mix and the streamlining associated with the work reform.FY2020FY2021Year-on-yearFY2021 result forecastsInitial forecastRevised Nov. 5Actual(million yen)Profit ratio(％)Actual(million yen)Profit ratio(％)Increase/decrease amount(million yen)Increase/decrease rate(％)Profit ratiochange (P)Forecast(million yen)Forecast(million yen)Sales35,588―42,337―+6,748+19.0―3,4449.74,78011.3 +1,335+38.8+1.6 4,25312.05,57213.2 +1,318+31.0+1.2 38,50040,5003,6004,2504,1004,7702,6237.43,5418.4+918+35.0+1.0 2,5152,960106.82 yen109.80 yenDepreciated by 2.98 yen103.00 yen109.00 yen121.81 yen129.89 yenDepreciated by 8.08 yen118.00 yen130.00 yen15.48 yen17.03 yenDepreciated by 1.55 yen15.00 yen16.80 yenOperating incomeOrdinary incomeNet income attributable to owners of parentAverage exchange rate of yen to the US dollarAverage exchange rate of yen to the euroAverage exchange rate of yen to RMBDividend Interim 13 yen (12 yen)17 yen (12 yen)30 yen (24 yen)Year-end(Forecast)Annual(Forecast)* Dividends: Shown within ( ) are the initially forecast dividends. The FY2021 year-end dividend will be formally decided at the76th ordinary general shareholders’ meeting, to be held on June 24.3Analysis of causes of operating income increase/decreaseAs in the 3rd quarter, the growth in sales compensated for the cost increase resulting from increased activities, contributing to the rise in income.Increase in gross profit(Sales – costs)+3,301Reduction in retirement benefit expenses+48Increase in payment of salaries and employee benefits-1,077Increase in sales-related expenses-386Increase in goodwill amortization and other depreciation costs-135Increase in other expenses-414(million yen)4,7803,444FY2020+1,335FY2021[+] Increase in sales: 42,337 million yen (up 6,748 million yen from last year)[+] Improvement in cost -to-sales ratio: 56.9％ (down 1.1 points from last year)・Changes in the product mix (up for coating equipment and down for coating systems), increase in income of the U.S. subsidiary that acquired a business, etc.[+] Improvement in selling, general & administrative expenses ratio: 31.8％ (down 0.5 points from last year)・Establishment of cost control through the use of the Web and optimization of face -to-face sales activities, etc.[-] Increase in goodwill amortization: 254 million yen (up 49 million yen from last year), depreciation cost (up 85 million yen from last year)・Acquisition of a business (sale of coating equipment) in the U.S., etc.[-] Increase in commission fees included in other expenses (up 308 million yen from last year)・The commission fees *1 related to IT investments are approx. 148 million yen.*1 Related to the order-receiving system including product information management, etc.4Sales by area and by productDue to booming overseas markets and our successful measures, the overseas sales ratio increased (62.1%).・Japan: Growth in sales. While the delayed supply of air compressor motors impacted us, the increase was propped up by countermeasures. Sales activities for coating systems were restricted by Covid-19, which pushed the sales down. In Japan, the competitive environment was harsh, but profitability was prioritized with price increases, etc.・Europe: Growth in sales. Despite the spread of infection by variants, effective sales promotion measures using the web and social media were taken. Sales of spray guns for car repair grew. Sales of vacuum pumps also grew steadily as the economy picked up.・Asia: Growth in sales. Sales of air compressors in China by SCR, as well as sales associated with exports grew at a high level, and so did the sales of medical air compressors by the subsidiary in India. Southeast Asia also shifted to a recovery trend, except for coating systems.・North America, etc.: Growth in sales. Growth of coating equipment due to the partial transfer of business in the car repair market in the United States; and increase in sales due to finding new customers for vacuum equipment. Sales of medical air compressors in Brazil also grew steadily.(million yen)FY2020 FY2021 Increase/decrease amountIncrease/decrease rate (%)Air energy businessCoating businessAir compressorVacuum equipmentCoating equipmentCoating systemJapan15,27116,050779+5.1Europe4,6515,6631,011+21.8Asia10,98814,5363,548+32.3NorthAmerica, etc.4,6776,0861,409+30.1Total35,58842,3376,748+19.0○〇◎◎◎◎◎◎◎◎〇◎◎◎◎×-◎××Note) Converted to actual sales in each individual area◎ 10％, 3％ 〇 < 10％, 0％ < △ < 3％,0％ > ▼ > -3％, -3％ ● > -10％, × -10％■Composition ratioFY2021 (FY2020)America, etc.14.4%(13.1%)Europe13.4%(13.1%)Asia34.3%(30.9%)Japan37.9%(42.9%)5Prospects for FY2022Sales of 44,000 million yen (up 3.9%) and operating income of 4,900 million yen (up 2.5%)FY2021 (Actual)FY2022 (Planned)Actual(million yen)Composition ratio(％)Target amount(million yen)Composition ratio(％)Increase/decrease amount(million yen)Increase/decrease rate(％)100.044,000100.0+1,662+3.9SalesAir energyAir compressorVacuum equipmentSubtotalCoating equipmentSubtotalCoatingCoating systemOperating incomeAir energyCoatingOrdinary incomeNet income attributable to owners of parentAverage exchange rate of yen to U.S. dollarAverage exchange rate of yen to RMB42,33722,9502,06425,01514,4512,86917,3214,7802,5132,2675,5723,541109.8017.0154.24.959.134.16.840.911.313.28.4――26,00059.1+984+3.9――――――40.911.112.88.1――――+678+119+86+32+77+39――――+3.9+2.5+3.5+1.5+1.4+1.1――――18,0004,9002,6002,3005,6503,580118.00 18.50 Average exchange rate of yen to euro129.89(Actual)137.00 (Forecast)* Dividend (interim + year-end ＝ annual)13 yen + 17 yen = 30 yen15 yen + 16 yen = 31 yen* Dividends: The FY2021 year-end dividend will be formally decided at the 76th ordinary general shareholders’ meeting, to be held on June 24. The FY2022 values are forecasts.6Prospects for FY2022Uncertainty is expected to continue globally due to, for example, the conflict in Eastern Europe and the Covid-19 pandemic, mainly in China.We aim to achieve increase in sales and income with the spread of price increases and by continuing the work reform.For the sales of 44,000 million yen (up 3.9%), we expect the following:・Impact of the Covid-19 pandemic, mainly in Southeast Asia and China, on the world economyflexibly.・Impact of soaring resource prices, for example, due to the conflict in Eastern Europe, on the world economy, including the European economy・As for the exchange rate, an assumed rate is used as a basis but will be reviewed ・Impact of the short supply of semiconductor and electronic parts on production・Steady delivery of unfilled orders for coating systemsFor the operating income of 4,900 million yen (up 2.5%), we expect the following:・As in FY2021, the continuation of sales reform and operational efficiency improvement. Avoidance of swing back to a situation before the Covid-19 pandemic.・Further spread of price increases due to soaring raw material and logistics costs７Capital investment plan and R&D cost(Actual) 4Q: Amount of capital investment 78.4% (IT -related investments: 603 million yen), R&D cost 91.1%IT-related investments: About 753 million yen were used annually, including about 150 million yen for items not yet subject to receiving inspection, such as the construction of work reform-related systems and the improvement of networks.Other investments: For factory capital investment, we reconsidered increasing p roduction and slid it to the next fiscal year.FY2021Depreciation costR&D cost＊Sales1,510（97.4％）1,5501,048（91.1％）1,15042,337－(million yen)Actual(Progress rate)PlanContentsAmount of capital investment1,568（78.4％）2,000・ Machine tools(creation of new ones and upgrading of existing one)・ Upgrading and enhancement of production lines・ Establishment of communication infrastructure・ IT-related investments2,000 1,568 (Note) R&D cost: Total of general administrative expenses and manufacturing costs related to research and developmentAmount of capital investment(million yen)Depreciation cost(million yen)R&D cost (million yen)1,245 1,112 1,509 1,426 1,510 1,680 1,084 1,045 1,048 1,200 FY2019FY2020FY2021FY2022FY2019FY2020FY2021FY2022FY2019FY2020FY2021FY2022(forecast)(forcast)(forcast)8Measures to increase shareholder returnsDividendpolicyDividendStock buybackWe secured internal reserves to invest in growth and ensure stable dividends.The payout ratio was 35% or more.FY2021 (planned): 30 yen (annual) (13 yen (interim) ＋ 17 yen (year-end))FY2022 (forecast): 31 yen (annual) (15 yen (interim) ＋ 16 yen (year-end))We bought back up to 682,000 shares of our company’s stock (1.65% of shares issued excluding treasury shares) or shares worth of up to 500 million yen over the period from Jan. 27, 2022, to June 30, 2022. ■Buyback completed on April 28616,900/682,000 shares (90.5％) 499.9/500 million yen (100％)Number of shares issued: 41,745,505Changes in dividend3031* FY2016included.Special dividend of 1 yen 2020222424(yen)35302520151050Dividend(yen)FY2016FY2017FY2018FY2019FY2020FY2021FY2022 (forcast)(planned)* Dividends: The FY2021 year-end dividend will be formally decided at the 76th ordinary general shareholders’ meeting, to be held on June 24. The FY2022 values are forecasts.9TopicsRecognized as a “Health and Productivity Management Brand 2022” for the first time (March 2022)In March 2022, ANEST IWATA was recognized as a company that practices management conscious about its employees and their families in the “Health and Productivity Management Brand” and “Outstanding Health and Productivity Management Organization (White 500)” systems (for two years in a row as a White 500 company).”Health and Productivity Management Brand” refers to a system established jointly by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange to select the best health and productively management companies. From 2,299 corporations recognized in the “Outstanding Health and Productivity Management Organization” system in all industry sectors, one company is, in principle, selected from each industry sector.ANEST IWATA carries out various health maintenance and improvement activities strategically so that our employees and their families can live happily and healthily. We have also been recognized in the “Sports Yell Company 2022” system as a company that makes active efforts to promote sports for health improvement, such as establishing internal training gyms.We will enlighten all our employees about the importance of health and, at the same time, make concerted efforts to promote activities toward health maintenance and improvement, with an aim to be the “top White 500 company in the machinery sector”.10 Details of profit and loss statementsThe increase in sales and the product mix contributed to bringing down the cost -to-sales ratio. The establishment of cost control associated with the work reform led to a drop in the selling, general & administrative expenses ratio by 0.5 points. The operating income ratio rose by 1.6 points.FY2020FY2021Year-on-yearActualComposition ratioActualComposition ratio(million yen)(million yen)Increase/decrease amountIncrease/decrease rateComposition ratio change (million yen)(％)SalesCost of salesGross profitSelling, general & administrative expensesOperating incomeNon-operating incomeNon-operating expensesExtraordinary incomeExtraordinary lossesProfit before income taxesIncome taxesNet income attributable to non-controlling shareholdersNet income attributable to owners of parent35,58820,66214,92611,4813,444940131962134,1361,0924202,623(％)―58.141.932.39.72.60.40.30.611.63.11.27.442,33724,10918,22713,4474,7808929915455,5411,3926073,541(％)―56.943.131.811.32.10.20.00.13.31.48.46,7483,4473,3011,9651,335-48-31-81-16730018691813.11,40519.016.722.117.138.8-5.1-24.031.0-84.3-78.634.027.544.335.0(P)―-1.1 1.1 -0.5 1.6 -0.5-0.11.2 -0.2 -0.5 1.5 0.20.31.0 Ordinary income4,25312.05,57213.21,31811 FY2021 Changes in business results[Total]Amount: million yenFY20211Q1 to 2Q1 to 3Q1 to 4Q[Quarterly]Amount: million yenSales9,10020,36030,22942,337SalesFY20211Q2Q3Q4Q9,10011,2599,86912,107Year-on-year31.6%23.2%18.5%19.0%Year-on-year31.6%17.1%Air compressor5,06111,19916,88922,950Air compressor5,0616,1389.9%5,689Air energyCoatingYear-on-year34.2%26.4%21.3%18.9%Year-on-year34.2%20.7%12.3%Vacuum equipment4119141,4372,064Vacuum equipment411502522627Year-on-year52.0%36.5%36.1%32.2%Year-on-year52.0%25.9%35.4%Sales5,47312,11418,32625,015Sales5,4736,6406,212Year-on-year35.4%27.1%22.3%19.9%Year-on-year35.4%21.1%13.9%Coating equipment3,3117,15610,44614,451Coating equipment3,3113,8453,2904,004Year-on-year22.3%38.1%28.9%Coating system3161,0891,456Year-on-year22.3%55.3%12.7%Coating system316772366Year-on-year92.3%-40.1%-40.0%-11.4%Year-on-year92.3%-53.3%-39.5%Sales3,6278,24611,90317,321Sales3,6274,618Year-on-year26.3%17.7%13.0%Year-on-year26.3%11.8%Air energyCoatingOperating income8932,3783,527Operating income8931,485Year-on-year117.8%66.3%42.7%Year-on-year117.8%45.6%10.4%Air energyCoatingOperating income4471,2502,028Year-on-year123.6%55.8%53.2%Operating income4461,1281,499Year-on-year112.2%79.7%30.7%Air energyCoatingOperating income447803777Year-on-year123.6%33.4%49.1%-2.4%Operating income446681371767Year-on-year112.2%63.3%-28.5%61.2%25.9%2,86917.7%4,78038.8%2,51338.0%2,26739.7%3,6573.7%1,14920.2%6,06112.7%24.2%6,68913.7%18.5%1,41373.8%5,41829.3%1,25228.7%48512 History of our businessWe started by manufacturing coating spray guns and air compressors for inspecting those guns.Founded in 1926(Former company name: Iwata Seisakusho)Started manufacturing of spray guns using an American-made spray gun as a modelSpray gunCoating hand gunProduct differentiationconcept・Environment-friendly・Ability to present proposals for coating surface creation・Oil-free・Energy-savingCoating robotAirbrushlDeveopment of new applicationsiDversification of productsCoating businessAir energy businessCoating equipment:Equipment units such as spray guns and paint supply pumpsCoating system:Systems combining coating equipment with ventilators, driers, and coating robotsAir compressor:Air compressors, N2 gas generators, and auxiliary equipment such as tanksVacuum equipment:Vacuum pumps and auxiliary equipment such as valves13Oil-free scroll vacuum pumpOil-free scroll air compressorAtomize paint with compressed airCompressorAir compressorStarted manufacturing of air compressors for spray gun inspectionNotes on the descriptions about future prospects and other mattersThe future prospects for our company mentioned in this document are based on the currently available information.Please be advised that there are various external factors that can impact our business performance, such as the global economy, exchange rate fluctuations, the industry’s market conditions, and capital investment trends, and that the actual performance may differ from what is stated herein.This document is intended to provide investors with relevant information and not meant to invite or recommend anyone to buy or sell shares in our company or any other securities.Contact:IR Corporate Communication Office, Corporate Planning Department,ANEST IWATA CorporationPhone: 045-591-9344E-mail: ir_koho@anest-iwata.co.jpURL : https://www.anestiwata-corp.com/14