Business Report April to December, 2016 (Q3 of FY …investors.wacom.com/media/files/investor-relations/2017-english/... · DTU-1141 DTU-1031 STU ... for Tablets 12.59 bn +32.1% Sales

Business ReportApril, 2016 to March, 2017

(FY 03/ 2017)

Wacom Co., Ltd.

(TSE Sec.1 6727)

All Rights Reserved. Copyright © 2017 Wacom Co., Ltd. 2

Contents Index3-5 FY 03/2017 (April, 2016 to March, 2017) Results Overview6-8 Consolidated P/L: Sales and Profit Comparison9 Operating Expenses Comparison10-11 Business Segment: Sales and Profit Comparison 12-19 Business Highlights20-22 Sales by Product Line23-25 Sales by Region, Sales Changes in Local Currencies Base26-27 Consolidated B/S, C/F28-33 New Products, etc.34-37 FY 03/2018 Basic Strategies and Business Focus38-46 Financial Forecasts47 Shareholders Return Policy48-50 Our Branding51 Disclaimer


FY 03/17 Results OverviewOperating environment

The penetration of mobile products, cloud computing, and social networking services, and the emergence of new fields such as IoT and VR in the IT industry are effecting major changes in our business environment.

Performance overview

Consolidated net sales declined compared to the previous fiscal year due to the strong yen and decreased sales in the Brand Business during product lifecycle transitions. Operating loss was posted due to depreciation, and subcontractor expenses associated with global IT infrastructure. In March, we came to the conclusion that net loss was posted mainly due to the impairment loss for intangible assets related to the global IT system development.

Sales in the Brand Business were weaker compared to the previous year. Creative Business shipments increased on a unit basis but overall sales decreased due to changes in the product mix, and the delay of new product launch. Consumer Business and Business Solution segments also struggled due to foreign exchange rates and changes in the market environment.

Sales in the Technology Solution Business also declined compared to the previous year. The recall and cancellation of Samsung’s Galaxy Note 7 in October led to significant sales drop for smartphones despite favorable shipments growth for tablets.


FY 03/17 Results Overview

Average Forex rate FY 03/17 YOY Change

1 USD 109.03 -9.3% (Strong JPY)

1 EUR 119.37 -9.8% (Strong JPY)

Business Performance FY 03/17 YOY Change

Net Sales 71.31 bn -8.1％

Operating Profit -1.17 bn -- (Prev. FY: 3.66 bn)

Ordinary Profit -0.87 bn -- (Prev. FY: 3.78 bn)

Net Profit aft. Tax -5.53 bn -- (Prev. FY: 2.31 bn)

Financial Indices FY 03/17 FY 03/2016

EPS -33.93 14.00

BPS (Book Value per Share) 130.75 188.22

Financial Summary (JPY)

(For reference)

(Note) Net Profit is equivalent to net profit attributable to shareholders of Wacom Co., Ltd.


FY 03/17 Results Overview (vs. forecast as of March 14)

Variance between the Forecast and Actual Results

Net sales were in line with forecast. Sales in the Technology Solution Business exceeded forecast owing to additional orders from major customers. However, operating loss was higher than forecast due to lower than expected sales in the Brand Business, which has a higher profit margin compared to the Technology Solution Business, along with slow initial sales for new pen tablet models and the delay of the new display product launch.

FY 03/17(prev. forecast)

FY 03/17

(result)Change

04/16-03/17 04/16-03/17 Amount

Net Sales 71,500 71,314 -186

Brand Business 45,700 43,874 -1,826

Tech. Solution Biz. 25,100 26,758 1,658

Other Business 700 682 -18

Operating Profit -500 -1,171 -671

Ordinary Profit -650 -870 -220

Net Profit aft. Tax -5,600 -5,534 66

(Unit: Million JPY)


Consolidated P/L FY 03/16 FY 03/17 YOY Change

04/15-03/16 04/16-03/17 Amount Ratio

Net Sales 77,568 71,314 -6,254 -8.1%

Gross Profit 30,736 27,566 -3,170 -10.3%

profit margin % 39.6% 38.7%

SG&A 27,072 28,737 1,665 6.2%

Operating Profit 3,664 -1,171 -4,835 --

profit margin % 4.7% -1.6%

Ordinary Profit 3,777 -870 -4,647 --

Net Profit after

Tax2,310 -5,534 -7,844 --

(Unit: Million JPY)

Effects of forex fluctuations

The US dollar weakened by JPY11.13 Sales -5,510 mil*, OP -310 mil*

The Euro weakened by JPY 12.99 Sales -1,420 mil, OP -840 mil

*The impacts in the US dollar are including the effects of depreciation in Asian currencies (Sales -1,290 mill, OP -840 mil)


Consolidated Sales Comparison

48,93143,874

27,974

26,758

663

682

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

FY 03/16 FY 03/17

Brand biz Tech. Solution biz Other biz

+3.0%

-10.3%

-4.3%

-8.1%77,568

71,314

(-2%*)

( %*) growth

excluding the effect

of FX fluctuations

(+5%*)

(Unit: Million JPY)

Change

Ratio


Consolidated Profit Comparison

3,664

-1,171

3,777

-870

2,310

-3,534

-4,000

-3,000

-2,000

-1,000

0

1,000

2,000

3,000

4,000

FY 03/16 FY 03/17

Operating Profit Ordinary Profit Net Profit

-5,000 -5,534 (Including impairment losses

of -4,224 mil. for IT software

in intangible assets)

(Unit: Million JPY)


Operating Expenses ComparisonFY 03/16 FY 03/17 YOY Change

04/15-03/16 04/16-03/17 Amount Ratio

Personnel 9,404 9,656 252 2.7%

R&D 4,342 4,397 55 1.3%

Ad. & Promo. 3,699 3,581 -118 -3.2%

Others 9,627 11,104 1,477 15.3%

Total 27,072 28,737 1,665* 6.2%

SG&A ratio % 34.9% 40.3%

(Unit: Million JPY)

Key changes in SG&A

Increase of depreciation (+480 mil) and subcontractor expenses (+760 mil) in Others and

personnel expense for global IT infrastructure development*.

*SG&A decreased by 1,800 mil due to the stronger yen for expenses incurred at subsidiaries.


Business Segment & Business Unit

Technology Solution Business Pen sensor systems for Smartphones and Tablets EMR, AES pen components & modules (feelTM)

Other Business Engineering Solution・ECAD dio

Consumer Business Makes daily lives more creative and enjoyable

Product Lines: Digital Stationery, etc.

Business Solution Serves society by providing innovative solutions

Product lines: Signature Tablet, Pen Display, etc.

Creative Business Serves the passion of professional and consumer creativity

Product Lines: Pen Tablet, Mobile, Display

Bra

nd

Bu

sin

es

s

Platform &applications

Provides

technology,

apps and

platforms

Cloud Apps

& Services

WILL (digital

Ink solution)


Consolidated P/L by Business Segment

FY 03/16 FY 03/17 YOY Change

04/15-03/16 04/16-03/17 Amount Ratio

Net Sales 77,568 71,314 -6,254 -8.1%

Brand Business 48,931 43,874 -5,057 -10.3%

Tech. Solution Biz. 27,974 26,758 -1,216 -4.3%

Other Business 663 682 19 3.0%

Operating Profit 3,664 -1,171 -4,836 --

Brand Business 8,036 5,685 -2,351 -29.3%

Tech. Solution Biz 3,130 2,443 -687 -21.9%

Other Business 36 -32 -68 --

Corp. and others -7,537 -9,267 -1,730 22.9%

profit margin % 4.7% -1.6%

(Unit: Million JPY)


Business Highlights: (Unit: JPY)

Emerging market model

(One by Wacom)

Brand Business

Creative Business 38.74 bn -7.4%

Shipment increased by 5% in units driven by the emerging market.

However, overall sales fell due to the strong yen and the impact of transitions to new

models, despite the focus on the next generation products launch from 2H.

Pen Tablet (subsection) 22.27 bn -7.8%

Shipment of Intuos Pro for professional creative users increased in units, but sales fell

due to the strong yen and the impact of transition to new models. We introduced the

next model Wacom Intuos Pro in January, which offers a new seamless paper-to-digital

workflow.

Sales of Intuos for consumer users decreased due to the prolonged IC supply problem caused by Kumamoto earthquake in 2016. New model for entry users in 3D modeling contributed to the sales.

Shipment of the emerging market model increased by 40% in unit base, reflecting an increase in new customers in China, India, and South America.

43.87 bn -10.3%

Intuos 3D



Brand Business

Creative Business

Mobile (subsection) 4.25 bn -4.6%

Changes in the competitive environment driven by an increase of digital

pen-adopted devices have given creative users more choices in the

category. Demand continues for highly-featured creative tablets that

support professional users' workflow.

During 1H, demand for the existing model Cintiq Companion 2 slowed

due to product life cycle transitions, and the strong yen led to sales

decease.

We introduced Wacom MobileStudio Pro in October as a new model,

adding features such as next generation pen technology and advanced

3D and color management functions. Sales in 2H increased 60%

comparing to the previous fiscal year. We continued to solidify our global

market leadership.


Brand Business

Creative Business

Display (subsection) 12.22 bn -7.6%

Shipment of display products expanded more than 5% in units.

Introduced Wacom Cintiq Pro 13/16 as a next generation model with 4K high-resolution display and stronger color management. The shipment started from the 13 inch model, which contributed to the sales. However, the shipment of the 16 inch one was delayed until March.

Sales of the existing models decreased due to product life cycle transitions.


27 QHD13HD



Brand Business

Consumer Business 1.32 bn -38.6%

Sales of stylus products for iPad largely decreased due to changes in

the competitive environment and a problem in product quality

Sales of Bamboo Spark, the first model of digital stationery that

transforms handwritten notes on paper into digital, decreased

significantly.

In September, we introduced the next models Bamboo Slate and

Bamboo Folio to establish a category of digital stationery.

We provided Wacom Cloud services to store and utilize digital ink

through cloud services.

Wacom InkLayer Language

Inkspace,

Bamboo Paper Apps


DTU-1031DTU-1141

STUシリーズSTU-540/430

DTH-2242DTK-1651


Brand Business

Business Solution 3.82 bn -23.0%

Sales dropped largely in the Eurozone due to changes in the competitive

environment such as availability of mobile devices as well as the strong yen.

STU series increased demand for digital signature solutions for credit card

transactions and over-the-counter services at retailers in Japan and public

services in India. However, sales slightly decreased due to a drop of demand

in the Eurozone.

Sales of LCD signature tablets, the DTU series decreased due to a drop of

the number of projects, despite DTU-1141 adoption by Citi Bank Korea.



Tech. Solution Business

Pen Sensor System

for Smartphones 13.21 bn -19.2%

The recall of Samsung’s Galaxy Note 7 led to discontinuance of production

for the Note 7, which caused significant sales decrease.

Shipment for Galaxy Note 5 remained stable, which contributed to sales.

Continued pen technology development for the next generation model.

Focused on automation of a new cartridge-type digital pen.

Continued new customer development efforts.

26.76 bn -4.3%

Smartphone models


Tablet ・PC models

Tech. Solution Business

Pen Sensor System

for Tablets 12.59 bn +32.1%

Sales of the Active ES pen solution increased with favorable demand

from tablet PC manufacturers. Orders from Huawei also contributed to

the sales growth.

Successful products such as Lenovo Yoga Book increased demand for

EMR pen.

Developing a standard digital pen for Windows 10 OS tablets with

Microsoft.

Adoption of a pen sensor system was expanded for Google

Chromebook.

Making efforts to the business expansion for the digital stationery.

Pen Sensor System

for Notebook PCs 0.96 bn -54.3%

Demand continued to shift from notebook PCs to 2in1 tablets.



(Unit: JPY)Business Highlights:Other Business

CAD software and others 0.68 bn +3.0%

Sales of major product ECAD DCX series remained a favorable level.

+3.0%0.68 bn

F&A (Corporate)

We promoted WILL (Wacom Ink Layer Language) under our open partnership policy as a new framework to standardize digital ink and engaged in activities for partnership development.

Connected Ink events were held in Shanghai, Berlin, Tokyo and Las Vegas in May, September, October, 2016 and January, 2017 to promote digital ink. The Digital Stationery Consortium was established and started its operation in September.

We announced “New strategic initiative at Wacom: Shift focus to profitability, grow corporate value in the medium term” after considering the performance below the growth targets for sales and profits published in our Strategic Business Plan ”SBP-2019”. We also resolved to post the impairment losses for global IT infrastructure and to reduce directors’ remuneration on March 14.


Sales by Product Line in Brand Business

24,148 22,267

4,4534,247

13,22312,223

2,149

1,321

4,958

3,816

0

10,000

20,000

30,000

40,000

50,000

FY 03/16 FY 03/17

Creative・Pen tablet Creative・Mobile Creative・DisplayConsumer Business Solution

-4.6%

-7.8%

-7.6%

-23.0%

43,874

48,931-10.3%

-38.6%

(Unit: Million JPY)

Change

Ratio

Creative

biz

41,824

Creative

biz

38,737

-7.4%


Sales by Product Line in Tech. Solution Business

16,35313,208

9,53212,594

2,089 956

0

5,000

10,000

15,000

20,000

25,000

30,000

FY 03/16 FY 03/17

Pen for Smartphone Pen for Tablet Pen for Notebook PC, etc.

-54.3%

+32.1%

-19.2%

26,75827,974-4.3%

(Unit: Million JPY)

Change

Ratio


0

5,000

10,000

15,000

20,000

25,000

14/4-6 14/7-9 14/10-12 15/1-3 15/4-6 15/7-9 15/10-12 16/1-3 16/4-6 16/7-9 16/10-12 17/1-3

Creative Consumer(Stylus, etc.) Business(VM) Tech. Solution CAD, etc.

Quarterly Trend by Product Line

13,669

18,342

24,954

17,592

15,142

23,814

21,936

16,676

13,261

20,535 20,943

16,575

(Unit: Million JPY)


Sales by Region

27,974 26,758

7,914 7,178

15,63113,520

14,84513,053

11,204

10,805

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

FY 03/16 FY 03/17

Tech. Solution Japan U.S. Germany Asia Oceania

(-4.7%)

(-2.5%)

-3.6%

-13.5%

-9.3%

-4.3%

-12.1%

77,56871,314

※5,248※5,438

(※+12.5%)

-8.1%(Unit: Million JPY)

Change

Ratio※Sales in China

of Asia Oceania

(※% growth based

on CNY)

(%) growth based

on local currency

(Note) There are no regional segments in the Tech. Solution Biz.


(Ref.) Sales Changes in Local Currency Base

Region CurrencyYOY

Change Ratio

Japan(excluding Tech. Solution biz)

JPY -9.3％

U.S. USD -4.7％

Europe EUR -2.5％

China CNY +12.5％

Korea KRW +10.6％

Australia AUD -1.5％

Singapore USD +8.8％

Hong Kong USD -19.5％

Taiwan NTD -3.5％

India INR +33.0％


0

5,000

10,000

15,000

20,000

25,000

14/4-6 14/7-9 14/10-12 15/1-3 15/4-6 15/7-9 15/10-12 16/1-3 16/4-6 16/7-9 16/10-12 17/1-3


Quarterly Trend by Region

13,669

18,342

24,954

17,592

15,142

23,814

21,936

16,676

13,261

20,53520,943

16,575

(Unit: Million JPY)



Consolidated B/SKey Changes

Assets

・ Decrease in intangible assets (impairment losses of global IT infrastructure)

-3,819

・ Increase in inventories 1,567(new product launch in Brand Business)

・ Increase in notes and accounts receivable 607

Liabilities

・ Increase in long-term loans 8,000

Net Assets

・ Decrease in shareholders’ equity(impairment losses in intangible assets and

dividends paid, etc.) -9,234

End of Mar. 2016

End of Mar. 2017

Change

Current Assets 37,874 39,500 1,626

Non-current Assets 13,693 10,750 -2,943

Total Assets 51,567 50,250 -1,317

Current Liabilities 16,479 17,384 905

Non-current Liabilities 3,992 11,509 7,517

Total Liabilities 20,470 28,893 8,423

Minority Interest in

Subsidiaries 0 0 0

Net Assets 31,096 21,357 -9,739

Total Liabilities and Net Assets 51,567 50,250 -1,317

Equity Ratio 60.0% 42.2% -17.8%

(Unit: Million JPY)


Consolidated C/FMajor Activities in FY 03/17

C/F from operating activities

・ Net loss before tax -5,691

・ Increase in inventories -1,791

・ Impairment losses 4,224

・ Depreciation 2,573

C/F from investing activities

・ Purchase of fixed assets -3,967(global IT infrastructure, etc.)

・ Proceeds from sales of property 536 (sales of property in US subsidiary, etc.)

C/F from financing activities

・ Increase in long-term loans payable 8,000

・ Decrease in short-term loans payable -1,000

・ Cash dividends paid -2,958

・ Purchase of treasury stock -753

FY 03/16 FY 03/17YoY

Change

04/15-03/16 04/16-03/17 Amount

C/F from operating

activities2,009 122 -1,887

C/F from investing

activities-4,878 -3,480 1,398

C/F from financing

activities1,209 3,299 2,090

Effect of change in

exchange rate -662 -101 561

Increase-decrease of

cash & cash equivalent -2,322 -160 2,162

Beginning balance of

cash & cash equivalent 16,687 14,365 -2,322

Ending balance of cash

and cash equivalent 14,365 14,205 -160

(Unit: Million JPY)


New products in FY 03/17Brand Product Business Creative Business

8mm thick and sleek design using premium materials

4 times higher pressure ranges with Wacom Pro Pen 2

Paper Edition offers a new paper-to-digital workflow

with Finetip Pen or Ballpoint Pen


New products in FY 03/17

13/16 13/16

Brand Product Business Creative Business

Highest performance tablet with Intel i7 and GPU

4 times higher pressure ranges with Wacom Pro Pen 2

High resolution and high color precision 4K display

Fully 3D design and modeling support with 3D camera



3D

3D Modeling solution for beginners

Integrated solution with 3D printing process

Standard service of 3D printing and delivery

Brand Product Business Creative Business


Brand Product Business Consumer Business

Inkspace,

Bamboo Paper



Other Business CAD Software

DTK-1651STU-540

ECAD DCX 2017

Brand Product Business Business Solution



• Started operation in September, 2016

• Promotes WILL “Wacom Ink Layer

Language” as new digital ink

standard and development of new

digital stationery market

www.digitalstationeryconsortium.org

Founding ofDigital Stationery Consortium

Connected Ink Las Vegas

January 6, 2017

http://www.digitalstationeryconsortium.org/

FY 03/2018

Basic Strategies and

Business Focus


Assumptions for FY 03/18 Business EnvironmentThe Global Economy

• The global economy is expected to expand driven by favorable growth in U.S. and sustaining growth in China.

• High uncertainty will be observed reflecting political developments such as a protectionist U.S. trade policy and instability in the EU.

• Geopolitical risk is expected to increase due to changing Middle East affairs and prolonged military tension in Far East.

• Instability in currency exchange rates is expected to persist.

The IT Industry and our Business Environment

• The IT industry is set to shift to a new industrial platform based on cloud services, big data, mobile communication services, and SNS. 5G and virtualization technology will accelerate innovation.

• IoT, VR/AR, 3D printing, and security-related business will continue to be key to our business. Creative markets will continue to expand and competition increases among major global IT players.

• Mobility, education, enterprise, and emerging countries are new business growth segments.

• Digital stationery linked with cloud services is expected to gain broader category awareness.

• Digital ink adoption is expanding to Windows, Chrome, and the other OS platforms.


Basic Strategies and Initiatives -1-Basic Strategy

• Recover profitability through optimization of our global organization and cost structure.

• Achieve sustainable growth by enhancing Wacom’s leadership in the digital pen and ink market.

• Plan new medium-term strategies to evolve our business model under a new management team.

• Improve user experience, enhance the relationship with customers

Key Initiatives

Brand Product Business

• Extend 3D design functions and develop enterprise markets (3D, VR/AR, CAD, Multimedia, etc.).

• Build strong relationship with customers and communities by enhancing regional marketing functions.

• Promote creative workflow solutions from ideas on paper to digital design and contents.

• Develop and expand emerging market business (China, Asia/Pacific, LATAM).

• Expand the digital stationery market, and build brand awareness through collaboration with partners.

• Expand business solutions for enhancing efficiency in workflow and data security by digital signature technology


Basic Strategies and Initiatives -2- Technology Solution Business

• Establish the de-facto-standard of digital pen technologies with EMR and AES for tablets.

• Support the transition to Samsung’s next-generation smartphone models.

• Develop and expand business opportunities through pen adoption for the education market with partner companies.

• Expand the digital stationery market in collaboration with various partner companies.

Corporate

• Enhance global organization and optimize cost structure and organization.

• Promote WILL through DSC and establish effective business structure utilizing digital ink with partner companies.

Risks and Opportunities

Risk

• Brand Business: Slow sales, delay of development and launch, and quality issues of new products.

• Technology Solution Business: Slow sales for Samsung’s next model smartphone.

Opportunities• Demand increase for new products and new technology (AES).

• Further progress in cost reduction.


Assumptions for FY 03/18 Financial Forecast

(Unit:

Million JPY)

Unit of sensitivity In case of stronger JPY 1.00

FY 03/18 (forecast) (for ref.) FY 03/17 (result)

Currency USD EUR USD EUR

Sales -520 (-410) -140 -500 (-380) -110

Operating Profit +30 (+100) -100 -30 (+50) -70

Note: In case of the weaker JPY, read the above signs of plus and minus the other way round.

USD sensitivity reflects exposure of Asia Pacific currencies supposing they synchronize with USD.

Each figure in brackets above in USD shows sensitivity excluding exposure of Asia Pacific currencies, namely USD only.

Reflected business update reviewing market trend as of mid April, 2017.

Reflected changes in customer demand and market trend in Technology Solution Business. Actual results may materially differ from forecast in short term due to its business nature.

Forex rate assumptions USD 1 = JPY 110 （YOY +0.9% weaker JPY）EUR 1 = JPY 118 （YOY -1.1% stronger JPY）

Forex sensitivity: 12-month forecast


Summary for FY 03/18 ForecastConsolidated performance

• Sales growth of 8% owning to sales expansion in the Creative Business with the new products launched in the fiscal year ended March 2017.

• GP ratio will maintain at approx. 40% of the previous fiscal year. SG&A ratio will remain at approx. 37% by strategic increase of R&D expense in spite of reduction of expenses for global IT infrastructure etc. As a result, OP ratio will improve to the level of approx. 2%.

Brand Product Business

• Growth recovery in Creative Business with new models for display and mobile products.

• ASP decline due to increase of sales of lower-end models in pen tablet products for emerging market.

• Recovery in Consumer Business driven by new products and new customers.

• Conservative forecast in Business Solution based on the competitive environment.

• Overall sales to grow by 12%.

Technology Solution Business

• Robust shipment of pen system owing to increasing demand for pen-enabled tablet models in PC market with diversification of customers.

• Shipment of next-generation Galaxy Note, while negative impact from Note 7 remains.

• Sales to remain at the same level as the previous fiscal year.

(All comparisons are with the previous fiscal year unless otherwise stated )


Summary for FY 03/18 Forecast1H FY 03/17 (rslt) 1H FY 03/18 (frct) YOY

04/16-09/16 04/17-09/17 Growth rate

Sales 33,797 35,180 1,383

Operating Profit -898 -2.7% -470 -1.3% 428

Ordinary Profit -1,021 -3.0% -500 -1.4% 521

Net Profit aft. tax -1,226 -3.6% -100 -0.3% 1,126

FY 03/17 (result) FY 03/18 (forecast) YOY

04/16-03/17 04/17-03/18 Growth rate

Sales 71,314 76,800 5,486

Operating Profit -1,171 -1.6% 1,800 2.3% 2,971

Ordinary Profit -870 -1.2% 1,740 2.3% 2,610

Net Profit aft. tax -5,534 -7.8% 1,130 1.5% 6,664

ROE -- 5.3% --

• We forecast a decrease in

operating loss in 1H owing to

the sales contribution of new

products in Brand Product

Business introduced in 2H for

FY 03/17.

• We forecast an YOY growth in

operating profit in 2H owing to

higher sales in both Brand

Product and Technology

Solution Businesses driven by

new products and business

seasonality.

• We forecast the growth both in

sales and profits.

(Unit: Million JPY)


(Note) Due to risks and uncertainties involved in the forecast of market and customer trends in Technology Solution Business,

actual results may materially differ from forward-looking statements in the short term.

Forecast by Business Segment

FY 03/17 (rslt) FY 03/18 (fcst) YOY Change

04/16-03/17 04/17-03/18 Amount Ratio

Net Sales 71,314 76,800 5,486 7.7%

Brand biz 43,874 49,200 5,326 12.1%

Tech. Solution biz 26,758 26,900 142 0.5%

Other biz 682 700 18 2.6%

Operating Profit -1,171 1,800 2,971 --

Brand biz 5,685 8,100 2,415 42.5%

Tech. Solution biz 2,443 2,260 -183 -7.5%

Other biz -32 40 72 --

Corp. and others -9,267 -8,600 667 -7.2%

profit margin % -1.6% 2.3%

(Unit: Mil JPY)


Sales Forecast by Business Segment

43,87449,200

26,75826,900

682700

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY 03/17 (result) FY 03/18 (forecast)

Brand biz Tech. Solution biz Other biz

+2.6%

+12.1%

+0.5%

+7.7 %

71,31476,800

(Unit: Million JPY)

Change

Ratio

（YOY change）


Sales Forecast by Product line in Brand Product

22,267 23,430

4,2475,800

12,223

14,1401,321

1,7303,816

4,100

0

10,000

20,000

30,000

40,000

50,000


Creative・Pen tablet Creative・Mobile Creative・DisplayConsumer Business Solution

+31.0%

+36.6%

+5.2%

+15.7%

+7.4%

49,200

43,874

+12.1%（YOY change）

(Unit: Million JPY)

Change

Ratio

Creative

biz

38,737

Creative

biz

43,370

+12.0%


Sales Forecast by Product line in Tech. Solution

13,20811,000

13,55015,900

0

5,000

10,000

15,000

20,000

25,000


Pen for Smartphone Pen for Tablet, Others

+17.3%

-16.7%

26,90026,758

+0.5%

(Note) “For tablets, others” is integrated with “For notebook PCs” categorized as a product line in FY03/17.

（YOY change）(Unit: Million JPY)

Change

Ratio


Sales Forecast by Region

26,758 26,900

7,178 7,780

13,520 15,200

13,05314,490

10,80512,430

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000



+15.0%

+12.4%

+8.4%

+0.5%

+11.0%

+7.7 %

71,31476,800

（YOY change）

(Unit: Million JPY)

Change

Ratio



Investment, depreciation and R&D

Capital expenditure

2.40 bn JPY (YOY -33.0％)

• Key items: Metallic mold for products in Brand Product Business and Technology Solution

Business, etc.

Depreciation

2.80 bn JPY (YOY +8.8％ )

• Key items: Depreciation of global IT infrastructure and metallic mold for products

R&D expense

4.90 bn JPY (YOY +11.4％)

• Key items: New products development and next-generation technology research, etc.


Shareholders Return Policy for FY 03/18

Dividend policy

• Continue steady dividend payout to shareholders while maintaining a stable financial base necessary for future business development.

• Target payout ratio maintains approximately 40% or more to attract global investment.

Dividend per share

• JPY 6.00 JPY per share for FY 03/18 (JPY 6.00 for FY 03/17)

• Payout ratio 86.2% (--% for FY 03/17)


8

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our brand

DisclaimerForward-looking statements regarding future events and

performance contained in this presentation are based on currently

available information and involve risks and uncertainties, including

macroeconomic conditions, trends of the industry in which the

company is engaged and progress in new technologies. Please

note that actual results could materially differ from those expressed

or implied by the forward-looking statements in this presentation

due to these risks and uncertainties.

Investor Relations Inquiries

TEL: +81-3-5337-6502 FAX: +81-3-5337-6519

Wacom Co., Ltd.

Sumitomo Fudosan Shinjuku Grand Tower 31F,

8-17-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo

160-6131, Japan

Wacom Co., Ltd.

http://www.wacom.com

Documents

Business Report April to December, 2016 (Q3 of FY …investors.wacom.com/media/files/investor-relations/2017-english/... · DTU-1141 DTU-1031 STU ... for Tablets 12.59 bn +32.1% Sales