FY2018 Q2 IR for Web (E) · of June were added to Q2 sales as the acquisition of Pontiac Coil, Inc. was closed on June 1, 2018 Sales from existing businesses increased widely compared

SUMIDA CORPORATION

Performance Briefings

<For the Second Quarter of FY2018 ending June 30, 2018>

August 1, 2018

Today’s Speakers

2Copyright© 2018 SUMIDA CORPORATION. All rights reserved. 2

Representative Executive Officer & PresidentTomoharu Suseki

Representative Executive Officer & CFOYoshiyuki Honda

Today’s Program

Copyright© 2018 SUMIDA CORPORATION. All rights reserved. 3

1. FY2018 Q2 Consolidated Financial Results

ＣＦＯ Yoshiyuki Honda

2. FY2018 Q2 Performance Results & Management Policies

President Tomoharu Suseki

3. Q&A Session

FY2018 Q2 Consolidated Financial Results

Yoshiyuki Honda

CFO


Copyright© 2017 SUMIDA CORPORATION. All rights reserved.

（Million yen）

Consolidated Income Statement

17.Ｑ2 18.Q1 18.Q2 Change % Change %

（A）（B) （C）（C)/(A) （C）/(B)S a l e s 21,768 22,701 23,838 9.5% 5.0％

G r o s s I n c o m e 3,989 2,913 3,939

GI % 18.3% 12.8％ 16.5%

O p e ra t i n g I n c o m e 1,780 456 1,281 △28.0％ 180.6％

OI % 8.2% 2.0％ 5.4%

Income before Taxes 1,606 441 782 △51.3％ 77.1％

Income Attributable toO w n e r s o f P a r e n t 1,166 287 416 △64.3％ 44.8％

E P S （ y e n ） 45.83 10.76 15.55

FOR

EX

USD/yen 11.06 109.67 107.92

Euro/yen 121.74 133.77 130.06

renminbi/yen 16.13 17.09 17.00

5

Steady increase in sales with profit heading for recovery

※Sumida adopted IFRS starting FY2017 Q1. Figures in the previous year were restated with IFRS


（Million yen）

Consolidated Income Statement for 1st half

6 months ending June 30

2017

6 months ending June 30,

2018Change %

（A）（B）（B)/(A)S a l e s 43,368 46,540 7.3％

G r o s s I n c o m e 7,688 6,853

GI % 17.7% 14.7％

O p e r a t i n g I n c o m e 3,346 1,738 48.0％

OI % 7.7% 3.7％

I n c o m e b e f o r e T a x e s 3,004 1,223 △59.3％

Income Attributable to Owners ofP a r e n t s 2,106 703 △66.6％

E P S （ y e n ） 86.54 26.32

FOR

EX

USD/yen 112.84 108.80

Euro/yen 121.50 131.91

renminbi/yen 16.36 17.05

6Steady increase in sales with profit heading for recovery

Operating Income Analysis2017 Q2 → 2018 Q2

Extra ordinaryexpenses

△220

7

2017 Q2Operating

income1,780

（Million yen）

2018 Q2Operating

income1,281

FOREX△240

Raw material

price△150

Wages/Social insurance

△330

Others32


Production efficiency

190

Capacity utilization

30

Operating income dropped due to increased wages and copper price

Sales increase/Product mix

240

Expenses△120

Pontiac69

Operating Income Analysis2018 Q1 → 2018 Q2

Capacityutilization

560

8

（Million yen）


2018 Q1Operating Income

456

Productionefficiency

200

2018 Q2Operating Income1,281

Pontiac69

Others94

FOREX△60

Wage /Social

insurance△140

Sales increase/Product mix

320Special EXP.

△160

Expenses△58

Recovering due to increased capacity utilization and production efficiency

Consolidated Statement of Financial Position

2017Dec 31

2018June 30 Change

Current Assets 44,986 45,383 396

Cash & Deposits 5,375 4,511 △864

Trade & other Receivables 19,469 19,065 △403

Inventories 17,011 17,545 533

Others 3,129 4,261 1,131

Non-current Assets 39,379 46,042 6,663

Tangible Assets 30,388 32,090 1,701

Intangible Assets 2,228 2,555 327

Goodwill 2,006 6,855 4,849

Deferred Assets 3,309 2,966 △343

Others 1,447 1,574 127

TOTAL ASSETS 84,366 91,426 7,0592017 Dec 2018 June

Current Ratio 1.28 1.09

DE Ratio 1.07 1.37

ＣＣＣ（days） 100 104

2017Dec 31

2018June 30 Change

Current Liabilities 35,117 41,759 6,641

Trade & other Liabilities 10,721 11,425 703

Interest-bearing Loans 19,957 25,755 5,797

Others 4,438 4,578 140

Non-current Liabilities 19,126 20,137 1,010

Interest-bearing Loans 15,879 17,128 1,249

Others 3,247 3,008 △238

TOTAL LIABILITIES 54,243 61,896 7,652

TOTAL NET EQUITY 30,122 29,530 △592EQUITY attributable to equity holders of the parent

28,570 27,949 △621

Minority Interest 1,551 1,580 29TOTAL LIABILITIES & EQUITY 84,366 91,426 7,059

USD/yen 112.66 110.63

euro/yen 134.71 128.60

renminbi/yen 17.23 16.68

（Million yen）


Consolidated Statement of Cash Flow

6 months thru June 30, 2017

6 months thru June 30, 2018 Change

Cash Flow from Operating Activities 3,138 2,527 △610Income before Taxes 3,004 1,223 △1,781Depreciation & Amortization 1,562 1,853 291Net Working Capital △713 △186 526Others △715 △362 352

Cash Flow from Investing Activities △3,412 △10,243 △6,830

Capital Investments △3,509 △4,373 △863

Acquisition of subsidiary shares - △5,991 △5,991Others 97 121 24

Cash Flow from Financing Activities 2,335 7,055 4,720Net Interest-bearing Debts △1,095 7981 9,076

Revenue from Issuance of New Shares 3,985 - △3,985Dividend Payment △509 △879 △369Others △45 △45 0

Cash & Cash Equivalent at end of period 5,554 4,511 △1,043

（Million yen）


Big investing activities due to capital investments and M&A 12

１． Expansion of customer base

We can expect to enhance customer services and expand distribution channels throughcross-selling of Sumida & Pontiac products by utilizing shared customer base.

２． Responding to existing customers’ needs

Facilitate global projects Pontiac’s customers are interested in (to produce and sell inChina and Europe) through a full utilization of Sumida Group’s production capabilitiesand anticipate new projects.

３． Expansion of R&D, production facilities and strengthen know-How of automation of production lines

By utilizing Pontiac’s head office and factories we anticipate R&D and expansion ofproduction of Sumida’s products for the North American market.

11

Pontiac Coil, Inc.


（Forecast） 7 months for Jun –Dec 2018

12 months for Jan-Dec2019

Sales 30〜33 60〜65

OP 2.5〜3.0 4.5〜5.0

【Synergy Effects】

(100 Million yen) : US$1=110 yen)


Tomoharu Suseki

President

FY2018 Q2 Performance Results and Management Policies

� Pontiac Coil’s one-month sales of June were added to Q2 sales as the acquisition of Pontiac Coil, Inc. was closed on June 1, 2018

� Sales from existing businesses increased widely compared to previous quarter and previous year

Sales by Quarter

13

� Achieved highest-ever quarterly sales in 2018 Q2

217.7 231.6 236.2

227.0 238.4

120

2Q 3Q 4Q 1Q 2Q

USD 111.06 110.91 112.54 109.67 107.92

Euro 121.74 129.12 132.73 133.77 130.06

（100 Million yen）

2017 2018


Sales by Market 2017 Q2 → 2018 Q2

14

HID-related sales recovered from Q1. Sales of other products in this market grew as well

36.89 42.75

2017 2Q 2018 2Q

141.74 152.94

2017 2Q 2018 2Q

AutomotiveAutomotive+ 7.9%

Industry+ 15.9%

39.04 42.70

2017 2Q 2018 2Q

Consumer ElectronicsConsumer Electronics+ 9.4%



Industry businesses continued to expand mainly in RFID- and FA-related areas

Like in Q1, consumer electronics sales continued to be strong due to start-ups of new projects in addition to the existing products

Sales by Region 2017 Q2 → 2018 Q2

15

� Sales grew in all regions

� North America sales significantly increased partly due to inclusion of Pontiac’s one-month sales

（億円

44.64 47.39

2017 2Q 2018 2Q

Asia excl. China/TaiwanAsia excl. China/Taiwan

+ 6.2%51.5 60.01

2017 2Q 2018 2Q

(100 Million yen)

China/TaiwanChina/Taiwan

+ 16.5%

18.06 22.80

2017 2Q 2018 2Q

North America/OthersNorth America/Others

+ 26.3%

EuropeEurope

+ 4.5%103.48 108.18

2017 2Q 2018 2Q


Operating Income by Quarter

16Copyright© 2018 SUMIDA CORPORATION. All rights reserved.

� Operating income made a significant recovery in Q2 from Q1, but still below Q2 last year

� Major factors for negative growth from last year� Production-related trouble caused

mainly by start-ups of new products, etc. that arose in Q1 and still continued in Q2

� Increase of costs resulting from professional fees related to M&A etc.

� Compared with last year� Appreciation of renminbi� Increase of copper price

15.66 17.80 17.74

10.98

4.57

12.82

0

10

20

1Q 2Q 3Q 4Q


2017 2018 2017 2018 2017 2018 2017 2018

� Sales steadily grew with ups and downs by quarter in the past

� Aiming to achieve the new Mid-Term Business Plan (new MTBP), we are tackling various kinds of automotive projects including many EV/HEV-related

Sales in Automotive Market by Quarter


141.7

152.9

110

135

160

QAVR Q AVR 1Q 2Q 3Q 4Q 1Q 2Q

2015 2016 2017 2018


Strategies for Automotive Business


� Sales trend of 3 key productsABS HID Keyless Entry System

Slightly UP Down Up

EV/HEV Actuator

New MTBP

� We will focus on the following 2 areas, so as to keep Automotive business growing more and more.

Total sales of these 3 products in Stage III will slow down compared with the previous stages.


� With the expansion of existing businesses and the additional resources of newly joined Pontiac, we expect to accelerate the growth of this business.

EV/HEV

Actuator

Major Challenges in Automotive Businessin new MTBP

Battery Management

System

Motor PCU

EV (Electric vehicles) - Car Body

On-board Charger

Battery

Charger

Progress of new MTBP


� Changed organization structure in April 2018� Started working on the issuance of CSR report (Sustainability report)

Overall progress

� Aggressively tackling new challenges for future growth in all three business areas, Automotive, Industry and Consumer Electronics

� Reviewing new projects and product lineup to focus business resources on growing fields

Existing businesses

M&A� Searching for a new candidate to acquire whose size is similar to

Pontiac’s to achieve the numerical targets of new MTBP� Started working together with universities and research institutions

for developing new products and technologies in addition to M&A activities

Documents

FY2018 Q2 IR for Web (E) · of June were added to Q2 sales as the acquisition of Pontiac Coil, Inc. was closed on June 1, 2018 Sales from existing businesses increased widely compared