Company Information - Nitto Denko · 2020. 7. 27. · Forecast of automotive market Asia Europe Americas Japan Automotive production by areas (M units/year) CAGR +6% -4% +3% ... Supply

日東電工株式会社 ©2014 Nitto Denko Corporation. All Rights Reserved.

Company Information

May, 2014

Nitto Denko Corporation

Hideo Takasaki, President & CEO･COO

日東電工株式会社 ©2014 Nitto Denko Corporation. All Rights Reserved. 1

To Start

Nitto will further expand into business areas without being limited by the

word “Denko” (Electric Industries) and increase the brand power all over

the world with a more recognizable logo.

On Oct. 1, 2013


Contents

1. Review of FY2013

2. Direction of FY2014

3. Strategy of each business

4. Mid. term management plan Nitto-2016


1. Review of FY2013





FY2012 FY2013 Year-on-Year

Change (%)

Net Sales 671.3 749.8 11.7%

Operating

Income 68.4 72.3 5.5%

Ordinary

Income 67.2 71.7 6.7%

Net Income 43.7 51.0 16.8%

Operating

Margin 10.2% 9.6% -0.6p

ROA (Based on net income)

6.3% 6.7% 0.4p

Exchange Rate

(¥/US$) 82.4 99.9 NA

FY2013 Operating results

Unit：Billions of Yen


FY2013 Highlights and lowlights

1. Year-on-Year increase in sales and profit Sales increased by 11.7% and operating income increased by 5.5%.

Though we revised downward the forecast, we finally marked

increases both in sales and profit.

2. Aggressive capital investments We made a capital investments of a record-high 75.8 billion yen.

3. Activities toward centennial of FY2018 Changing a brand mark, moving and uniting the head office & Osaka

branch and renewing a corporate philosophy etc.

4. Change of the business circumstance of Information fine

materials div. was beyond what we expected


Sales & OP results by segments

(Unit : Billions of Yen) Net Sales

FY2012 FY2013

Industrial Tape Functional base products

& Automobile products 252.0 283.1

Optronics

Information fine materials 348.5 378.2

Flexible printed circuits 41.3 55.5

Processing materials 20.7 18.7

Medical &

Membrane

Medical products 15.1 17.3

Membrane products 18.6 20.3

Total 671.3 749.8

Operating Profit

FY2012 FY2013

12.2 17.3

56.4 52.4

0.3 1.8

68.4 72.3

＊ “Total” includes the trades between each segments or the profit which is belonging to corporate segment

Profit decrease of Optronics was covered by Industrial Tapes and Medical &

Membrane in FY2013 and the profit increase of the company was achieved

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


0

20

40

60

80

FY09 FY10 FY11 FY12 FY13

R&D Expenses

Capital Investments (completion basis)

27.6

(Bln.¥)

Trend of capital investments and R&D expenses

49.8

75.8

28.5

we practiced a record–high capital investments in FY2013 and Information

fine materials was accounting for the large part of the total amount.


Review of FY2013 / Operating profit

Analysis of OP from FY2012 to FY2013

8

68.4 72.3

59.0

24.3 ▲41.9

▲13.7

▲23.8

FY2012 Sales Volume / Foreign Exchange

Streamlining Operation etc

Selling Price Erosion

Fixed Cost

Product mix etc

FY2013

（Unit：bln.¥）

・Among set makers of smart

phone & tablet PC ・Between ITO film & ITO glass

・Among ITO film makers

Keen competition

Though aided by the yen’s depreciation, we increased OP only by 6%

because of the keen competition of smartphone & tablet PC market.


1. Review of FY2013





A year to “Soar”

In the latter half of the 2nd stage of globalization,

we enhance “Product strength”,

“Information-gathering ability” & “Team strength”

and start achieving the results of ample business

strategy

How we position the FY2014


FY2013 FY2014 Year-on-Year

Change (%)

Net Sales 749.5 780.0 4.1%

Operating

Income 72.5 78.0 7.6%

Ordinary

Income 72.5 78.0 7.6%

Net Income 51.9 57.0 9.8%

Operating

Margin 9.7% 10.0% 0.3p

ROA (Based on net income)

6.8% 7.3% 0.5p

Exchange Rate

(¥/US$) 99.9 100.0 NA

FY2013 results and FY2014 forecast

Unit : Billions of Yen

＊From FY2014, we start to adapt International Financial Report Standard (IFRS) voluntarily and

the figures of FY2013 have been adjusted to IFRS standard.


Sales & OP plan by segments

Plan to increase OP mainly because of Optronics & Industrial tape in FY2014

(Unit : Billions of Yen) Net Sales

FY2013 FY2014

Industrial

Tape

Functional base products 192.6 193.0

Automobile products 101.3 109.0

Optronics

Information fine materials 378.1 388.0

Flexible printed circuits 55.5 61.0

Processing materials 20.1 22.0

Medical &

Membrane

Medical products 17.4 18.3

Membrane products 20.4 22.0

Total 749.5 780

Operating Profit

FY2013 FY2014

17.9 18.8

54.7 56.8

2.6 1.9

72.5 78.0

＊“Total” includes the trades between each segments or the profit which is belonging to corporate segment

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

＊From FY2014, we start to adapt International Financial Report Standard (IFRS) voluntarily and

the figures of FY2013 have been adjusted to IFRS standard.


13

Enter the new stage to achieve the results of ample business strategy

Industrial Tapes ＊Functional base products

Optronics Information fine materials

Flexible printed circuits

Medical & Membrane Medical

Membrane

Optronics

Processing materials

Create ANT(Area Niche Top) products Use the increased production capacity of ITO

film for touch panel and launch the new

products

Keep the present customers and get the new

customers for the display of smartphone

From the oversea market, expand the

new product which can contribute to

customer’s process innovation Expand the business area from water treat-

ment to the others

With strengthening global activities, expand

the business to non-Japanese customers

Expand the sales of new drug delivery patch

named “Bisono” tape

Extend the contracted manufacturing service

of oligonucleotide synthesis drug

＊Automotive products Increase the customer of new polarizing film

and improve the productivity

Summary of the FY2014 strategy


14

Expand capital investments for the other segments than

Information fine materials in FY2014

75.8 73.0 （Bln.¥）

26.1 33.0

Capital

investment R&D

expenses

28.5

FY2013 FY2014

Information

fine materials

27.0

FY2015

Capital investments and R&D expenses

Other than

Information

fine materials


30 35 40 40

20

4050 50 50 50

30

35

40 40

20

50

50 50 50 50

0

40

80

120

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

15

Trend of dividends

Yearly dividend per share

Mid-year dividend per share

Yen per share

( ) Under Review

( )

( )

( )

Just as the previous year’s figure, 100 yen per year is planned for FY2014.

We will adjust the figure as necessary in accordance with external

environment and situations concerning our operating income.


1. Review of FY2013





Application CY2013 CY2014（YOY） Market Trend

TV 234 ±0% No unit production growth, but the panel size will be larger

Monitor 161 -5 ～ -9% Demand of desktop PC will decrease

Notebook PC 185 -10 ～ -14% Demand will move to tablet PC

Tablet PC 236 +20 ～ +24% Low price model will lead to the market growth

Cell-phone (including smartphone)

1924 +5 ～ +9% Market expansion by smartphone

Smartphone 1040 +20 ～ +24% Demand in China will expand

Market trend of 2014 by applications

Although tablet PC & smartphone market will continuously expand,

the low price model might be the mainstream in the market because

the growth will come from emerging countries

Forecast of LCD panel production in 2014 (M units）

＊External institution & company data


18

Market share of film touch panel by main applications

Film TP has gained high market share in smartphone & tablet PC

due to Nitto’s strong initiative.

Nitto will continuously promote ITO film for the wide range of

potential applications

Market share of film touch panel in 2013

Smartphone Tablet PC

60% 40%

Largely expanded

from 10% of 2011

Film

type Non-

film


Surface resistance(Ω/□)

10”

5”

20”

High Low

Develop low resistance ITO film and consider the introduction of new technology other than ITO film

19

ITO film

Smartphone

Tablet PC

Tablet notebook

Silver nano wire

Metal mesh

Notebook PC

Promote low

resistance value type

for large panel size

Growth strategy in touch panel market

Dis

pla

y S

ize


Forecast of automotive market

Asia

Europe

Americas

Japan

Automotive production by areas (M units/year) CAGR

+6%

-4%

+3%

+4%

CAGR(2013-2018) of the overall market is 4%

＊Data of external institutions


21

Strength of auto material business (1)

Tier2, 3

Tier1 1st auto parts maker

OEM Car maker

Supply functional products to the global market supply chain

Air, sound, water proof, Vibration-damping, Reinforcing, Bonding, Fixing, Protection, Buffering, Heat release, Heat insulation, Insulation, Shield etc.

Function needed Exterior Interior

Electric Power

train

Products supplied Supply chain of

auto industry

Car electronics


Start full scale of NVH production & processing after 2008

Brazil

Mexico

Missouri New Jersey

India Foshan

Czech

Taiwan Thailand

Shanghai

Tianjin

Belgium

Japan

Start full scale of auto materials production & processing before 2008

UK

Turkey

Indonesia

Australia

Xiamen

Philippines Vietnam

Hungary

Strength of auto material business (2)

Set up the full scale local production & processing of NVH factories

in overseas from 2008 and has completed the system for the local

supply globally

Processing only

NVH products play the

role of door opener for the

local supply (NVH=Noise,

Vibration, Harshness)


Head lamp, ECU, Sensor,

Power control units, Battery,

Motor etc.

◆Car electronics mtls. (Heat resistant tape, Vent filter,

Thermal conductivity sheet,

Hybrid & next generation car

mtls.)

Traditional Mkt. Growth Mkt. Auto Type

◆NVH rltd.

Body(Interior,

Exterior)

◆Surface

protection

Coated body

◆Fix/Bonding

tape Wire harness

Side molding

Mudguard

Emblem etc. Hybrid

Gasoline

Next generation

Demand

image

Further strength is to supply auto electronics products

Take all the stable demand of NVH products and earn a return from

car electronics products for hybrid and next generation cars

Demand

image

Acceleration of IT

(EV, PHEV, FCEV etc)

Create new demand by

connecting auto makers to LCD

panel makers


101.2 109.0

（億円）

CAGR over 10%

Plan the sales growth of over 10%(CAGR) which is higher than

car production growth(4%) by the expansion of overseas sales

Sales plan of auto material business

◆Set global

account mana-

gement ◆Start operation

of Brazil factory ◆Strengthen

alliance

100

50

0

150 (Bln.¥)

2013 2014 2016


Diaper tape Hygiene products

Develop new products by

collaboration with functional

base product div.

Nitto Bento is annually selling 10bln.yen of

diaper tape and hygiene products to Europe,

Middle East and North Africa

Nitto

Bento

＊ANT＝Area Niche Top product

Build sales expansion system in China & ASEAN market which will

be enriched by economy growth

Initiation of ANT candidates/Hygiene biz. fm Turkey

http://ja.wikipedia.org/wiki/%E3%83%95%E3%82%A1%E3%82%A4%E3%83%AB:Flag_of_Japan.svg


．

＊ANT＝Area Niche Top product

Build sales globally which is originally initiated in US and expand the material approval to Europe as well

U.S. Japan

France Germany

Asia

Market size of

aircraft tape

is18bln. yen

per year

Go into high

gear from 2013

Nitto

Sales

Initiation of ANT candidates/Challenge to aircraft industry


Initiation of ANT candidates / Solve the problem of social infrastructure in China

Qingtao Hailan Nitto Technology. Co. Ltd.

Capital : 25M CNY

Capital Construction : Nitto Denko 67%

Qingtao Hailan Material Technology 33%

Sales target : FY2014 2bln. yen FY2018 20bln. yen

Corporate profile

Onshore anticorrosion tape

Underwater & underground anticorrosion tape

Product : Nitohalmac XG

Product : No. 59

Dustproof material

Plan the production & sales after 2015

Waterproof tape Product : Nitoroof

Product : YBMS

Subway

waterproof

Measure for

PM2.5

Exploit new markets

by the old technology

Develop the biz. from anticorrosion tapes to the overall products

which can totally guard infrastructures

Start production & sales of anticorrosion tape from 2014


Introduction of expected order

Steel pipe

Anticorrosion

tape

Protective

layer FRP

Seawater

surface

Expected order Petrochemical complexes wharf Scale of order Wharf steel pipes (4,000) Type of anticorrosion Underwater anticorrosion tape(No. 59) Expected order receipt Summer in this year Process Please refer to the right Durability life Over 20 years


Shipbuilding

Port facility

Petrochemical complex

Power generation

Offshore oilfield

Wind-power generation

Gas

Korea

Taiwan

India

Nitto anticorrosion tape

Receiving orders from large industries in China

& many inquiries out of China

29

Use Japanese

origin technology

Qingtao Hailan Nitto

Technology. Co. Ltd.

http://wrs.search.yahoo.co.jp/_ylt=A8vY8nurPGhTkpUA1_CDTwx.;_ylu=X3oDMTFuNGl0cW5oBHBhdHQDcmljaARwb3MDMQRwcm9wA2lzZWFyY2gEcXADBHNjA0NUREQEc2VjA3NjBHNsawNpbWc-/SIG=14to36q3l/EXP=1399441003/**http:/image.search.yahoo.co.jp/search?rkf=2&ei=UTF-8&p=%E3%82%A4%E3%83%B3%E3%83%89%E5%9B%BD%E6%97%97

http://wrs.search.yahoo.co.jp/_ylt=A8vY8wjpOmhTjWYAXjSDTwx.;_ylu=X3oDMTFuNGl0cW5oBHBhdHQDcmljaARwb3MDMQRwcm9wA2lzZWFyY2gEcXADBHNjA0NUREQEc2VjA3NjBHNsawNpbWc-/SIG=14e38gnf1/EXP=1399440553/**http:/image.search.yahoo.co.jp/search?rkf=2&ei=UTF-8&p=%E9%9F%93%E5%9B%BD%E5%9B%BD%E6%97%97

http://wrs.search.yahoo.co.jp/_ylt=A8vY8wkOO2hTdFwAEtODTwx.;_ylu=X3oDMTFuNGl0cW5oBHBhdHQDcmljaARwb3MDMQRwcm9wA2lzZWFyY2gEcXADBHNjA0NUREQEc2VjA3NjBHNsawNpbWc-/SIG=14e9neiq2/EXP=1399440590/**http:/image.search.yahoo.co.jp/search?rkf=2&ei=UTF-8&p=%E5%8F%B0%E6%B9%BE%E5%9B%BD%E6%97%97

http://ja.wikipedia.org/wiki/%E3%83%95%E3%82%A1%E3%82%A4%E3%83%AB:Flag_of_Japan.svg


Pre-clinical IND Clinical study Launch

FY2012 2013 2018 2015

Practical use

Option : Collaboration with pharma

Plans to initiate clinical study in U.S. this year in order to assess safety

and efficacy in patients, and expects to collaborate with drug company

from late P-2 stage toward approval in 2018 or after

Timeline for anti-fibrotic drug development

Phase-1a：Safety

Phase-1b/-2a：POC

POC by

animals Safety verification by healthy individual

Safety and efficacy verification in patients

POC: Proof of Concept Verification of efficacy and safety

2014

（Following U.S., clinical study in Japan will start as soon as the preparation is ready)

Steady progress of major theme for future growth

Approval

30


1. Review of FY2013





Performance Target：FY2016 Net Sales 920bln.¥、Operating profit 100bln.¥

Business Growth（ANT creation fm GCF）

-Structural Reform and Growth

strategy through ｢Mu･Gen･Dai」

・Biz diversification & early launch

・Strengthe existing biz foundation

・Strategic M&As

Qualitative Improvement

・Continued efforts for the

environment and better quality

・Upgrade global HQ functions

・Optimizing regional / group

company governance

Human resource growth ・Developing Nitto Persons worldwide ・Improving/Globalizing personnel system

Platform New Corporate Philosophy（Mission＆The Nitto Way), Brand Logo

Niche Top Strategy（GNT/ANT), SAN-SHIN activities, Proximity to Customers

Soar toward the future through structural reform and growth strategy

Basic concept of Nitto-2016

32


日本

東ｱｼﾞｱ

Nitto-2015（2013～2015）

60% 30%

26%

38%

Nitto-2016（2014～2016）

50%

28%

22% 10%

In Nitto-2016, almost half of total investments of 3 years (2014～2016) is

used for non-Optronics business in order to realize the healthy and steady

growth with a reform of business portfolio.

Capital Investment Plan

Medical＆

Membrane

Industrial ﾃｰﾌﾟ Tape

Optronics

TOTAL：200～240bln.¥ TOTAL：200～220bln.¥

＊Industrial Tape consists of Functional base products and Automotive products

＊Medical＆Membrane includes corporate IT investment


Net

Sales

749.5 780

920

72.5 bln.¥ 78bln.¥

100bln.¥ （bln.¥）（bln.¥）

Net Sales Operating profit

Take the new challenge to achieve 100bln. yen of operating profit

Sales & operating profit plan


Contribute to customers’ value creation with innovative ideas

＜Notes＞

This materials include forecasts and forward-looking statements determined by the Company based on

the currently available information that include risks and uncertainties. Please acknowledge that actual

results may vary significantly due to a number of important factors.

Documents

Company Information - Nitto Denko · 2020. 7. 27. · Forecast of automotive market Asia Europe Americas Japan Automotive production by areas (M units/year) CAGR +6% -4% +3% ... Supply