business report - investors.wacom.com...business report april, 2015 to march, 2016 (fy 03/2016)...

Business ReportApril, 2015 to March, 2016

(FY 03/2016)

Wacom Co., Ltd.

(TSE Sec.1 6727)

All Rights Reserved. Copyright © 2016 Wacom Co., Ltd. 2

Contents Index3-4 FY 03/16 Results Overview5-6 Consolidated P/L, Operating Expenses Comparison7-8 Consolidated Sales/Profit Comparison9-10 Business Segment Sales/Profit Comparison 11-18 Business Highlights19-21 Sales by Product Line22-24 Sales by Region, Sales Changes for Local Currencies25-26 Consolidated B/S, C/F27-29 Review of FY 03/16 Results for the latest forecast29-31 FY 03/17 Business Strategies32-40 FY 03/17 Financial Forecast41-43 Shareholders Return Policy for FY 03/1744-47 Review of Wacom Strategic Business Plan SBP-201948-50 Our Branding51 Disclaimer


FY 03/16 Results OverviewOperating environment The global economy maintained a slow recovery until 3Q. However, the uncertainties for global

economy has increased since 4Q, with multiple factors including refugees issues in Europe, decline of U.S. exports, low oil prices, low domestic demand in Japan, and further economic slowdown in emerging countries including China.

The Japanese Yen rapidly appreciated against US dollar in February, and remained strong against Euro throughout the year.

As cloud computing, mobile products, and SNS rapidly expand, the IT industry faces intensified competition and structural changes. Market trends related to our business are changing rapidly.

Performance overview Consolidated net sales increased, but fell under the latest forecast. Operating income and net profit

decreased due to the increase of SG&A such as global IT infrastructure and R&D expenses, and the effect of exchange fluctuations.

Sales in Brand Business reached a record high, driven by strong sales of Display products in Creative Business and digital stationery products in Consumer Business, as well as sales expansion in China and other Asian markets.

Sales in Technology Solution Business declined. While, the sales of new Active ES pen solution increased by new customers and mass production of educational tablets, the shipment for the newsmartphone model was lower than for the previous model and the sales for notebook PCs has declined significantly.


FY 03/16 Results Overview

Average Forex rate FY 03/16 YOY

1 USD 120.16 JPY +9.2% (Weak JPY)

1 EUR 132.36 JPY -4.6% (Strong JPY)

Business Performance FY 03/16 YOY

Net Sales 77.57 bn 4.0％

Operating Income 3.66 bn -40.3％

Ordinary Income 3.78 bn -37.7％

Net Profit aft. Tax 2.31 bn -33.5％

Financial Indices FY 03/16 FY 03/15

EPS 14.00 JPY 20.86 JPY

BPS (Book Value per Share) 188 JPY 202 JPY

Financial Summary (JPY)

(For reference)

(Note) Net Profit of FY 03/16 is equivalent to net profit attributable to shareholders of Wacom Co., Ltd.


Consolidated P/L FY 03/15 FY 03/16 YOY Change

04/14-03/15 04/15-03/16 Amount Ratio

Net Sales 74,557 77,568 3,011 4.0%

Gross Profit 30,050 30,736 686 2.3%

profit margin % 40.3% 39.6%

SG&A 23,908 27,072 3,164 13.2%

Operating Income 6,143 3,664 - 2,478 -40.3%


Ordinary Income 6,065 3,777 - 2,288 -37.7%

Net Profit after

Tax3,473 2,310 - 1,164 -33.5%

(Unit: Million JPY)

• Effects of forex fluctuationsThe US dollar strengthened by JPY 10.13: Sales +4,020 mil JPY, OP -330 mil JPYThe euro weakened by JPY 6.32 JPY: Sales -710 mil JPY, OP -450 mil JPY


Key changes in SG&A

R&D expenses increased due to development of new products for the next FY.

Headcount including temporary staff increased. (avg. 1,195 for FY 03/15, avg. 1,243 for FY 03/16)

Other expenses increased due to subcontractor expenses for global IT infrastructure development.

SG&A (incl. global IT infrastructure development) increased by ¥500 million due to the weaker yen for expenses incurred at subsidiaries.

Operating Expenses ComparisonFY 03/15 FY 03/16 YOY Change

04/14-03/15 04/15-03/16 Amount Ratio

Personnel 8,541 9,404 863 10.1%

R&D 3,180 4,342 1,162 36.5%

Ad. & Promo. 3,333 3,699 366 11.0%

Others 8,853 9,627 774 8.7%

Total 23,908 27,072 3,164 13.2%

SG&A ratio % 32.1% 34.9%

(Unit: Million JPY)

(Note) Headcount excluding temporary employees: avg. 1,040 for FY 03/15, avg. 1,056 for FY 03/16


Consolidated Sales Comparison

43,62548,931

30,27727,974

655663

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY 03/15 FY 03/16

Brand biz Tech. Solution biz Other biz

(Unit: Million JPY)

Change

Ratio

+1.2%

+12.2%

-7.6%

+4.0%

74,55777,568


Consolidated Profit Comparison

6,143

3,664

6,065

3,777 3,473

2,310

0

1,000

2,000

3,000

4,000

5,000

6,000

FY 03/15 FY 03/16

Operating Income Ordinary Income Net Profit

(Unit: Million JPY)

-40.3%

-37.7%

-33.5%


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: Display, Signature Tablet, 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 SegmentFY 03/15 FY 03/16 YOY Change

04/14-03/15 04/15-03/16 Amount Ratio

Net Sales 74,557 77,568 3,011 4.0%

Brand Business 43,625 48,931 5,306 12.2%

Tech. Solution Biz. 30,277 27,974 -2,303 -7.6%

Other Business 655 663 8 1.2%

Operating Income 6,143 3,664 -2,479 -40.3%

Brand Business 5,965 8,036 2,071 34.7%

Tech. Solution Biz 4,642 3,130 -1,512 -32.6%

Other Business 55 36 -19 -35.1%

Corp. and others -4,519 -7,538 -3,019 66.8%


(Unit: Million JPY)

(Note) Corp. and others Operating Income decrease includes approx. -2.5 bn JPY due to the reassignment of SG&A

items from Brand Business to Corporate functions reflecting the new global organization started from April, 2015.


Business Highlights:

Brand Business

Creative Business 41.82 bn +14.6%

Pen Tablet (subsection) 24.15 bn + 9.9%

Intuos Pro was well received for its high value-added features

for professional use and maintained stable sales globally.

New generation Intuos products such as Intuos Comic, Intuos

Draw, Intuos Photo, and Intuos Art launched in September

gained high recognition for their focus on user needs.

The emerging market model maintains strong sales in China,

and contributed to the expansion of new entry level users.

48.93 bn +12.2%

Emerging market model

(One by Wacom)

(Unit: JPY)


Brand Business

Creative Business

Mobile (subsection) 4.45 bn +13.9%

Wacom’s mobile tablet, Cintiq Companion 2, was highly

appraised for its QHD display, light body, and wide range of

model lines. The high-end model launched last May contributed

to sales expansion.

Sales channel expansion from Wacom Store exclusive o to

selective mass merchant retailers contributed to sales growth

Demand in 2H slowed down due to intensified competition and

the transition period of product life cycle.

Inutos Creative Stylus 2 for iPads decreased its sales as a year

and half has passed since its launch.

Business Highlights: (Unit: JPY)

companion 2


Brand Business

Creative Business

Display (subsection) 13.22 bn +24.9%

Cintiq 27 QHD, gained a reputation as the flagship model for

professional use, with its high-definition display and precision

color management. This series is creating a new market in 3D

design and production.

Cintiq 22HD continued to contribute steadily to sales expansion.

Cintiq 13HD touch with multi-touch function acquired new users

in the portable 13 inch category. 13HD


27 QHD touch

22HD touch

13HD touch

27 QHD

(Unit: JPY)


Brand Business

Consumer Business 2.15 bn +38.3%

Bamboo Spark was launched in September as a new

generation digital stationery that transforms handwritten notes

on paper into digital ink for editing and sharing. It was well-

received and contributed to sales expansion.

Launched Wacom Cloud services to share inspirations and

ideas captured in digital ink through cloud services.

Next generation Bamboo Fineline 2 for iPad and new Bamboo

Alpha launched in September, contributed to sales owing to

their premium design.and affordable price.

Business Highlights: (Unit: JPY)

Wacom InkLayer Language Bamboo Spark

Bamboo Paper



STU Series

(Unit: JPY)

Brand Business

Business Solution 4.96 bn -11.3%

Sales dropped in the Eurozone due to the absence of large-scale

orders that boosted results in the previous FY and weaker Euro

against Japanese Yen. Some projects were prolonged due to the

uncertainties in global economic environment.

The STU series was well received in credit card transaction and

over-the-counter services in the financial industry. The latest

models, STU-530 and STU-430, contributed to sales growth.

DTU-1031 was widely adopted for financial over-the-counter use.

DTU-1141 with data encryption contributed to sales.

All Rights Reserved. Copyright © 2016 Wacom Co., Ltd.

DTU-1031DTU-1141 DTH-2242



Tech. Solution Business

Pen Sensor System

for Smartphones 16.35 bn -10.8%

Sales decreased due to a lower shipments level of Samsung’s

GALAXY NOTE 5 compared to the previous model.

Development for next model of GALAXY NOTE is ongoing.

Focusing on development of new cartridge pen and automated

production

Active development of new customers.

27.97 bn -7.6%

(Unit: JPY)

Smartphone models


Business Highlights:Tech. Solution Business

Pen Sensor System

for Tablets 9.53 bn +11.6%

Large-scale shipments of educational tablets for a Turkish

government project contributed to sales expansion.

Active ES pen solution expanded mass production, and added

a new major Chinese tablet player Huawei.

Partnered with Microsoft in Active ES pen technology and

licensed its Windows Pen Protocol in March.

Pen Sensor System

for Smartphones 2.09 bn -38.6%

• Continued shift in demand from notebook PC to 2in1 tablets

(Unit: JPY)

Tablet ・PC models

General Mobileetab5



Other Business

CAD software and others 0.66 bn -1.2%

Promoted sales of ECAD dio 2015 and launched ECAD dio DCX R2.

0.66 bn

(Unit: JPY)

-1.2%

F&A (Corporate)

Transitioned from the region-based organization to a new customer-centric global organization.

Continued to invest in business infrastructure for growth and operational efficiency. Major projects include new SCM system, IT infrastructure, e-commerce, etc. for global integrated operations.

Promoted WILL (Wacom Ink Layer Language) as a new framework to standardize digital ink and engaged in activities for partnership development, and held the Wacom ‘Inkathon’ software developer challenge and began preparations for the establishment of ‘Digital Stationery Consortium’ under our “Open Partnership Policy”.

Submitted a Corporate Governance Report to the TSE in September in compliance with newly introduced Corporate Governance Code in Japan.


Sales by Product Line in Brand Business

21,981 24,148

3,9094,453

10,590

13,2231,554

2,1495,591

4,958

0

10,000

20,000

30,000

40,000

50,000

FY 03/15 FY 03/16

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

Creative

biz

36,480

Creative

biz

41,824

+14.6%

(Unit: Million JPY)

Change

Ratio

+13.9%

+9.9%

+24.9%

-11.3%

48,931

43,625

+12.2%

+38.3%


Sales by Product Line in Tech. Solution Business

18,33116,353

8,5429,532

3,4042,089

0

5,000

10,000

15,000

20,000

25,000

30,000

FY 03/15 FY 03/16

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

(Unit: Million JPY)

Change

Ratio

-38.6%

+11.6%

-10.8%

27,97430,277

-7.6%


0

5000

10000

15000

20000

25000

13/4-6 13/7-9 13/10-12 14/1-3 14/4-6 14/7-9 14/10-12 15/1-3 15/4-6 15/7-9 15/10-12 16/1-3

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

Quarterly Trend by Product Line

15,414

19,026

23,389

20,786

13,669

18,342

24,954

17,592

15,142

23,814

(Unit: Million JPY)

21,936

16,676


Sales by Region

30,277 27,974

7,132 7,914

13,914 15,631

14,532 14,845

8,70211,204

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY 03/15 FY 03/16

Tech. Solution Japan U.S. Germany Asia Oceania

( ) % growth based

on local currency

(Unit: Million JPY)Change

Ratio

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

(+2.9%)

(+7.0%)

+28.7%

+12.3%

+11.0%

-7.6%

+2.1%

74,55777,568

+4.0%

※3,799(※+34.5%)

※5,438※Sales in China

of Asia Oceania

(※% growth based

on local currency)


(For reference) Sales Changes in Local Currency Base

Region CurrencyYOY

Change Ratio

Japan(excluding Component biz)

JPY +11.0％

U.S. USD +2.9％

Europe EUR +7.0％

China CNY +34.5％

Korea KRW +21.7％

Australia AUD +18.5％

Singapore USD -2.2％

Hong Kong USD +6.3％

Taiwan NTD +5.9％

(Note) The figure of Singapore is including sales in India.


0

5,000

10,000

15,000

20,000

25,000

13/4-6 13/7-9 13/10-12 14/1-3 14/4-6 14/7-9 14/10-12 15/1-3 15/4-6 15/7-9 15/10-12 16/1-3


Quarterly Trend by Region

15,414

19,026

23,389

20,786

13,669

18,342

24,954

17,592

15,142

23,814

(Unit: Million JPY)


21,936

16,676


Consolidated B/SKey Changes

Assets

・ Increase in intangible fixed assets 2,690(increase in software suspense account for

global IT infrastructure, etc.)

・ Decrease in cash and cash equivalents

-2,322Liabilities

・ Increase in long-term loans 3,400

・ Increase in short-term loans 2,000

・ Decrease in notes and accounts payable

-3,101

Net Assets

・ Decrease in shareholders’ equity -1,848(decrease in treasury stock by share buy-back, etc.)

End of Mar. 2015

End of Mar. 2016

Change

Current Assets 40,188 37,874 -2,314

Noncurrent Assets 11,269 13,693 2,424

Total Assets 51,457 51,567 110

Current Liabilities 15,880 16,479 598

Noncurrent Liabilities 1,718 3,992 2,274

Total Liabilities 17,598 20,470 2,872

Minority Interest in

Subsidiaries0 0 0

Net Assets 33,859 31,096 -2,763

Total Liabilities and Net Assets 51,457 51,567 110

Equity Ratio 65.4% 60.0% -5.4%

(Unit: Million JPY)


Consolidated C/FMajor Activities in FY 03/16

C/F from operating activities

・ Net profit before tax 3,597

・ Depreciation 2,004

・ Decrease in notes and accounts

payable-trade -2,780

・ Income taxes paid -1,635

C/F from investing activities

・ Purchase of fixed assets -5,200(global IT infrastructure, etc.)

C/F from financing activities

・ Increase in short-term and long-term loans

payable 5,400

・ Cash dividends paid -2,992

・ Purchase of treasury stock -1,245

FY 03/15 FY 03/16YoY

Change

04/14-03/15 04/15-03/16 Amount

C/F from operating

activities6,782 2,009 -4,773

C/F from investing

activities-3,278 -4,878 -1,600

C/F from financing

activities-2,850 1,209 4,059

Effect of change in

exchange rate 638 -662 -1,300

Increase-decrease of

cash & cash equivalent1,293 -2,322 -3,614

Beginning balance of

cash & cash equivalent15,394 16,687 1,293

Ending balance of cash

and cash equivalent16,687 14,365 -2,322

(Unit: Million JPY)


Review of FY 03/16 Results for the Latest ForecastConsolidated net sales

Brand Business：

• Business Solution fell below the forecast due to prolonged projects, etc.

• Creative Business experienced “Mobile” product slowdown in 2H due to the

intensified competition and the transitional period of its product life cycle

Technology Solution Business:

• Sales for Smartphones fell below the forecast due to a lower shipment level of

the customer.

Operating income

• Gross profit fell below the forecast due to sales drop in Brand Business.

• SG&A increased in 4Q due to initial expense of R&D for new products to be

launched in FY 03/17.


Results by Business SegmentFY 3/16 (fcst.

as of Oct. 2015)

FY 3/16

(actual)YOY Change

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

Net Sales 81,000 77,568 -3,432 -4.2%

Brand biz 51,800 48,931 -2,869 -5.5%

Tech. Solution biz 28,500 27,974 -526 -1.8%

Other biz 700 663 -37 -5.3%

Operating Income 4,800 3,664 -1,136 -23.7%

Brand biz 9,040 8,036 -1,004 -11.1%

Tech. Solution biz 3,260 3,130 -130 -4.0%

Other biz 60 36 -24 -40.4%

Corp. and others -7,560 -7,538 22 -0.3%


(Unit: Mil JPY)

FY 03/2017

Basic Strategies and

Business Focus


Initial Assumptions of Business Environment for FY 03/17Global Economy

• Modest growth trends will be supported by financial policies in each country.

• Destabilizing factors are increasing such as refugees in Europe, low oil prices and economic slowdowns in U.S. and China.

• Rapid appreciation of the Japanese Yen and the impact from the Kumamoto earthquake in April are concerns for the Japanese economic recovery.

IT industry and our business environment

• 3D market growth accelerates triggered by 3D design, VR and 3D printing.

• Creative markets in emerging countries continue to expand in both professional and consumers segments.

• 2in1 tablet market starts to grow as the smartphone market at standstill.

• Tablet market for educational and enterprise sectors expand.

• Digital stationery creates new value through integration with Apps and Cloud services.

• Digital signature expands by improving workflow and security.


Basic Strategies and Initiatives Expand Creative Business and enhance the market leadership.

Extend 3D design and color management functions with the next generation of product lines.

Accelerate the growth of Creative Business in emerging markets

Establish a new consumer segment by integrating digital stationery and Cloud

services.

Promote standardization of digital ink by WILL (Wacom Ink Layer Language).

Enhance paperless workflow and security business with digital signature.

Promote standardization of digital pen and expand Technology Solution Business.

Enhance the collaboration among global organizations and improve business efficiency by

leveraging the new global IT infrastructure.

Enhance corporate governance and processes for improving corporate value.


Assumptions for FY 03/17 Financial Forecast

(Note) Each figure of the above sensitivities shows a opposite sign in case of the weaker JPY.

(Unit:

Million JPY)

Market demand based on further review of trend in mid April, 2016.

Reflected the customers demand forecast and market trends in Technology Solution Business. Actual results may materially differ from our latest financial forecast in the short term.

Influences by the Kumamoto Earthquake on the supply of key components are not reflected since the disaster is on-going and the effect is under evaluation.

Forex rate assumptions for FY 03/17 1 USD =110 JPY （YOY +10.16 stronger JPY）1 EUR =125 JPY （YOY +7.36 stronger JPY）

Forex exchange sensitivity: 12-month forecast (assumption: Asian currencies are pegged to USD.)

Unit of sensitivity Per 1 JPY in case of the stronger JPY

FY 03/17 (forecast) (for ref.) FY 03/16 (actual)

Currency USD EUR USD EUR

Sales -500 -140 -400 -112

Operating Income +40 -100 +33 -71


Summary for FY 03/17 Forecast1H FY 03/16(act.) 1H FY 03/17(fcst.) YOY

04/15-09/15 04/16-09/16 Growth rate

Sales 38,956 37,230 -4.4%

Operating Income 2,053 5.3% 100 0.3% -95.1%

Ordinary Income 2,098 5.4% 70 0.2% -96.7%

Net Profit aft. tax 1,261 3.2% 50 0.1% -96.0%

FY 3/16(act.) FY 3/17(fcst.) YOY

04/15-03/16 04/16-03/17 Growth rate

Sales 77,568 82,000 5.7%

Operating Income 3,664 4.7% 4,200 5.1% 14.6%

Ordinary Income 3,777 4.9% 4,140 5.0% 9.6%

Net Profit aft. tax 2,310 3.0% 3,000 3.7% 29.9%

ROE 7.1% 9.7% 2.6%

• We forecast an operating loss

in Q1 at the same level as the

last Q4, and expect OP to

break-even in 1H due to the

decrease in GP by sales drop in

Tech. Solution Business and

the increase in SG&A including

R&D expenses for the launch of

new products, which will raise

the SG&A ratio.

• We forecast an YOY growth of

OP in 2H owing to higher sales

in both Brand and Technology

Solution Businesses driven by

new products and business

seasonality.

• We forecast an YOY growth of

NP. We are not currently

expecting any extraordinary

losses or gains.

(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 3/16(act.) FY 3/17(fcst) YOY Change

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

Net Sales 77,568 82,000 4,432 5.7%

Brand biz 48,931 56,200 7,269 14.9%

Tech. Solution biz 27,974 25,100 -2,874 -10.3%

Other biz 663 700 37 5.6%

Operating Income 3,664 4,200 536 14.6%

Brand biz 8,036 11,400 3,364 41.9%

Tech. Solution biz 3,130 1,600 -1,530 -48.9%

Other biz 36 50 14 39.8%

Corp. and others -7,538 -8,850 -1,312 17.4%


(Unit: Mil JPY)


Forecast of Results by Business Segment

• Brand Business

• Brand Business is expected to grow favorably owing to new product launches in major

product line and improved business efficiency leveraging the global IT infrastructure.

• Enhance 3D design and color management functions for mobile and display products.

• Enhance Consumer products (Digital stationery) line-up and expand sales channels.

• Expand workflow and security solutions utilizing digital signature.

• Technology Solution Business

• Technology Solution Business is expected to decrease in both sales and operating income.

• Business relation for smartphones are expected to remain stable including the launch of

the next generation products.

• Sales for tablets are expected to grow through the expansion of customers base for Active

ES pen solutions. Meanwhile, sales for educational tablet for Turkey government are not

expected to grow.

• Corporate and others

• Estimate the increase of depreciation and expenses due to the implement of global IT system

transition.

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


Sales Forecast by Business Segment

48,93156,200

27,97425,100

663700

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY 03/16 (actual) FY 03/17 (forecast)

Brand biz Tech. Solution biz Other biz

(Unit: Million JPY)

Change

Ratio

+5.6%

+14.9%

-10.3%

+5.7%

77,56882,000


Sales Forecast by Product line in Brand Product

24,148 25,700

4,4535,900

13,22314,700

2,149

3,3004,958

6,600

0

10,000

20,000

30,000

40,000

50,000


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

Creative

biz

41,824

Creative

Biz

46,300

+10.7%

(Unit: Million JPY)

Change

Ratio

+53.5%

+32.5%

+6.4%

+11.2%

+33.1%

56,200

48,931

+14.9%


Sales Forecast by Product line in Tech. Solution

16,35313,200

9,532

9,800

2,089

2,100

0

5,000

10,000

15,000

20,000

25,000


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

(Unit: Million JPY)

Change

Ratio

+0.5%

+2.8%

-19.3%

-10.3%

25,100

27,974


Sales Forecast by Region

27,974 25,100

7,914 9,080

15,631 17,410

14,845 17,170

11,20413,240

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000



(Unit: Million JPY)Change

Ratio


+18.2%

+11.4%

+14.7%

-10.3%

+15.7%

+5.7%

77,56882,000


Investment, depreciation and R&D

Capital expenditure

4.00 bn JPY (YOY -17.7％)

• Key items: Mold for new products and global IT systems (mainly ERP), etc.

Depreciation

3.20 bn JPY (YOY +59.7％)

・ Key items: Depreciation of new global IT systems, etc.

R&D expense

4.70 bn JPY (YOY + 8.3％)

• Key items: New products development in Brand Business,next generation ICs and basic technology research, etc.


Shareholders Return Policy for FY 03/17Acquisition of own shares and Cancellation of treasury stock

Acquire its own shares for the purpose of enhancing return to shareholders, improving capital efficiency, and ensuring a flexible capital policy management in response to changes in the Company’s business environment. Execute cancellation of certain treasury stocks in accordance with acquisition.

Acquisition of own shares

• Total number of shares to be acquired: Up to 5,000,000 shares

(Equivalent of 3.04% of outstanding shares)

• Total acquisition cost: Up to 2.0 bn JPY

• Acquisition period: From May 12, 2016, to September 30, 2016

Cancellation of treasury stock• Total number of shares to be cancelled: 2,500,000 shares

(Equivalent of 1.48% of outstanding shares)

• Scheduled date of cancellation: May 25, 2016


Shareholders Return Policy for FY 03/17

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

• 18.00 JPY per share for FY 03/17 (18.00 JPY for FY 03/16)

• Payout ratio 98.7% (128.6% for FY 03/16)

Total return ratio for shareholders

• Total return ratio: 165.4% (FY 03/17 forecast)

(details) Payment of shareholders’ dividends 2.96 bn JPY (forecast)

Acquisition of own shares Up to 2.00 bn JPY


Dividends per Share

0.00

2.50

5.00

7.50

10.00

12.50

15.00

17.50

20.00

FY 03/13 FY 03/14 FY 03/15 FY 03/16 FY 03/17

Specialdividend pershare

Ordinaydividend pershare

37.7%55.9%

86.3%

128.6%

98.7%

Payout ratio

11.25

18.0017.50 18.00

(Unit: JPY)

(Forecast)

(Forecast)

(Forecast)18.00

Wacom Strategic Business Plan

SBP-2019Evolve the business model toward mobile and

Cloud for reaching new customers as well as

expanding existing business. In addition, improve

the speed and profitability by leveraging our global

business infrastructure.

Financial Goals by FY ending March, 2019

• Consolidated sales: 120 billion JPY

• Consolidated operating profit margin: 12%

• Consolidated ROE: 20% or higher


43,625 48,93156,200

75,300

30,277 27,974

25,100

43,700

655 663

700

1,000

0

20,000

40,000

60,000

80,000

100,000

120,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Other biz

Tech. Solution biz

Brand biz

Consolidated Sales

10%

15%

CAGR

(Unit: Million JPY)

Consolidated

Sales

13%

(FY32 Act.) (FY33 Act.) (FY34 Fcst) (FY35 Plan) (FY36 Plan)

74,557

120,000

The target for FY 03/19 is maintained as weexpect Brand Business to exceed the original plan, hedging risks of the underperformance of Technology Solution Business.

77,56882,000


6,143

3,6644,200

10,400

14,400

3,473

2,3103,000

7,070

9,800

0

5,000

10,000

15,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Operating Profit Net Profit

Consolidated Profits(Unit: Million JPY)

(FY32 Act.) (FY33 Fcst) (FY34 Plan) (FY35 Plan) (FY36 Plan)

30%

24%

CAGR

Raise profitability by significant improvement of

operational efficiency and quick decision-making

through leveraging global IT Infrastructure.


SBP-2019 Basic Strategy

Evolve the business toward mobile, Cloud and ecosystems.

Accelerate the growth with a new global business organization and enhanced global integration.

Accelerate creative business with mobile product line expansion, 3D penetration and emerging market investment.

Reach new consumer users with Digital Stationery and Cloud.

Expand the Technology Solution Business with AES and WILL (Wacom Ink Layer Language).

Enhance business workflow and security solutions by leveraging WILL and digital signature solutions.

Leverage global business system for efficiency, speed and profitability.


our vision


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

business report - investors.wacom.com...business report april, 2015 to march, 2016 (fy 03/2016)...

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