fy2017 results presentation · 109.45 . 110.00: 112.04 . yen / euro. 120.59 . 120.00: 127.09 ....

©2018 KITZ CORPORATION All Rights Reserved

FY2017 Results Presentation

KITZ CORPORATION

May 2018

The forecast data presented herein reflects assumed results based on conditions that are subject to change. KITZ Corporation does not make representations as to, or warrant, in whole or in part, the attainment or realization of any of the forecasted results presented in this document. Numerical figures presented herein are rounded down.

©2018 KITZ CORPORATION All Rights Reserved ｜2

FY2017 Results (Consolidated)

FY2016 Result

FY2017

Plan

FY2017

Result YoY Plan vs Result

Sales 114,101 123,000 124,566 10,464 9.2% 1,566 1.3%

Valve Manufacturing 91,766 97,800 98,162 6,396 7.0% 362 0.4%

Brass Bar Manufacturing 19,333 22,500 23,535 4,202 21.7% 1,035 4.6%

Operating Income 8,929

7.8%

10,000

8.1%

10,117

8.1% 1,188 13.3% 117 1.2%

Valve Manufacturing 11,444 12,700 12,798 1,354 11.8% 97 0.8%

Brass Bar Manufacturing 831 650 699 (132) (16.0%) 49 7.6%

Ordinary Income 8,799 9,700 9,733 934 10.6% 33 0.3%

Net income attributable to owners of the parent

5,400 6,300 6,518 1,117 20.7% 218 3.5%

Yen / US Dollar 109.45 110.00 112.04

Yen / Euro 120.59 120.00 127.09

Electrolytic Copper, Yen/ton 604,000 760,000 757,000

(Millions of Yen)

*Note : Total Sales and Operating Income include other segment and adjustment..


Valve Manufacturing Business – Domestic Sales

Sales of valves for building facilities increased due to beginning of deliveries for large construction projects mainly in Tokyo metropolitan area. As for industrial valve, demand for maintenance works was firm. Demand of valves for water works was weak as municipal budget implementation has not progressed as expected. Valves for semiconductor manufacturing equipment continued to show good growth. Production capacity of valves for semiconductor increased according to schedule.

(Millions of Yen)

*Note : Sales of each market in Japan are our estimated amount.

FY2016

Result Q1 Q2 Q3 Q4

FY2017

Result YoY

Domestic Total 58,600 15,200 15,400 16,700 16,700 64,200 5,600 10%

Building Facilities 25,400 6,800 6,600 6,900 7,000 27,300 1,900 7%

Water (supply, sewer, industrial filter)

7,600 1,600 2,100 2,300 2,000 8,000 400 5%

Semiconductor 5,600 1,700 1,900 2,100 2,300 8,000 2,400 43%

Machinery 5,600 1,500 1,500 1,600 1,600 6,100 500 9%

Petrochemical 2,500 700 700 700 600 2,700 200 8%

General Chemical 2,100 500 500 600 600 2,200 100 5%

Food and Paper 3,700 900 900 1,000 1,000 3,900 200 5%

Gas 2,800 800 700 800 800 3,100 300 10%

Power Plant 600 200 200 200 200 800 200 33%

Project (LNG, etc) 2,500 400 400 300 600 1,700 (800) (32%)


Valve Manufacturing Business – Overseas Sales

Sales of valves for semiconductor manufacturing equipment grew significantly in Korea and China. In China, demand of commercial valves especially for data center increased. In Americas (North, Middle and South America) and Europe, demand of industrial valves was still weak in Oil&Gas market, especially for downstream. In ASEAN, sales slightly increased. New marketing bases were established in that area. Delivery of valves for large project in Middle East postponed to FY2018.

(Millions of Yen)

FY2016

Result Q1 Q2 Q3 Q4

FY2017

Result YoY

Overseas Total 33,100 7,700 8,500 8,500 9,200 34,000 800 3%

ASEAN and other 11,300 2,900 3,500 3,000 3,700 13,100 1,800 16%

(for semiconductor) 1,700 600 700 500 500 2,400 700 41%

China 5,400 1,500 1,500 1,700 1,800 6,500 1,100 20%

(for semiconductor) 1,100 500 400 500 500 2,000 900 72%

Middle East 1,200 200 500 200 300 1,200 - -%

Asia total 18,000 4,600 5,500 4,900 5,800 20,800 2,800 16%

Americas 10,600 2,300 2,300 2,700 2,500 10,000 (600) (6%)

Europe 4,300 800 600 800 900 3,200 (1,100) (26%)


Valve Manufacturing Business – Operating Income (Millions of Yen)

FY2016 Result

FY2017

Plan

FY2017


Sales 91,766 97,800 98,162 6,396 7.0% 362 0.4%

Operating

Income 11,444 12,700 12,798 1,353 11.8% 97 0.8%

114.4億円 128.0億円

Millions of yen

FY2016 FY2017

Cost Reduction

+1,620

Material Cost

(1,250) SG&A

(1,100)

Sales Increase

+2,180

Forex

(100)

0

5,000

10,000

15,000

20,000

11,444 12,798


Brass Bar Manufacturing Business

(Millions of Yen)

FY2016 Result

FY2017

Plan

FY2017


Sales 19,333 22,500 23,535 4,202 21.7% 1,035 4.6%

Operating Income 831 650 699 (132) (16.0%) 49 7.6%

Electrolytic Copper, Yen/ton 604,000 760,000 757,000

■Sales Sales increased compared with the previous term due to rise in selling price arising from copper market trend, even though sales volume slightly declined. ■Operating Income Operating profit decreased 16% impacted by fluctuation in copper market in Q4, although productivity has improved as a result of enhancement of manufacturing lines.

Electric Copper (From April 2015 to March 2018）

Brass rods 400

500

600

700

800

900

15/4 15/7 15/10 16/1 16/4 16/7 16/10 17/1 17/4 17/7 17/10 18/1

¥1,000/ton

Graph1

42095

42125

42156

42186

42217

42248

42278

42309

42339

42370

42401

42430

42461

42491

42522

42552

42583

42614

42644

42675

42705

42736

42767

42795

42826

42856

42887

42917

42948

42979

43009

43040

43070

43101

43132

43160

765

808

770

724

676

680

677

639

610

573

577

602

581

555

534

548

526

525

533

629

705

700

713

704

670

671

673

713

753

773

812

813

811

826

802

766

2016.4-2017.9

【銅建値】ドウタテネ

2013201420152016

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5月ガツ42491555

6月42522534

7月42552548

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10月42644533

11月42675629

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2月42767713

3月42795704

42826670

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42887673

42917713

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42979773

43009

43040

43070

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2016.4-2017.9

（千円/t）

2017年度当初計画前提： 680千円/t

下期前提： 760千円/t

2016年度実績

2017年度実績

2015.4-2017.12


2013201420152016

41365750732765581

41395772748808555

41426729741770534

41456728770724548

41487745769676526

41518754783680525

41548749772677533

41579750828639629

41609785816610705

41640808746573

41671782724577

41699730763602

41730732

41760748

41791741

41821770

41852769

41883783

41913772

41944828

41974816

42005746

42036724

42064763

42095765

42125808

42156770

42186724

42217676

42248680

42278677

42309639

42339610

42370573

42401577

42430602

42461581

42491555

42522534

42552548

42583526

42614525

42644533

42675629

42705705

42736700

42767713

42795704

42826670

42856671

42887673

42917713

42948753

42979773

43009812

43040813

43070811

43101826

43132802

43160766

2015.4-2017.12

（千円/t）

2013～2016


2013201420152016

41365750732765581

41395772748808555

41426729741770534

41456728770724548

41487745769676526

41518754783680525

41548749772677533

41579750828639629

41609785816610705

41640808746573

41671782724577

41699730763602

41730732

41760748

41791741

41821770

41852769

41883783

41913772

41944828

41974816

42005746

42036724

42064763

42095765

42125808

42156770

42186724

42217676

42248680

42278677

42309639

42339610

42370573

42401577

42430602

42461581

42491555

42522534

42552548

42583526

42614525

42644533

42675629

42705705

2013～2016

Sheet1


Other

(Millions of Yen)

FY2016 Result

FY2017

Plan

FY2017


Sales 3,002 2,700 2,867 (134) (4.5%) 167 6.2%

Operating

Income 59 0 (28) (87) - (28) -

KITZ subsidiary Hotel Beniya Co., Ltd. operates a resort hotel in Suwa city, Nagano pref. Sales and operating income decreased compared with the previous term. In the previous term, there was a big festival “Onbashira” in Suwa area. Also, number of inbound customers especially from Taiwan did not grow as expected.

Hotel Beniya in Suwa city, Nagano pref.


Other income/expense Extra ordinary income / loss

FY2016

Result

FY2017

Result YoY

Note

(FY2017)

Operating Income 8,929 10,117 1,188

■Non-operating Income 768 793 24

■Non-operating Expense 898 1,177 278 Forex loss 208(FY2016 : 19)

Ordinary income 8,799 9,733 944

■Extraordinary income 2,152 883 (1,268) Gain on sales of securities 869(FY2016 : 2,097)

■Extraordinary loss 3,925 502 (3,423) Impairment loss 386(FY2016 : 3,598)

Net Income before income taxes and minority interests

7,025 10,114 3,088

Income Taxes 1,509 3,513 2,003

Net Income 5,515 6,601 1,085

Net Income attributable to non-controlling interests

115 82 (32)

Net Income attributable to owners of the parent

5,400 6,518 1,117

(Millions of Yen)

©2018 KITZ CORPORATION All Rights Reserved ｜9 ｜9

Balance Sheet

Asset March

2017

March

2018 Variance Liabilities

March

2017

March

2018 Variance

Current Asset 67,972 78,807 10,835 Current Liabilities

19,608 24,139 4,531

Fixed Asset 51,175 55,379 4,204 Fixed

Liabilities 24,647 32,656 8,008

PPE 34,722 36,799 2,076 Total Liabilities 44,255 56,796 12,540

Intangible 6,881 8,951 2,070

Investment and others

9,571 9,628 57 Net Asset 74,892 77,391 2,498

Total Asset 119,148 134,187 15,039

Total Liabilities and

Net Assets

119,148 134,187 15,039

(Millions of Yen)

Compared to March 2017, cash and deposits increased due to the 4th issuance of unsecured corporate bonds

of ¥10 billion in March 2018. Current asset increased due to expansion of sales volume and rise of material

price. Fixed asset increased due to capital investment for production capacity expansion and new IT System.

Liabilities also increased due to the issuance of corporate bonds.

©2018 KITZ CORPORATION All Rights Reserved ｜10 ｜10

Cash Flows

(Millions of Yen)

March

2017

March

2018 YoY

Operating Cash Flow 12,979 6,941 (6,038) (46.5%)

Investing Cash Flow (2,141) (7,066) (4,925) -

Free Cash Flow 10,838 (125) (10,964) -

Financing Cash Flow (6,838) 5,267 12,106 -

Cash and cash equivalents

at the end of the period 16,799 22,019 5,220 31.1%


FY2017 Financial Highlight

Consolidated

FY2016 FY2017

Sales 114,101 124,566

Operating Income 8,929 10,117

Ordinary Income 8,799 9,733


5,400 6,518

Overseas Sales Ratio 29.7% 27.9%

Total Asset 119,148 134,187

Net Asset 74,892 77,391

Interest Bearing Debt 24,787 34,302

ROE 7.3% 8.7%

Equity Ratio 61.9% 56.8%

BPS(Yen) 727.78 782.98

EPS(Yen) 51.43 65.50

（Millions of Yen）


FY2018 Plan

FY2017

Result

FY2018 Plan

Q1+Q2 Q3+Q4 Total YoY

Sales 124,566 66,000 66,000 132,000 7,433 6.0%

Operating Income 10,117

8.1%

5,500

8.3%

5,700

8.6%

11,200

8.5% 1,083 10.7%

Ordinary Income 9,733

7.9%

5,400

8.2%

5,500

8.3%

10,900

8.3% 1,167 12.0%


6,518

5.3%

3,500

5.3%

3,600

5.5%

7,100

5.4% 582 8.9%

ROE 8.7% - - 9.1% - -

EPS(Yen) 65.50 - - 72.93円 7.18円 10.9%

Yen / US Dollar 112.04 109.0

Yen / Euro 127.09 132.0

Electrolytic Copper, Yen/ton 757,000 800,000



FY2018 Plan (By Segment)

Sales

FY2017 Result FY2018 Plan

Q1+Q2 Q3+Q4 Total Q1+Q2 Q3+Q4 Total

Valve 46,951 51,211 98,162 52,600 52,400 105,000

Brass Bar 11,046 12,489 23,535 11,700 12,300 24,000

Other 1,594 1,271 2,867 1,700 1,300 3,000

Total 59,592 64,974 124,566 66,000 66,000 132,000

Operating

Income

FY2017 Result FY2018 Plan

Q1+Q2 Q3+Q4 Total Q1+Q2 Q3+Q4 Total

Valve 5,606 7,191 12,797 6,700 7,200 13,900

Brass Bar 342 356 699 330 320 650

Other 56 (84) (28) 80 (30) 50

Adjustment (1,690) (1,661) (3,351) (1,600) (1,800) (3,400)

Total 4,314 5,802 10,116 5,500 5,700 11,200




Valve Manufacturing Business Environment

【Domestic】

Try to penetrate new prices into the market.

For building facilities, delivery to large-scale projects in the metropolitan area will get into full swing. In 2H of FY2018, delivery related to Tokyo Olympics and Paralympics will be expected.

In the industrial valve market, maintenance and renewal demand will be the main focus of the business. Expect some users make capital investment for new plant.

As for semiconductor market, “super cycle” will continue and the demand of valves will be favorable.

【Overseas】

In the North American market, there is a feeling of bottoming out. Capital investment in Oil&Gas market improve and the distributors begin to increase their inventories.

In the ASEAN region, demand of valves gradually improves. Establish new marketing bases in each countries and try to develop new product based on the local needs.

In China, commercial valves for construction equipment such as data center continue to be strong. As for industrial valve, there is a feeling of bottoming out.

In Europe, the market of industrial valves will continue in severe situation. Deliveries of valves for large project in Middle East will be completed in 1H 2018.


Valve Manufacturing Business – Domestic Sales

FY2018

Plan

Domestic Total 66,500

Building Facilities 28,400

Water (supply, sewer, industrial filter)

8,200

Semiconductor 8,200

Machinery 6,800

Petrochemical 6,000

General Chemical 2,400

Food and Paper 2,200

Gas 2,100

Project (LNG, etc) 2,200

(Millions of Yen)


Valve Manufacturing Business – Overseas Sales

FY2017

Result

FY2018

Plan YoY YoY

Overseas Total 34,000 38,500 4,500 13%

ASEAN and other 13,100 15,200 2,100 16%

(for semiconductor) 2,400 2,800 400 17%

China 6,500 6,900 400 6%

(for semiconductor) 2,000 2,000 - -%

Middle East 1,200 3,000 1,800 150%

Asia total 20,800 24,800 4,000 20%

Americas 10,000 10,400 400 4%

Europe 3,200 3,000 (200) (6%)

(Millions of Yen)


Valve Manufacturing Business OP YoY Change

(Millions of yen)

FY2017

Result

FY2018

Plan YoY

Operating Income 12,797 13,900 1,102 8.6%

110億円

(Millions of yen)

FY2017 FY2018

Cost Reduction

+1,500

Material Cost

(1,000) SG&A

(2,400)

Sales Increase

+2,950

Forex

+50

0

5,000

10,000

15,000

20,000

25,000

12,797 13,900


Brass Bar Manufacturing Business Others

FY2017

Result

FY2018

Plan YoY

Brass

Bar

Sales 23,535 24,000 464 2.0%

Operating Income 699 650 (49) (7.0%)

■Copper Price ：800,000 yen/ton (Average Price in FY2017 : 760,000 yen/ton)

■Domestic demand of brass bar is expected to decrease slightly compare to FY2017.

■Operating profit will decrease due to increase of depreciation and labor cost. The company will

focus on improvement of productivity and expansion of sales of value added product.

Brass Bar Manufacturing Business

■The company will strengthen online-reservation, obtain more reservation from domestic group

travelers to achieve target.

Others

FY2017

Result

FY2018

Plan YoY

Others Sales 2,867 3,000 132 4.6%

Operating Income (28) 50 78 -

(Millions of Yen)

(Millions of Yen)


Capex and Depreciation Plan

(Millions of Yen)

FY2016

Result

FY2017

Result

FY2018

Plan

Valve Manufacturing

(Excl. IT) 4,700 5,000 6,100

Brass Bar Manufacturing 600 1,300 2,700

IT 1,800 3,200 1,500

Other 100 100 100

Total 7,300 9,800 10,500

＜Capex Plan＞

＜Depreciation Plan＞ (Millions of Yen)

FY2016

Result

FY2017

Result

FY2018

Plan

Depreciation 4,100 4,200 5,000


FY2018(Plan) Financial Highlight

Consolidated

FY2017

Result

FY2018

Plan

Sales 124,566 132,000

Operating Income 10,117 11,200

Ordinary Income 9,733 10,900


6,518 7,100

Overseas Sales Ratio 27.9% 29.8%

Interest Bearing Debt 34,302 30,675

ROE 8.7% 9.1%

Equity Ratio 56.8% 58.8%

BPS(Yen) 782.98 832.00

EPS(Yen) 65.50 72.93

(Millions of Yen)

©2018 KITZ CORPORATION All Rights Reserved

For questions concerning this material, please contact: KITZ Corporation

Publicity and IR Promotion office E-mail : [email protected]

FY2017�Results Presentation　　FY2017 Results (Consolidated)　 Valve Manufacturing Business – Domestic SalesValve Manufacturing Business – Overseas Sales　 Valve Manufacturing Business – Operating IncomeBrass Bar Manufacturing Business　Other　Other income/expense�Extra ordinary income / lossBalance SheetCash Flows　FY2017 Financial HighlightFY2018 PlanFY2018 Plan (By Segment)Valve Manufacturing Business EnvironmentValve Manufacturing Business – Domestic SalesValve Manufacturing Business – Overseas SalesValve Manufacturing Business OP YoY ChangeBrass Bar Manufacturing Business�OthersCapex and Depreciation Plan　FY2018(Plan) Financial Highlightスライド番号 21

fy2017 results presentation · 109.45 . 110.00: 112.04 . yen / euro. 120.59 . 120.00: 127.09 ....

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