Consolidated Financial Results for Fiscal 2015 Full-Year Forecasts for Fiscal 2016

Transcription

1 Consolidated Financial Results for Fiscal 2015 Full-Year Forecasts for Fiscal 2016 Yasuo Takeuchi Director, Senior Executive Managing Officer Head of Corporate Management Office, CFO Olympus Corporation May 8, 2015

2 FY2015-Consolidated Financial Results Medical Business makes large contributions to overall performance, operating income and ordinary income reach post-lehman Shock highs Provision for loss of approx billion recorded in consideration of progress in discussions with U.S. DOJ, net loss amounts to 8.7 billion Dividends issued for 1st time in 4 years in consideration of progress toward resolving financial issues Full Year (Billions of yen) FY2014 FY2015 YoY change YoY (%) FY2015 (Initial forecasts) Difference (Change) Net sales % Operating income (% of sales) Ordinary income (% of sales) Net income (% of sales) 73.4 (10.3%) 50.9 (7.1%) 13.6 (1.9%) 91.0 (11.9%) 72.8 (9.5%) -8.7 (-) (+1.6pt) (+2.4pt) (-) +24% +43% (11.6%) 70.0 (9.2%) 45.0 (5.9%) /US$ (yen depreciation) /Euro (yen depreciation) Impact on net sales bil. Impact on operating income bil. 2

3 FY2015-Results by Business Segment Strong performance in Medical Business, new records set for quarterly and full-year net sales and operating income Substantially higher income due to strong performance in Scientific Solutions Business and withdrawal from biologics business in Others Sales and income down in Imaging Business as result of investments in B to B operations, contraction of compact camera operations, yen depreciation, and mirrorless camera write-downs Full Year 4Q (Jan.-Mar.) (Billions of yen) FY2014 FY2015 YoY change YoY (%) FY2014 FY2015 YoY change YoY (%) Medical Scientific Solutions Imaging Others Elimination and corporate Consolidated Total Net sales % % Op. income % % Net sales % % Op. income % % Net sales % % Op. income Net sales % % Op. income Net sales Op. income Net sales % % Op. income % % 3

4 FY2015-Imaging Business 4Q Performance (Jan. Mar vs. Targets) Large degree of failure to meet target for mirrorless camera net sales was primary performance detractor Greater-than-expected drop in mirrorless camera selling prices results in failure to meet net sales target and decline in gross profit Write-downs centered on readily affordable mirrorless camera models (PEN series) Recording of SG&A expenses due to mirrorless camera sales promotions FY2015 (Jan.-Mar.) Difference (Billions of yen) Targets in 3Q Results (Change) Net sales Mirrorless Camera Compact Camera, Others Gross profit SG&A expenses Operating loss

5 FY2015-Net Sales by Region Consolidated: Strong Medical Business performance results in higher earnings in all regions except Japan Medical: Overseas business brisk, double-digit growth in all regions except Japan (*) ( 前 (YoY) 期 比 ) +9% ( 前 (YoY) 期 比 ) +14% % % % % % % % % * Graphs above are total of three core businesses (Medical, Scientific Solutions, and Imaging) 5

6 Consolidated Balance Sheet (End of March 2015) Equity ratio: 32.9%; interest-bearing debt: down approx billion Digital camera inventories ; down 5.5 billion from Dec. 31, 2014 (Billions of yen) Current assets (Digital camera inventories) Property, plant and equipment End Mar (21.7) End Mar (23.7) Change +1.0 (+2.0) End Mar End Mar Change Current liabilities Non-current liabilities (Incl. bonds/long-term loans payable) (346.8) (253.3) (-93.5) Intangible assets Net assets Investments and other assets (Equity ratio) (32.1%) (32.9%) (+0.8pt) Total assets 1, , Total liabilities and net assets 1, , Dec. 31, 2014 Digital camera inventories: 29.2 billion Interest-bearing debt : billion ( billion form March 31, 2014) Net interest-bearing debt: billion ( billion from March 31, 2014) 6

7 Cash Flows (April 2014 to March 2015) (Billions of yen) FY2014 FY2015 Change Net sales Operating income (%) 10.3% 11.9% +1.6pt CF from operating activities CF from investing activities CF from financing activities Cash flow Free cash flow Cash and cash equivalents at end of year Depreciation and amortization Amortization of goodwill Capital expenditures

8 Forecasts for Fiscal

9 FY2016-Forecasts of Consolidated Financial Results Net sales: Double-digit growth projected in Medical Business, which will drive 6% YOY increase in net sales, to 810 billion Operating income: Forecast to exceed 100 billion for 1st time in 8 years Net income: Record-breaking 56 billion projected due to improved balances of non-operating and extraordinary items (Billions of yen) YoY change YoY (%) FY2015 (Results) FY2016 (Forecasts) Net sales % Operating income (% of net sales) Non-operating income/expenses Ordinary income (% of net sales) Net income (% of net sales) 91.0 (11.9%) (12.4%) +9.0 (+0.5pt) (9.5%) -8.7 (-) 86.0 (10.6%) 56.0 (6.9%) (+1.1pt) (-) +10% +18% /US$ (yen depreciation) /Euro (yen appreciation) Impact on net sales billion Impact on operating income billion - 9

10 Segment Forecasts for FY2016 (Full Year) Medical Business to set new records for both net sales and operating income of 615 bil. and 137 bill, respectively Imaging Business to be operated while limiting management resource allocation Imaging Business management resources to be reallocated to new business fields and corporate R&D (Billions of yen) Medical Scientific Solutions Imaging Others (New Businesses) Elimination and corporate Consolidated Total FY2015 (Results) FY2016 (Forecasts) YoY change YoY (%) Net sales % Op. income % Net sales % Op. income % Net sales % Op. income % Net sales % Op. income % Net sales % Op. income % Net sales % Op. income % 10

11 Management Policies Fiscal 2016 Hiroyuki Sasa President and Representative Director Olympus Corporation May 8, 2015

12 Review of 1st 3 Years of Medium-Term Vision (Corporate Strategic Plan) Steady progress made under appropriate governance systems, featuring management system with segregated business execution and supervisory functions and Board of Directors with half of outside directors Reorganization of non-core businesses, including transference of Information & Communication Business and withdrawal from biologics business, completed ahead of schedule Medical Business performed impressively throughout plan period with 3 consecutive years of increased sales and income and 2 consecutive years of record-breaking net sales and operating income Equity ratio recovered to above 30%, and dividends issued for 1st time in 4 years due to reduction of risk factors 12

13 FY2015-Performance Indicators ROIC: Recovered to 8% Operating margin and equity ratio: Exceeded FY2017 targets Return on invested capital (ROIC) (*) 2.7% 8% 10% or more Operating margin 4.2% 11.9% 10% or more Free cash flow (Cash flow from operating activities + cash flow from investing activities) billion 27.2 billion 70.0 billion or more Equity ratio 4.6% 32.9% 30% or more * Return on Invested Capital (ROIC): Return (Operating income after taxes) / IC (Shareholders equity + Interest-bearing debt) 13

14 FY2016-Management Policies (Complete Medium-Term Vision) Reallocate Management Resources to High-Growth Fields 1. Expand Medical Business, reap benefits of strategic investments 2. Reallocate management resources from Imaging Business to growth fields 14

15 Reallocation of Management Resources 15

16 Investment in New Businesses 16

17 FY2016-Key Management Points (1) 1. Growth Potential 2. Efficiency 3. Financial Soundness 17

18 FY2016-Key Management Points (2) 1. Growth Potential 18

19 FY2016-Key Management Points (3) 2. Efficiency 3. Financial Soundness 19

20 Shareholder Returns <Basic Capital Allocation Policy> 1. Prioritize growth investments centered on Medical Business 2. Achieve level of capital that is appropriate based on business characteristics of a medical equipment manufacturer 20

21 21

22 Supplementary Materials 22

23 Supplementary Materials Forecasts for FY2016 (1H and 2H) FY2015(Results) FY2016(Forecast) YoY(%) (Billions of Yen) 1H 2H 1H 2H 1H 2H Net sales % +3% Operating income (% of net sales) 38.4 (10.8%) 52.5 (12.8%) 45.0 (11.5%) 55.0 (13.1%) +17% +5% Non-operating income and expenses Ordinary income (% of net sales) 29.7 (8.4%) 43.1 (10.5%) 37.0 (9.5%) 49.0 (11.7%) +25% +14% Net income (% of net sales) 22.3 (6.3%) (-) 24.0 (6.2%) 32.0 (7.6%) +8% - 23

24 Supplementary Materials Segment Forecasts for FY2016 (1H and 2H) FY2015(Results) FY2016(Forecast) YoY(%) (Billions of yen) 1H 2H 1H 2H 1H 2H Medical Net Sales Operating income % +19% +5% +2% Scientific Solutions Net Sales Operating income % +54% +5% +7% Imaging Net Sales Operating income % - -20% - Others Net Sales Operating income % - +11% - Elimination and Corporate Net Sales Operating income Consolidated Total Net Sales Operating income % +17% +3% +5% 24

25 Supplementary Materials FY2015 Results (Medical) Net Sales Operating Income Operating Margin (Billions of Yen) Gastrointestinal Endoscopes Surgical Devices Endotherapy Devices % Gastrointestinal Endoscopes Surgical Devices % Endotherapy Devices /3 2015/3 (YoY) Net Sales:+13% Gastrointestinal Endoscopes:+14% Surgical Devices :+13% Endotherapy Devices:+11% 20% Operating Income: +11% 0% (Billions of Yen) Net Sales Operating Income Operating Margin (YoY) Gastrointestinal Endoscopes 79.7 Surgical Devices 45.8 Endotherapy Devices % Gastrointestinal Endoscopes 93.0 Surgical Devices 50.3 Endotherapy Devices /3 2015/3 Net Sales:+14% Gastrointestinal Endoscopes :+17% Surgical Devices :+10% Endotherapy Devices :+10% 25% % Operating Income : +20% 0% 25

26 Supplementary Materials FY2015 Results (Scientific Solutions) Net Sales Operating Income Operating Margin Net Sales Operating Income Operating Margin (Billions of Yen) Life Science % Life Science % (YoY) Net Sales:+6% 6% Life Science :-1% Industrial :+11% (Billions of Yen) Life Science % Life Science % 10% (YoY) Net Sales:+1% Life Science:-6% Industrial:+6% Industrial 53.7 Industrial /3 2015/3 3% Operating Income : +39% 0% Industrial 15.8 Industrial /3 2015/3 5% Operating Income: +14% 0% 26

27 Supplementary Materials FY2015 Results (Imaging) Net Sales Operating Loss Net Sales Operating Loss (Billions of Yen) Compact 40.8 Mirrorless 42.8 Others Compact 19.6 Mirrorless 49.8 Others /3 2015/3 (YoY) Net Sales:-13% Compact :-52% Mirrorless :+16% Others :+16% (Billions of Yen) Compact 7.6 Mirrorless 10.4 Operating Loss: Billion Others Compact 3.7 Mirrorless 12.7 Others /3 2015/3 (YoY) -7.7 Net Sales:-8% Compact:-51% Mirrorless :+23% Others :-3% Operating Loss: Billion 27

28 Supplementary Materials R&D Expenditures Medical Scientific Solutions Imaging Others, Elimination and corporate % of net sales * % 10.1% 9.4% % % 8.0% 6.0% 4.0% 2.0% /3 2013/3 2014/3 2015/3 0.0% *Excluded net sales of Information & Communication Business 28

29 Supplementary Material Depreciation and Amortization Medical Scientific Solutions Imaging Others, Elimination and corporate Information & Communication /3 2013/3 2014/3 2015/ Bil 33.9 Bil 36.9 Bil 41.2 Bil 29

30 Supplementary Materials Capital Expenditures Medical Scientific Solutions Imaging Others, Elimination and corporate Information & Communication /3 2013/3 2014/3 2015/ Bil 28.1 Bil 37.8 Bil 47.7 Bil 30

31 Supplementary Materials Sales by product (Medical) Endotherapy Surgical Endoscopes Domestic :57.1 Overseas : Domestic :56.3 Overseas : Domestic:43.8 Overseas: Domestic :47.3 Overseas : Domestic : Overseas :95.7 Domestic :20.5 Overseas : Domestic :25.6 Overseas : Domestic :26.5 Overseas : Domestic : Overseas :25.2 Domestic :21.7 Overseas :27.4 Domestic :23.1 Overseas : /3 2013/3 2014/3 2015/ Bil Bil Bil Bil Domestic :23.1 Overseas :

32 Supplementary Materials Sales by product (Scientific Solutions) Industrial Life Science Domestic:10.6 Overseas: Domestic :10.3 Overseas: Domestic :11.9 Overseas: Domestic :8.4 Overseas: Domestic : Overseas: Domestic :7.5 Overseas: Domestic :8.0 Overseas: Domestic :8.3 Overseas: /3 2013/3 2014/3 2015/ Bil 85.5 Bil 98.5 Bil Bil 32

33 Supplementary Materials Sales by product (Imaging) Others Digital Cameras Domestic:27.3 Overseas: Domestic :27.2 Overseas : Domestic :25.9 Overseas : Domestic :22.3 Overseas : Domestic:4.0 Overseas:9.3 Domestic :4.2 Overseas :8.4 Domestic :3.9 Overseas : /3 2013/3 2014/3 2015/ Bil Bil 96.1 Bil 83.8 Bil Domestic : 2.4 Overseas :

34 Supplementary Materials Sales by Reign (Medical) Japan N. America Europe Asia/Oceania Others /3 2013/3 2014/3 2015/ Bil Bil Bil Bil 34

35 Supplementary Materials Sales by Reign (Scientific Solutions) Japan N.America Europe Asia/Oceania Others /3 2013/3 2014/3 2015/ Bil 85.5 Bil 98.5 Bil Bil 35

36 Supplementary Materials Sales by Reign (Imaging) Japan N.America Europe Asia/Oceania Others /3 2013/3 2014/3 2015/ Bil Bil 96.1 Bil 83.8 Bil 36

37 Supplementary Materials Interest-bearing Debt End Sep 2012 End Dec 2012 End Mar 2013 End Jun 2013 End Sep 2013 End Dec 2013 End Mar 2014 End Jun 2014 End Sep 2014 End Dec 2014 End Mar

38 Supplementary Materials Equity Ratio 45.0% 40.0% 36.8% 38.6% 35.0% 30.0% 28.7% 31.8% 32.1% 33.0% 32.9% 25.0% 20.0% 15.0% 10.0% 9.7% 15.5% 18.9% 5.0% 3.7% 0.0% End Sep 2012 End Dec 2012 End Mar 2013 End Jun 2013 End Sep 2013 End Dec 2013 End Mar 2014 End Jun 2014 End Sep 2014 End Dec 2014 End Mar

39 This material contains forward-looking statements that reflect management s current views, plans, and expectations based on information available at the time of preparation. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, future business decisions, and other internal and external factors that may cause the Company s actual results, performance, achievements, or financial position to be materially different from any future results expressed or implied by these forward-looking statements. Additionally, this information is subject to change without notice. Accordingly, other information should be used in addition to this material when making investment decisions. Olympus Corporation assumes no responsibility for any damage resulting from the use of this material. 39