company presentation menicon co. ltd
TRANSCRIPT
Company PresentationMenicon Co. Ltd
(TSE 1st Section: Ticker 7780)
Who We Are
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We are the oldest contact lens manufacturer in Japan.
We have achieved sales growth for over 15 consecutive years.
We have a full product line up, such as Daily disposable, 2week, 1month, Soft contact lens and RGP.
We have a membership system, MELS Plan that contributes to eye safety of contact lens users and stable earnings of the Company.
We are conducting our corporate activities through a R&D, Manufacturing and Sales structure that puts the safety of our customers’ eyes first.
About Menicon
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Menicon began when founder Kyoichi Tanaka developed Japan's first corneal contact lens in 1951.
Our Strength
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Full Product Line up
MELS Plan
Business
R&D, Manufacturing,
Sales
Product Lineup
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Daily 2Week 1Month
Hard Specialty lens Bifocal Color
Products
Monthlyfees
MELS Plan Virtuous Circle
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Menicon- Stable revenue
- Benefits returned tothe customer with
our service- Investment in research
& development
Store(affiliated facility)- Reliable customer
follow-up- Stable revenue
(freedom from price competition)
Service
Sales commissions
Customers(MELS members)- High-quality lenses- Reasonable service
- Peace of mind
Sales in Japan
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Menicon Shop 48
Ace contact 78
Fuji contact 13
City contact 18
Total 157
MELS Plan shop 1,692
Contact lens shopAbout8,000
＜2018/3 /31＞
✓ Menicon Group retail shop “Miru Partner”
✓ Retail shop network, “MELS Plan shop”
◆Menicon Group ◆Retail shop
✓ Expanding sales of Daily disposable
✓ Silicone Hydrogel Contact Lens“1day Menicon PremiO”
Daily Disposable
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✓ Flat pack daily disposable “Magic” (Japan)
“Miru 1day Menicon Flat Pack”(Global)
Daily Disposable
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1. Open 2. Pick up 3. Wear
The design of the package allows users to remove the lenses without needing to check which side is correct, without touching the inside of the lenses.
Menicon
Competitors
4. Wear
CLEAN &EASY
1. Open 2. Pick up 3. Flip
Net Sales
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0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
FY1975 FY1980 FY1985 FY1990 FY1995 FY2000 FY2005 FY2010 FY2015
MELS Plan
Contact lens, others
*Note: From FY2013, Consolidated financial result
(JPY m)✓ We have achieved sales growth for
over 15 consecutive years.
Expansion ofmember ranksof MELS Plan
Productstrategy
Strengtheningand expansion
of overseas businesses
Investment in new
businesses
Vision 2020
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Growth ofMELS Plan
Growth ofoverseas
businesses
Growthof new
businesses
Achievement of Our Medium-term Business plan Vision 2020Toward Achievement of Sales of JPY100bn and
Operating Profit Margin of 10%
Appendix
Menicon Today
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JPY 102 bn+ market cap
3,000+ employees
*consolidated
1.27 mnnumber of MELS
plan members
85+ countriesproduct distributed
JPY 76 bnannual revenue
14.5 yearsaverage number of
years of employment*non-consolidated
*Note: company data as of last fiscal year end.
Annual Sales/Operating Profit
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62,209 63,131 67,332 72,052 76,672
80,338
2,294
2,863
3,457 3,910
4,394
5,148
0
1,000
2,000
3,000
4,000
5,000
6,000
(10,000)
10,000
30,000
50,000
70,000
90,000
FY2013 FY2014 FY2015 FY2016 FY2017 FY2018(Forecast)
Net sales(JPY m)
Operating profit(JPY m)
Net sales Operating profit
Research & Development
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✓ Development of various daily disposableastigmatic lens, cosmetic lens and bifocal lens
✓ Basic research
2.7
3.4 3.4 3.3
4.4%5.1% 4.8% 4.4%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
0.0
1.0
2.0
3.0
4.0
FY2014 FY2015 FY2016 FY2017
R&Dexpenditure
(JPY bn)
% of consolidated
net sales
Manufacturing
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✓ A high-quality mass manufacturing system
Kakamigaharafactory (Japan)
Seki factory (Japan) Singapore factory
Expansion of Our Overseas Business
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China• Expanding sales of specialty contact lenses, with a focus on
orthokeratology.• Expanding sales of daily disposable and hard contact lenses.
North America• Full-scale entry to the US market.• Daily disposable sales expansion with volume retailers.
Europe• Trust gained through our history with hard contact lenses.• Expanding sales of specialty and order-made contact lenses.• Daily disposable sales expansion with volume retailers.
FY2017 Sales:JPY6,017m
FY2017 Sales:JPY902m
Asia regionFY2017 Sales:
JPY1,255m
FY2017 Highlights - Summary
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FY 2016 FY 2017 Change YoY Change
Net sales 72,052 76,672 +4,620 6.4%
Cost of sales 33,192 35,478 +2,286 6.9%
(Cost rate) 46.1% 46.3% (+0.2pt) ---
Gross profit 38,859 41,194 +2,335 6.0%
Operating income 3,910 4,394 +484 12.4%
(Operating margin) 5.4% 5.7% (+0.3pt) ---
Ordinary income 4,036 4,458 +422 10.4%
Profit attributable to ownersof parent
2,543 2,657 +114 4.5%
Basic earnings per share JPY71.75 JPY75.67 +3.92 ---
JPY Million
Note: Basic earnings per share are calculated, assuming that the stock split was conducted at the beginning of 2016.
FY2017 Highlights - Net Sales
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YoY change
+JPY4.6bn（+6.4%）
1) MELS Plan+JPY2.4bn
2) Contact lens sales+JPY1.4bn
3) Others
+JPY0.8bn
Key reasons1) 2) daily disposable sales increased.
3) Effects of FOREX Rates.10％ weak yen per １Euro , 2％ weak yen per１USD.
JPY76.6bn
FY2017 Highlights - Operating Income
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YoY change
+JPY0.5bn（+12.4％）
Gross profit+JPY2.3bn
Selling, general and
administrative expenses
+JPY1.8bn
Key reason
Gross profit increased along with sales growth.
JPY4.3bn
FY2018 Forecast - Summary
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FY 2017ForecastFY 2018
Change YoY Change
Net sales 76,672 80,338 +3,665 4.8%
Cost of sales 35,478 37,289 +1,811 5.1%
(Cost rate) 46.3% 46.4% (+0.1pt) ---
Gross profit 41,194 43,049 +1,855 4.5%
Operating income 4,394 5,148 +754 17.2%
(Operating margin) 5.7% 6.4% (+0.7pt) ---
Ordinary income 4,458 5,137 +679 15.2%
Profit attributable to ownersof parent
2,657 3,231 +574 21.6%
Basic earnings per share JPY75.67 91.87 +16.20 ---
JPY Million
Note: Basic earnings per share are calculated, assuming that the stock split was conducted at the beginning of 2017.
New Businesses
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We have launched new businesses by taking advantage of technologies and know-how which have been cultivated throughout our history.
Environmental and Bioscience Business
Veterinary Medicine Business
Life Science Business
Eye care Project Event Business
Shareholder Return
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15 15
19
25 25
0%
10%
20%
30%
40%
0
5
10
15
20
25
30
FY2014 FY2015 FY2016 FY2017 FY2018
Dividend per Share Dividend Payout Ratio
(JPY)
Note: Dividends are calculated, assuming that the stock split was conducted at the beginning of FY2014.
Balance sheet
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AssetsFY2017
(Mar 2018)Cash and equivalents 16,904
Accounts receivables 8,162
Inventories 11,412
Other current liabilities 2,490
Net property, plant & equipment 22,567
Goodwill 3,708
Patents 1,464
Investment securities 645
Other fixed assets 4,383
Total assets 71,736
JPY Million
Liabilities & Shareholder’s equityFY2017
(Mar 2018)Accounts payables 4,251
Accrued expenses 3,323
Short-term borrowings 503
Current portion of bonds 2,636
Current portion of long-term borrowings
2,372
Other current liabilities 5,645
Bonds 5,312
Long-term borrowings 5,158
Other fixed liabilities 2,414
Total liabilities 31,614
Total shareholder’s equity 40,467
Minority interest 39
Total equity 40,121
Capital ratio 55. 8%
D/E 0.40x
Net D/E -0.02x
Total debt 16,185
Disclaimer on Forward-Looking Statements
• This material includes certain forward-looking statements about the Menicon Group. To the extent that statements in this material do not related to historical or current facts, they constitute forward-looking statements.
• These forward-looking statements are based on the current assumptions and judgments of the Menicon Group in light of the information currently available to it, and involve know and unknown risks, uncertainties and other factors, which may affect the statements made in this material.
Menicon Co., Ltd. Finance & Investor Relations Dept.TEL: +81-52-935-1646E-mail: [email protected]