fy2018 3q financial results - topcon...fy2018 3q financial results january 30, 2019 topcon...

FY2018 3QFinancial ResultsJanuary 30, 2019TOPCON CORPORATIONDirector and Executive Officer, CFOGeneral Manager of Accounting & Finance Div. Haruhiko Akiyama

©2019 Topcon Corporation 1

Ⅰ. FY2018 3Q Financial Results

Ⅱ. FY2018 Full Year Plan

Ⅲ. Appendix

FY2018 3Q Financial Results

Contents



Ⅰ-１. FY2018 3Q Financial Results

Ⅰ-２. Overview of Each Business


¥6.8B

¥103.1B

+9%

+1%

0

1

2

3

4

5

6

7

8

9

10

0

10

20

30

40

50

60

70

80

90

100

110

120

FY20151-3Q

FY20161-3Q

FY20171-3Q

FY20181-3Q

Net Sales Operating Income

91.5

4.44.2

87.4

101.7

6.2

103.1

6.8

FY2018 3Q Overview

- Growth in sales and profit

YoY

Net Sales

Operating Income

（Sales Record)

(unit : billion yen)


1-3Q Actual 1-3Q Actual YoY YoY(%)

Net Sales 101,660 103,106 1,446 +1%Gross Profit(Gross Profit Ratio)

51,894 （51.0%）

54,707 （53.1%）

2,813

SGA 45,667 47,948 2,281

Operating Income (Operating Income Ratio)

6,227（6.1%）

6,758 （6.6%）

531 +9%

Non-Operating Income (Expenses) -908 -1,147 -239

Ordinary Income 5,319 5,611 292 +5%Extraordinary Income (Loss) -125 -730 -605Income Before Income Taxes and Minority Interests 5,193 4,880 -313

Net Income 2,946 2,518 -428 -15%

Exchange Rate

ＵＳＤ ¥111.82 ¥110.82 -¥1.00ＥＵＲ ¥128.59 ¥129.38 ¥0.79

FY2017 FY2018

FY2018 3Q Financial Results [Consolidated]（unit：million yen）

(Average)


1-3Q Actual 1-3Q Actual YoY YoY(%)

Net Sales

Positioning 52,589 53,645 1,056 +2%Smart Infrastructure 25,506 26,055 549 +2%

Eye Care 32,828 33,338 510 +2%Others 1,592 1,301 -291 -18%Elimination -10,857 -11,232 -375Total 101,660 103,106 1,446 +1%

Operating Income

(Operating Income Ratio)

Positioning 4,485（8.5%）

4,496（8.4%）

11 +0%

Smart Infrastructure

2,680（10.5%）

3,933（15.1%）

1,253 +47%

Eye Care 1,207 （3.7%）

1,310 (3.9%)

103 +9%

Others -81 （-5.1%）

-46 （-3.5%）

35 -

Elimination -2,064 -2,935 -871

Total 6,227（6.1%）

6,758（6.6%）

531 +9%

FY2017 FY2018

FY2018 3Q Financial Results by Business [Consolidated]

（unit：million yen）Both Sales and Profits grew across all business segments


FY2018 3Q Operating Income YoY Breakdown

6.2

2.0

0.7-1.9 -0.2

6.8

0

2

4

6

8

10

FY20171-3Q

Sales Volume,Product Mix

Cost Reduction Fixed Cost FX Effects FY20181-3Q

(unit : billion yen)

(Main Factor)・Positioning

R&D cost increase(Advanced technology)・Eye Care

IoT related expenses


I-1. FY2018 3Q Financial Results

I-2. Overview of Each Business



• IT Construction / IT Agriculture： Deceleration of Construction and Agriculture market conditions in US

• Continue investments for future business growth(Advanced technology development)

• IT Construction：Strengthen of sales by launching strategic new products

• Promotion of the market development in emerging countries

Topics

FY2017 FY20181-3Q Actual 1-3Q Actual YoY %

Net Sales 52,589 53,645 1,056 +2%Operating Income(Operating Income Ratio)

4,485（8.5%）

4,496（8.4%） 11 +0%

Overview of Each Business Positioning

Growth in sales, profit leveling off

Review of 3Q Financial Results

(unit: million yen)


Features

✔ Autonomous Operationsaccording to the designed data

✔ Autonomous deep-diggingprevention function

✔ Correspond to “MICHIBIKI”(correspond to multiple GNSS)

Market size and penetration rate of IT Construction

FY2016actual

FY2017actual

FY2018plan

ExcavatorDozer

Penetration Rate

PenetrationRate

-Present penetration rate is low-Much room for growth

Excavator machine control system (auto)

Prevention of deep-digging

Sales of Excavator system（unit: sales）

IT Construction：Strengthen of sales by launching strategic new products Positioning

*Expected useful life is 8 years（Topcon’s estimated number）


ChinaMiddleEast

Bauma China 2018

Technology Days Middle East 2018

Southeast Asia/ India

Establishment of an IoT joint venturewith Sumitomo Corporation

Exhibited at the largest exhibition of construction machinery in Asia

(Shanghai, China November, 2018)

IT Construction hands-on session held for the first time in the Middle East region

(Dubai, UAE December, 2018) (Jakarta, Indonesia November, 2018)Collaborate in telematics business and IT agriculture in growing Southeast Asian and Indian markets.

X

PT. Weeo Solutions Frontier(Joint Venture)

(3,000 exhibitors and 200,000 visitors)

(Participants: users, dealers total 140 people)

Promotion of the market developmentin emerging countries Positioning

IT Construction / IT Agriculture : Active enlightenment activities in undeveloped emerging countries


• Expansion of Infrastructure market in Japan

FY2017 FY20181-3Q Actual 1-3Q Actual YoY %

Net Sales 25,506 26,055 549 +2%Operating Income(Operating Income Ratio)

2,680（10.5%）

3,933（15.1%） 1,253 +47%

Smart InfrastructureOverview of Each Business

Growth in sales and significant growth in profit(unit: million yen)

• Robust core business (Total Station)• Steady growth in i-Construction related sales• Continuing sales growth of IT Agriculture in Japan

*”i-Construction” is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, Japan.


Topics


1,203 1,327

1,503

0

500

1,000

1,500

FY20163Q actual

FY20173Q actual

FY20183Q actual

（number of order）

i-ConstructionNumber of order

i-Construction

✔ The scale of the project is approx. ¥7 trillion in 3 yearsContribute to the expansion of infrastructure market in Japan

National resilience (Three-years emergency measure: Cabinet decision on December 14, 2018)

Emergency measures such as reinforcement of river banks

Emergency measures such asreinforcement of road side slope

（unit:sales）

Sales plan ofIT construction in Japan

✔ "Year of Deepening” (3rd year )✔ Number of i-Construction work

contracts increase steadilyMarket expansion continues

FY2016actual

FY2017actual

FY2018plan

Expansion of Infrastructure market in Japan

Source：the Ministry of Land, Infrastructure and Transport Source：the Ministry of Land, Infrastructure and Transport

*”i-Construction” is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, Japan.

Levee Strengthening

Floodway excavatingMain stream

Branch stream


Expected range of flooding

Levee raising


（単位：百万円）FY2017 FY2018

1-3Q Actual 1-3Q Actual YoY %

Net Sales 32,828 33,338 510 +2%Operating Income(Operating Income Ratio)

1,207（3.7%）

1,310（3.9%） 103 +9%

Eye CareOverview of Each Business

Growth in sales and profit

Topics


(unit: million yen)

• Steady sales growth of 3D OCT Maestro/Triton• Continuing aggressive investments on IoT

for Screening business expansion

• Screening business getting started• Expansion of business in China


Screening business getting started

FY2016actual

FY2017actual

FY2018plan

Maestro &

TRC-NW400

Global sales plan of screening equipment

- Major optical chain in ANZ, Specsaversaccelerates deployment of Maestro

NW400 sold to US IDx Technologies Inc.Pioneering the general practitioner market

Launching an autonomous AI diagnosis system

Expect 300+ storesDeployment also in Scandinavian country

*SpecsaversGlobal optical chain having 1,600 stores in 10 countries

*

Effect Early detection, early treatment / Improvement of medical efficiency and quality

Eye Care

（unit: sales）

Fully automatic

“Easy-to-Operate” OCT

Sales growth for optical chain


FY2018plan

FY2021plan

Expansion of business in China

（Topcon (Beijing) Medical Technology Co., Ltd. Business start: Jan. 23, 2019)

Sales plan to China market

●China : 2.8

(million)Source : Diabetes Atlas 8th Edition

2x Salesin 3years

●United States : 15.7

●Japan : 11.2

Source : MarketScope 2018

New sales company established in China

8 8 8 9 10 12 13

30 73

114

0 50 100 150

PakistanGermany

EgyptRussia

IndonesiaMexicoBrazil

United StatesIndiaChina

Eye Care

（unit: sales）

✔ Focus on strengthening salescapabilities in the rapidly growing Chinese healthcare market

✔ Pioneering diabetic screening market

100M+

Opening Ceremony

Beijing

Number of Diabetes Top10 Countries Ophthalmologists per 100,000 population

The number of diabetes is the largest in the world, while in shortage of ophthalmologists

reference


Ⅱ. FY2018 Full Year Plan


Full YearActual

Full YearPlan

YoY(%)

Announced on October 31st

Net Sales 145,558 150,000 +3% 150,000

Operating Income(Operating Income Ratio)

12,073(8.3%)

15,000(10.0%)

+24% 15,000(10.0%)

Ordinary Income 10,674 13,000 +22% 13,000

Net Income 6,028 7,000 +16% 7,000

ROE 9.7% 11% 11%

ROIC 7.1% 9% 9%

Dividends ¥20 ¥24 ¥24

Exchange Rate (Average)

USD ¥110.81 ¥105

EUR ¥129.45 ¥130

FY2017 FY2018

FY2018 Full Year Plan [Consolidated]

No change from initial forecasts

Assumed FX rate for 4Q( )

（unit：million yen）


Full YearActual

Full YearPlan

YoY(%)

Announced on October 31st

Net Sales

Positioning 74,945 79,000 +5% 79,000Smart Infrastructure

36,626 38,000 +4% 38,000

Eye Care 46,515 48,000 +3% 48,000Others 2,493 1,500 -40% 1,500Elimination -15,023 -16,500 -16,500Total 145,558 150,000 +3% 150,000

Operating Income

(Operating Income Ratio)

Positioning 8,018(10.7%)

9,500(12.0%)

+18% 9,500(12.0%)


5,102(13.9%)

6,000(15.8%)

+18% 6,000(15.8%)

Eye Care 2,038(4.4%)

2,500(5.2%)

+23% 2,500(5.2%)

Others 88(3.5%)

0(0.0%)

- 0(0.0%)

Elimination -3,173 -3,000 -3,000

Total 12,073(8.3%)

15,000(10.0%)

+24% 15,000(10.0%)

FY2017 FY2018

FY2018 Full Year Plan by Business [Consolidated]

（unit：million yen）


Topcon for Human Life 医・食・住


Ⅲ. Appendix


9.2 8.5

11.1

8.2

10.0

7.8

0.81.1

2.4

0.9

2.0

1.1

0

1

2

3

0

5

10

FY17/2Q 3Q 4Q FY18/1Q 2Q 3Q

Net Sales Operating Income （unit:billion yen）

12.3 11.413.7

10.011.8 11.5

1.00.7 0.8

0.20.4

0.7

△ 1

△ 1

0

1

1

2

2

0

5

10

15

FY17/2Q 3Q 4Q FY18/1Q 2Q 3Q


18.716.7

22.418.4 18.6

16.6

2.2

0.6

3.5

1.81.9

0.80

1

2

3

4

0

5

10

15

20

25

FY17/2Q 3Q 4Q FY18/1Q 2Q 3Q


36.533.6

43.9

33.436.9 32.8

3.21.7

5.8

1.93.4

1.50

2

4

6

8

0

10

20

30

40

50

FY17/2Q 3Q 4Q FY18/1Q 2Q 3Q


Financial Results (Quarterly)

Consolidated Positioning

Smart Infrastructure Eye Care


57.9 70.4 68.0

77.5 70.3

79.7

3.8 5.8

4.6

7.5 5.3

9.7

0.0

5.0

10.0

15.0

0

20

40

60

80

100

FY16/1H FY16/2H FY17/1H FY17/2H FY18/1H FY18/2H


15.0 18.1 17.0

19.6 18.2

19.8

1.4

2.5 1.6

3.5 2.9 3.1

0.0

2.0

4.0

0.0

10.0

20.0



27.2 33.4 35.9

39.1 37.0 42.0

2.5 3.1 3.9 4.1 3.7

5.8

0.0

2.0

4.0

6.0

0.0

10.0

20.0

30.0

40.0



19.6 23.5

21.4 25.1

21.8 26.2

1.3 1.3 0.5

1.5

0.6

1.9

0.0

2.0

4.0

0.0

10.0

20.0

30.0



Financial Results and Plan (Semiannually)

Consolidated Positioning

Smart Infrastructure Eye Care


YoY+1％

FY2017/3Q FY2018/3Q

21%

29%25%

25%22％

30%25%

23%

Sales by region

¥101.7B ¥103.1B

Japan¥20.8B

North America¥29.6B

Europe¥25.8B

Asia / Others¥25.4B

Japan¥22.2B

Asia / Others¥24.1B

North America¥30.8B

Europe¥26.0B


4.45.1

5.5

FY16 FY17 FY18

4.75.4 5.5

FY16 FY17 FY18

10.413.0

14.5

FY16 FY17 FY18

Capital Expenditure and R&D / Forex Sensitivity

*Excluding Goodwill Amortization

Capital expenditure Depreciation* R&D

（unit:billion yen）（unit:billion yen）（unit:billion yen）

Projections

USD：Operating income ¥0.15B～¥0.2BEUR：Operating income ¥0.07B～¥0.1B

Forex Sensitivity（impact by ¥1 change）

planactualactual planactualactual planactualactual


These materials contain forward-looking statements, including projections of future operating performance. Such statements are based on management’s best judgment, given the materials available to them at the time these statements are made.

However, please be aware that actual performance may differ from projected figures owing to unexpected changes in the economic environment in which we operate, as well as to market fluctuations.

The original disclosure in Japanese was released on January 30, 2019 at 15:30(UTC+9)

Inquiries: Corporate Communication Div.Corporate Communication Dept. TOPCON CORPORATIONTel: +81-3-3558-2532E-mail: [email protected]: https://global.topcon.com/invest/

Cautionary Note regarding Forward-Looking Statements

fy2018 3q financial results - topcon...fy2018 3q financial results january 30, 2019 topcon...

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