©2018 Topcon Corporation 11
Ⅱ. FY2018 Full Year Plan
Ⅱ-1. FY2018 Full Year Plan
Ⅱ-2. Strategic Plans
Ⅱ-3. Summary
©2018 Topcon Corporation 12
1HActual
Full YearActual
1HActual
Full YearPlan
YoY(%)
Announced on July 31st
Net Sales 68,046 145,558 70,271 150,000 +3% 150,000
Operating Income(Operating Income Ratio)
4,570(6.7%)
12,073(8.3%)
5,268(7.5%)
15,000(10.0%)
+24% 15,000(10.0%)
Ordinary Income 4,088 10,674 4,742 13,000 +22% 13,000
Net Income 1,867 6,028 2,146 7,000 +16% 7,000
ROE 9.7% 11% 11%
ROIC 7.1% 9% 9%
Dividends ¥10 ¥20 ¥12 ¥24 ¥24
Exchange Rate (Average)
USD ¥111.42 ¥110.81 ¥110.07 ¥105 ¥106.14
EUR ¥126.63 ¥129.45 ¥129.88 ¥130 ¥129.81
FY2018 Full Year Plan [Consolidated]
FY2017 FY2018
Assumed FX rate( )
No change from initial forecasts:Expect growth in sales and profit, dividend increase
(unit:million yen)
©2018 Topcon Corporation 13
1HActual
Full YearActual
1HActual
Full YearPlan
YoY(%)
Announced on July 31st
Net Sales
Positioning 35,884 74,945 37,018 79,000 +5% 79,000Smart Infrastructure
17,042 36,626 18,207 38,000 +4% 38,000
Eye Care 21,397 46,515 21,828 48,000 +3% 48,000Others 1,030 2,493 934 1,500 -40% 1,500Elimination -7,307 -15,023 -7,716 -16,500 -16,500Total 68,046 145,558 70,271 150,000 +3% 150,000
Operating Income
(Operating Income Ratio)
Positioning 3,869(10.8%)
8,018(10.7%)
3,740(10.1%)
9,500(12.0%)
+18% 9,500(12.0%)
Smart Infrastructure
1,630(9.6%)
5,102(13.9%)
2,856(15.7%)
6,000(15.8%)
+18% 6,000(15.8%)
Eye Care 526(2.5%)
2,038(4.4%)
636(2.9%)
2,500(5.2%)
+23% 2,500(5.2%)
Others -22 (-2.1%)
88(3.5%)
-17(-1.8%)
0(0.0%)
- 0(0.0%)
Elimination -1,433 -3,173 -1,947 -3,000 -3,000
Total 4,570(6.7%)
12,073(8.3%)
5,268(7.5%)
15,000(10.0%)
+24% 15,000(10.0%)
FY2018 Full Year Plan by Business [Consolidated]
FY2017 FY2018
Expect sales and profit growth in all segments(unit:million yen)
©2018 Topcon Corporation 14
Ⅱ. FY2018 Full Year Plan
Ⅱ-1. FY2018 Full Year Plan
Ⅱ-2. Strategic Plans
Ⅱ-3. Summary
©2018 Topcon Corporation 15
Strategic Plans
0
2
4
6
8
10
12
0
20
40
60
80
FY2016 FY2017 FY2018
Sales Operating Income
8.0
74.9 79.0
9.5
5.6
60.6
IT Construction:Strengthen of sales by launching strategic new productsExpansion of maintenance business for road repaving works
IT Agriculture:Sales expansion by strengthening of OEM business
Asian business expansion:Launch of IT Construction and IT Agriculture business
planactual actual
(unit:billion yen)
Positioning
©2018 Topcon Corporation 16
IT Construction:Strengthen of sales by launching strategic new products
FY2016actual
FY2017actual
FY2018plan
Sales of Excavator system
*Expected useful life is 8 years(Topcon’s estimated number)
Features・Autonomous Operations according to the design data・Safety and security in the deep-digging prevention function
・Easy upgrade from current machine guidance model⇒ Coping with the shortage of skilled operators
Global addressable number of excavator
approx. 200,000 units
3D system for concrete paving
The world’s first Mastless system for motor grader
Excavator machine control system (auto)
Release in 4Q (tentative)
Positioning
4Q Release (tentative)4Q Release
(tentative)
Prevention of deep-digging
Mastless
Present:low penetration
(unit:sales)
*
©2018 Topcon Corporation 17
IT Construction:Expansion of maintenance business for road repaving works Automation of road repaving work process(Acquisition of ThunderBuild BV Group )
FY2016actual
FY2017actual
FY2018plan
Sales of paving system
Reuse asphalt
INOUTAsphalt plant
*Software Development Company in Netherland. Software they develop is related to logistics management with a primary focusin the asphalt market, as well as additional applications that pertain to the transport of bulk materials.
Integrated datamanagement
Delivery time management
Just-in-Timesupply system
of asphalt
Road repaving solution
After acquisition
Present
Subscription business model
Just-in-Time
Positioning
Road surface measurement
MillingPaving
DesignCompaction
(unit:sales)
*
Transport asphalt
©2018 Topcon Corporation 18
IT Agriculture:Sales expansion by strengthening of OEM businessStabilization of OEM sales due to diversification of OEM partners and OEM products
Display unitsWeighing system
OEM Products
OEM Customers Small to medium sized OEM partners are increased
FY2016actual
FY2017actual
FY2018plan
Sales of IT Agriculture
Expansion of product lineup for 250 OEM partners
0
100
200
300
FY2014 FY2016 FY2018
Auto Steering System
Control Display
GNSSreceiver
(unit: # of companies)
Over 250OEM partners
Steering wheel with electric motor
(unit:sales)
Positioning
©2018 Topcon Corporation 19
Asian business expansion:Launch of IT Construction and IT Agriculture business
FY2014actual
FY2015actual
FY2016actual
FY2017actual
FY2018plan
Asian Sales(IT Construction and IT Agriculture)
Sales ratio of Asia
FY2018 planFY2014 actual
12%5%
Key market
-Digging up demand in the local OEM partners-Utilization of distribution network of existing
business-Apply the best practice of Japan
Increasing OEM inquiry from local machine manufacturers
Our action
ChinaIndia
Spreading of i-ConstructionStrong demand of IT Agriculture
Japan
(unit:sales)
Strengthen of collaboration with Smart Infrastructure Business for expansion of i-Construction and IT Agriculture
Tractor market in IndiaAnnual sales:
approx. 700,000 units(Global:1.5 million units)
Excavator market in ChinaAnnual sales:
approx. 70,000 units(Global:230,000 units)
Source:Off-Highway Research DataTechnavio「Global Agriculture Tractor Market」
Positioning
China India
* "i-Construction" is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, JAPAN.
Japan
©2018 Topcon Corporation 20
Strategic Plans
0
2
4
6
8
0
10
20
30
40
50
FY2016 FY2017 FY2018
Sales Operating Income
(unit:billion yen)
5.1
36.6 38.0
6.0
3.9
33.1
i-Construction:Continue market and business growthIT Agriculture in Japan:Further business expansion by strengthening support capabilities
planactualactual* "i-Construction" is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, JAPAN.
Smart Infrastructure
©2018 Topcon Corporation 21
Number of orderNumber of implementation
Market is expanding 1st “Construction&Survey Productivity improvement EXPO”Aug.28-30 in Makuhari Messe
0
1,000
2,000
3,000
FY2016actual
FY2017actual
FY2018plan
(number) i-Construction
Number of order/implementation
【Reference】Number of public
works orders
approx.15,000
FY2017actual Construction machinery manufacturers exhibited IT Construction machinery
15,000
Market trends
1,625
1,952
2,500
50%
36%42%
Source:the Ministry of Land, Infrastructure and Transport
* "i-Construction" is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, JAPAN.
Smart Infrastructure
A kind of Japan version of BAUMA(International construction machinery exhibition)
held for the first time Approx. 30,000 visitors
i-Construction:Continue market and business growth
©2018 Topcon Corporation 22
FY2014actual
FY2015actual
FY2016actual
FY2017actual
FY2018plan
・Deployed 4 training centers in Japan nationwide・Enhancement of training programs ・Enlightenment by sharing success stories of i-Construction 0
2,000
4,000
6,000
8,000
10,000
12,000
FY2016actual
FY2017actual
FY2018plan
10,000 totalswill be exceeded
3D point navigator 「LN-100」 getting popular
Focus on fostering of i-Construction engineersTotal number of trainees
LN-100 sales As an entry product for i-Construction
(unit:number of trainees)
Topcon’s action
KobeTraining Center
Kita-KyushuTraining Center
Kanto Training Center
(Ibaraki)
ShirakawaTraining Center
* "i-Construction" is a registered trademark of National Institute for Land and Infrastructure Management, MLIT, JAPAN.
Smart Infrastructure
(unit:sales)
i-Construction:Continue market and business growth
©2018 Topcon Corporation 23
IT Agriculture in Japan:Further business expansion by strengthening support capabilities
0
500
1,000
1,500
2,000
0
10,000
20,000
30,000
40,000
50,000
60,000
Sales of IT Agriculture in Japan(Auto Steering System )
Source:Hokkaido Agricultural Administration Department Production Promotion BureauJapan Agricultural Machinery Industry Association
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
FY2014actual
FY2015actual
FY2016actual
FY2017actual
FY2018plan
【Reference】Company A
Step1 Strengthen product capabilities
Step 2 Strengthen Sales Network
Step 3 Strengthen support capabilities
Utilization of sales network of major tractor manufacturers
・Increase sales and support personnel・Enhancement of sales support tools・Enhancement of training programs for dealer skill up
Auto Steering System ・Easy installation・Installable to existing tractor・Shared use⇒ Released Auto-turn function
Auto Steering System sales
Tractor sales in Japan
NewFrom July, 2018
Smart Infrastructure
Done
Company B Company C Company D
Control Display
GNSSreceiver
Steering wheel with electric motor
(unit:sales)
Done
New
(unit:Q’ty)(unit:Q’ty)
©2018 Topcon Corporation 24
Strategic Plans
0
1
2
3
4
5
6
0
10
20
30
40
50
60
FY2016 FY2017 FY2018
Sales Operating Profit(unit:billion yen)
2.0
46.5 48.0
2.52.6
43.1
Expansion of business domain into Preventive and Prognostic:Pioneer a new business model utilizing IoT and AI
Launching a Screening business:Case 1 : Overseas major optical chain deployed OCT for the first timeCase 2 : Exclusive agreement with US IDx
planactualactual
Eye Care
©2018 Topcon Corporation 25
Pioneer a new business model utilizing IoT and AI
Expansion of business domain into Preventive and Prognostic
Exam/Diagnosis/Treatment domains
General Hospital
Eye ClinicScreeningOptical Store
GeneralPractitionerDrug Store
AIdiagnosis
Nursing Home
Full AutoOCT/
Retinal Camera
Promotion of screening business
Promotion of Prognostic business
Preventive domain Prognostic Domain
Existing business
Optical Store
GeneralPractitionerDrug Store
Eye Care
©2018 Topcon Corporation 26
Launching a Screening business:Case 1
Realized eye screening at optical store
0
500
1000
1500
2000
2500
3000
FY2017actual
FY2018plan
Global sales of 3D OCT(unit:Q’ty)
Maestro
TritonProvide early detection of eye disease as a value added service
Maestro has been deployed in 200 stores
Overseas major optical chain deployed OCT for the first time
Optical chain having 1,600 stores in 10 countries
Fully automatic
“Easy-To-Operate” OCT
Eye Care
©2018 Topcon Corporation 27
Announcing strategic alliance for Autonomous AI diagnostic system
Exclusive agreement with US IDx Technologies Inc.
Effect Early detection, early treatment / Improvement of medical efficiency and quality
*US venture company which develops algorithm of the disease detection based on retina or OCT image
Retina images by NW400
AI automatic diagnosis
Diagnose Diabetic Retinopathy automatically (General Practitioner)
*
Launching a Screening business:Case 2
Fully automatic AI
Center of the picture) IDx Technologies Inc. CEO and Founder Mr.Michael D. Abramoff, MD, PhD
Joint press announcement (October 23, 2018)
*
World's First FDA approved “Autonomous AI diagnosis system”
Upload on a Cloud
Cloud
Eye Care
©2018 Topcon Corporation 28
Ⅱ. FY2018 Full Year Plan
Ⅱ-1. FY2018 Full Year Plan
Ⅱ-2. Strategic Plans
Ⅱ-3. Summary
©2018 Topcon Corporation 29
Summary
2030405060708090100110120130140150160170180190200
0100200300400500600700800900
10001100120013001400150016001700
FY2016actual
FY2017actual
FY2018plan
Net Sales Operating Income
FY2018 Full Year Plan : No change from initial forecasts
12.1
145.6 150.0
15.0
9.6
128.4
(unit : billion yen)
YoY
¥15B
¥150B
¥7B
¥13B
+24%
+3%
+16%
+22%
Net Sales
Operating Income
Net Income
Ordinary Income
Interim Dividends ¥24FY2017
¥20FY2018
ActualPlan
Expects growth in sales and profit, dividend increase
FY2018Plan
©2018 Topcon Corporation 30
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