© Hitachi Construction Machinery Co., Ltd. 2017. All rights reserved.
Regional Market Environments and Projections
Business Result for the Third Quarter ended December 31, 2016
January 30, 2017
Senior Vice President and Executive Officer
Yasushi Ochiai
Hitachi Construction Machinery Co., Ltd.
2
20 10 14
23 28 40
31 24 20 20
26
15
23
27 25
27 31
30 31 34
17
10
13
19 24
24 27
26 23
23
23
29
40
48 44
36 32
32 38 39
32
15
28
38 39
34
32
24 17 17
44
73
111
70
42 50
30
19 22
25
161
151
230 225
202
211
183
155 151
159
0
25
50
75
100
125
150
175
200
225
250
'08 '09 '10 '11 '12 '13 14 '15 '16 '16
Global Demand Trend for Hydraulic Excavators 1
*Estimates by HCM
(Distributing, copying, or forwarding prohibited)
(K Units)
*Excluding Chinese manufacturer
Year-on-Year Change *Emerging Countries: China, Asia/Oceania, and others
Emerging Countries 2016:51% (Y-0-Y Change:+3%)
'15'16
Previous
Outlook
'16
Present
Outlook
-15% -3% +3%
-36% +15% +31%Russia, CIS,
E Europe -46% -8% -8%
Africa -34% -8% -8%
Middle East -2% -45% -45%
Latin America -38% -22% -22%
-25% -29% -29%
India +29% +50% +50%
Indonesia -38% +11% +29%
Others +0% +1% +4%
0% +19% +22%
-4% -12% -12%
-3% +3% +13%
-23% -17% -17%
China
N America
W Europe
Japan
Total
Others
Asia & Oceania
Japan
Western Europe
North America
Asia Oceania
Others
Total
*Incl. India
China
Previous
Outlook
Present
Outlook
3
-150%
-100%
-50%
0%
50%
100%
150%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-150%
-100%
-50%
0%
50%
100%
150%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q-40%
-20%
0%
20%
40%
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
<Japan> 2
-150%
-100%
-50%
0%
50%
100%
150%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16
/1Q
2Q
3Q
・住宅投資:済(10%)
・公共投資:済(-5%)
・設備投資:済(4%)
・油圧、ミニ、WL需要:済
Market Environment: Housing/Public Spending and Capex (y-o-y) (K units) Demand Trend for Mini Excavators
*Estimates by HCM
(K units) (K units) Demand Trend for Hydraulic Excavators Demand Trend for Wheel Loaders
*Estimates by HCM *Estimates by HCM
*Source: MLIT, Cabinet Office, and
Construction Surety Company
New housing starts (number of houses)
Capex (Orders for machinery, excluding foreign demands)
Public spending (Public work orders)
◇ Public investment turned downward, though capital investment and housing investment are both on a continuously increasing trend.
◇ During the third quarter (from October to December 2016), the demand for construction machinery decreased in reaction to last-
minute demands before the emissions regulations.
(The demand for hydraulic excavators, mini excavators, and wheel loaders decreased by 10%, 24% and 19% year-on-year,
respectively.)
4
-100%
-50%
0%
50%
100%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-1%
0%
1%
CY11/1Q
2Q
3Q
4Q
CY12/1Q
2Q
3Q
4Q
CY13/1Q
2Q
3Q
4Q
CY14/1Q
2Q
3Q
4Q
CY15/1Q
2Q
3Q
4Q
CY16/1Q
2Q
3Q
-100%
-50%
0%
50%
100%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
<Europe> 3
-100%
-50%
0%
50%
100%
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
1.5%
0.5%
-0.5%
主要国GDP:済
◇ 16年1~3月GDPはユーロ圏全体で堅調に推移するも、2Q以降は下振れリスク有。 ◇ 建設機械需要は英国で減少も、全体では増加傾向。 (対前年油圧7%増、ミニ12%増, ホイール10%増)
FY16 1Q
FY16 2Q
◇ GDPはユーロ圏全体で堅調に推移。 ◇ 建設機械需要は英国で減少も、全体では増加傾向継続。 (対前年油圧7%増、ミニ4%増、ホイール8%増)
◇ GDPはユーロ圏全体で緩やかな回復が持続。 ◇ 油圧ショベル需要は仏での需要低迷の影響等により微減。(対前年5%減)
FY15 3Q
◇ GDPはユーロ圏全体で緩やかに回復。 ◇ 油圧ショベル需要は仏での需要低迷の影響等により減少。(対前年12%減)
FY15 2Q
◇ GDPはユーロ圏全体で緩やかな回復が持続。 ◇ 油圧ショベル需要は仏での大幅減等を受け、全体では微減。(対前年同期比6%減)
FY15 1Q
GDP Growth Rate in Major Countries (q-o-q) (K units) Demand Trend for Mini Excavators
*Source: IMF, etc *Estimates by HCM
Demand Trend for Hydraulic Excavators (K units) (K units) Demand Trend for Wheel Loaders
*Estimates by HCM *Estimates by HCM
France
UK
Germany
Italy
Others
UK
Germany
France
EUR zone
France
UK
Germany
Italy
Others
France
UK
Germany
Italy
Others
◇ GDP growth remained flat throughout the Euro zone. ◇ The demand for construction machinery throughout the Euro zone remains on a continuously increasing
trend, despite a decrease in the UK. (The demand for hydraulic excavators, mini excavators, and wheel loaders increased by 19%, 21% and 11% year-on-year, respectively.)
5
75%
100%
125%
150%
CY11/1Q
2Q
3Q
4Q
CY12/1Q
2Q
3Q
4Q
CY13/1Q
2Q
3Q
4Q
CY14/1Q
2Q
3Q
4Q
CY15/1Q
2Q
3Q
4Q
CY16/1Q
2Q
3Q
4Q
Residential Non-residential State & local
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-100%
-50%
0%
50%
100%
-10%
-5%
0%
5%
10%
0
500
1000
1500
2000
CY11/1Q
2Q
3Q
4Q
CY12/1Q
2Q
3Q
4Q
CY13 1
Q
2Q
3Q
4Q
CY14/1Q
2Q
3Q
4Q
CY15/1Q
2Q
3Q
4Q
CY16/1Q
2Q
3Q
4Q
<North America>
*Bureau of Economic Census, US Census Bureau
*Bureau of Economic Census, US Census Bureau
4
0
5
10
15
20
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-100%
-50%
0%
50%
100%
GDP Growth Rate, Housing Starts in US (K units) (K units) Demand Trend for Hydraulic Excavators
*Estimates by HCM
Construction Spending in US (y-o-y) Demand Trend for Mini Excavators (K units)
*Estimates by HCM
GDP (q-o-q/Right axis)
(Seasonally adjusted) Housing starts (Left axis)
◇ 15年度 ◇ 16年度
◇ Housing starts remained brisk; however, construction spending in the public sector is continuously on a
downward trend.
◇ Regarding construction machinery, the demand for hydraulic excavators continuously decreased by 16%
year-on-year, while the demand for mini excavators increased by 3% year-on-year.
6
0
10
20
30
40
50
60
70
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-150%
-100%
-50%
0%
50%
100%
150%
<China>
0%
10%
20%
30%
40%
CY11/1Q
2Q
3Q
4Q
CY12/1Q
2Q
3Q
4Q
CY13/1Q
2Q
3Q
4Q
CY14/1Q
2Q
3Q
4Q
CY15/1Q
2Q
3Q
4Q
CY16/1Q
2Q
3Q
4Q
0
5
10
15
20
(%)
North China -30%/-21%/34%/226%
North West 51%/-19%/41%/89%
South West 1%/-8%/100%/82%
North East -21%/-23%/2%/2%
South Middle China 8%/-13%/59%/64%
East China 7%/-20%/52%/103%
Total China 6%/-15%/58%/83%
FY15 4Q FY16 1Q/2Q/3Q
(6.8%) (8.0%)
0%
20%
40%
60%
80%
100%
FY131H 2H
FY141H 2H
FY151Q 2Q 3Q 4Q
FY161Q 2Q 3Q
~6t
20t
10~15t
21~29t
30~39t
40t~
6~10t
5
GDP and Fixed Asset Investment Quarterly Demand for Hydraulic Excavators by Region (y-o-y)
*Foreign manufactures only *Estimates by HCM
GDP (Right axis)
(y-o-y)
Fixed Asset Investment (y-o-y) (Left axis)
Demand Trend for Hydraulic Excavators
Y-o-y comparison data is limited to foreign manufactures only *Estimates by HCM
*National Bureau of Statistics of China
Demand Composition by Class for Mini Excavators and Hydraulic Excavators
*Estimates by HCM Foreign manufactures
only
20t and below
20t over
Domestic
Foreign
(K units)
*当社推定 *当社推定
◇ GDP growth from October to December 2016 remained flat at a rate of 6.8%, and fixed-asset investments continuously slowed at a rate of 8%.
◇ The demand recovered mainly due to increased public investment (increased 83% year-on-year).
7
0
5
10
15
4月 5月 6月 7月 8月 9月 10月11月12月 1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月 1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
《Supplementary Information》 Chinese Market
0
1
2
3
4
5
6
7
8
9
4月 5月 6月 7月 8月 9月 10月 11月 12月 1月 2月 3月
FY2015 Actual
FY2014 Actual
6
y-o-y
-51%
FY2016 (Forecast)
-49% -39% +6% -15% +58% +83%
Demand Trend for Hydraulic Excavators (y-o-y)
*Estimates by HCM
(Foreign Manufactures only) (K units)
Monthly Demand Trend for Hydraulic Excavators (Foreign Manufactures Only) (Compared to the same month in the previous year)
*Estimates by HCM
(K units)
FY2014 FY2015 FY2016
Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec.
Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar.
※ Actual result (From April to December)
【Chinese New Year】
Feb 19, 2015
Feb 8, 2016
Jan 28, 2017
8 《Topic》
“Artisan work fine award” CMIIC2016 in China
7
The Construction Machinery Industry Internet Competition 2016 (CMIIC2016) was held on
November 21, 2016, hosted by Hui Cong Construction Machinery Network. Our hybrid
hydraulic excavator ZH200-5A received the annual prize of “Artisan work fine award” after a
six-month process of internet voting, customer reviews, expert examination and other factors.
In China, there is increasing market demand for energy-saving products, including the hybrid
hydraulic excavator, and ZH200-5A is a fuel-efficient machine with improved energy
efficiency.
Going forward, we will strive to expand the product line-up to meet market needs and further
expand sales.
ZH200-5A CMIIC2016 Award Ceremony
9
0
1
2
3
4
5FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-150%
-100%
-50%
0%
50%
100%
150%
0
2
4
6
8
10
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-150%
-100%
-50%
0%
50%
100%
150%
<Asia, Oceania, and India> 8
-10
-5
0
5
10
15
20
CY11/1Q
2Q
3Q
4Q
CY12/1Q
2Q
3Q
4Q
CY13/1Q
2Q
3Q
4Q
CY14/1Q
2Q
3Q
4Q
CY15/1Q
2Q
3Q
4Q
CY16/1Q
2Q
3Q
(%)
主要国GDP:済
インドSH需要:済
・油圧、ミニ、WL需要:済
Demand Trend for Hydraulic Excavators in Asia & Oceania
(K units) *Estimates by HCM
GDP Growth Rate in Major Countries (y-o-y)
*Source: IMF, etc
Malaysia Indonesia India
Singapore
Thailand
Demand Trend for Hydraulic Excavators in India
(K units) *Estimates by HCM
※ Calculation criteria for GDP growth rate in India was revised in CY2013 2Q
Thailand
Malaysia
Singapore
Australia
Indonesia
NZ
Others
◇ Demand has continuously increased in the entire Asia Pacific region, driven by increases in Indonesia and
Malaysia, etc. (increased by 11% year-on-year).
◇ In India, demand has continuously increased by 56% year-on-year, mainly for infrastructure investments, such
as railways and roads.
10
0.01
0.014
0.018
0.022
0.026
0.03
0.034
0.038
0
1
2
3
4
5
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
-100%
-50%
0%
50%
100%
0
5
10
15
20
30
55
80
105
130
<Russia and the Middle East>
(US$) (US$)
-100%
-50%
0%
50%
100%
0
1
2
3
4
5
FY11/1Q
2Q
3Q
4Q
FY12/1Q
2Q
3Q
4Q
FY13/1Q
2Q
3Q
4Q
FY14/1Q
2Q
3Q
4Q
FY15/1Q
2Q
3Q
4Q
FY16/1Q
2Q
3Q
9
FY11 FY12 FY13 FY14 FY15 FY16 FY17
FY11 FY12 FY13 FY14 FY15 FY16
原油・天然ガス実績値予測値:済
ルーブル為替推移:済
ロシア、中東SH需要:済
原油価格:下げ止まり
通貨:低調に推移
*Estimates by HCM *Ex-Works base
*Incl. Local manufacturing
Price Trend of Crude Oil and Natural Gas Demand Trend for Hydraulic Excavators in Russia (K units)
*Created by HCM , the source from IMF HP
Natural Gas (Right axis)
Crude Oil (Left axis)
<IMF forecast as of December>
Foreign Exchange Rate of the Ruble
*Estimates by HCM *Ex-Works base
Demand Trend for Hydraulic Excavators in the Middle East (K units)
*Data concerning Turkey is on a retail-sales basis, unlike the others.
UAE
Saudi Arabia
Turkey
Others Against
US$
Against
EUR€
*According to HCM’s research
【Russia】 Despite a sign of recovering crude oil prices, demand has been continuously sluggish.
【Middle East】 Demand for hydraulic excavators continued to decrease, mainly around the Gulf countries, by 51%
year-on-year.
11 <Mining Machinery>
0
500
1000
1500
2000
2500
3000
12上 12下 13上 13下 14上 14下 15上 15下 16上
10
0
100
200
300
400
500
12上 12下 13上 13下 14上 14下 15上 15下 16上
Demand proportion by region: Ultra-large Excavator (over 100t) *Estimates by HCM
(Units)
Demand proportion by region: Truck (over 55t)
*Estimates by HCM
(Units)
Africa and Middle East
Asia
China
Oceania
Europe,Russia,CIS
North America
Central and South America
Africa and Middle East
Asia
China
Oceania
Europe,Russia,CIS
North America
Central and South America
12/1H 12/2H 13/1H 13/2H 14/1H 14/2H 15/1H 15/2H 16/1H
12/1H 12/2H 13/1H 13/2H 14/1H 14/2H 15/1H 15/2H 16/1H
◇ Excavators: Demand increased in Europe, Russia and CIS, and some countries in Asia, while demand
decreased in Central and South America, etc.
◇ Trucks: Demand increased in the Russia CIS region and Africa, etc., while demand decreased
in the entire Americas and Oceania etc.
12 《Supplementary Information》 BB Ratio 11
BB Ratio (Ultra-large Hydraulic Excavator)
BB Ratio (Dump Truck)
※Book-to-Bill(BB)Ratio = Bookings (Orders received) / Billings (Value of shipment)
Non-consolidated basis (average of 6 months)
FY2011 FY2012 FY2013 FY2014 FY2015 FY2016
FY2011 FY2012 FY2013 FY2014 FY2015 FY2016
13 《Topic》
First order received from a copper mine
in the Republic of Chile
• 2 units of EX5600-6 will be delivered to a copper
mine in the Republic of Chile.
• This is our first mining machinery order received
from the Republic of Chile.
12
Full acquisition of H-E Parts in the
United States
We have acquired all the equity of H-E Parts (H-E Parts International LLC and H-E Parts
Australian Holdings LLC). H-E Parts provides service and solution business regarding mining,
quarry and construction machineries and equipment mainly in Australia and the U.S. It is also
engaged in the development, processing and sales of parts associated with these machineries.
Going forward, we will provide cost efficient and highly productive service that meets the local
needs of clients. Furthermore, we strive to strengthen our value chain and further improve our
earnings stability.
(Reference: the actual sales revenue of FY2015 was ¥23.5 billion.)
Reference photo: EX5600-6
14
© Hitachi Construction Machinery Co., Ltd. 2017. All rights reserved.
END
[Cautionary Statement]
This material contains forward-looking statements that reflect management’s views and assumptions in the light of
information currently available with respect to certain future events, including expected financial position, operating
results, and business strategies. Actual results may differ materially from those projected, and the events and
results of such forward-looking assumptions cannot be assured.
Factors that may cause actual results to differ materially from those predicted by such forward-looking statements
include, but are not limited to, changes in the economic conditions in the Company’s principal markets; changes in
demand for the Company’s products, changes in exchange rates, and the impact of regulatory changes and
accounting principles and practices.
For further inquiries:
TEL : 03-5826-8152
FAX : 03-5826-8209
Public Relations Strategy office
Hitachi Construction Machinery Co., Ltd