fy2010 2q financial results - topconglobal.topcon.com/invest/library/financial/fr2010/... · topcon...

Topcon Investor Relations 2010

FY2010 2Q Financial Results

October 29, 2010TOPCON CORPORATIONDirector Takayuki Ogawa

(*In this presentation, “FY2010” refers to the year ending March 31, 2011. In addition, “FY2010 2Q” refers to the period from April 1 to September 30, 2010.)


FY2010 2QFinancial Results


Consolidated FY2010 Six-Month ResultsConsolidated FY2010 SixConsolidated FY2010 Six--Month ResultsMonth Results2009/9 Actual

2009/9 Actual

Dividends（¥）DividendsDividends（（¥¥）） ¥2 ¥2

Net SalesNet SalesNet Sales

2010/9 Actual

2010/9 Actual

YoY （％）

YoY （％）

Operating Income (Loss)Operating Income (Loss)Operating Income (Loss)

OP Ratio

（billion yen）

Point （YoY）

PointPoint （（YoYYoY））

2

Ordinary Income (Loss)Ordinary Income (Loss)Ordinary Income (Loss)

Gross Income on SalesGross Income Gross Income

on Saleson Sales

SGASGASGA

Net Income (Loss)Net Income (Loss)Net Income (Loss)

Non-Operating ExpensesNonNon--Operating Operating

ExpensesExpenses

Loss Before Income Taxes and Minority InterestsLoss Before Income Taxes Loss Before Income Taxes

and Minority Interestsand Minority Interests

Extraordinary Income (Loss)

Extraordinary Income Extraordinary Income (Loss)(Loss)

＋ Increased Sales Volume（U.S., China, Japan）

－ Yen Strength

＋ Increased Sales Volume－ Yen Strength

43.3 115%115%

(1.8)(4) %(4) % 0%0%

―%―%

49.6

0

(2.3) ―%―%(0.7)

114%114%17.6 20.0

103%103%

(2.3) ―%―%(1.2)

(0.5) (0.8)

―%―%

19.4 19.9

―%―%(0.3) (0.4)

(2.6) (1.2)


Financial Results by SegmentFinancial Results by SegmentFinancial Results by Segment

3

（billion yen）

43.3

2010/9Actual2010/9Actual


49.6

7.07.0

2010/7/30

Announcement

4848.0.0

YoY

(%)YoY

(%)

112%112%

97%97%

173%173%

16.016.0

25.025.0

115%115%

5.4

14.9

22.9

9.3

14.5

25.7

Net SalesNet Sales (Consolidated)

(1.8) 0 00



Operating IncomeOperating Income (Consolidated)

YoY

(%)YoY

(%)

(billion yen)

PositioningPositioning Eye CareEye Care FinetechFinetech

(0.9)

(1.1)

0.3 0.20.1

(0.3) (0.4)(0.2)0.6

2010/7/30

Announcement


10.412.5

11.2 15.0

13.911.8

1.0

(0.9)

2.1

(0.9)

0

(1.1)0

10

20

FY09/1Q FY09/2Q FY09/3Q FY09/4Q FY10/1Q FY10/2Q(2.0)

(1.0)

0.0

1.0

2.0

3.0Net Sales Operating Income

Financial Results (Quarterly)Financial Results Financial Results (Quarterly)(Quarterly)

27.721.920.920.1

23.2

30.5

(1.8)0

(1.5)

4.7

(1.5)

1.5

0

10

20

30

40


0.0


Operating Income （billion yen）Net Sales （billion yen）

4

7.1 7.7 7.1

9.4

6.77.7

0 0.2(0.1)

1.8

(0.3)0

0

5

10

15


0.0

1.0


6.0 6.0

3.32.92.4 2.4

(0.7)(0.2) (0.4)

0.8

(0.3)

0.5

0

5

10


0.0


１．Consolidated１．Consolidated ２．Positioning２．Positioning

３．Eye Care３．Eye Care ４．Finetech４．Finetech

Net Sales （billion yen）

Net Sales （billion yen） Net Sales （billion yen）

Operating Income （billion yen）

Operating Income （billion yen） Operating Income （billion yen）


Analysis of Gain and Loss in Operating Income (YoY)Analysis of Gain and Loss in Operating Income (Analysis of Gain and Loss in Operating Income (YoYYoY))

5


Impact from Currency Exchange in FY2010 1H (Compared with Original Plan) Impact from Currency Exchange in FY2010 1HImpact from Currency Exchange in FY2010 1H (Compared with Original Plan)(Compared with Original Plan)

Exchange Rate in FY2010 Total Amount of Impact(Compared with Original Plan)

Assumed Rate for FY2010

(Original Plan)

Exchange Rate for 2Q

(July to Sept)

Average Exchange Rate Net Sales Operating

Income

US$ ¥90 ¥90 ¥88.85 (¥0.3 billion) (¥0.1 billion)

EUR ¥120 ¥110 ¥114.82 (¥0.5 billion) (¥0.2 billion)

Total (¥0.8 billion) (¥0.3 billion)

6


Domestic and Overseas Sales （YoY）Domestic and Overseas Sales Domestic and Overseas Sales （（YoYYoY））

North AmericaNorth AmericaJapanJapan

Six-Month Results of

FY2009

EuropeEurope

ChinaChina Asia & OceaniaAsia & Oceania OthersOthers

7

¥¥44..5 5 billionbillion




¥¥10.6 10.6 billionbillion



¥¥44..77 billionbillion




FY2010

¥¥7.57.5 billionbillion

¥¥9.9.44 billionbillion


FY2009


FY2010


FY2009


FY2010


FY2009


FY2010


FY2009


FY2010

Six-month Results of

FY2009


FY2010

122%125%

95%

137% 114% 106%


Consolidated Cash FlowsConsolidated Cash FlowsConsolidated Cash FlowsCash Flows （billion yen）

2.1

(0.03)

(2.1)

2008/92008/9 2009/92009/9 2010/92010/9

8

10.0

5.0

(10.0)

(5.0)

0

3.8

(2.0)

1.7

100

50

0

D/E Ratio (%)

81.5%

132.2%153.7%

1.1

(6.2) (5.1) C/F from Operating Activities

C/F from Investment Activities

Free Cash Flow

D/E Ratio

150


CAPEX / Depreciation R&D

CAPEX

Depreciation

Positioning

R&D Expense to Sales Ratio

Eye CareFinetech

2009/9 2010/92008/9 2009/9 2010/92008/9

R&D Expense to Sales Ratio （％）

R&D （billion yen）

（billion yen）

2.7

66..22

9

1.3

0.7

6

4

2

0

10

5

2

1

1.5

0.5

1.6

2.3

4.0

1.3

0.79.4％

10.7％2.0

1.0

44..77

CAPEX / Depreciation / R&DCAPEX / Depreciation / R&DCAPEX / Depreciation / R&D

1.61.6

2.9

1.6

0.8

5.35.3

11.0％


２０１０年３月期

通期計画

２０１０年３月期

通期計画

２０１０年３月期

通期計画

FY2010Full Year Forecast


FY20101H 2H

11

Business Trends by Region and MarketBusiness Trends by Region and Market

America America

Europe Europe

Japan Japan

FY20101H 2H

Construction Construction

Precision Agriculture

Precision Agriculture

Surveying/GIS Surveying/GIS

3DMeasurement

3DMeasurement

▶

Negative impact of high Yen in all regions, in addition to overall soft market in North America, Europe and Japan

▶

Steady growth in Emerging countries

▶

Negative impact of high Yen in all regions, in addition to overall soft market in North America, Europe and Japan

▶

Steady growth in Emerging countries

▶

Construction market was slower than expected, though it showed some stability & solidity

▶

Steady growth in Precision Ag and Measurement

▶

Construction market was slower than expected, though it showed some stability & solidity

▶

Steady growth in Precision Ag and Measurement

✔ Slight growth in Europe while North America & Japan arestable

✔ Steady growth in Emerging countries

✔ Slight growth in Europe while North America & Japan arestable

✔ Steady growth in Emerging countries

✔ Construction & Survey/GIS markets continue to be soft, but can be pushed up with new products

✔ Precision Ag and Measurement markets continue to grow

✔ Construction & Survey/GIS markets continue to be soft, but can be pushed up with new products

✔ Precision Ag and Measurement markets continue to grow

EmergingCountries

EmergingCountries

《Overview of 1H 》

《Forecast for 2H》



By Region

By Market


▶

Strong Japanese Yen weakens cost competitiveness to overseas market

▶

Capital investment freeze in U.S. and Europe▶

Asia: Steady Chinese growth; major impact on oil producing nations

▶

Strong Japanese Yen weakens cost competitiveness to overseas market

▶

Capital investment freeze in U.S. and Europe▶

Asia: Steady Chinese growth; major impact on oil producing nations

✔ U.S. experiencing gradual recovery. Facilitating IT investment✔ E.U. Restructuring healthcare investment. ✔ Upgrades in Japanese exam market have run course; further growth

in facilities adopting OCT✔ China and India continue to grow. Emerging health screening

market

✔ U.S. experiencing gradual recovery. Facilitating IT investment✔ E.U. Restructuring healthcare investment. ✔ Upgrades in Japanese exam market have run course; further growth

in facilities adopting OCT✔ China and India continue to grow. Emerging health screening

market

▶

Ophthalmic facilities hold off on investment; bid projects decreased▶

Freeze in eyeglass capital investment ▶

Growth in screening market

▶

Ophthalmic facilities hold off on investment; bid projects decreased▶

Freeze in eyeglass capital investment ▶

Growth in screening market

✔ Recovering in ophthalmology capital investment (budgets to invest in more efficient diagnosis/treatment)

✔ Eyeglass market will rebound from bottom; new stores opening, mainly in emerging countries

✔ Screening market will maintain strength; expansion in China andIndia

✔ Recovering in ophthalmology capital investment (budgets to invest in more efficient diagnosis/treatment)

✔ Eyeglass market will rebound from bottom; new stores opening, mainly in emerging countries

✔ Screening market will maintain strength; expansion in China andIndia

Ophthalmic Market

Optometric Market

Diabetes and Glaucoma Screening Market

By Region

By Market

FY20101H 2H

FY20101H 2H





Business Trends by Region and MarketBusiness Trends by Region and Market

America America

Europe Europe

Japan Japan

Asia Asia


▶

Steady growth in semiconductor market after Lehman’s fall▶

Activation in electronic industry by new application▶

Started out to construct new LCD factories in China successively▶

Increased demand on PJ for Business in emerging countries

▶

Steady growth in semiconductor market after Lehman’s fall▶

Activation in electronic industry by new application▶

Started out to construct new LCD factories in China successively▶

Increased demand on PJ for Business in emerging countries

✔ Launch of new electric devices with the latest concept to drive the market

✔ Oversupply of LCD panels caused by excessive investment in new LCD factories in China

✔ Expected high demand along with conversion of digital broadcasting in Japanese market

✔ Rapid expansion of touch screen panel market

✔ Launch of new electric devices with the latest concept to drive the market

✔ Oversupply of LCD panels caused by excessive investment in new LCD factories in China

✔ Expected high demand along with conversion of digital broadcasting in Japanese market

✔ Rapid expansion of touch screen panel market

▶

Resumption of investments by Korean, Taiwanese, Chinesemanufactures

▶

Slow recovery in Japan, but not proactive to resume capital investment

▶

Resumption of investments by Korean, Taiwanese, Chinesemanufactures

▶

Slow recovery in Japan, but not proactive to resume capital investment

✔ Investments in Chinese and Asian markets continues to be good

✔Speed of recovery at Japanese manufactures slows down by high Yen

✔ Investments in Chinese and Asian markets continues to be good

✔Speed of recovery at Japanese manufactures slows down by high Yen

13

BusinessBusiness Trends by Region and MarketTrends by Region and Market

By Market

By Region FY20101H 2H

FY20101H 2H

North AmericaNorth America

EuropeEurope

JapanJapan

SemiconductorSemiconductor

FPDFPD

Optical DeviceOptical Device





AsiaAsia


［Consolidated］ FY2009FY2009 FY2010FY2010

1H1H Full YearFull Year 1H1H Full YearFull Year

ActualActual ActualActual ActualActualYoYYoY

(%)(%) ForecastForecastYoYYoY

(%)(%)

Net SalesNet Sales 43,33843,338 94,86294,862 49,649,68888 114.114.77%% 10104,04,00000 109.6%109.6%

Operating Income (Loss)Operating Income (Loss) (1,836)(1,836) 1,4051,405 1111 --%% 2,7002,700 192.2%192.2%

Ordinary Income (Loss)Ordinary Income (Loss) (2,364)(2,364) 545545 (792)(792) --%% 1,4001,400 256.8%256.8%Current Term (MidCurrent Term (Mid--Term) Term) Net Income (Loss)Net Income (Loss) (2,369)(2,369) 133133 (1,295)(1,295) --%% 200200 150.4%150.4%

ROEROE 0.3%0.3% 0.5%0.5%

DividendsDividends ¥¥22 ¥¥44 ¥¥22 ¥¥44

Exchange RateExchange Rate（（AverageAverage））

US$ ¥¥95.2795.27 ¥¥93.93.0404 ¥¥88.8588.85 ¥¥84.7784.77

EUR ¥¥132.73132.73 ¥¥130.62130.62 ¥¥114.82114.82 ¥¥112.60112.60

Full Year Business ForecastFull Year Business ForecastFull Year Business Forecast（million yen）

14

＊Assumed exchange rate, after October 2010, will be 80 yen per U.S. dollar and 110 yen per Euro


［Consolidated］ FY2009FY2009 FY2010FY2010

1H1H Full YearFull Year 1H1H Full YearFull Year

ActualActual ActualActual ActualActualYoYYoY

(%)(%) ForecastForecastYoYYoY

(%)(%)

Net Net SalesSales

PositioningPositioning 22,99722,997 49,35049,350 25,25,767767 112.0112.0%% 52,00052,000 105.4%105.4%

Eye CareEye Care 14,92914,929 31,56131,561 14,53314,533 97.3%97.3% 31,00031,000 98.2%98.2%

FinetechFinetech 5,4115,411 13,95013,950 9,3879,387 173.5%173.5% 21,00021,000 150.5%150.5%

TotalTotal 43,33843,338 94,86294,862 49,68849,688 114.114.77%% 104,000104,000 109.6%109.6%

Operating Operating Income Income (Loss)(Loss)

PositioningPositioning (1,173)(1,173) 66 109109 --%% 700700 --%%

Eye CareEye Care 326326 1,9631,963 (316)(316) --%% 900900 45.8%45.8%

FinetechFinetech (990)(990) (564)(564) 218218 --%% 11,,110000 --%%

TotalTotal (1,836)(1,836) 1,4051,405 1111 --%% 2,7002,700 192.2%192.2%

Business Forecast by SegmentBusiness Forecast by SegmentBusiness Forecast by Segment（million yen）

15


11.69.38.5

5.4

9.012.0

0.90.20.4

(0.9)

(3.3)

0

0

10

20

08/1H 08/2H 09/1H 09/2H 10/1H 10/2H(4.0)

(2.0)

0.0


54.349.643.3

51.546.965.7

2.7

0

3.2

(1.8)

(9.9)

3.0

0

20

40

60

80

08/1H 08/2H 09/1H 09/2H 10/1H 10/2H(10.0)

(5.0)

0.0


18.415.0 14.9

16.6 16.414.5

1.8

(0.1)0.3

1.6

(0.3)

1.2

0

10

20

30

08/1H 08/2H 09/1H 09/2H 10/1H 10/2H(1.0)

1.0

Net Sales Operating Income

16

Financial Results and Forecast (Semiannually)Financial Results and Forecast Financial Results and Forecast (Semiannually)(Semiannually)

Net Sales (billion yen)

Operating Income (billion yen)

35.122.8

22.9

26.3 25.7 26.2

1.1

(6.4)

(1.1)

1.10.1 0.6

0

10

20

30

40

08/1H 08/2H 09/1H 09/2H 10/1H 10/2H(8.0)

(6.0)

(4.0)

(2.0)

0.0


１．Consolidated１．Consolidated ２．Positioning２．Positioning

３．Eye Care３．Eye Care ４．Finetech４．Finetech

Operating Income (billion yen)

Operating Income (billion yen) Operating Income (billion yen)Net Sales (billion yen)

Net Sales (billion yen) Net Sales (billion yen)


Analysis of Gain and Loss in Operating Income (Analysis of Gain and Loss in Operating Income (YoYYoY))


Impact from Currency Exchange (After FY2010 2H)Impact from Currency ExchangeImpact from Currency Exchange (After FY2010 2H)(After FY2010 2H)

Exchange Rate Impact from Fluctuation by ¥1 (after FY2010 2H)

Assumed Rate for FY2010 2H Net Sales Operating

Income

US$ ¥80 ¥0.25 billion ¥0.1 billion

EUR ¥110 ¥0.1 billion ¥0.05 billion

18


Promotion of Business RestructuringPromotion of Business RestructuringPromotion of Business Restructuring１

Fixed-Cost Reduction, Enhancement of Organizational Efficiency１

Fixed-Cost Reduction, Enhancement of Organizational Efficiency

Optimize Staffing Allocation in Topcon Group■■

Promote Business Process Restructuring■■

Restructure Organization, Review Position’s Allocation ■■

２

Cost Reduction２

Cost Reduction

■■ Reduce Distribution Cost

Strengthen *VA/CD Activities （increase oversea procurement）

*Value Analysis / Cost Down■■

Improve the Ratio of Direct Cost and Overhead Cost （reduce indirect personnel）

■■

Reorganize Production Bases in Japan■■

３

Improvement of Cash Flow３

Improvement of Cash Flow

■■ Reduce Accounts Receivable (aim to promote collection of long term debts)

Reduce Inventories (promote *PSI process) *Supply Chain Management■■


Forward-looking StatementsForwardForward--looking Statementslooking Statements

20

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.

Inquiries:Corporate Communication Dept.IR AffairsTOPCON CORPORATIONＴel：+８１-３-３５５８－２５３２E-mail:[email protected]ＵRＬ: http://global.topcon.com/invest/

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