Fiscal Year Q Results and Full Year Plan

Transcription

1 This notice has been translated from the original notice in Japanese. In the event of any discrepancy, the original in Japanese shall prevail. Fiscal Year Q Results and Full Year Plan January 29, 2016

2 3Q, FY 2015 Financial Overview An increase in sales and profits. Sales in remodeling increased and sales in the overseas housing equipment business also continued to increase steadily. Domestic housing equipment business: - Sales and profits increased in remodeling mainly due to the strong performance of the house remodeling segment. - Sales and profits increased in the new housing segment thanks to a recovery in the demand for detached housing. Overseas housing equipment business: - Despite a slowdown in sales in China since July, total sales and profits in the overseas housing equipment business saw an increase for the third quarter as a whole. - Washlet toilet sales continued to increase, as in the first and second quarters, by more than 30% compared to last year. 1

3 3Q, FY 2015 Results Financial results Y 100 million, rounded down 3Q, FY14 3Q, FY15 Results Plan Results YoY (%) Net Sales Operating Profit Ordinary Income Profit Attributable to Owners of Parent 3,891 4, , (+7%) +88 (+35%) +80 (+29%) +94 (+50%) 2

4 3Q, FY 2015 Results Sales and profit by business segment < Net Sales > < Operating Profit > Y 100 million, rounded down 4,180 3, Remodeling Remodeling New Housing New Housing New Domain Overseas H.E. Domestic H.E 3Q,FY14 3Q,FY15 YoY(%) Domestic H.E. 2,896 3,080 +6% (Remodering) 1,917 2,096 +9% (New Housing) % Overseas H.E % New Domain % Others % Total 3,891 4,180 +7% 3Q,FY14 3Q,FY15 YoY Domestic H.E (Remodering) (New Housing) Overseas H.E New Domain Others Total The calculation method has been partially changed to bring the profits earned in individual business segments closer to actual conditions. Sales in remodeling increased and sales in the overseas housing equipment business also continued to increase steadily, resulting in an increase in total sales and profits. 3

5 3Q, FY 2015 Results Sales per Products in Domestic Housing Equipment Business Y 100 million, rounded down Net Sales 3Q, FY14 3Q, FY15 YoY(%) Restroom Products 1,152 1,223 +6% Fittings -1% Bathrooms +6% Modular Kitche ns/basins +18% Bath/Kitchen Products Total 1,527 1,611 +6% Others Total % Adjusted amount Domestic H.E. Total 2,896 3,080 +6% Continued increase in total sales of restroom products as well as of bathroom and kitchen products. A slowdown in sales of faucets and appliances in markets for nursing care and other public facilities. 4

6 3Q, FY 2015 Results Sales and profit per region in Overseas housing equipment In Local Currency Net Sales Operating Profit Currency 3Q, FY14 3Q, FY15 YoY(%) 3Q, FY14 3Q, FY15 YoY Operating Margin Americas $ million % % 100 million China Chinese yuen % % Asian & Oceanian Region $ million % % Europe million % In Japanese Yen Americas Y 100 million % China Y 100 million % Asian & Oceanian Region Y 100 million % Europe Y 100 million % Total Y 100 million % Exchange rates 1$ Chinese yuen The calculation method has been partially changed to bring the profits earned in individual business segments closer to actual conditions. Despite a slowdown in sales in China since July, the overseas housing equipment business as a whole saw an increase in sales and profits during the third quarter (on a yen basis). Financial results for business in China (on a local currency basis): Financial performance slowed down during the third quarter, with sales decreasing to 95% of last year s level and operating profit decreasing by 40 million yuan compared to last year. During the fourth quarter, however, sales are predicted to be 103% of last year s level and operating profit nearly the same as last year. 5

7 3Q, FY 2015 Results Cause of increase/decrease of operating profit Y 100 million, rounded down Positive Factors Negative Factors Cause of Increase/Decrease Usual Cost Reduction +22 3Q, FY15 YoY Cost Reduction V Plan Cost Reduction Increase in Remodeling Sales +72 Increase in New housing Sales +2 Profit and loss in Overseas Housing Equipment Business +14 Profit and loss in the New Domain Business +4 Others +5 Increase in material prices -22 V Plan investments -13 Strengthening investment sales -6 Increase in labor cost -4 Respond to the expansion of volume zone market -12 Total +88 6

8 Topics (1) New factory construction - New sanitary ware factory (Vietnam) As a part of our global supply chain, a new factory is being constructed for the mass production of sanitary ware to create a production system based on our supply strategy. While viewing Vietnam as a supply base that supports our business in Asia and Oceania, we will supply products to Vietnam and other rapidly growing Asian countries. Image of the new factory Global supply chain Local production for local consumption Establishment of a supply system from a global perspective Numbers of sanitary ware production sites by region (December 2015): Japan: 4 Americas: 3 China: 4 Asia and Oceania: 5* * A new factory in Hung Yen Province is the second production site after the factory in Hanoi City, Dong An Province. Including this factory, there are six sanitary ware production sites in Asia and Oceania. Factory overview Company name Address Amount of investment Products Production capacity Construction started TOTO VIETNAM CO., LTD. Plot No. M-7, Thang Long Industrial Park II, My Hao District, Hung Yen, Vietnam Approx. 9.7 billion yen Sanitary ware Approx. 600,000 pieces/year January 2016 Operation scheduled to start March

9 Topics (2) New factory construction - New building at faucet factory (Fukuoka, Japan) To reconstruct the basis for domestic business and to further develop business worldwide, we will build a new factory building. As the mother factory, designed to improve productivity as well as to be environmentally friendly, the new factory will reduce water consumption in manufacturing processes by approximately 80% compared to the current level. Image of the new factory Manufacturing/assembly factories - TOTO AQUATECHNO Kokura factory - TOTO AQUATECHNO Oita factory - TOTO DALIAN CO., LTD. - P.T. SURYA TOTO INDONESIA Factory overview Company name Address Amount of investment Products Construction started TOTO AQUATECHNO Kitakyushu City, Fukuoka Prefecture, Japan Approx billion yen Faucets, electric water heaters, railings, etc. February 2016 Operation scheduled to start October

10 Topics (3) New products (to be released on February 1, 2016) - Bathroom unit SAZANA - Vanity cabinet SAQUA - Bathroom for condominium remodeling Expanding WG Hokkarari Floor series Progress in cleanliness (equipped with four easy-to-clean features) - Hokkarari floor that prevents scale formation - Mirror that prevents dirt from adhering to its surface - Artificial marble bathtub that repels water and sebum - Counter that is separate from the walls and the bathtub and is easy to clean New features: - A new design with a wide, square ceramic bowl - TOTO s first vanity cabinet equipped with an air-in-swing faucet - Patray, which allows the user to see and take out its contents easily - Energy-saving, wide LED lighting 9

11 Topics (4) Chosen for the Climate Disclosure Leadership Index (CDLI) for four years running TOTO replied to a questionnaire prepared by Climate Disclosure Project (CDP) *1 representing 822 institutional investors requesting the disclosure of climate change information, including greenhouse gas emissions, as well as the risks and opportunities resulting from climate change. We obtained a disclosure score in the top 10% of 500 Japanese companies targeted for the survey and were selected for the CDLI. *1 CDP: An international non-profit organization that provides the only global system designed to assess, disclose, manage, and share important environmental information on companies and cities. CDP has the world s largest dataset on product risks regarding climate change, water and forests, and provides the data for strategic decision making in business, investment and policies. TOTO was highly recognized for its activities for climate change information disclosure and was selected for the CDLI four years running. 10

12 This presentation material contains forward-looking statements based on assumptions, estimates and plans as of January 29, Actual performance may differ materially from these forward-looking statements due to risks and undermined factors arising from changes in the world economy, competition and foreign currency exchange rates.