FY2020 Financial Results...CV-Japan Full-scale decline expected in 2Q (YoY 1Q-90%, 2Q-60%,...
Transcript of FY2020 Financial Results...CV-Japan Full-scale decline expected in 2Q (YoY 1Q-90%, 2Q-60%,...
May 26, 2020ISUZU MOTORS LIMITED
Copyright(C) 2020 Isuzu Motors Limited All rights reserved
FY2020 Financial Results
1 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
1. Overview2. Business Status3. FY2020 Financial Results4. FY2021 Full-year Outlook5. Alliance6. Q&A Session
Contents
2 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
1. Overview
3 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Overview: Influence of COVID-19 Pandemic
� Limitations to our business will last a long lapse of time. Isuzu shall achieve and maintain both “healthcare of our stakeholders and employees” and “social responsibility” by tackling on 2 measures.
1. As a company supporting the power to “deliver” worldwide, we shall offer vehicle that answer to our customers’ needs.
2. Guarantee stable operation of vehicles by our after-service programs.
� We are forced to face challenges as the demand meets full-impact of the COVID-19 pandemic. On the other hand, even as the new coronavirus ravages throughout the world, the distribution business is constantly moving. Therefore, Isuzu assumes that the recovery in demand shall start sometime in FY2021.
� Isuzu shall reduce costs and seek profit by building a structure to struggle with the crisis.
Latest Initiatives
4 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Overview: FY2020 Consolidated Results� While slowdown in markets became apparent in FY2020, was able to record a 140.6
billion yen profit.� Only minor impact from COVID-19 pandemic in FY2020. Full-scale impact comes
after April 2020 and onwards.
FY2020 FY2019CV-Japan 81 83 -2 -2%CV-Overseas 208 223 -15 -7%
CV Total 289 306 -17 -5%LCV-Thailand 163 163 -0 -0%LCV-Export 148 179 -31 -17%
LCV Total 311 342 -31 -9%Total 600 648 -48 -7%
2,079.9 2,149.2 -69.3 -3%140.6 176.8 -36.2 -20%150.9 189.0 -38.1 -20%81.2 113.4 -32.2 -28%
38 Yen 37 Yen 1 Yen
Changes
Financial Forecast (Bil. Yen)
Global Sales Units (K-units)
SalesOperating IncomeOrdinary Income
Net IncomeDividends
5 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Overview: FY2021 Full-year Outlook� Despite the uncertainty in the markets, Isuzu is determined that it does
matter to present an outlook with certain assumptions.� As Isuzu expects substantial decline in sales units, the forecast for FY2021
includes emergency initiatives to reduce expenses.
FY2021 FY2020CV-Japan 68 81 -13 -16%CV-Overseas 167 208 -41 -20%
CV Total 235 289 -54 -19%LCV-Thailand 108 163 -55 -33%LCV-Export 133 148 -15 -12%
LCV Total 241 311 -70 -23%Total 476 600 -124 -21%
1,700.0 2,079.9 -379.9 -18%50.0 140.6 -90.6 -64%
Changes
Financial Forecast (Bil. Yen)
Global Sales Units (K-units)
Operating IncomeSales
6 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
2. Business Status
7 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Impact of COVID-19 and countermeasures
Regions April
JapanSuspended operations atFujisawa Plant(April 13th-17th)
ThailandAll plants temporarilysuspended for 4 weeksstarting from April 13th
KD AssemblyPlants Outside
Japan
Suspended operations in11 plants
Present
Resumed operation from April20th with thorough protectivemeasures
Resumed operation from earlyMay
Suspending operation in6 plants
� Suspended operations at plants in Japan and Thailand in April, but has already resumed operations.
� Japan: To minimize production loss, continue initiatives to prevent future infections.� Overseas: Will decide whether or not to restart operations taking in account of local
government orders, operation status of sales and supply chains.
8 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Assumptions of FY2021 Outlook� Assumptions of recovery in demand and sales units were made in accordance
to the most recent market information available.
*There may be major delays in recovery of markets due to second wave ofCOVID-19 pandemic.
Assumptions of Sales Units
CV-Japan Full-scale decline expected in 2Q (YoY︓1Q-90%, 2Q-60%, 3Q-80%, 4Q-90%)
CV-Overseas Forecasting the worst at 1Q, slight recovery from 2Q onwardsWill still remain at YoY 90% in the latter half of FY2021
LCV-Thailand Low demand will continue till 2Q, but start to recover in 3QWill return to the same level as previous year in 4Q
LCV-Export Same assumptions as CV-Overseas
9 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
Mid/South AmericaOceania
AsiaAfrica
EuropeChina
19
33
12
17 1126
7669
10
20
North America
31 29
39 45
44 36
FY19 FY20 FY21
Japan
83 81
68
Global Sales Units-CV
Mid-East
1822
2017
(K-units)
*Details of Global Sales Units-CV
Japan:Wholesale & Direct Sales to Customers North America / Australia: Wholesale of Local Distributors
Other Regions: Shipment from Japan
1H 2H
Global Sales Units FY2019 FY2020 FY2021CV-Japan 83 81 68
CV-Overseas 223 208 167 CV-Total 306 289 235 Forecast
Forecast
8 6 9
5
FY2019 FY2020
8 9 9 11
FY2019 FY2020
9 11 9 11
FY2019 FY2020
17 16
16 10
FY2019 FY2020
39 32
37 37
FY2019 FY2020
7 5 5 5
FY2019 FY2020
16 17
15 12
FY2019 FY2020
10 9
9 11
FY2019 FY2020
� FY2020︓Sales units decreased mainly due to a drop in demand of L/D trucks in Japan and deteriorating markets in Asia.
� FY2021︓Decline of demand from 2Q and onwards in Japan, expected sales units of each regions of CV-Overseas are to be announced.
10 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
44 48
47 44
31.8%32.5%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
0
20
40
60
80
100
120
FY19 FY20 FY21Forecast
91
792H
1H
92
51 58
59 45
40.6%42.4%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
0
20
40
60
80
100
120
140
FY19 FY20 FY21Forecast
Japan Industry Sales and Isuzu Share
110
81
103
� H/D & M/D︓Industry sales increased slightly, stable sales resulted to a rise in shares.� L/D︓Despite fall in industry sales, successfully took in the last-minute surge demand
before implementation of the new emissions regulations into force in the 1H of FY2020 to increase shares.
H/D & M/D Trucks(4 tons or above)
L/D Trucks (2-3 tons) (K-units) (K-units) (Share)
(Share) 1H 2H
11 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
74 70
89 93
FY19 FY20 FY21
108
Mid/South America
Oceania
AsiaMid-East
19
Europe China
30
17
11
15
24
24
29
20
Thailand
7
163 163
1724
Africa
48 43
(K-units)
1H 2H
Global Sales Units-LCV
Global Sales Units FY2019 FY2020 FY2021LCV-Thailand 163 163 108LCV-Export 179 148 133LCV-Total 342 311 241
*Details of Global Sales Units-LCV:: Thai Shipment
Forecast
5 13 10
16
FY2019 FY2020
8 7 11
0
FY2019 FY2020
26 19
22 24
FY2019 FY2020
18 7
6
4
FY2019 FY2020
12 8
12 9
FY2019 FY2020
16 14
14 10
FY2019 FY2020
9 6
11 11
FY2019 FY2020
� FY2020︓Same level of sales units for LCV-Thailand as previous year, while sales units of LCV-Export saw a major drop due to decline of demand and restrained buying awaiting for the forthcomin full-model change.
� FY2021︓LCV-Thailand is forecasted to decline due to a drop in industry sales. Forecasted sales units according to regions for LCV-Export are to be announced.
(K-units)
12 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
163 163
81 74
80 67
0
50
100
150
200
250
300
350
400
FY2019 FY2020
Vehicle-Thailand Vehicle-Export KD Set
(K-units)
237 258
274 234 321
31.7% 31.1%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
0
100
200
300
400
500
600
CY18 CY19 CY20
512 492
1H
2H
Forecast
324
304
� Industry sales declined in 2019. Introduced full-model changed pickup trucks in the latter half of the year to maintain same level of shares as 2018.
� Production units for export decreased due to deteriorating markets and restrained purchase before the expected full-model change.
Thailand LCV Industry Sales & Share /LCV Production Units
Thailand LCV Industry Sales/Isuzu Share (Jan.-Dec.)
LCV Production Units in Thailand(Share)
(K-units)
13 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
63 59
72 64
0
20
40
60
80
100
120
140
160
FY2019 FY2020
430 366
417
365
0
100
200
300
400
500
600
700
800
900
1,000
FY2019 FY2020
731
847123
135
� Industrial Engines︓Decreased in result of the doubtful Chinese construction machine demand.
� Production units of diesel engines dropped in result of decline in sales units of vehicles and industrial engines.
Industrial Engine Global Shipment/Diesel Engine Production
Global Shipment of Industrial Engines
Production Units of Diesel Engines(K-units)
(K-units)
1H
2H
14 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
3. FY2020 Financial Results
15 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
FY2020 Consolidated Results- Year-on-year Comparison -
* Net income attributable to owners of parent
( JPY Bil. ) FY2020 FY2019
Sales 2,079.9 2,149.2 -69.3 -3%
Operating Income 140.6 176.8 -36.2 -20%
Ordinary Income 150.9 189.0 -38.1 -20%
*Net Income 81.2 113.4 -32.2 -28%FX
USD/JPY 109 111THB/JPY 3.51 3.43AUD/JPY 74 81
Changes
16 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
CV-Japan -1.3
CV-Overseas -8.7
LCV -8.5
Others -2.4
USD -2.0
AUD -3.0
THB -11.3
R&D +0.9
Dep. -1.7
Labor Cost -2.5
Strengthening
Infrastructure-1.8
Others+2.6
176.8
-36.2
140.6‘
-20.9+12.0
-2.5
-16.3-8.5
FY2019 vs. FY2020 Fluctuations- Consolidated operating income : analysis of change -
Operating Income for FY2019
Co
st R
ed
uc
tion
Ac
tivity
Sa
les
/Mo
de
l Mix
FX S
tee
l, Oil P
rice
etc
. F
luc
tua
tion
s
Fix
ed
Co
st
Flu
ctu
atio
n
Operating Income for FY2020
(JPY Bil.)
� Decline in industry sales in Japan, worsening markets outside Japan, and FX resulted in decrease of operating income.
17 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
4. FY2021 Full-year Outlook
18 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
FY2021 Full-year Outlook- Consolidated, Year-on-year Comparison -
( JPY Bil. ) FY2021 FY2020
Sales 1,700.0 2,079.9 -379.9 -18%
Operating Income 50.0 140.6 -90.6 -64%
Ordinary Income 150.9 - -
*Net Income 81.2 - -FX
USD/JPY 108 109THB/JPY 3.30 3.51AUD/JPY 68 74
Changes
TBA
* Net income attributable to owners of parent
19 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
-90.6
50.0営業利益
20年3
月期
+8.0
-100.0
-10.0
140.6
+11.4
±0
FY2020 vs. FY2021 Fluctuations- Consolidated operating income : analysis of change-
(JPY Bil.)
Operating Income for FY2020
Operating Income for FY2021
Sa
les
/Mo
de
l
Mix F
X
Ste
el, O
il
Pric
e e
tc.
Flu
ctu
atio
ns
Co
st
Re
du
ctio
n
Ac
tivity
Fix
ed
Co
st
Flu
ctu
atio
n
� Strategies to reduce costs will be taken, but the effect from sales/model mix shall be critical. Expecting a 90.6 billion yen decline of operating profit to amount to a 50.0 billion yen profit.
20 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
5. Alliance
21 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
� Collaboration in the area of Commercial Vehicle ① New Technology② H/D and M/D trucks in Japan and Asia③ M/D and L/D trucks
� UD Trucks ownership transfer from VG to ISZ (by end of CY2020)� Direction aiming through the strategic alliance with VG
• Create new valuable solution to take up the challenges and opportunities of the future logistic revolution, which will maximize the value for the customers and the society
• The very best No.1 in CV among Japan and Asia brands together with UD Trucks
December 18/2019 : Entered into Memorandum Of Understanding (MoU)
Collaborative Areas and Agreements currently under discussion � Technology Partnership Agreement� UD Trucks Share Purchase Agreement � Start the study of possible collaboration in Europe and North America
VG-ISZ strategic alliance status (1)
22 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
VG-ISZ strategic alliance status (2)
� The original time plan for signing binding agreements is still valid, but COVID-19 created challenges and there is some risk of delay.
� We will come back once there is better visibility on the COVID impact.
Expected Synergies
Next Milestone
� Collaboration in the area of R&D • Continuous support on UD Trucks Products R&D • R&D investment sharing in the area of future new
technology • Efficient H/D and M/D truck development for Japan and
Asian market� Cost reduction through components and parts sharing and
integration
23 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
24 Copyright(C) 2020 Isuzu Motors Limited All rights reserved
91.497.0 99.0 98.1 95.0
FY17 FY18 FY19 FY20 FY21
R&D Costs (JPY Bil)
(Appendix) Main Financial Index
93.8
76.672.3
80.8 81.0
FY17 FY18 FY19 FY20 FY21
CAPEX (JPY Bil.)
58.8 59.9 60.9 62.7 64.0
FY17 FY18 FY19 FY20 FY21
Depreciation Cost
(JPY Bil.)
26.0 25.2 26.0 27.3 28.1
23.1
26.924.6 24.6
34.5
0.0
30.0
60.0
0.0
50.0
FY16 FY17 FY18 FY19 FY20
Dividends (JPY Bil/%)
171.6
146.4
166.8176.8
140.6
8.9
7.5
8.1 8.1
6.8
0
12
0.0
240.0
FY16 FY17 FY18 FY19 FY20
Operating Income
(JPY Bil./%)
693.1788.4 786.9 819.2 827.2
141.3
173.3 143.1 166.8 157.8
541.5
529.6 640.4644.6 613.3
551.1461.9
500.0518.6
481.6
0.0
2,500.0
FY16 FY17 FY18 FY19 FY20
Consolidated Sales by
Regions (JPY Bil.)
Japan North America
Asia Others
64 63 62 61 58
195 175 169 179
166
80
74 70
72
65
0
400
FY16 FY17 FY18 FY19 FY20H/D L/D KDSET
Production Units in Japan (K-units)
751.4
818.4
919.6 929.8 952.9
15.2
12.0 12.2 12.3
8.6
41.543.5 44.5 43.6 44.3
0.0
70.0
0.0
1,100.0
FY16 FY17 FY18 FY19 FY20
Shareholders’
Equity/ROE
(JPY Bil./%)