The results for FY2016. - Panasonic USA · The global automotive market is expected to grow...
Transcript of The results for FY2016. - Panasonic USA · The global automotive market is expected to grow...
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
This presentation contains the business policy of Automotive
& Industrial Systems Company.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
This slide shows the FY2016 results on a U.S.GAAP basis.
Sales decreased due to the large impact of demand slumps in
lithium-ion batteries and devices for ICT application, despite
growth in the automotive business which has been led by the
strong performance of vehicle sales in North America, and
growth in the industrial business such as power storage.
The operating profit decreased due to a decline in sales and
an increase in upfront development expenses for the future
growth of the automotive and power storage businesses.
On the other hand, the marginal profit ratio improved by 0.8
points from the previous year as a result of the withdrawal
and downsizing of unprofitable businesses. We are steadily
improving the management structure.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Although both sales and profit decreased in FY2016, we have
made steady strategic moves to ensure growth.
In particular, in the automotive field, we invested 49% in
Ficosa International, an automotive component company in
Europe, in June last year and started a collaboration.
In February this year, we also established a joint automotive
battery manufacturing company with a local firm in Dalian,
China. We will supply products globally in response to the
increasing demand.
On the other hand, we continued to work on structural
reforms. In order to accelerate growth with a new framework,
we decided to transfer the lead-acid storage battery business
to GS Yuasa.
We also decided to discontinue the business of PC optical
disk drives, whose demand declined significantly due to the
progress in the adoption of cloud technologies.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
This slide shows sales targets for FY2017.
The sales target is 2,640 billion yen. We aim to increase net
sales on a currency-neutral basis by 2% from the previous
year by moving into the automotive and industrial businesses.
With regard to the existing business, we expect a sales
decrease due to the declining demand for ICT and withdrawal
from the optical disk drive business.
On the other hand, in the automotive business, automotive
batteries will grow significantly as the demand for eco-cars
such as EVs, HVs, and PHVs is expected to increase.
In the industrial business, the power storage business and
devices business including power-supply modules and multi-
layer circuit board materials will spur growth, together with the
factory solutions business, which is the core.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Next, we'll look at the operating profit.
This slide shows the change factors of the adjusted operating
profit excluding temporary expenses.
In FY2017, we will make proactive investments for future
growth despite an expected decrease in operating profit due
to an increase in fixed costs to step up investments for
production increase and development in the automotive and
industrial businesses.
Please note that while the operating profit on an IFRS basis
was 50.2 billion yen in the previous fiscal year due to
temporary expenses such as those related to lawsuits and
market quality issues, we expect to reach a figure of 100
billion yen with an operating profit ratio of 3.8% for this fiscal
year.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
This slide shows capital investments for FY2017.
We classified our business portfolio into three areas, i.e.,
"High growth businesses," "Stable growth businesses," and
"Low profitability businesses," to clarify strategic scenarios
that we should implement.
We have positioned the automotive and industrial businesses,
which are the key businesses of AIS company, as the
company's "High growth businesses" and "Stable growth
businesses."
The automotive and industrial businesses account for 70% of
AIS Company's overall sales in FY2017. We will allocate 85%
of capital investments for these businesses to accelerate our
growth strategies.
This slide shows major investment categories.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Now, I'd like to explain infotainment systems and
rechargeable batteries, which are positioned among the
Panasonic Group's large-scale six businesses.
First, the Automotive Infotainment Systems Business Division.
Although sales and profits are decreasing this fiscal year, we
will continue with our proactive efforts and investments to win
orders and enhance development for future growth.
We are thoroughly preparing to win orders from FY2018
onward, despite a sales in FY2017 decrease due to
prioritizing the establishment of BCP, such as the
restructuring of supply chains over marketing activities from
2011 to 2012.
The operating profit is expected to decrease as we will
continue with upfront development investments, in addition to
the impact of a decline in sales. We've been working with car
manufacturers on developing software that will be at the core
of next-generation cockpits, and we will establish a
development platform to enable future business growth and a
reduction in development investment.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Next, let's examine the Rechargeable Battery Business Division.
With regard to the rechargeable battery business, we aim to
increase sales and operating profit by clearly classifying existing
businesses, such as those for ICT, from a profitability perspective
and accelerating a shift to the automotive and industrial businesses.
With regard to products for the automotive field, we expect double-
digit growth for the total sales of cylindrical and prismatic batteries.
We intend to respond to increased demand, prepare for a
production increase, and supply products on a timely basis.
For the industrial field, we will expand the power storage business.
Through collaboration with local partners and system integrators,
we intend to accelerate the development of large-scale power
storage businesses, such as power infrastructures, in addition to
base stations and data centers.
With respect to operating profits, we expect an increase partly
because we recorded temporary expenses for handling lawsuits
and market quality issues, etc., during the previous fiscal year. We
aim to reestablish management foundations, including the
establishment of safety quality, and at the same time achieve the
next phase of growth.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Growth strategy towards FY2019 and beyond.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
First, let's deal with sales and profit targets.
We will target 3.2 trillion yen in sales and a 5% operating
profit ratio for FY2019.
The sales target has been reset as a more realistic target
from the previous 3.6 trillion yen, with consideration given to
the effects of exchange rates. We will focus on profits and
make a turnaround after bottoming out in FY2017.
In the automotive field, we will work on increasing orders to
improve our position with respect to car makers in Japan, the
U.S., Europe, and China.
In the industrial field, we aim to expand the business scope
from single products to systems and services.
In the existing field, we will secure profits by concentrating
resources on competitive devices.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
Now, I will explain automotive business strategies.
First, let's look at the market environment of the automotive
business.
The global automotive market is expected to grow steadily.
Meanwhile, regulations such as those shown on the slide
have been adopted or tightened in the relevant countries and
regions.
Under these environmental changes, the demand for
automotive electronic equipment, which our company targets,
is forecast to increase significantly in line with the
development of electrification and electronization at an
average annual growth rate of 8%. This is higher than that of
the vehicle market growth.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
In this automotive market which has a high growth potential, we
aim to achieve two trillion yen in sales for FY2019, with a high
annual growth rate of 16%, exceeding the industry average, by
expanding businesses into systems.
We are making steady progress with orders and the
achievement of the two trillion-yen target for FY2019. We have
already received orders for approximately 90% of the organic
portion, which excludes nonlinear sales.
In the Comfort area, we will expand the cockpit system
business by applying digital AV technologies, which are our
competitive advantage.
In the Safety area, we will accelerate ADAS development by
utilizing sensing and image processing technologies in
collaboration with other companies.
In the Environment area, we will leverage our advanced battery
and power supply technologies to obtain orders for a larger
number of vehicle models.
From the next slide, I will explain specific efforts in the Comfort,
Safety, and Environment areas, as well as their progress.
Copyright (C) 2016 Panasonic Corporation All Rights Reserved.
First, the Comfort area.
In the Comfort area, we aim to obtain a larger number of
orders by leveraging our group's technical assets in
developing new-generation cockpit systems with car
manufacturers.
Our strengths lie in possessing advanced image processing,
downsizing, and optical lens technologies within the group,
which we cultivated in digital consumer electronics.
In FY2018, we will start delivering new cockpit products that
use these technologies, such as head-up displays and center
information displays.
We've also been working on developing a platform for next-
generation cockpits with car manufacturers . We believe that
the horizontal deployment of this platform will enable our
cockpit business to enter a new growth phase.
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Next, let's move on to the Safety area.
In the Safety area, we've been working on expanding our
ADAS business by applying the group's technologies, such as
advanced image processing technologies to the AIS
Company's devices, such as automotive camera modules
which have the No. 1 market share, and furthermore, by
promoting collaboration with other companies.
We mainly target perimeter monitoring and in-vehicle ADAS in
low- and medium-speed ranges. We aim to expand the
business by exerting our strengths in self-parking, lane
change assistance, low-speed emergency brakes, driver
monitoring systems, etc.
With regard to emergency brake systems, some product
deliveries are scheduled for FY2017, and we will further work
on obtaining orders.
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Finally, let's examine the Environment area.
In the Environment area, the demand for eco-cars, such as
EVs, HVs, and PHVs, is expected to increase rapidly due to
enhanced environmental regulations in the relevant countries
and regions. As a result, inquiries on our batteries by car
manufacturers have been increasing significantly.
We have installed our batteries in 45 car models in total, with
an increase of five models over the same period last year. We
are currently working on 41 car models, 19 of which have
already placed orders.
In order to meet this increasing demand, we collaborate
closely with car makers and prepare for production increases
in these three world zones, Japan, the U.S., and China.