Rinnai : Financial Results (2405KB)

Financial Results of Fiscal 2024, ended March 31, 2024

May 9, 2024

Disclaimer

Forecasts, projections, strategies, and other forward-looking statements contained in this

document are based on information currently available to the Company and certain

assumptions that the Company believes are reasonable. Actual results may differ materially from these statements due to various risks and uncertainties. This material is

for informational purposes only and is not intended as a solicitation to trade.

©Rinnai Corporation

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1. Fiscal 2024 Results
2. Review of Medium-Term Business Plan (New ERA 2025) and Future Outlook
3. Fiscal 2025 Outlook

3

Fiscal 2024: Consolidated Performance Overview

Net sales: ¥430.1 billion (up 1.2% year on year)

Record-high level

[vs target*: down 2.2%]

Despite weak market conditions in the first half of the year, inventory levels began to optimize in the second half, leading to record-high net sales

Operating income: ¥39.3 billion (down 5.0% year on year; Operating income to net sales ratio：9.2%) Normalization of the production system and cost reductions in the second half largely compensated

	for our negative performance in the first half	[vs target*: up 0.9%]
		Record-high level
	Ordinary income: ¥46.0 billion (up 3.4% year on year; Ordinary income to net sales ratio：10.7%)
	Increase with the help of foreign exchange gain	[vs target*: up 4.7%]

Net income attributable to owners of the parent company: ¥26.6 billion

(up 2.2% year on year; Net income to net sales ratio: 6.2%)

[vs target*: up 6.7%]

*"vs target" indicates the figure compared to performance forecasts announced August 4, 2023.

• First half: Weak sales due to cooling consumer confidence caused by rising prices and high interest rates
• Second half: Due to optimization of inventory levels, both sales and profit recovered significantly, with second-half profit reaching a record high

©Rinnai Corporation

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Fiscal 2024: Consolidated Financial Results
Net Sales	Operating Income	Attributable to owners of the parent company
	Net Income
[Billions of Yen]	[Billions of Yen]			[Billions of Yen]
450	45			45
300	30	Operating income to	30
	11.8%	net sales ratio				Net income to
	9.8%	9.7%
150	9.2%	15	8.0%		net sales ratio
15
					6.5%	6.1%	6.2%
0	0			0
FY2021 FY2022 FY2023 FY2024	FY2021 FY2022 FY2023 FY2024		FY2021 FY2022 FY2023 FY2024

• Net sales up for fourth consecutive year, partly due helped by foreign currency translation
• Profits volatile over past four years due to supply-demand imbalance and supply chain disruptions

©Rinnai Corporation

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Fiscal 2024: Net Sales by Product

	Fiscal	Fiscal	YOY
[Billions of yen]		2023	2024	Change
Amount	% of total	Amount	% of total	Amount		(%)

	Water heaters	258.65	60.8%	263.83	61.3%	+5.18	+2.0%
	Kitchen
	91.78	21.6%	90.49	21.0%	-1.28	-1.4%
	appliances
	Air	21.94	5.2%	21.74	5.1%	-0.19	-0.9%
	conditioning
	appliances
	Commercial-
	10.66	2.5%	11.21	2.6%	+0.54	+5.1%
	use equipment
	Others	42.17	9.9%	42.89	10.0%	+0.71	+1.7%
	Total	425.22	100.0%	430.18	100.0%	+4.95	+1.2%

©Rinnai Corporation

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Fiscal 2024: Consolidated Sales/Income Results

[Billions of yen]	Net Sales	YOY	Operating	YOY Change	Operating	YOY
Change	Income	Margin	Change
Consolidated	430.18	+1.2%	39.36	-5.0%	9.2%	-0.6pt
[Billions of yen]	Net Sales	YOY	Operating	YOY Change	Operating	YOY
Change	Income	Margin	Change
Japan	192.35	-2.3%	17.96	-23.9%	9.3%	-2.6pt
United States	57.87	+3.8%	-1.19	-	-2.1%	-2.6pt
Australia	30.33	+9.7%	1.24	+5.6%	4.1%	-0.2pt
China	71.88	+8.7%	12.14	+14.9%	16.9%	+0.9pt
South Korea	31.87	-0.7%	0.01	-97.7%	0.1%	-2.1pt
Indonesia	14.91	-8.0%	2.74	+14.4%	18.4%	+3.6pt
Others	30.94	+1.3%	4.36	-10.5%	14.1%	-1.9pt
Adjustments	-	-	2.07	-	-	-
						7

Fiscal 2024: Consolidated Operating Income Analysis

[Billions of yen]

Effect of domestic

41.41 revenue decrease

-13.78

Decreased

fixed

costs in

Effect of local Japan revenue

increase at

overseas

subsidiaries

+7.94 +3.04

+4.24

Increased

fixed costs overseas

-5.45

-3.11

YOY change

-2.05 billion

Cost-

cutting 39.36

Effect of efforts, etc. raw

materials

prices

-0.15 +6.35

-0.53

*Overseas local

procurement

FY2023			FY2024
Forex effect +0.60

• Reductions in fixed costs in Japan and overseas and cost reductions resulting from recovery in production significantly curbed the profit decline in the first half

©Rinnai Corporation

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Japan Fiscal 2024 Results

*From April 2023 to March 2024

• Segment companies

Rinnai (non-consolidated basis), domestic consolidated subsidiaries (manufacture and sales of products)

■ Main products	Net sales by product
	(Fiscal 2024 results)

• Non-consolidatedresults of major company Rinnai (non-consolidatedbasis)

• Recovery trend due to optimization of distribution inventories through the second half and entrenched effects of price revisions
• Increase in sales of key products such as hybrid water heaters

		Commercial-use equipment 1%
Built-in hobs	Gas clothes	Others
(stovetops)	dryers	14%
			Water
		Kitchen	heaters
		appliances	51%
		30%
Hybrid water	Dishwasher/
heater	dryers	Air conditioning

appliances 4%

• Segment results

[Billions of Yen]	Fiscal	Fiscal	YOY
2023	2024	change
Net Sales	196.83	192.35	-2.3%
Operating Income
23.59	17.96	-23.9%
Operating income to
12.0%	9.3%	-2.6pt
net sales ratio

Rinnai (non-consolidated basis),

Fiscal 2024 Results

■：Net sales ■：Operating income	（Billions of yen）
-●-：Operating income to net sales ratio

204.92242.44 210.52

14.27	19.87		15.10
Fiscal 2022	Fiscal 2023	Fiscal 2024
[Billions of Yen]	Fiscal		Fiscal		YOY
2023		2024		change
Net Sales	242.44		210.52		-13.2%
Operating Income
19.87		15.10		-24.0%
Operating income to
8.2%		7.2%		-1.0pt
net sales ratio

Quarterly Operating Income

（Billions of yen)

6.25

4.78

1.60	2.46
	[Sales Volume in Japan]	YOY
	change
	Water heater with heating	-16.3%
	systems
	Water heater with bath-filling
	-25.2%
	systems
	Built-in hobs (stovetops)	-3.9%
	Gas clothes dryers	-2.7%
	©Rinnai Corporation	9

United States Fiscal 2024 Results

*From January to December 2023

■ Segment company

Rinnai America

■ Main products	Net sales by product
		(Fiscal 2024 results)
		Commercial-use	Others
		equipment 1%	5%
Non-	Condensing water	Air conditioning
appliances
condensing	heaters (High-	6%
water heaters efficiency models)
			Water
Condensing boilers		heaters
			88%

• Segment results

[Billions of Yen]	Fiscal	Fiscal	YOY
2023	2024	change
Net Sales	55.75	57.87	+3.8%
Operating
0.31	-1.19	-
Income (loss)
Operating
income (loss) to	0.6%	-2.1%	-
net sales ratio

• Non-consolidatedresults of major company Rinnai America

• Adjustments of inventories, which had been high since the beginning of the fiscal year, due to sales promotion and production cutbacks, ran its course
• Inventory optimization led to reductions in warehousing fees, labor costs, and sales promotion expenses, and reduced cumulative losses

Rinnai America, Fiscal 2024 Results

■：Net sales ■：Operating income	（Billions of yen）
-●-：Operating income to net sales ratio
Quarterly Operating Income

44.75	55.75	57.87		（Billions of yen)
					1.37
						0.68
					-1.77	-1.47
2.01			-2.1%-1.19
0.30
Fiscal 2022	Fiscal 2023		Fiscal 2024
	Fiscal	Fiscal	YOY change
[Billions of Yen]			[Sales Volume]	YOY change
2023	2024	Yen	Local
			currency
				Tankless water
						-5.8%
Net Sales	55.75	57.87	+3.8%	-3.4%	heaters
Operating Income (loss)	0.30	-1.19	-	-	Condensing water
heaters of total
						-13.6%
Operating income (loss)					(High-efficiency
0.6%	-2.1%		-
to net sales ratio			models)
					©Rinnai Corporation	10