Amada : Consolidated Results for the Nine Months Ended December 31, 2021(with script)

I would like to begin with a summary of the third quarter financial results.

In the current fiscal year, as the economy continues to normalize, this third quarter was another solid quarter, with cumulative sales revenue increased 26.5% YoY to JPY217.1 billion.

Operating income totaled JPY26.5 billion, an increase of 40.2% YoY.

Net income totaled JPY20.2 billion, an increase of 47.1% YoY.

Orders received continued to be strong, especially overseas, because of the favorable combinations of subsidy effect, pent-up demand and the trend in operation toward automation and optimization. Orders received totaled JPY279 billion, an increase of 56.9% YoY, and a record high for the third quarter (9 months).

As mentioned at the beginning of this report, sales revenue was JPY217.1 billion, an increase of 26.5% YoY. Gross profit was JPY93.2 billion, an increase of 36% over the same period last year, and the gross profit margin increased by three percentage points from 39.9% to 42.9%.

The main reasons for the increase in the gross profit margin were 2.1 percentage points from improved capacity utilization brought about by higher production output, 0.6 percentage points from raised selling prices, and 0.2 percentage points from manufacturing cost rationalization, despite the impact of price hikes of steel and other materials.

SG&A expenses were JPY67.3 billion, an increase of JPY8.3 billion YoY, but the SG&A ratio improved to 31% from 34.4% in the same period last year. The variable cost ratio increased by 0.5% due to an increase in the proportion of exports to overseas subsidiaries and the impact of rising logistics costs.

In addition, fixed costs increased by JPY5.4 billion, but after taking into account foreign exchange rates, the increase was only JPY3.6 billion. The main reasons for the increase were research and development expenses as well as sales-related expenses and personnel expenses associated with the sales growth. I will explain the details later.

Next is operating income. In the third quarter of last fiscal year, operating income included a gain of about JPY10 billion from the sale of fixed assets, so the JPY26.5 billion for this fiscal year was a 40.2% increase YoY. But in terms of operating income on Japanese standards, excluding this special factor, operating income increased 2.7 times YoY, caused by the effects of streamlining as well.

The break-even point is not shown here, but it remains below the JPY200 billion at JPY199.4 billion on an annualized basis.

The yen weakened against the US dollar to JPY111.10, the Euro to JPY130.62, and the yuan to JPY17.25.

As mentioned at the beginning of this report, orders received totaled JPY279 billion, up 57% from JPY177.9 billion YoY.

Of this total, the sheet-metal fabrication machines division, shown in the center bar graph, accounted for JPY205.1 billion, an increase of 57% from JPY130.3 billion YoY. In particular, sales of machinery increased significantly to JPY150.6 billion, up 76% from JPY85.5 billion YoY.

Orders by region are shown on the right. Domestic orders increased 43% to JPY109.4 billion from JPY76.5 YoY. Meanwhile overseas orders increased 67% to JPY169.6 billion from JPY101.3 billion YoY, driving the increase in orders.

As for the results by business segment, the left graph shows that sales revenue from the metal working machinery segment was JPY177.7 billion, an increase of 27% YoY.

Operating income was JPY21.5 billion, an increase of only 24% YoY, due to the impact of the special factors I mentioned earlier.

As shown on the right graph, the metal working machinery segment recorded sales revenue of JPY38.4 billion, a 26% YoY, and operating income of JPY4.3 billion, 7.4 times increase YoY.