Hirose Electric : Transcript of Financial Results Briefing for the 2nd Quarter of the Fiscal Year Ending March 2022

HIROSE ELECTRIC CO., LTD.

Q2 Financial Results Briefing for the Fiscal Year Ending March 2022

November 2, 2021

Event Summary

[Company Name]	HIROSE ELECTRIC CO., LTD.
[Company ID]	6806‐QCODE
[Event Language]	JPN
[Event Type]	Earnings Announcement
[Event Name]	Q2 Financial Results Briefing for the Fiscal Year Ending March 2022
[Fiscal Period]	FY2021 Q2
[Date]	November 2, 2021
[Time]	10:30 - 11:27
	(Total: 57 minutes, Presentation: 23 minutes, Q&A: 34 minutes)
[Venue]	Webcast
[Number of Speakers]	3
	Kazunori Ishii	President
	Shin Kamagata	Director, Group President, Administration
		Group
	Hideo Suzaki	Manager, IR Office

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Presentation

Suzaki: We will now begin HIROSE ELECTRIC CO., LTD.'s s financial results briefing.

Thank you very much for joining us today. Today's financial results briefing is attended by Kazunori Ishii, President; Shin Kamagata, Group President, Administration Group; and myself, Hideo Suzaki from the IR Office. I will serve as moderator. Again, we are holding the meeting online.

First of all, President Ishii will make a brief speech, and then we will explain our financial results for the second quarter based on the material. For the summary section at the beginning of the presentation, Kamagata, Group President of Administration Group, will explain the summary and various topics.

We will take your questions during the remaining time.

Then, President Ishii will deliver the opening speech.

Ishii: Good morning again, everyone. This is Kazunori Ishii, President of HIROSE ELECTRIC. Thank you very much for taking time out of your busy schedules to participate in our financial results briefing today.

After this, our IR official will report on the recent developments, financial results, and forecast.

Almost all items fared well, reflecting the active market conditions. However, the most important thing for HIROSE is continuous growth, so I think it is important to improve our ability to operate business in H2 of the current fiscal year and into the next fiscal year, as well as to increase our sensitivity and responsiveness to foresight.

With your wisdom and advice, we hope to make our Company even stronger. We wish to have your continued advice and support for us.

That's all from me.

Suzaki: We will now begin the explanation in accordance with today's presentation material.

Kamagata, Group President of Administration Group, will give you a presentation.

Kamagata: Hello, everyone. This is Kamagata from Administration Group.

In both Q2 and H1 of the current fiscal year, sales and orders received were at their record highs. I will explain the numbers later.

Next is the forecast for the full year.

We revised up the sales estimate by JPY6 billion to JPY156 billion. We raised the operating profit estimate by JPY2 billion to JPY35 billion, the profit before tax estimate by JPY2 billion to JPY36 billion, and the estimate for Net profit by JPY1 billion to JPY26 billion. For the full year, we added JPY60 per share to the initial dividend forecast, bringing the total to JPY320 per share.

Of other topics, the first one, we have decided to select the Prime Market in the TSE's new stock market segmentation, and we are now preparing to apply for listing on the new market segment.

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The second topic, HIROSE will publish its first‐ever integrated report, with the first edition scheduled to be launched by the end of this year.

The third topic, we are currently restructuring our supply chain, and we plan to revamp the core system of the entire HIROSE ELECTRIC Group as well. At present, we are planning to switch over in the next 2 years, from 2022 to 2024.

The fourth topic is the construction of the new Koriyama plant, which will focus on the automotive application, as we have announced. This is going on schedule. We are planning to start construction in 2022 and finish it in 2023.

Now, we will move on to the details. I will hand over to the IR Office.

Suzaki: Now please see page 3. This is a summary of the business results.

In Q2, sales for general industrial, consumer, and automotive applications grew year on year. Orders received in H1 totaled JPY103.33 billion. Sales in H1 were JPY79.19 billion, and the operating profit ratio was 25%.

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The graph on page 4 shows the Q2 results.

In Q2, sales were JPY40.75 billion, operating profit was JPY10.7 billion, and the operating profit ratio was 26.3%.

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