Nippon Paint : "Medium-Term Plan Progress Briefing" Presentation Material 6.3MB

Nippon Paint Group

Medium-TermPlan(FY2021-2023)

Progress Report

March 16, 2022

Yuichiro Wakatsuki

Representative Executive Officer & Co-President

Nippon Paint Holdings Co., Ltd.

TODAY'S AGENDA

1. Introduction	…P3
	2. Strategy By Region And Business	…P11
		3. Sustainability Strategy	…P22
			4. M&A Strategy	…P28

5. Financial Plan	…P33

1. Introduction

1-1. Executive Summary

• Numerous corporate actions post Co-President setup

Aggressive pursuit of growth in paint and adjacency arena through M&A also driving autonomous growth of existing Group partner companies※ Established the basis for sustainable growth with small headquarters at the holding company and with reinforced governance

• Delivered strong revenue growth despite the pandemic

Recognition of the strength of our business model predicated on high market share in each region with emphasis on autonomy and accountability Expect to achieve Year 3 revenue target of 1,100 billion yen one year early

• Achieved effective operating profit growth despite challenging environment

Despite impact of higher raw material prices and supply chain disruptions, achieved effective operating profit growth excluding one-off items with contributions from Indonesia, selling price increases, and significant savings in Head Office expenses compared to the initial plan

• Operating profit target for FY2023 unchanged

Well positioned to achieve Year 3 target of 140 billion yen operating profit and 45 yen EPS, driven by autonomous growth across the Group based on solid paint demand and market share gains, progress with selling price increases, and contributions from new acquisitions

Year 1 of Medium-Term Plan provided the foundation for our "Asset Assembler" model

which combines strong organic and M&A growth

Continue to fuel our insatiable appetite for medium- and long-term growth

※NPHD's consolidated subsidiaries

4

1-2.Medium-Term Plan Year 1 Review

Following Co-President setup, implemented numerous actions including M&A aimed at MSV

Clarified role of holding company while respecting autonomy of Group companies

and reinforced the foundation for sustainable EPS growth

• January
  Completed full integration of the Asia JVs and the acquisition of the Indonesia business (growth M&A, reinforce governance)
• • April
    Shifted to the Co-President stetup

2021

• October
  ・Announced the acquisition of Cromology (growth M&A) ・Announced the acquisition of JUB (growth M&A)
  ・Announced a company split involving NPHD (holding company) and NPCS※ (functional company in Japan)
  (Clearly separating functions from holding company functions and clarifying costs)

2022

• January
  Secondary share offering (improving market liquidity of NPHD common stock, reconfigure shareholder composition)

• March
  Announced the acquisition of Vital Technical (expansion to adjacencies)

• August
  Announced the transfer of the European automotive business and the India businesses to the Wuthelam Group
  (divestiture of unprofitable businesses and retention of future options)

◼ November
	Announced full integration of	◼ February
	the Chinese automotive coatings		Announced a new Board
	consolidated subsidiaries		structure
	(integration of the Chinese		(reinforce governance)
	automotive business)

※Nippon Paint Corporate Solutions

5