SEIKO GROUP CORPORATION FY2022 Consolidated Results
(from April 1, 2022 to March 31, 2023)
May 10, 2023
Net Sales and Operating Profit by Domain
- Both net sales and operating profit increasedin the two strategic domains of the EVS and SS, and operating profit remained lower while net sales grewin the DS.
EVS: Emotional Value Solutions Domain
DS: Devices Solutions Domain
SS: Systems Solutions Domain
Net Sales | Operating Profit | |||||||||||||
(Billions of yen) | FY2021 | FY2022 | Variance | FY2021 | FY2022 | Variance | ||||||||
EVS | 150.8 | 170.7 | +19.9 | 8.2 | 11.5 | +3.2 | ||||||||
Watches Business | 144.2 | +18.4 | Watches Business | 11.1 | +3.4 | |||||||||
125.7 | 7.6 | |||||||||||||
DS | 61.0 | 64.5 | +3.4 | 5.6 | 5.0 | -0.5 | ||||||||
SS | 34.4 | 36.6 | +2.2 | 3.9 | 4.3 | +0.4 | ||||||||
Others | 1.0 | 1.1 | +0.0 | 0.2 | 0.1 | -0.0 | ||||||||
Cons. Adj. | -10.0 | -12.5 | -2.5 | -9.3 | -9.9 | -0.6 | ||||||||
Cons. Total | 237.3 | 260.5 | +23.1 | 8.7 | 11.2 | +2.4 | ||||||||
1
Business Environment
★MVP Products
High-added-value, highly profitable products that move people
Positive
factors
Economic Environment
Market Environment
Impact of the depreciation of the yen
Recovery trend in sales to foreign tourists
Economic recovery from COVID-19 in Japan
EVS | Steady performance |
DS | of overseas business |
【Overseas net sales ratio】(Year-on-yearchanges)
EVSapprox. | % | DS approx.70% |
50 | (Slight increase) | |
(+ Several points) |
EVS Mainly the WAKO Business
EVS Watches and WAKO Business
- Business for food service industry
Watches
- Strong performance of luxury goods, especially Swiss brands
Medical equipment
- Growing demand of medical equipment
Digital transformation- related business
- Increasing investment in digital transformation by companies
EVS
High-priced watches ★ (Japan, Europe, and the U.S.)
DS
Micro batteries
for medical equipment ★
SS
Digital contracts, performance management, security, etc.★
Soaring energy costs
Soaring prices and shortages of parts and materials
Risk of economic recession
EVS | Overall business |
DS | |
EVS | Overall business |
DS | |
EVS Mainly the Watches Business
Watches
- Stagnation of affordable watches due to economic recession
Devices for use in consumer and general-purpose products
EVS
Watch movements
DS
Negative
factors
*European, U.S., and Chinese economies
DS Business for Chinese market
- Sharp slowdown in 2H from strong demand through 1H
Hard disk drive components, etc.
2
KPIs of SMILE145 (8th Mid-Term Management Plan)
MVP Ratio | GP% | Operating Profit | |||||||||
FY2022 | (Year-on-year changes) | Year-on-year changes | Amount (FY2022) | Year-on-year changes | |||||||
Luxury domain and products with | approx.50% | (approx. +5pt) | |||||||||
high emotional value, such as GB, | |||||||||||
as % of net sales | +1.8 | 11.5 | |||||||||
EVS | Target for FY2026 | 60% | billion yen | +39.6% | |||||||
pt | |||||||||||
Watches Business | approx.70％ | approx.75％ | |||||||||
GB ratio | Japan | Overseas | *Target for FY2026: 14.5 - 15.0 billion yen | ||||||||
(approx. +10pt） | (approx. +10pt) | ||||||||||
Target for FY2026 over 85% | |||||||||||
Sales to digital economy and | approx.40% | (slight increase) | - 1.3 | 5.0 | - 10.3% | ||||||
DS | green economy markets | billion yen | |||||||||
pt | |||||||||||
as % of net sales | |||||||||||
Target for FY2026 | 60% | *Target for FY2026: 7.5 - 8.0 billion yen | |||||||||
SS | Stock business | approx.65% | (approx. +5pt) | +1.8 | 4.3 | billion yen | +10.7% | ||||
pt | |||||||||||
as % of marginal profit | |||||||||||
Target for FY2026 | 73% | *Target for FY2026: 6.5 - 7.0 billion yen | |||||||||
+1.1 | 11.2 | ||||||||||
Total | - | pt | billion yen | +28.1% | |||||||
Cons. | |||||||||||
*Target for FY2026: +5.0pt | *Target for FY2026: 18.0 - 20.0 billion yen | ||||||||||
compared to FY2021 | |||||||||||
(common to cons. total and each domain) |
3
Cash Allocation & ROIC of SMILE145
Cash Allocation | FY2022 | ||||||||||||||||
（Billions of yen） | Details of Growth Investment | ||||||||||||||||
SMILE145 (8th Mid-Term Management Plan) | |||||||||||||||||
20.0 | |||||||||||||||||
（Billions of yen） | Growth Investment Areas | Branding | approx. 5.0 | ||||||||||||||
（Billions of yen） | |||||||||||||||||
Growth | ・Branding | Over 20.0 | |||||||||||||||
10.0 | |||||||||||||||||
investment | ・Capital investment | Over 50.0 | Capital investment | approx. 9.0 | |||||||||||||
5 years | Over 100.0 | ・Investment in new area development | |||||||||||||||
before prior | |||||||||||||||||
Investment in | |||||||||||||||||
investment | (R&D, M&A, DX, Human Resources, etc.) | approx. 6.0 | |||||||||||||||
Over 30.0 | new area development | ||||||||||||||||
operating CF | 0.0 | ||||||||||||||||
Improvement of | |||||||||||||||||
Over 130.0 | |||||||||||||||||
financial constitution | ROIC (Return on Invested Capital) | ||||||||||||||||
Over 15.0 | |||||||||||||||||
Shareholder | |||||||||||||||||
FY22 | FY26 | ||||||||||||||||
return | FY21 | ||||||||||||||||
Over 15.0 | Estimate | Target | Target | ||||||||||||||
3.5% | 3.6% | 4.1% | Over 6.5% | ||||||||||||||
*ROIC = (Ordinary income after income taxes + Interest expense) / (Interest bearing debt + Net assets) *ROIC for FY2022 is an estimate as of May 9, 2023
4
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Disclaimer
Seiko Holdings Corporation published this content on 19 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 May 2023 07:59:07 UTC.
