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    7721   JP3624000000

TOKYO KEIKI INC.

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TOKYO KEIKI : Financial Results Briefing for 3Q of the Fiscal Year Ended March 31, 2021 (Fiscal 2020)

03/10/2021 | 01:13am EST

Financial Results Briefing for

3Q of the Fiscal Year Ended March 31, 2021 (Fiscal 2020)

From April 1 to December 31, 2020

February 10, 2021

The forward-looking statements contained in this material reflect the management's assumptions based on currently available information as of the date of announcement. Future changes in business environment and other factors may therefore cause differences with the actual situation.

©TOKYO KEIKI INC. All Rights Reserved

Summary of 3Q Results

(From April 1 to December 31, 2020)

  • The Hydraulics and Pneumatics Business saw a firm recovery trend on the Chinese market. However, market recovery was sluggish in Japan despite the bottoming out of demand decline on major markets due to COVID-19.

  • Full-year earnings forecast is for a slight increase in profits driven by a reduction in SG&A expenses.

  • The Defense & Communications Equipment Business launched new products for the semiconductor production equipment market.

  • Adopted new shareholder benefits program.

Launched new products on semiconductor production equipment market

"Solid state microwave power supply for film deposition equipment"

In addition to our existing products for etching equipment, in 3Q we released a microwave power supply for film deposition equipment.

Planning to start full-scale mass production beginning in FY2022.

We will apply our expertise in microwave technology to advance the development of semiconductor microfabrication and make continuous technology advancements towards the realization of Society 5.0, the vision for a future digital society.

Using a solid state device as the microwave power source instead of a conventional magnetron enables us to provide greater advantaqge, such as stable frequency characteristics and higher precision microfabrication.

Frequency characteristics | Comparison

Magnetron

Unnecessary components

are generated in the

vicinity of the required

frequency

Solid state

Allows for easy

selection of required

frequency only

Changes in consolidated profit & loss

Net Sales

Operating Profit

Full year3Q

Million yen

Million yen

46,692

47,440 Forecast

2,440

2018/3

2019/3

2020/3

2021/3

2018/3

2019/3

2020/3

370 2021/3

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020" on February 10, 2021.

Quarterly changes in net sales

Million yen

15,766

2017/3

2018/3

2019/3

2020/3

2021/3-3Q

¥41,394 million

¥43,803 million

¥46,692 million

¥47,440 million

¥28,718

million

Quarterly changes in operating profits

Million yen

2,162

2017/3

2018/3

2019/3

2020/3

2021/3-3Q

¥1,121 million

¥1,319 million

¥2,440 million

¥1,875 million

¥△370

million

6

Equipment

*Net sales before adjustment.

*"Fire Extinguishing Systems Business", which has been included under "Other Businesses", is included under the

"Fluid Measurement Equipment Business" in Fiscal 2018. The amounts before Fiscal 2018 are updated to reflect the segment change.

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020"

on February 10, 2021.

Equipment

*Operating profits before adjustment.

*"Fire Extinguishing Systems Business", which has been included under "Other Businesses", is included under the

"Fluid Measurement Equipment Business" in Fiscal 2018. The amounts before Fiscal 2018 are updated to reflect the segment change.

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020"

on February 10, 2021.

3. Fiscal 2020 3Q Progress Fiscal 2020 3Q progress

Million yen

Net SalesOperating

ProfitOrdinary

ProfitProfit attributable to owners of parent

Forecast at the beginning of the fiscal year

Full year forecast

Remaining 43,000

14,282 46,700

Remaining 1,180

Remaining 1,174

Remaining 787

810 1,930

980 2,050

650 1,530

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020"

on February 10, 2021.

3. Fiscal 2020 3Q Progress Progress of net sales by segment

Million yen

Marine SystemsHydraulics and PneumaticsFluid Measurement EquipmentDefense and Communications EquipmentOthers

Forecast at the beginning of the fiscal year

Progression rate 46.2

*Net sales before adjustment.

Full year forecast

8,590 9,200

10,380 12,500

3,950 4,200

16,730 17,000

3,360 3,700

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020" on February 10, 2021.

-Forecasting decreased net sales due to lower demand for new shipbuilding on the commercial vessel market and in overseas markets, particularly Asia, due to the impact of COVID-19.

-Forecasting decreased net sales due to sluggish recovery on mainstay markets, plastic processing machinery, machining tools, and construction machinery, in markets other than China as a result of the impact of COVID-19.

-The public-sector market is expected to trend roughly according to forecasts, but net sales are expected to decline because some projects in private-sector market and overseas markets will be postponed to next fiscal year due to COVID-19.

-There was an increase in sales volume of satellite communications antenna stabilizers, but net sales are expected to decline because some overseas projects and private-sector projects have been postponed to next fiscal year due to COVID-19.

-Railway Maintenance Business net sales forecast as largely on par with plans but forecasting decreased net sales in other businesses due to the suspension or postponement of certain projects as a result of the impact of COVID-19.

3. Fiscal 2020 3Q Progress

Progress of operating profit by segment

Million yen

Marine SystemsHydraulics and PneumaticsFluid Measurement EquipmentDefense and Communications EquipmentOthers

Forecast at the beginning of the fiscal year

59

266

109

Remaining 639

Progression rate 20.3

*Operating profits before adjustment.

Full year forecastRemaining 56

Remaining 101

Remaining 279

Remaining 459

210 260

580 310

580 620

350 290

350 540

*Full year forecast of Fiscal 2020 was changed in "Summary of financial results for the third-quarter of fiscal 2020" on February 10, 2021.

-Although operating profits improved compared to 2Q forecasts (+110 million yen), we forecast operating profits will fall below initial forecasts due to the impact of decreased net sales.

-Expecting an operating loss due to weaker net sales and deteriorating cost-of-sales ratio from decline in operation capacity.

-Although operating profits improved compared to 2Q forecasts (+60 million yen), we forecast operating profits will fall below initial forecasts due to the impact of decreased net sales.

-Forecasting increased operating profits compared to 2Q forecast (+30 million yen).

-The Railway Maintenance Business is expected to trend according to forecasts, but all others are expected to see a decline in operating profit due to weaker net sales.

4. Status of Orders Received and Order Backlog

The Hydraulics and Pneumatics Business experienced a large downturn in orders and order backlog due to declining demand in the plastic processing machinery market, machine tool market, and construction machinery market caused by COVID-19 from the second quarter on.

The order backlog for the Defense & Communications Equipment Business declined largely year on year after a peak in mass-production orders for radar warning receivers in the public-sector market, which continued up to the previous third quarter.

5. Consolidated Balance Sheets (Main accounting items only)

Assets

Liabilities and net assets

Million yen

As of Mar 31, 2020

As of Dec 31, 2020

Amount of change

Million yen

As of Mar 31, 2020

As of Dec 31, 2020

Amount of change

Current assets

42,695

40,101

2,593

Current liabilities

21,736

19,571

2,166

Cash and deposits

7,709

11,003

+3,294

Notes and accounts payable

5,800

5,121

679

Notes and accounts receivable

15,262

9,474

5,787

Short-term loans payable

11,692

10,935

758

Electronically recorded monetary claims

4,404

4,168

236

Provision for bonuses

1,123

562

560

Inventories

15,001

14,696

305

Non-current liabilities

3,197

3,302

+105

Accounts receivable

81

449

+367

Long-term loans payable

1,076

1,213

+137

Other

240

315

+75

Net defined benefit liability

1,229

1,180

48

Non-current assets

11,882

12,177

+295

Total liabilities

24,933

22,872

2,061

Tangible assets

7,004

7,051

+47

Shareholders' equity

29,065

28,538

527

Intangible assets

0

13

+13

Retained earnings

22,542

21,995

547

Investment securities

2,991

3,416

+424

Total net assets

29,644

29,407

237

54,577

52,279

2,298

Total liabilities and net assets

54,577

52,279

2,298

Accounts receivable-trade (notes and accounts receivable and electronically recorded monetary claims)

decreased significantly thanks to the collection of accounts receivable for the Defense & Communications Equipment Business that had increased at the end of the previous fiscal year. (down 6,023 million yen compared to end of previous fiscal year)

Liabilities decreased due to a decrease in purchase liabilities (notes and accounts payable) and repayment of loans payable (long- and short-term liabilities collectively decreased by 621 million yen)

Retained earnings decreased due to dividends (409 million yen) and net loss attributable to owners of parent

©TOKY(1O3K7EmIKiIllIioNnC.yAelnl )R.ights Reserved

Profit returns to shareholders

[Basic policy]

Implement stable returns to shareholders while maintaining balance with financial capacity.

Regarding the use of internal reserves

Allocate investments aimed at "new technology research" "new product development," "productivity improvement," "overseas base expansion," "human resource development," "organizational capacity building," "management resource enhancement," etc., which serve as the sources for profitability (earning power), in

order to achieve sustainable growth and improve medium-to-long-term corporate value, while taking capital efficiency into account.

Dividend for the last five years and forecast for Fiscal 2020

2016/3

2017/3

2018/3

2019/3

2020/3

2021/3 Forecast

Annual dividend per share (yen)

5.00Common, 4 + Commemorative, 1

4.00

20.00

25.00

25.00

25.00

Payout ratio (consolidated) (%)

33.2

46.8

29.6

21.3

28.8

63.0

Total return ratio (consolidated) (%)

39.8

46.8

37.1

25.6

34.7

*From Fiscal 2017 (2018/3) onward, dividend amounts are those after consolidation of shares.

(Dividend amount before consolidation of shares is 1/5 of amount shown.)

Status of recent acquisition of treasury shares

May 2014

May 2015

Nov 2015

Nov 2017

Feb 2019

Nov 2019

Total number of reacquired shares* (yen)

310,000

300,000

335,000

58,000

76,800

84,700

Acquisition cost (million yen)

84

84

84

85

85

85

*From Nov 2017 onward, total numbers of reacquired shares are those after consolidation of shares.

Shareholder benefits program

1) Purpose of adoption

We established the new TOKYO KEIKI Premium Benefits Club as a new shareholder benefits program to express our gratitude for the ongoing support of our shareholders, to further increase the appeal of investing in our stock, and to increase shareholders interested in medium- to long-term stock retention. Through the adoption of this program, we will work to further increase our communication with our shareholders.

2)Overview

-Eligibility for shareholders retaining 3 or more trading units (300 shares) as of the end of March each year.

-Eligible shareholders are awarded points based on their number of retained shares. Shareholders can access the TOKYO KEIKI Premium Benefits Club members-only website to select from over 4,000 products for which they can exchange points. The points can be also donated to social contribution activities. Alternatively, shareholders can exchange points for WILLsCoin, the universal shareholder benefits coin. WILLsCoin balances can be added to the points earned through the stock benefits programs of other companies enrolled in the Premium Benefits Club.

Retained shares

Awarded points

Allocation timing

300 shares or less

0 points

300 to 499 shares

3,000 points

Annually in May

500 to 699 shares

6,000 points

700 to 999 shares

9,000 points

1,000 to 2,999 shares

20,000 points

3,000 or more shares

50,000 points

Disclaimer

Tokyo Keiki Inc. published this content on 10 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 March 2021 06:12:02 UTC.


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Financials
Sales 2021 42 081 M 372 M 372 M
Net income 2021 945 M 8,36 M 8,36 M
Net cash 2021 680 M 6,01 M 6,01 M
P/E ratio 2021 16,4x
Yield 2021 2,65%
Capitalization 15 895 M 140 M 141 M
EV / Sales 2020 0,35x
EV / Sales 2021 0,35x
Nbr of Employees 1 672
Free-Float 76,9%
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Tsuyoshi Ando President, CEO & Representative Director
Motoo Uenoyama Director, Manager-Finance & Accounting
Hisato Okayasu Managing Executive Officer, Manager-R&D Center
Nampei Yanagawa Independent Outside Director
Takashi Nakamura Independent Outside Director
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