Announcement of FY2018/3 Second Quarter Business Results (April 2017 to September 2017)

November 14th, 2017 Tokyo Seimitsu Co., Ltd.

*

Hitoshi Yoshida, President and CEO Ticker Symbol: 7729.T

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 1

  • Cautionary Statement with respect to Forward-Looking Statements

    • This presentation data contains "forward-looking statements" that are based on current best available information and policies.

    • There are various factors such as world economic conditions and semiconductor/automobile market conditions which will directly and indirectly impact the Company's results in the future.

    • As a result, future outcomes may differ from those projected in this presentation.

  • Data in presentation

    • Information listed in this presentation is summarized in Billions of Yen or percentage except as otherwise noted. As a result, there may be a case where the total of individual amount and total amounts in each matter may differ.

  • Audit procedure

    • This presentation is not subject to audit procedures.

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 2

      FY2018/3 1st Half (April - Sept. 2017) Business Results

      FY2017/3

      FY2018/3

      1st Half

      2nd Half

      1st Half

      HoH(%)

      YoY(%)

      Sales

      37.2

      40.6

      43.7

      +8%

      +17%

      SPE Segment

      24.3

      26.0

      30.3

      +17%

      +25%

      Metrology Segment

      12.9

      14.6

      13.3

      -9%

      +3%

      Operating Income

      6.6

      7.1

      8.9

      +26%

      +35%

      SPE

      4.4

      4.4

      6.4

      +46%

      +43%

      Operating Income Ratio

      18%

      17%

      21%

      -

      -

      Metrology

      2.1

      2.7

      2.5

      -5%

      +20%

      Operating Income Ratio

      17%

      19%

      19%

      -

      -

      Ordinary Income

      6.3

      7.6

      9.0

      +20%

      +43%

      Net Income Attributable to Owners of the Parent

      4.7

      5.2

      6.4

      +21%

      +36%

      (Billions of Yen except dividend)

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 3

      FY2018/3 2nd Quarter(July - Sept. 2017)

      FY2017/3

      FY2018/3

      1Q

      2Q

      3Q

      4Q

      1Q

      2Q

      QoQ(%)

      YoY(%)

      Sales

      16.3

      20.9

      19.5

      21.1

      19.9

      23.8

      +19%

      +14%

      SPE Segment

      11.0

      13.3

      13.2

      12.8

      14.2

      16.1

      +13%

      +22%

      Metrology Segment

      5.3

      7.6

      6.3

      8.3

      5.7

      7.6

      +34%

      +0%

      Operating Income

      2.9

      3.7

      3.2

      3.9

      4.0

      4.9

      +21%

      +31%

      SPE

      2.2

      2.2

      2.1

      2.3

      3.1

      3.3

      +3%

      +46%

      Operating Income Ratio

      20%

      17%

      16%

      18%

      22%

      20%

      Metrology

      0.6

      1.5

      1.1

      1.6

      0.9

      1.6

      +86%

      +10%

      Operating Income Ratio

      12%

      20%

      17%

      20%

      16%

      22%

      Ordinary Income

      2.6

      3.7

      3.5

      4.1

      4.1

      4.9

      +19%

      +31%

      Net Income Attributable to Owners of the Parent

      1.9

      2.8

      1.4

      3.9

      2.9

      3.5

      +20%

      +24%

      Business Results

      (Billions of Yen)

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 4

      SPE Segment - Business Trends

      3.3

      3.1

      2.2

      14.2

      13.3

      16.1

      • 2Q Sales (Yen 16.1B) in SPE exceeded forecasts

  • Firm demand continued overall, including Memory and Automotive devices

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 5

    SPE Segment - Order Status

    18.5

    12.4

    12.3

    15.0

    16.6

    14.2

    • Orders for 2Q were 14.2B, 1H were 29.3B, 2Q's backlog was 16.6B

  • Short-team demand peaked out, however, increases in orders for Grinders and CMP made up

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 6

    SPE Segment - Regional Sales

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 7

    Metrology Segment - Business Trends

    1.51.6

    0.9

    7.6

    7.6

    5.7

    • In 2Q, Sales(7.6B) is on track

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 8

Metrology Segment - Order Status

7.7 7.6

6.6

6.3

7.3

7.5

  • Orders in 2Q were 7.5B (increased for 4 consecutive quarters), 1H were 14.9B

    • Demand from Japan (Automobile) was firm, while overseas bottomed-out

      • 2Q backlog was 7.6B, remaining high level

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 9

Metrology Segment - Regional Sales

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 10

Mar/E 2017

Sep/E 2017

Diff.

Liabilities, Net Assets

(Billions of Yen)

Mar/E 2017

Sep/E 2017

Diff.

Cash

33.9

36.4

+2.5

Accounts Payable (*2)

15.8

19.8

+4.0

Short term Debt

1.3

1.3

±0.0

Accounts Receivable (*1)

28.4

31.1

+2.7

Others

9.5

8.2

-1.3

Total Current Liabilities

26.6

29.3

+2.7

Inventories

17.3

18.9

+1.6

Total Fixed Liabilities

0.7

0.7

+0.0

Others

3.2

2.5

- 0.7

Total Liabilities

27.3

30.0

+2.7

Total Current Assets

82.8

88.9

+6.1

Net Assets

87.2

93.0

+5.8

Fixed Assets

31.7

34.1

+2.4

Total Assets

114.5

122.9

+8.4

Total

(Int. bearing debt)

114.5

(1.3)

122.9

(1.3)

+8.4

(±0.0)

Assets

(Billions of Yen)

FY2018/3 2Q (Sept. 2017)

Balance Sheet

(*1) Incl. Trade notes and Electronically Recorded Monetary Claims (*2) Incl. Trade notes and Electronically Recorded Obligations-operating

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 11

FY2018/3 1H (April - Sept. 2017)

Cash Flows

（Billions of Yen) FY2016/3 1H FY2017/3 1H FY2018/3 1H

Opening Balance 26.8 27.3 33.8

From Operating

Activities

Income before Tax, Interest & Depreciation 8.8 7.5 10.3

-0.5 2.7 - 0.5

(Receivables + Inventories) - Accounts Payable

Tax Payment

- 2.4

- 1.9

- 4.0

Others

- 0.4

0.3

1.0

Total

5.6

8.6

6.8

From Investing Activities

- 3.0

- 3.7

- 2.9

Free Cash Flow

2.7

4.9

3.9

Increase/decrease in Borrowings

- 0.2

- 0.2

0.0

Dividends & others

- 1.3

- 1.4

- 1.5

Total

- 1.5

- 1.6

- 1.5

1.3 3.0 2.5

From

Financing Activities

Net Cash Increase (incl. adjustments and change in consolidated subsidiaries)

Closing Balance 28.1 30.3 36.4

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 12

Number of Employees

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 13

R&D, Capex & Depreciation

（Billions of Yen)

No change with FY plan

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 14

Market Outlook

Semiconductor Production Equipment

  • Short-team demand peaked out, however, the bottom is shallow due to firm demands for Grinders and CMP

  • Anticipate recovery in latter half of FY as usual

  • Expect potential demands for Memory, Automotive devices, and Electric components

    Metrology Equipment

  • Demand for manufacturing in Japan continues to be active

  • Overseas demand (especially China) is recovering

  • Expect additional demands from Automation /IoT trend

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 15

Forecast for FY2018/3 (April 2017 - March 2018)

FY2017/3

FY2018/3

1H

2H

Full Year

1H

2H

Fcst

Full Year Fcst

Diff from prev. fcst

YoY(%)

Sales

37.2

40.6

77.8

43.7

41.3

85.0

+6.0

+9%

SPE

24.3

26.0

50.3

30.3

26.7

57.0

+6.0

+13%

Metrology

12.9

14.6

27.5

13.3

14.7

28.0

±0.0

+2%

Operating Income

6.6

7.1

13.7

8.9

7.1

16.0

+2.0

+17%

Operating Income Ratio

18%

17%

18%

20%

17%

19%

-

-

Ordinary Income

6.3

7.6

13.9

9.0

7.0

16.0

+2.0

+15%

Net Income attributable to Owners of the parent

4.7

5.2

9.9

6.4

4.8

11.2

+1.2

+13%

Dividend per share

34 Yen

38 Yen

72 Yen

41 Yen

41 Yen

82 Yen

+10 Yen

+10 Yen

(Billions of Yen except dividend)

Previous forecast announced

on August 10th, 2017

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 16

SPE Segment - Sales/Orders trend incl. Forecasts

  • Orders in FY2018/3 2H anticipated to decrease from 1H, but to stay relatively high

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 17

    Metrology Segment - Sales/Orders trend incl. Forecasts

    • Anticipate an increase of Orders for 2018/3 2H over FY2017/3 2H

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 18

      Corporate Philosophy

      Growing together with partners and customers by collaborating technology, knowledge and information to create the world's No.1 products.

      Our motto depicting this philosophy;

      「WIN-WINの仕事で世界No.1の商品を創ろう」

      WIN-WIN relationships create the World's No. 1 Products

      Our corporate brand ;

      A combination of the words ACCRETE (grow together) and TECHNOLOGY

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 19

      Business Portfolio Analysis

      SPE

      • Strengths: Precision positioning technology and in-house manufacturing

      • Opportunities: New Semiconductor technologies and devices

Metrology

  • Strengths: Precision, high-resolution measuring technology and reliability

  • Opportunities: New metrology products and demands from overseas including emerging countries

    • Well-balanced business portfolio

- Enables stable business performance through offsetting demand fluctuations across variable sector trends

Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 20

Long-term / Mid-term Business Target

  • Long-term: To maintain strong corporate structure with over 10% ROE

  • Mid-term (by FY2019/3): To achieve historical highest OP (15.0 billion yen)

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 21

    Short-term business strategy

    1. Increase product competitiveness toward mainstream markets

    2. Allocate resources to markets that can expect potential growth or stable demand

      SPE Metrology

      Mainstream Markets

      ・Mobiles

      ・Storage

      ・Automobiles

      Mainstream Markets

      ・Auto and Auto Parts

      ・Machine Tools

      + +

      Emerging Markets

      ・ China Market

      • Non-Si and Substrates

        ・ Consumables

        Emerging Markets

        ・ Aircrafts

        ・ Automations

      • Overseas Market

      Continuous Increase in Sales and Profits

      Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 22

      Strategy of SPE Business

    3. Semiconductor business is in structural growth phase, with concept of "connectivity" at the core

    4. Maximize the strength in our products for devices needed in this phase, such as Memory devices, Automotive devices, and Electric components

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 23

    Strategy of Metrology Business

    Increase in Sales through new Products

    - Products for stable and growing industries

    - Sales expansion of OMI

    Increase in Overseas Sales

    - Response to growing needs for automation and IoT

    - Launch of easy operation models for global use

    OMI: Optical Measuring Instruments

    Continuous Increase in Sales and Profits

    Copyright 2017 Tokyo Seimitsu Co., Ltd. (7729.T) All rights reserved. 24

    ACCRETECH is Tokyo Seimitsu

    Copyright 2017 Tokyo Seimitsu Co., Ltd.(7729.T) All rights reserved. 25

    Tokyo Seimitsu Co. Ltd. published this content on 14 November 2017 and is solely responsible for the information contained herein.
    Distributed by Public, unedited and unaltered, on 14 November 2017 08:09:01 UTC.

    Original documenthttp://www.accretech.jp/english/ir/library/financial_summary/files/BR_2018_2q_E.pdf

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