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Company name:
Stock exchange listing:Stock code:
Representative:
Inquiries

Denyo Co., Ltd.
Tokyo6517
President
Senior Executive Officer

May 10, 2018
Shoichi Shiratori
Toshiya Tozawa

TEL +81-3-6861-1111

Notice Regarding Formulating Medium-term Management Plan
Denyo group, has formulated a three-year medium-term management plan “Denyo 2020”, covering fromthe fiscal year ending March 31, 2019 to the fiscal year ending March 31,2021, and announced the plan here.
Overview of the Medium-term Management Plan
1. Business Objectives
Consolidated Net Sales
Ordinary Income Margin
ROE

58 billion yen
11%7%

2. Basic Policy
Establish a profit structure that is resistant to changes in the environment, by increasing the ratios of nonconstruction-related products as well as products for overseas markets, while firmly maintaining our position as
the leading provider of high-quality power sources in the construction-related sector.
3. Business Strategies(1) Strategies in the Domestic Market① Maintain market share by reliably promoting a review of the sales structure and development of newproducts based on customer needs.
② Aim to increase market share of the stationary generators by reviewing the Group’s sales system throughcloser cooperation with Nishinihon Generator Mfg. Co., Ltd. and enhancing sales activities based oncomprehensive proposals.
(2) Strategies in Overseas Markets① Be proactive in Asia, including the rental market which is expected to expand in the future. Step up
activities for strengthening sales and service capabilities in regions including Asia and elsewhere (such as
Europe and the Middle and Near East, etc.). Strengthen cooperation with local distributor in the America.
② Confirm the specifications demanded in each target market and establish a system for producing andselling stationary generators in Asia and the Middle and Near East.
③ For welding machines, enhance the lineup of products that each target market demands and focus efforts
on developing highly maintainable products.
(3) Reinforcing the Operating Foundations① Identify market needs accurately and develop competitive products promptly. Step up measures forstationary generators in Japan and other countries.
② Further promote production in optimal locations to supply high-quality products, reduce cost, and ensure
quicker delivery.
③ Further enhance the training system with a special emphasis on developing globally competitive humanresources.
End of Text

Denyo Medium-term Management Plan
FY2019/3～FY2021/3『2020』～Power Source for the Next Stage～2018.5.10

Overview of the Medium-term Management Plan
Contribute to enriching society by providing safe, secure power sources based on“Benefits for Three Parties” (which expresses our aim to see the user (customer),the seller (dealership), and the manufacturer (Denyo) prosper together).

Corporate
Philosophy

Aim to be the global No1 brand of high-quality power sources with creativity andconstant technological innovations.

Management Vision

Priority Strategies:
Strategies in the domestic market• Focus efforts on mobile-type generators by reviewing the sales structure and developing newproducts.
• Increase the market share of stationary generators by strengthening cooperation with Groupcompanies.
Strategies in overseas market

2020 Medium-termManagement Plan• Strengthen marketing and establish a system for producing and selling the stationary
generators that each target market demands.
Reinforcing the operating foundations• Be quick in developing products that meet market needs.
• Supply higher-quality products through production in optimal locations.
• Focus efforts on developing globally competitive human resources.

Business Objectives

Consolidated
Net sales

FY2018/3

FY2021/3（Results）（Target）

50.1

billion yen

58.0

billion yen

Change･Rateof Change+7.9

billion yen

Ordinary
income margin

8.3%

11.0%

+2.7%

ROE

5.3%7.0%+1.7%

58.0 billion yen
50.1 billion yen

11.0%

8.3%

7.0%

5.3%

2017
FY2018/3

2018
FY2019/3

2019
FY2020/3

2020
FY2021/3

Aim for consolidated net sales: 58 billion yen, ordinary income: 6.4 billion yen(ordinary income margin: 11%) for the FY2021/3 through sustainable growth.
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Business Strategies
Basic Policy
Establish a profit structure that is resistant to changes in the environment, by increasing the ratios of non construction-related products as well as products foroverseas markets, while firmly maintaining our position as the leading provider of high-quality power sources in the construction-related sector.

Strategies in the Domestic Market
Construction-related sector（engine-driven Generators, Welders, Compressors, Self-propelled lifter, etc.）• Maintain market share by reliably promoting a review of the sales structure anddevelopment of new products based on customer needs.
The Japanese industry’s
most silent generator※

Silent Generator “Mālie” DCA-25MZ※2017.7 according to the company survey

Construction work in the Tokyo Metropolitan Area

Non construction-related sector(General-use･Stand-by Generating sets, Power-Supply Vehicles, etc.)• Aim to increase market share by reviewing the Group’s sales system through closer
cooperation with Nishinihon Generator Mfg. Co., Ltd. and enhancing sales
activities based on comprehensive proposals.

LP gas-fueled, in-house
generator for general-use

The Japanese industry’s
first certified product!!!
LP Gas general-use Generating Set LLG-35US

In-house generators installed in hotels for use in the event of disaster
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Business Strategies
Strategies in Overseas Markets

Overseas sales subsidiaries

Overseas sector（engine-driven Generators, Welders, Compressors, etc.）• Be proactive in Asia, including the rental market which is expected toexpand in the future. Step up activities for strengthening sales and service
capabilities in regions including Asia and elsewhere (such as Europe and theMiddle and Near East, etc.). Strengthen cooperation with local distributor inthe America.
• Confirm the specifications demanded in each target market and establish asystem for producing and selling stationary generators in Asia and theMiddle and Near East.
• For welding machines, enhance the lineup of products that each target
market demands and focus efforts on developing highly maintainableproducts.
Sales subsidiary in Singapore: DUM

slimmer dimensions&higher performance

Evolution!
Slim-type diesel engine welder DLW-300LSW2
Sales subsidiary in Netherland: DEB
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Business Strategies
Reinforcing the Operating Foundations• Identify market needs accurately and develop competitive products promptly. Step up measures for stationary generators in Japan and other countries.
• Further promote production in optimal locations to supply high-quality products, reduce cost, and ensure quicker delivery.
• Further enhance the training system with a special emphasis on developing globally competitive human resources.

Development

Production

Human Resource Development

Future Visions

Future Visions

Future Visions

Develop market-leading
products as the pioneer ofhigh-quality powersources.

Build a globallycompetitive production
system.

Secure and foster excellent
human resources.

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4

Sales Plan (Consolidated)
Sales by Region
FY2018/3（Result）

FY2021/3(Target)ChangeRate ofChange

Domestic Sales

31,21134,300+3,089+9.9%

North/CentralAmerica

10,382

11,900+1,518+14.6%

Asia

5,938

7,800+1,862+31.4%

Others2,648

4,000+1,352+51.1%

50,18258,000+7,818+15.6%※

TotalJapan(million yen)

31,211

11,90010,382

FY18/3 FY19/3 FY20/3

FY21/3Asia

FY18/3 FY19/3 FY20/3

FY21/3

Others

7,800

4,000
5,938
2,648

FY18/3 FY19/3 FY20/3※Others：Europe, Middle and Near East, Russia, etc.

North/Central America
34,300FY21/3

FY18/3 FY19/3 FY20/3FY21/3

Expand sales of stationary generators in Japan by working together with Group companies. Aim to expand businesses overseas by developing the productsthat each target market demands.

Sales by Product
FY2018/3（Result）

FY2021/3(Target)ChangeGenerators

38,65345,050+6,397+16.5%

Welders

4,919

5,300

+381

+7.7%

Compressors

1,083

1,250

+167+15.4%※ Others

5,525

6,400

+875

+15.8%

58,000+7,818

Total

50,182

Generators(million yen)

※Others: Parts, Self-propelled lifter, etc.

Rate ofChange+15.6%

Welders
5,300

45,05038,653

4,919

FY18/3 FY19/3 FY20/3

FY21/3

FY18/3 FY19/3 FY20/3

OthersCompressors
1,250

1,083

FY18/3 FY19/3 FY20/3

FY21/3

6,400

5,525

FY21/3

FY18/3 FY19/3 FY20/3

FY21/3Pursue aggressive sales activities in the domestic and overseas markets by launching new products that each market demands, with a focus on generators as
our mainstay products.
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Capital Investment Plan
Make capital investments aimed at improving product quality andproduction efficiency

Domestic production sites

Total amount:3.7

billion yen

Fukui Plant, Shiga Sub-Plant, Nishinihon Generator Mfg (Saga prefecture)

Overseas production sites

Total amount:1.8

Fukui Plant

billion yen

America Plant, Vietnam Plant, Indonesia Plant

Total

Sum amount:5.5

billion yen

Production Sites：

Nishinihon Generator Mfg

America Plant•••

Fukui Plant
Shiga Sub-Plant
Nishinihon Generator Mfg•Vietnam Plant•Indonesia Plant•

America Plant

Vietnam Plant

Indonesia Plant

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Notes on Our Outlook

This material contains assumptions and outlooks for the future andforecasts based on plans as May 10, 2018.
Actual results may differ materially from projected values due to future
economic changes and competition.
This material is prepared for the purpose of providing information and is
not meant to solicit investment in securities issued by the Company.
Investors are responsible for making their own final investment decision.

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