First Half of FY2018
Operating Results(Six months ended September 30, 201７)
Munetoshi Goto
President, Representative Director

November 7, 2017

1

FY18 1H Sales
Variance to FY17 1H

Net Sales¥231.0 billion + 15.4%

Domestic¥39.9 billion+ 13.3%

Overseas¥191.1 billion+ 15.9%Overseas sales ratio: 82.7% (FY17 1H: 82.4%)
21

Sales by Geographic Area
Yen inbillions

231.0
207.6

200

217.2
10.0
11.1
15.3
19.7

150

11.0
12.2
14.8
20.6

200.1
8.2
11.7
10.7
17.8

34.5

28.0

100

MidEast/Africa

35.0

Central &SouthAmerica
Asia

98.6

North America

Oceania

31.8
84.6

91.5

91.1

6.9
15.6
13.5
21.5

Europe50
32.4

32.6

39.9

35.2

Japan0
FY15 1H

FY16 1H

FY17 1H

FY18 1H

3

Foreign Exchange Rate
FY17 1H

FY18 1H

US$¥105.20¥ 111.04

Depreciation

Euro¥118.04¥ 126.32

Depreciation

RMB¥ 15.92¥ 16.42

5.6%

7.0%

3.1%

Depreciation
Weighted average change for all foreign currencies:
6.6% depreciated in the value of the yen

Effect on net sales: Increase of ¥11.8 billion
42

Sales Growth (Local Currency Basis)
JapanJapan15%

FY17 1H
FY17 2H
FY18 1H10%+ 8.1%+ 9.2%
+ 13.3%

5%0%
FY162H-5%

FY171H2H

FY181H
5

Sales Growth (Local Currency Basis)
Europe+8.8%
EasternEurope/Russia

25%

FY17 1H
FY17 2H
FY18 1H20%15%+ 6.9%+ 23.6%+ 9.0%

10%

WesternEurope5%0%

FY17 1H
FY17 2H
FY18 1H-5%-10%-15%

FY162HFY171H2H+ 9.9%+ 10.1%+ 8.7%FY181H
63Sales Growth (Local Currency Basis)
North America/Asia
Asia
20%

FY17 1H
FY17 2HFY18 1H- 0.3%+ 14.0%+ 14.9%10%

North America
FY17 1H
FY17 2H
FY18 1H0%-10%

FY162HFY171H2H+ 7.1%+ 9.6%+ 4.5%

FY181H
7Sales Growth (Local Currency Basis)
Other Regions(Central & South America, Oceania, Mid-East/Africa )

25%
20%
15%
10%
5%0%-5%-10%-15%-20%-25%Oceania
FY17 1H
FY17 2H
FY18 1H+ 11.2%+ 9.0%+ 23.2%

Central &South America
FY17 1H
FY17 2H
FY18 1H- 7.3%+ 14.1%+ 17.0%

Mid-East/Africa
FY162HFY171H2H

FY181H

FY17 1H
FY17 2H
FY18 1H- 14.6%- 5.0%- 19.9%84

Lithium-ion Battery Products
Outdoor Power Equipment (OPE)New Products in 2017

Lithium-ion Battery Products

Outdoor Power Equipment

Auto-start Wireless
System Series

Battery PoweredWheelbarrow

New Cordless Grass
Trimmer Series

Cordless Angle Grinder

Cordless Trimmer

9Production Quantities byGeographic Area
10 thousandsof units
800

FY17 1H
1,194

729

17600

793

787

292572020633

17FY18 1H
1,580

FY17 2H
1,449

Central &SouthAmerica
Asia

561

15400

443

20001Q

North America

376Europe

31703532

31

74346985

91

936767676976

68

32

FY17572563511

544

2Q

3Q

4Q

FY181Q

Japan

2Q

105

Inventories
March 31, 2017¥167.4 billion

September 30, 2017¥190.2 billion

Increase of inventories¥22.8 billion

Breakdown:
Increase of actual inventories¥12.8 billion

Increase by translation into yen¥10.0 billion
11

Cost of Sales, SG&A
Variance to FY17 1H

Net Sales¥231.0 billion+ 15.4%

Cost of Sales¥146.7 billion+ 17.6%

Cost of Sales
Ratio
SG&A
Expenses

63.5%

Up 1.1 points¥46.0 billion+ 10.4%

SG&A Ratio

19.9%

Down 0.9 points
126Operating Income
FY17 1H

Variance toFY17 1H

FY18 1H¥200.1 billion ¥231.0 billion+ 15.4%

Cost of Sales ¥124.8 billion ¥146.7 billion+ 17.6%Net Sales

SG&A
Expenses
OperatingIncome
OperatingIncome Ratio¥41.6 billion¥46.0 billion+ 10.4%¥33.6 billion¥38.3 billion+ 13.8%

16.8%

16.6%

Down
0.2 points
13Analysis of Operating Income
Yen inbillions

Procurement
Exchange Cost down
SG&A
rate+4.0

Sales
volume+0.5 -2.6 Others-3.9+6.7

38.3
33.6FY17 1H

FY18 1H

147

Other Income (Expenses),
Income Before Income Taxes,
Net Income attributable to Makita Corporation

Variance toFY17 1H

FY17 1H

FY18 1H

Other Income(Expenses)¥0.4 billion¥1.2 billion + ¥0.8 billion

Income Before
Income Taxes¥34.1 billion¥39.5 billion+ 15.8%Net Income
attributable toMakita Corporation¥24.1 billion¥27.7 billion+ 15.0%¥88.68¥101.96+ 15.0%EPS

15Capital Expenditure,
Depreciation, R&D Cost
Capital Expenditure(Yen in billions)

6.2

FY16 1H
FY17 1H

5.0

China Plant equipment and mold

7.2

FY18 1H

Depreciation

FY2018 1H Main Capital Expenditure
Machine and Equipment for the Okazaki plant(Yen in billions)

R&D Cost

FY16 1H

4.6

FY16 1H

FY17 1H

4.4

FY17 1H

FY18 1H

4.8

FY18 1H(Yen in billions)

4.6
5.0
5.5
168

Makita’s Commitments
1) Expansion of the lithium-ion battery product lineup
2) Conversion from engine-powered to battery-powered
3) Expansion of after-sales service and sales networks

17Makita’s Commitments
1) Expansion of the lithium-ion battery product lineup
Representative products in the current fiscal year

Auto-start Wireless System Series
・Cordless Circular Saw KS512D/513D
・Cordless Vacuum Cleaner VC864D
The industry’s first dust-collecting system that iswirelessly connected to cordless tools.*1

Cordless grinder as powerful as AC
powered equivalent products*2
・Cordless Angle Grinder GA700D
The Company has commercialized a large cordless grinder
with a 180-mm grinding wheel that requires larger power.

*1: As of July 2017 (Source: Makita)*2: Comparison to Makita’s AC productLaunching of large cordless tools and a dustcollecting system that is wirelessly connected tocordless tools
189Makita’s Commitments2) Conversion from engine-powered to battery-powered
Expanding the sales of battery-powered OPE
Public relations
targeted at endusers(Example) A demonstration at a home
improvement center (in Japan)

Under the slogan, “ZERO EMISSION,” theCompany has focused on expanding thesales of and raising the awareness ofcordless outdoor power equipment (OPE).

Aggressively
developing
new products(Example) Sponsoring of five top
European football leagues (in Europe)

19Makita’s Commitments2) Conversion from engine-powered to battery-poweredExpanding the sales of battery-powered OPE
40%

30%

23%20%10%
17 2Q

18 2Q

Ratio of sales of lithium-ion
battery-powered products to OPE sales(on a consolidated basis)
2010

Makita’s Commitments
3) Expansion of after-sales service and sales networks
Establishment of market-, site- andcustomer-based sales networks
Expansion ofwarehouses
Upgrading of
distribution channels

Improvement ofdemonstration rooms
and training facilities

Strengthening of therepairing system

Bases opened in this fiscal year

New office building inNew ZealandApril 2017

New office buildingin Austria
July 2017

New branch inWarsaw, Poland
July 2017

21FY2018 Sales Forecast
Variance to FY2017

Net Sales¥455.0 billion+ 9.6%

Domestic¥80.0 billion+ 7.6%

Overseas¥375.0 billion+ 10.1%

Overseas sales ratio: 82.4% (FY2017: 82.1%)
Assumed foreign exchange rates

2H
FY

US$Euro

RMB

¥110
¥111

¥130
¥128

¥16.8
¥16.6

2211

FY2018 Sales Forecastby Geographic Area
Yen inbillions

455.0
423.6

400

415.0
21.2
24.7
26.1
41.4

17.2
25.1
23.1
40.1

67.8

66.1

14.9
29.5
26.3

MidEast/Africa

43.8Oceania

71.3

300

Central &SouthAmerica

Asia

200
174.0

169.0

189.2

100

NorthAmerica
Europe74.4

68.4

80.0

Japan0FY2016

FY2017FY2018 (Forecast)

23Production Plan
Plan for FY2018
3,050
100

10 thousands of units

3,000

2,643

2,653

69116

Central &SouthAmerica

Asia

2,000

2,130
1,833

1,874

131132301

298271

270

North
America

1,000

Europe0
FY2016FY2017125415Japan280
FY2018 (Forecast)2412

FY2018 Performance Forecast
FY2017
Net Sales

FY2018

Variance¥415.0 billion ¥455.0 billion+ 9.6%

Operating Income¥62.6 billion¥70.0 billion+ 11.9%

Income Before
Income Taxes¥64.7 billion¥72.3 billion+ 11.7%Net Income
Attributable toMakita Corporation¥44.8 billion¥51.0 billion+ 13.9%EPS¥164.96¥187.87+ 13.9%

ROE

9.1%

Up

9.8% 0.7 points
25

Capital Expenditure,
Depreciation, R&D Cost
Capital Expenditure
FY16
FY17(Yen in billions)

1H

FY

6.2

11.8

5.0

FY18

Depreciation

FY2018:¥19.0 billion (Forecast)
China Plant equipment and moldOkazaki plant equipment and mold

13.2

7.2

19.0（Forecast）

R&D Cost(Yen in billions)
1H

FY(Yen in billions)

1H

FYFY164.69.3

FY164.69.6

FY174.48.9

FY175.010.1

FY184.8

FY185.510.0（Forecast）

11.0 （Forecast）
2613

Cash Dividends
Dividend Policy

Dividend Payout Ratio: 30% or greater
FY2017FY2018 (Forecast)

Net income Attributable
to Makita Corporation¥44.8 billion¥51.0 billion

EPS
Special Circumstance
Annual Cash Dividend
Per Share
Interim Dividend¥164.96¥187.87--¥100(Note)¥18¥10Year-end Dividend¥82(Note)

Payout Ratio

30.3%30% or greater

Note: In April 2018, the Board of Directors plans to propose a dividend equivalent toat least 30% of net income attributable to Makita Corporation.
27

http://www.makita.biz/FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements based on Makita's own
projections and estimates. The power tools market, where Makita is mainlyactive, is subject to the effects of rapid shifts in economic conditions, demandfor housing, currency exchange rates, changes in competitiveness, and otherfactors. Due to the risks and uncertainties involved, actual results could differ
substantially from the content of these statements. Therefore, these statements
should not be interpreted as representation that such objectives will beachieved.

28

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