First Half of FYE2020
Operating Results(Six months ended September 30, 2019)
Munetoshi Goto
President, Representative Director

November 7, 2019

1

FYE2020 1H Results
Variance to FYE2019 1H

Revenue¥243.5 billion+ 0.3%

Domestic¥50.5 billion+ 15.6%

Overseas¥193.0 billion- 3.0%

Overseas revenue ratio: 79.3% (FYE2019 1H: 82.0%)
21Revenue by Geographic Area
Yen inbillions

6.9
15.6
13.5
21.5

200.1
200
150

8.3
11.7
10.7
17.8

243.5

242.8

231.0

250

35.0

4.3
14.3
12.9
19.6

7.6
15.4
13.9
20.4MidEast/Africa
Oceania

34.4

36.3

Central &SouthAmerica

31.8

Asia

100

98.6

105.5

107.5

84.6

NorthAmerica
Europe5039.9

35.2

50.5

43.7

Japan0FYE17 1H

FYE18 1HFYE19 1H

FYE20 1H

3Foreign Exchange RateFYE19 1H

FYE20 1H

USD

¥110.26¥ 108.60

Appreciation

EUR¥129.79¥ 121.40

Appreciation

RMB¥ 16.74¥ 15.68

1.5%

6.5%

6.3%

Appreciation
Weighted average change for all foreign currencies:
5.2% appreciated in the value of the yen

Effect on revenue: Decrease of ¥10.5 billion
42

Revenue Growth (Local Currency Basis)
JapanJapan20%

FYE19 1H + 9.6%
FYE19 2H +13.4%
FYE20 1H + 15.6%

15%10%
5%0%
FYE18-5%

FYE20

FYE192H

1H2H

1H
5Revenue Growth (Local Currency Basis)
Europe+8.6%
EasternEurope/Russia

20%

FYE19 1H + 8.5%
FYE19 2H + 13.0%
FYE20 1H + 12.2%

15%
10%

WesternEurope5%0%
FYE18-5%

2H

FYE191H

FYE20
2H

FYE19 1H + 4.3%
FYE19 2H + 7.9%
FYE20 1H + 6.4%

1H
63

Revenue Growth (Local Currency Basis)
North America/Asia20%

Asia

15%

FYE19 1HFYE19 2H
FYE20 1H

10%

- 4.0%- 8.3%- 1.9%

5%

North America

0%

FYE19 1H + 4.4%
FYE19 2H - 7.1%
FYE20 1H - 3.6%

-5%
-10%

FYE182H

FYE191H

FYE202H

1H

7

Revenue Growth (Local Currency Basis)
Central & South America, Oceania, Mid-East/Africa
Central &South America

20%

FYE19 1H + 17.5%
FYE19 2H + 8.7%
FYE20 1H + 0.9%10%0%Oceania-10%

FYE19 1H + 3.0%
FYE19 2H + 1.3%
FYE20 1H + 0.8%

-20%-30%

Mid-East/Africa

-40%
-50%

FYE182H

FYE191H

FYE202H1H

FYE19 1H + 10.1%
FYE19 2H - 27.7%
FYE20 1H - 41.6%
84Outdoor Power Equipment (OPE)New Products in this period

As powerful as engine models

As powerful as AC models

Cordless Chain Saw
Top Handle Series

Cordless
High Pressure Washer

9Lithium-ion Battery Products
New Products in this period
165 mm cordless modeltilting to right and left
The improved rigidity of
individual parts achieves
high-precision cutting

Deep and highly
precise detection

CordlessWall Detector165 mm Cordless Slide
Compound Miter Saw

High-speed riveting likepneumatic models

Cool air circulates aroundthe entire body

Cordless Rivet Gun

Cordless Fan Jacket
Cordless Fan Vest
105

Production Quantities byGeographic Area
10 thousandsof units
FYE19 1H
1,800
1,541

FYE20 1H
1,569

FYE19 2H
1,517

525457

Central &SouthAmerica
Asia

1,200
1,016997

70

64257

255

146

144

1,014

600

0286

EuropeJapan

164
FYE20

FYE191H51

North
America

2H

1H

11Inventories
March 31, 2019¥219.9 billion

September 30, 2019¥221.2 billion

Increase of inventories¥1.3 billion

Breakdown:
Increase of inventories on hand

¥12.5 billion

Decrease by translation into yen¥11.2 billion
126Operating Profit, Cost of Sales,
SG&A
FYE19 1H

Variance toFYE19 1H

FYE20 1H

Revenue¥242.8 billion ¥243.5 billion+ 0.3%

Cost of Sales- ¥152.6 billion - ¥160.0 billion+ 4.8%- 62.9%

Cost of Sales Ratio

SG&A Expenses- 65.7% Up 2.8 points- ¥50.1 billion - ¥51.2 billion+ 2.1%

SG&A Ratio- 20.6%

Operating Profit¥40.1 billion¥32.4 billion- 19.1%

Operating Profit Ratio

16.5%

13.3%Down
3.2 points
13- 21.0% Up 0.4 points

Analysis of Operating Profit
Yen inbillions

Sales
VolumeSG&A+3.9 -3.0 Exchange
Rate-2.6

Cost up-1.5

40.1

Others-4.5

32.4
FYE19 1H

FYE20 1H
147

Financial Income (Expenses),Profit Before Income Taxes,
Profit Attributable to Owners of the Parent

Variance toFYE19 1HFYE19 1H

FYE20 1H

Financial Income(Expenses)¥2.2 billion¥2.1 billion- ¥0.1 billion

Profit Before
Income Taxes¥42.3 billion¥34.5 billion- 18.4%

Profit Attributable toOwners of theParent¥29.7 billion¥25.0 billion- 15.8%¥109.33¥92.01- 15.8%EPS

15Capital Expenditure,
Depreciation and Amortization, R&D Cost
Capital Expenditure
FYE18 1HFYE19 1H(Yen in billions)
FYE2020 1H Main Capital Expenditure
Romania Plant： Extension of plant building(land・building)Okazaki Plant ：Distribution warehouse(building)
U.S.A. ：Distribution warehouse(land・building)

7.7
12.1
16.8

FYE20 1H

Depreciation and Amortization

R&D Cost(Yen in billions)(Yen in billions)

FYE18 1HFYE19 1H
FYE20 1H5.2
5.6
6.1

FYE18 1H

5.4

FYE19 1H

5.4

FYE20 1H

5.7168

Makita’s Commitments
 Li-ion 40Vmax series
 Conversion from engine-powered tobattery-powered Expand field equipment lineup
 Reinforcement of production andsales structures

17Makita’s Commitments
Introduction of Li-ion 40Vmax series
Achieving high power,
long life and highdurability

Makita original“Smart System”
Optimized power supplyand recharging
189

Makita’s Commitments
Introduction of Li-ion 40Vmax series
Models in 8 categories released

Pushing ahead with theintroduction of more
cordless products
Enhanced work efficiency
Improved safety

Helping to solve labor
shortages in the workplace
19

Makita’s Commitments
Conversion from engine-powered to battery-powered
Develop and expand cordless OPE
New Products in this period＜Main commitments＞
 Introduce new highperformance products
 Proactive advertising Strengthen services andlogistics
 Increase staffing for sales
expansion
 Develop sales channels

Cordless Chain Saw
Top Handle Series

Advertising

TV commercials in the U.S.
LED billboards at European
football stadiums(in 7 countries)
2010

Makita’s Commitments
Expand field equipment lineup
Excellent receiver sensitivity & large 10V LCD

Cordless LEDFlashlight

Cordless
Job Site Radio

Cordless
Adapter for USB

Cordless Job Site Television with Radio

Preparing for disasters

Making fresh coffee anywhere

Emergency Kit

Cordless
Coffee Maker

21

Makita’s Commitments
Strengthen of production network
Extension of Romania plant（Completion in July, 2019）<Production capacity
expansion>
 Responding to sales increasein Europe Decentralizing production bases
 Responding to increasing lineup
for cordless products, including
OPE2211

Makita’s Commitments
Strengthen of sales network by increasing sales, after-sales anddistribution bases
Strengthen customer- and community-based sales networks
Bases opened in this fiscal year(including translation and remodeling)
AreaCityJapan

Miyakonojo（Miyazaki）

EuropeBerlin（Germany）
Slovenia<Translate building>North
America

Dallas（U.S.A.）<Expansion of distribution
warehouse>

Asia

Jamshedpur etc.（India）
Yunlin etc.（Taiwan）

Central andSouthAmerica

Guaxupe（Brazil）•••

Strengthen services and logistics
Introduce new products and develop
user needs
Respond to increasing sales forcordless OPE(service and logistics fields)

23

Dallas（U.S.A.）Warehouse

Forecast of Financial Results
Dividend Revenue Forecast, Production Plan Financial Performance Forecast
 Capital Expenditures, Depreciation andAmortization, R&D Cost Dividend
24

12

FYE2020 Revenue Forecast
Variance to FYE2019Revenue¥480.0 billion- 2.2%

Domestic¥100.0 billion+ 8.5%

Overseas¥380.0 billion- 4.6%

Overseas revenue ratio: 79.2% (FYE2019: 81.2%)
FYE2020 Assumed foreign exchange rates

2HFYUSD

EuroRMB

¥105
¥107

¥115
¥118

¥14.8
¥15.225

FYE2020 Revenue Forecastby Geographic AreaYen inbillions
500

15.5
31.3
27.9
44.1

400

73.9

300

480.0

490.6

477.3

13.8
30.2
27.8
40.9

10.0
27.5
25.5
39.0

72.5

71.0

Mid-East/Africa

Oceania

Central & SouthAmerica
Asia

200

213.2

202.0

207.0
North America

100

Europe

92.1

82.6

100.0
Japan0FYE2018

FYE2019

FYE2020 (Forecast)

2613

Analysis of Operating Profit(Forecast)
Yen inbillions

Sales SG&A
Volume-8.0
Exchange
+6.0
Rate

78.3

-6.0 Cost up-3.0 Others
-4.3

63.0

FYE2019

FYE2020

27FYE2020 Performance Forecast
FYE2019
Revenue

FYE2020

Variance¥490.6 billion ¥480.0 billion- 2.2%

Operating profit¥78.3 billion¥63.0 billion- 19.5%

Profit before
income taxes¥79.9 billion¥63.0 billion- 21.2%

Profit attributable toowners of theparent¥55.8 billion¥44.0 billion- 21.1%

EPS¥205.37¥162.05

-ROE

9.9%

Down

7.8% 2.1 points
2814

Production Plan
10 thousands of units

Plan for FYE2020
3,100

3,058

3,111
3,000

105

109

120

2,000

2,179

2,013

1,990

134

100

512

580

290

310

1,000

124
414
289

0FYE2018

FYE2019

Central& SouthAmerica
Asia
NorthAmerica
EuropeJapanFYE2020(Forecast)
29Capital Expenditure,
Depreciation and Amortization, R&D Cost
Capital Expenditure
FYE18
FYE191H

FY

7.7

15.0

(Yen in billions)

23.9

16.8

38.0

Depreciation and Amortization（Forecast）

R&D Cost(Yen in billions)1H¥38.0 billion (Forecast)

Expand factories in China and Romania,
distribution warehouses and sales andaftersales bases in Japan and overseas

12.1

FYE20

FYE2020:(Yen in billions)

1H

FY

FY

FYE18

5.2

10.8

FYE18

5.4

10.9

FYE195.6

11.3

FYE195.4

11.3

FYE20

6.1

FYE20

5.7

12.0 （Forecast）

12.8（Forecast）

3015

Cash Dividends
Dividend Policy

Dividend Payout Ratio: 30% or greater
FYE2019

FYE2020 (Forecast)Profit attributable toowners of the parent¥55.8 billion¥44.0 billion

EPSSpecial Circumstance
Annual Cash Dividend
Per Share
Interim Dividend¥205.37¥162.05--¥62(Note)¥10¥10Year-end Dividend¥52(Note)

Payout Ratio

30.2%

30% or greater

Note: In April 2020, the Board of Directors plans to propose a dividend equivalent to at least 30% of profit attributable to owners of theparent.

31

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.

32

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