Briefing on Results for the Third quarter of theFiscal Year ending March 31, 2017

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Highlights of Results for the Third quarter of FY2017/3(Consolidated)(million yen）

Third quarter ofFY2017/3

Net Sales

36,633100％

35,224

100％ △1,409△3.8％

Operating income

2,696

7.4％

2,653

7.5％

△43

△1.6％

Ordinary income

3,034

8.3％

2,890

8.2％

△144

△4.7％

Net income

2,093

5.7％

1,817

5.2％

△276

△13.2％

Capital investment

912－

372－

△540

△59.2％

Depreciation

937－

896－

△41

△4.4％

97.95yen－

84.99yen－Net income per share

ROE(%)

5.9 Annualized

4.9 Annualized

Change(YoY)

Rate ofchange(YoY)

Third quarter of
FY2016/3△12.96yen △13.2％－－2

Sales Trends by Product (Consolidated)(million yen）

Third quarter of
FY2017/3

36,633100％

35,224

100％ △1,409△3.8％

Generators

27,70375.6％

26,163

74.3％ △1,540△5.6％

Welders

3,955

10.8％

3,765

10.7％

△190

△4.8％

Compressors

786

2.1％

1,052

3.0％

266

33.8％

Others

4,187

11.4％

4,242

12.0％

55

1.3％

Net sales

By product

Rate ofChange(YoY)Third quarter of
FY2016/3

Change(YoY)

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Engine Generators (Consolidated)(million yen）

Third quarter of
FY2016/3

Generators

27,703

Third quarter of
FY2017/3

26,163Rate of change(YoY)△5.6％• In Japan, shipment to the major leasing and rental industry increased.
• Overseas, shipment to Asia and the Middle and Near East remain
sluggish.
Manufacturing engine-driven generators with capacity from 1kVA to 1100kVA
Mobile-type generators
Power source on a construction site and for civil engineering work and disaster recovery/restoration, etc.
Stand-by generating sets (stationary type)Back-up power source such as disaster prevention equipment and offices, etc.
Power-supply vehicles, power light, etc.

65%

Domestic market share ofengine generators (mobile-type)

Mobile-type generator

Stand-by generating sets

*According to a Company survey

4Engine Welders (Consolidated)(million yen）

Third quarter of
FY2016/3

Welders

3,955

Third quarter ofFY2017/3

3,765

Rate of change(YoY)△4.8％• Shipment to Europe increased while the shipment to the domesticmarket decreased.
The Company developed the first engine-driven welder for outdoor work in Japan.
Ranging from 135A for welding light-gauge steel to a 500A engine-driven welder
for heavy-gauge steel, a TIG welder and a CO2 welder, etc.
Welding of steel construction for buildings, condominiums and bridges
Welding of important structures such as petroleum storage tanks and pipelines

55%

Engine welder

Battery welder

Domestic market share ofengine welders*According to a Company survey

5Engine Compressors (Consolidated)(million yen）

Third quarter ofFY2016/3

Compressors

786

Third quarter ofFY2017/3

Rate of change(YoY)

33.8％1,052• Shipment to the domestic market is unchanged from the previous year,
shipment to America increased.
Manufacturing compressors
with air discharge amounts from 1.6㎥/min to 42.4㎥/min.
 Breaking-up of roads and ground improvement work of roads
 Mortar spraying work for preventing landslides of mountain roads
 For artificial snow machines on ski slopes, etc.

20%

Engine compressor

Motor compressor

Domestic market share ofengine compressors*According to aCompany survey

6Others (Consolidated)(million yen）

Third quarter ofFY2016/3

Others4,187

Third quarter ofFY2017/3

4,242

Rate of change
(YoY)

1.3％

• Sales of self-propelled lifters and Parts, etc. are at the same level as theprevious year.
Sales of other products
Self-propelled lifters
PartsSecondhand equipment and purchased
merchandiseRepair sales, etc.

Self-propelled lifter

Load testing equipment

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Sales Trend by Region (Consolidated)(million yen）

Third quarter ofFY2016/3

Third quarter ofFY2017/3

Change(YoY)

Rate of change(YoY)

36,633100%

35,224

100% △1,409△3.8%

Domestic sales

20,994

57.3%

20,95859.5%△36△0.2%

Overseas sales

15,63942.7%

14,266

40.5% △1,373△8.8%

North/Central
America

7,339

20.0%

7,408

21.0%

690.9%

Asia

5,589

15.3%

4,973

14.1%

△616

△11.0%

Others

2,709

7.4%

1,884

5.3%

△825

△30.5%

By region

Net sales

Third quarter of FY2016/3

Japan

North/Central
America

Asia

Third quarter of FY2017/3

Japan

North/Central
America

Asia

0

5,000

10,00015,00020,00025,00030,000

OthersOthers35,00040,0008Factor Analysis of Changes in Operating Income（Consolidated）
Decrease inOperating income• The operating income margin is slightly improved, but
the operating income decreased due to the decline of netsales.
(million yen）

Third quarter of
FY2016/3

Third quarter of
FY2017/3

Operating income

2,696

2,653

Operating income margin

7.4%

7.5%

Third quarter of
FY2016/3

Third quarter of
FY2017/3

Change(YoY)△430.1percentage point

Rate of change(YoY)

Gross profit margin

23.8%

24.1%

0.3percentage point

Ratio of SG&A to sales

16.5%

16.6%

0.1percentage point

Ratio of operating income tosales

7.4%

7.5%

0.1percentage point••Gross profit margin is improved by an increase in the sales of the large-sized machine with relatively highprofitability.
Ratio of SG&A to sales increased due to an increase of the personnel expenses, etc.
910Outlook for FY2017/3 : Consolidated Income and LossKeypoints• Net sales are expected to be 50.5 billion yen.
• Assumed exchange rate is 105 yen/dollar.
(million yen）

FY2016/3

FY2017/3(forecast)

Change(YoY)

Rate ofChange(YoY)

Net sales

50,419100%

50,500

100%

81

0.2%

Operating income

4,097

8.1%

4,100

8.1%30.1%

Ordinary income

4,494

8.9%

4,500

8.9%

60.1%

Net income

3,137

6.2%

2,900

5.7%

Capital investment

1,125－

1,000－

Depreciation

1,284－

1,250－△34

Net income per share

146.8yen－

135.7yen－△11.1yen

6.5%－

30.0yen－

ROE(%)Cash dividends pershare△237 △7.6%△125 △11.1%△2.6%－

is calculated by using the amount of money at
5.9% *Equity
the end of FY2016/3.

30.0yen－－－11Changes in the Amount of Capital Investment (Consolidated)(million yen）

End of March2014

End of March2015

End of March2016

End of March2017 (plan)

2,453

2,531

1,125

1,000

Cost ofequipment••

Main uses••

Machinery of Fukui plant,etc. 480
Nishinihon Generator Mfg.
270
Vietnam Plant 440
Singapore 1,100

•
•

•
•
•

Machinery of Fukui plant,etc. 440
Nishinihon Generator Mfg.
160
U.S. Plant 50
Vietnam Plant 1,630
Singapore 180

•
•

•
•

Machinery of Fukui plant,etc. 430
Nishinihon Generator Mfg.
80
Vietnam Plant 100
Singapore 280••••

Machinery of Fukui plant,etc. 500
Nishinihon Generator Mfg.
100
U.S. Plant 300
Others 100

Amount of capital investment

million

3,000
2,500
2,000
1,500
1,000
500
0
End ofMarch2014

End ofMarch2015

End ofMarch2016(plan)End ofMarch2017(plan)

Denyo Vietnam the 2nd factory12Outlook for Sales by Product (Consolidated)

Overview• Sales of generators are expected to increase by 106 million yen (0.3 %).
• Sales of welders are anticipated to decline by 300 million yen (5.9%).
• Sales of compressors are forecasted to be up by 196 million yen (17.8%).
(million yen）

FY2016/3

By products

Consolidatedsales

50,419FY2017/3 (forecast)100%

50,500Change(YoY)

Rate ofchange(YoY)

100%

81

0.2%

Generators

38,294 76.0%

38,400 76.3%

1060.3%Welders

5,100 10.1%

4,800 10.2%

△300

△5.9%

1.9%

196

17.8%

6,000 11.5%

81

1.4%

Compressors
Others

1,1042.2%

5,919 11.7%

1,300

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Outlook for Sales by Region (Consolidated)(million yen）

FY2016/3

Change (YoY)

Rate of change(YoY)

100%

81

0.2%

FY2017/3 (forecast)

50,419Domestic sales

30,115 59.7%

31,400 62.2%

1,285

4.3%

Overseas sales20,304 40.3%

19,100 37.8% △1,204△5.9%

North/Central
America

9,776 19.4%

10,200 20.2%

Asia

6,921 13.7%

6,100 12.1%△821 △11.9%

Others

3,606

5.6%

△806 △22.4%

By region

Consolidatedsales

FY2016/3

Japan

FY2017/3(forecast)

Japan
0

10,000100%

7.2%

50,5002,800

North/Central
America
North/Central
America
20,00030,00040,000

424

Asia

4.3%

OthersAsia Others
50,00060,00014Details of the Operating Income Forecast (Consolidated)
Increase slightly inoperating income• The operating income and the operating income margin arealmost unchanged from the previous year.
(million yen）

FY2016/3

FY2017/3(forecast)

Operating income

4,097

4,100

Operating income margin

8.1%

8.1%

FY2016/3

FY2017/3(forecast)

Change (YoY)

3±0percentage points

Change (YoY)

Gross profit margin

24.1%

24.6%

0.5

percentage point

Ratio of SG&A to sales

16.0%

16.4%

0.4

percentage point

Ratio of operating income
to sales

8.1%

8.1%

±0

percentage point••

The gross profit margin is expected to be improved by the enhancement of production efficiency and anincrease in sales of large-sized machine.
The Ratio of SG&A to sales is expected to rise due to an increase of the personnel expenses.
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Notes on Our Outlook

This material contains assumptions and outlooks for the future andforecasts based on plans as of February 9, 2017.
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 andis 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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