FY2013 First Half Results Meeting
Results for the six months ended September 30, 2013
FY2013 : Year ending March 31, 2014

November 15, 2013
Ryosan Company, Limited

Code : 8140 / Stock listings: Tokyo Stock Exchange (First Section)
URL : http://www.ryosan.co.jp/eng/

Results for FY2013 First Half and Forecasts for Whole Financial Year

Management
ManagementEfforts
EffortsforforSecond
SecondHalf
HalfofofFY2013
FY2013

NoticeBusiness forecasts and all statement related to the future contained in thispresentation are based on information currently possessed by the Company and on
certain assumptions which we judge to be rational. Actual business performance
may differ greatly depending on a variety of factors. The following is a list ofmajor factors:
・Economic conditions in key markets (Japan and the rest of Asia), rapid changes
in consumption trends and supply-demand balance for products
・Sharp fluctuations in the dollar-yen exchange rate

An Electronics Systems Coordinator・Substantial fluctuation in prices in capital markets

1

Results for FY2013 First Half and Forecasts for Whole Financial Year

Management Efforts for Second Half of FY2013

An Electronics Systems Coordinator

2Overview of Consolidated ResultsFY2012
1H

Net sales

2HFY2013
1H

Whole Year

Results Results

Results

1,061 1,003

2,065

Of
T otal2HWhole Year

Results% Chg.
YoY% Chg.
YoYPlan

1,110＋4.6%

1,139 ＋13.5%

OfT otalPlan

2,250% Chg.
YoY
＋8.9%

Gross margin

8680

166 8.1%

91＋5.6%

94 ＋16.8%

185 8.2%＋11.0%

SG & A expenses

6464

129 6.3%

68＋6.1%66＋1.7%

135 6.0%＋3.9%

Operating income

2115

36 1.8%22＋4.2%27 ＋79.7%

50 2.2%＋36.1%

Ordinary income

2515

41 2.0%21(15.2)%

28 ＋81.1%

50 2.2%＋21.6%Net income

151228 1.4%

13(13.7)%

17 ＋39.5%

31 1.4%＋10.1%

Earnings per share¥46.40¥38.00¥84.40¥42.16

Results Results

Results

OfT otal

Results% Chg.
YoY

594(13.5)%

Domestic sales

687

624

1,312 64%

Overseas sales

374378752 36%An Electronics Systems Coordinator

516 ＋37.9%¥55.84

Plan605% Chg.
YoY(3.2)%

533 ＋41.0%¥98.00OfT otal% Chg.
YoY

1,200 53%(8.6)%

Plan

1,050 47% ＋39.5%(Unit: 100 millions of yen)3Overview of Results by Business Segment
FY2012FY2013
1H

2H

Whole Year

1H2H

Whole Year

Results

Results

Results

Results

Net Sales

67,10664,066 131,172

74,332＋10.8%

74,668＋16.5%

149,000＋13.6%

Operatingincome

1,169

765

1,934

1,364

＋16.7%

1,636＋113.9%3,000＋55.1%

Electronic
Components

Net Sales

26,884

24,12451,00825,895(3.7)%

27,105＋12.4%

53,000＋3.9%

Operatingincome

660

544

1,204

654(0.9)%

796＋46.3%

1,450＋20.4%

Electronic
Equipment

Net Sales

9,620

9,899

19,5198,285(13.9)%

9,715( 1.9)%

18,000(7.8)%

Operatingincome334519853307(8.1)%

343(33.9)%650(23.8)%

Ryosan Products(Heat sinks)

Net Sales

2,573

2,260

4,833

2,579

＋0.2%

2,421

＋7.1%

5,000＋3.5%

Operatingincome39(27)

12(2)

‐

52

‐

50＋316.7%

(83)

(248)

(331)

(115)

‐

(35)

‐

(150)

106,185 100,349 206,534

111,092＋4.6%

113,908＋13.5%

225,000

＋8.9%

2,208

＋4.2%

2,792

＋79.7%

5,000＋36.1%

Semiconductors

Adjustments
Net Sales

Consolidated

Operatingincome2,119

An Electronics Systems Coordinator1,554

3,673% Chg.
YoY% Chg.
YoY

Plan% Chg.
YoYPlan‐(Unit: millions of yen)4

Change in Net Sales for Semiconductors (By product)
Overview of Results for FY2013 First Half: sales of system LSIs for in-vehicle electrical components, memories for smartphones,etc. were favorable.
Prospects for FY2013 Second Half: expecting sales of system LSIs for in-vehicle electrical components, memories forsmartphones, etc. to continue the current favorable trend.
(Unit: 100 millions of yen)

743

746

9287

469

480

System LSIs

164180178

Discretesemiconductors

2H

1H

2H (Plan)

800674649

34671

640

404550600

400

Memories

462423433425200

180

177

196

1H

2H

1H0

FY2011An Electronics Systems Coordinator

FY2012FY20135Change in Net Sales for Electronic Components (By product)
Overview of Results for FY2013 First Half: although sales of mechanical parts for in-vehicle electrical components, etc. increased,sales of display devices for digital cameras etc. were not as favorable.
Prospects for FY2013 Second Half: expecting sales of mechanical parts, etc. for in-vehicle electrical components andsmartphones to increase.
(Unit: 100 millions of yen)
300

278

275

268
241

738275271

258

53585427200
2426

Display
Devices
PowerSupplies

242321100169

176

170

165

1H

2H

1H

2H

189

176

Electromechanical
Parts

0

FY2011An Electronics Systems Coordinator

FY20121H

2H (Plan)
FY20136

Change in Net Sales for Electronic Equipment (By product)
Overview of Results for FY2013 First Half: sales of systems equipment, etc. for in-vehicle electrical components decreased.
Prospects for FY2013 Second Half: expecting sales of systems equipment for multifunction printers and sputtering
equipment , etc. to increase.
(Unit: 100 millions of yen)
150

135120111
9896909782

9789608380

77

Systems
Equipment

Facilities
Equipment

69303722161513191H

2H

1H

2H (Plan)

01H

2H
FY2011An Electronics Systems Coordinator

FY2012FY20137

Change in Net Sales for Ryosan Products (By area)
Overview of Results for FY2013 First Half: sales of heat sinks for white home appliances increased.
Prospects for FY2013 Second Half: expecting both domestic and overseas sales to advance on the levelof the first half.
(Unit: 100 millions of yen)
40.0

30.7
30.0

23.8
20.0

25.7

25.7

24.2

22.6

22.9
17.5

18.9
18.2

16.6

Domestic

8.2

7.5

Overseas

1H

2H (Plan)

15.9

10.0

7.7

5.6

6.8

6.6

2H

1H

2H

0.0

1H
FY2011An Electronics Systems Coordinator

FY2012FY20138Main Suppliers

COSEL
1.9%
ORTUS
Technologies
2.1%

Othersuppliers
15.7%

NEC TOKIN
2.1%
NLT
Technologies
2.6%

Renesas Electronics
51.6%

Japan Aviation
Electronics
Industry
2.8%

NEC
5.7%

NXP
Semiconductors
3.0%

ElpidaMemory ALPS
6.1% Electric
6.4%[Percentage of net sales bybusiness segment]
RyosanproductsElectronic(2%)
Equipment(8%)
ElectronicComponents(23%)
Semiconductors(67%)* Honorifics omitted* Percentage (%) is based on actual sales of products purchased from suppliers for the first half of FY2013.
An Electronics Systems Coordinator

9Main Clients<<Top 40 companies by net sales>>Top 1-10

Top 11-20

Top 21-30

Top 31-40

ALPINEALPS ElectricCanonADVANTESTCASIO COMPUTER

Brother Industries

Fuji Xerox

BLUEWAY(C)HITACHICalsonic Kansei

Mamiya-OP

ClarionClients

Mitsubishi ElectricDENSO

Stanley Electric

Fujitsu(alphabetical order)

NECFuji Film

Sumitomo Electric Industries

Furuno Electric

NIKON

Hyundai Motor (K)TOPRO(C)JVC KENWOODOMRONJABIL(U)TOSHIBA TEC

KONICA MINOLTAPIONEERNINTENDO

Wuhan Fiberhome(C)

Sharp

SAMSUNG (K)Panasonic

YAMAHATCL (C)

Wacom

Sumitomo Wiring Systems

Yazaki Corporation

Yokowo(Top 10)Percentage
Sales of allclients

51%(Top 20)

68%(Top 30)75%(Top 40)80%* Honorifics omitted* Ranking and percentage (%) are based on actual sales for the first half of FY2013.
* (K), (U) and (C) represent clients in Korea, US and China, respectively.
An Electronics Systems Coordinator

10Consolidated Balance Sheet
2,00073.5%◆ Assets

1,800
1,600

1,602

1,643

73.0%
1,600
72.5%

1,200

72.0%

800

1,396

1,400

1,602

1,643

434

475

72.9%

71.1%

100.0%

Liabilities
80.0%

1,200

Current
1,000
assets
71.5%

1,435

120.0%◆ Liabilities/net assets

1,800

1,400

1,000

2,000

Net assets tototal assets

60.0%

800

40.0%

600

71.0%

400

600

1,167

Net assets

1,168

400
20.0%

70.5%

Fixed200
assets2000205

207

70.0%

End of Mar. 2013 End of Sep. 201300.0%

End of Mar. 2013

End of Sep. 2013

Major increases/decreases

Cash, deposits and securities
Trade notes and accounts receivable
Inventories

End of Sep.
2013

Increase/decrease

494
703
223

(10)
+22+32An Electronics Systems Coordinator

Trade accounts payable
Short-term bank loans

End ofSep. 2013

Increase/decrease

290
136+38+7(Unit: 100 millions of yen)11

Consolidated Statement of Cash Flow
FY2012
1H
Results

Cash flows from operating
activities

62

Cash flows from investing
activities

14

Free cash flow

77FY2013
1HResults

13- Income before income taxes and minrity
interests- Increase in notes and accounts payable- Increase in notes and accounts receivabletrade- Increase in inventories

21(24)- Purchase of property, plant and equipment- Purchase of intangible fixed assets

(1)
(1)

- Purchase of treasury stock- Cash dividends paid
- Increase in short-term loans payable

(17)
(9)
129
(8)

(2)

11

Cash flows from financing
activities

(12)

(27)

Balance of cash and cash
equivalents

403

494

An Electronics Systems Coordinator

Main factors(Unit: 100 millions of yen)

12Redistribution of Profits to the Shareholders
In the period from FY2011 to FY2013, the Company repurchased 1 million shares each year andretired them.
50(Unit: 100 millions of yen)

Current term net income

Purchase of treasury stock

Total amount of dividends (figures inparenthesis are dividend payout ratio)

Total payout ratio

67%

141%

40

119%

3936

162%
30

30

72%

191720

31

27

28
10

1741

20

28（66%）

18（72%）

13

19

18（71%）

（61%）

@¥60

@¥60（71%）@¥60
0FY2009@¥80FY2010

An Electronics Systems Coordinator@¥40FY2011

FY2012FY2013 (Plan)

13

Results for FY2013 First Half and Forecasts for Whole Financial Year

Management Efforts for Second Half of FY2013

An Electronics Systems Coordinator

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Management Efforts for FY2013[Our Basic Stance]

Seek sustainable growth and sound management[Specific Efforts]
Cultivation of businesses to serve as 2nd and 3rd pillars◇Further strengthening of overseas semiconductor device business・Implement projects for developing new resources
・Further strengthening of overseas semiconductor device business

Further improvement of corporate structure◇Improvement in the profit structure and financial structure・Continuously challenge for improvement in the profit rate
・Proper adjustment of turnover months for inventories:
Target of less than 1 month
An Electronics Systems Coordinator

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Progress Made With Measures to Further Strengthening of Overseas Semiconductor Device Business◆ Progress made with “Implementing projects for developing new resources”=> Plan to establish a subsidiary to engage in business with new suppliers.

◆ Progress made with “Further strengthening of overseas semiconductor device business”

SAXIS

RYOSAN GROUP

Main suppliers: NXP Semiconductors, Macronix International, Entropic Communications, Everspin
Technologies, THine Electronics.

=> In FY2013, the Company is concentrating on expansion of business with the existingsuppliers.

GYRONICSRYOSAN GROUPGYRONICSMain suppliers: Winbond Electronics, Micrel, STMicroelectronics, ATMEL, Faraday Technology, Applied
Micro Circuits (new suppliers)=> In FY2013, the Company is also making efforts to establish business with new suppliers.
An Electronics Systems Coordinator16

Progress Made With Measures to Improve Profit Structure
The Company has been tackling the issue of improvement of profit structure from FY2011, and themeasures implemented in this area succeeded in recovering the ratio of gross profit to net sales to8.2% in the first half of FY2013. We plan to make further efforts to improve the ratio of gross profit tonet sales in the future.

[Changes in gross margin]
100(Unit: %)(Unit: 100 millions of yen)

85

82

94

91

86

Gross margin

9.5

80

80

10.0

9.0

8.1

60

7.7

8.0

8.2

8.3

7.7

8.5
8.0

40

Gross profit
margin

7.5
7.0

20
6.5
0

6.0

1H

2H

FY2011

1H

2H

FY2012An Electronics Systems Coordinator

1H

2H (Plan)

FY201317

Progress Made With Measures to Improve Financial Structure
The Company has similarly implemented measures to improve financial structure, improving theinventory turnover period to 1.1 months. We shall promote rationalization further aiming at reaching
the target of less than one month.

[Changes in inventories](Unit: month(s))(Unit: 100 millions of yen)

300

2.0

255

Inventories

246

250

227

223

1.7

190

200

1.3

1.3

1.3

1.4

150

1.1

Turnover period

1.1
1.1

1000.85000.5End of 1H End of 2H End of 1H End of 2H End of 1H
FY2011An Electronics Systems Coordinator

FY2012FY201318Growth Strategies for 8th Medium-Term Management PlanAddition

Growthstrategies

1. Further strengthening ofoverseas semiconductor devicebusiness

2. Strengthening approach todeveloping countries of quick
growth (China and India)

3. Strengthening dealing with
globalizing Japanesecustomers

4. Strengthening exploitation in
growing fields (car electronics,social infrastructure, etc.)

An Electronics Systems Coordinator

19