Presentation Materials
for the Second Quarter of
the Fiscal Year Ending February 2024
October 24, 2023

TAKEUCHI MFG. CO., LTD.
(Securities code: 6432)© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

▶ FY2023 First Half Consolidated Results▶ FY2023 Consolidated Forecast▶ Topics•

Production Capacity Expansion (New Factories in Japan and the US)•

Current orders and order backlog•

Challenges in electrification of construction equipment▶ Reference Materials
1© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Summary of Earnings Results for the First Half of the FY2023(1) Sales volume increased in both the US and Europe⚫ North American sales volume increased +3.6%⚫ European sales volume increased +7.0%⚫ Total sales volume increased +5.5%(1Q: +17.6%, 2Q: -7.7%, YoY)
(1Q : -1.5%, 2Q : +18.3%, YoY)
(1Q : +6.6%, 2Q : +4.4%, YoY)

(2) Record-high net sales and profits for 1H (net sales +22.3%, operating profit +81.9%, YoY)
⚫ Despite a softened & in an adjustment phase in housing market due to rising interest rates and highhousing prices, demand for products remained strong due to robust construction of water and gas
pipeline infrastructure projects.

⚫ Despite factors that reduced profits, such as rising raw material prices, significant profit growth wasachieved through higher sales, product price increases, and the impact of foreign exchange (forex)
fluctuations.
(Billions of yen)

FY2022

FY2023 (Current FY)

1Q

2Q

1H

3Q

4Q

2H

1Q

2Q

Net sales

42.4

43.6

86.0

46.8

46.0

92.9

53.0

52.1 105.1

Gross profit

9.8

10.1

19.9

11.1

11.9

23.0

12.9

12.5

25.5

SG&A expenses

4.4

6.1

10.6

6.4

4.7

11.1

4.4

4.1

8.5

of these, transportation costs

2.6

4.1

6.7

4.3

2.7

7.1

2.1

1.5

3.6

Operating profit

5.3

3.9

9.3

4.6

7.2

11.8

8.5

8.4

16.9

2

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

1H

Consolidated Financial Highlights for the First Half of the FY2023
FY2022Millions of yen

1st half

FY2023(%)

1st half

Sales ratio

Change

(%)

1H
Prev.
Forecast

ChangeNet sales

86,033-

105,176-+19,143+22.3%

96,200+8,976■

Operating profit

9,328

10.8%

16,96916.1%+7,640+81.9%

14,500+2,469■Ordinary profit

10,33912.0%

17,072

16.2%+6,733+65.1%

14,400+2,672■

Profit attributable toowners of parent

7,663

8.9%

12,67012.0%+5,007+65.3%

10,300+2,370Capital investment

4,959

5.8%

4,798

4.6%

(160)

(3.2)%

1,688+3,110

780

0.9%

1,285

1.2%

+504

+64.7%

1,413

(127)

Orders received

130,833-

87,309-(43,524)(33.3)%***-

Order backlog

178,649-

172,880-(5,769)(3.2)%***-FY2022
1H

FY2022
2H

Net sales

FY2023
1H

0

FY2022
1H

FY2022
2H

17,072

16,969FY2023
1H

Operating profit

FY2022
1H

FY20222H

FY2023
1H

Ordinary profit© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2022
1H

FY2022
2H

12,670

5,000

8,316

25,000

7,663

10,00011,03950,00010,33915,00011,89220,00075,00003(Millions of yen)

9,328

100,000

92,932125,000

86,033

Depreciation

105,176■

FY2023
1H

Profit attributable to owners ofparentQuarterly Net Sales and Operating Profit(Millions of yen)

50,000Net sales

40,00040,89633,332

32,67433,9893Q

4Q

42,414

43,6191Q

2Q

46,892

46,0393Q

4Q

53,03952,137

1Q

2Q

8,542

8,426

1Q

2Q

30,00020,00010,0000

1Q

Operatingprofit

7,268

8,000

6,000

2Q

5,755
4,202

5,355

4,201

3,604

3Q

4Q

4,000

3,972

4,623

2,000
0

1Q
Exchange rates

4

2Q

1Q

2Q

FY2021

3Q

4Q

FY2022

FY2023

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

2Q

JPY/USD

108.89109.96110.66114.70121.43133.43143.54134.12134.74140.48JPY/GBP151.26

153.60152.21154.07157.87163.51

166.55163.00165.80179.25JPY/EUR

130.43131.70130.56129.41133.83138.77142.85142.51

146.10154.14JPY/RMB

16.45

17.07

17.08

17.90

18.56

19.70

20.11

19.60

19.43

19.66

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Financial Results by Region for 1H FY2023
FY2022(Millions of yen)

1st half

FY2023

Sales ratio

1st half

Sales ratio

Change1H
Prev.
Forecast(%)

Change■ Japan

1,156

1.3%

1,094

1.0%

(62)

(5.4)%

1,260

(165)

■ North America

47,19254.9%

56,61053.8%+9,417+20.0%

51,510+5,100■ Europe

35,41841.2%

44,31842.1%+8,900+25.1%

40,900+3,418■ Asia

277

0.3%

60

0.1%

(217)

(78.2)%

90(29)■ Others

1,987

2.3%

3,092

2.9%

+1,104+55.6%

2,440

+652

Total net sales

86,033100.0%

105,176

100.0%+19,143+22.3%

96,200+8,976

Net sales overseas

84,876

98.7%

104,082

99.0%+19,205+22.6%

94,940+9,142

FY2022
1H

FY2023
1H(Millions of yen)

Units sold
1H: +7.0%
44,31838,48840,000（Average）（YoY）

35,41850,00056,61060,00051,31347,192

Units sold
1H: +3.6%
（YoY）

USD

126.74138.45

GBP

160.63172.16EUR

136.90149.84

RMB

19.13

19.55

0

5

1H

2H
FY2022Japan

1H
FY20231H
1H
2H
FY2022
FY2023
North America

1H
1H
2H
FY2022
FY2023
Europe1H
2H
FY2022Asia© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

1H
FY2023

3,092

2,032

60

218

277

1,094

879

10,0001,156

20,0001,987

30,0001H
1H
2H
FY2022
FY2023
OthersGeographic Segment Information and Results for 1H FY2023(Millions of yen)
Japan

USA

UK

FY2022
1H

ChinaProfit ratio

1H

Profit ratio

Change(%)

Net sales

29,448-36,166-+6,717+22.8%

Segment profit

5,739

19.5%

12,45834.4%+6,718+117.0%Net sales

47,192-

56,618-+9,425+20.0%

Segment profit

4,980

10.6%

5,167

9.1%

+186

+3.7%

Net sales

6,022

-

7,488

-

+1,466+24.4%

510

8.5%

842

11.2%

+332

+65.1%

3,282

-

4,867

-

+1,585+48.3%

Segment profit

236

7.2%

520

10.7%

+283

+119.7%

Net sales

87

-

35

-

(51)

(59.5)%

Segment profit

(13)

-

26

75.4%

+39

-

Segment profit
FranceFY2023

Net sales̶Japan Segment: (TAKEUCHI MFG. CO., LTD.)• Development and manufacture of construction machinery• Sales of construction machinery in Japan / Sales of construction machinery to distributors in Europe and Asia/Oceania
̶

US Segment: (Takeuchi Mfg. (U.S.), Ltd.)• Sales of construction machinery in the US and Canada• [NEW] Manufacture of construction machinery in the US̶UK Segment: (Takeuchi Mfg. (U.K.) Ltd.)• Sales of construction machinery in the UK̶France Segment (Takeuchi France S.A.S.)• Sales of construction machinery in France

6̶

China Segment: (Takeuchi Qingdao Mfg. Co., Ltd.)• Sales of construction machinery in China• Manufacture of construction machinery for China and otherparts of Asia
• Manufacture, procurement, and sales of construction
machinery components for the Japan segment© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Factors of Increase/Decrease in Operating Profit (1H FY2023)
Cost of sales +1,254M- Other than US : +819M- US +435M
SG&A expenses +228M(Millions of yen)
18,000+3,577

16,000Price+2,278 increases

14,00012,000Effects of
FOREX
rates

8,000

6,000

9,328

4,000

└ Decrease in unit price: -3,065M└ Increase in shipping volume: +125M└Transfer to COS: -434M(2,109 )Increasein cost(Rawmaterial
price)

Effect ofincreased+3,263 sales

10,000Transportation costs: -3,373M+338(778 )Start-upof new
factories
(US,
Aoki)

(1,483 )Investment inhuman
capital+2,987

Others(434 )

Transporta Decreasetion costs in SG&A
for SKD
expenses
produc (Excludingtion (COS) effects of
FOREX
rates)

16,969US factory: +738M
Aoki factory: +40M

Transportation costs└ WIP for SKD production in the U.S.: Inventory→Cost of Sales└ Finished goods for sale to customers: SG&A expenses

2,000

FY2022(1st Half)
Operating profit

7+7,640 million yen© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2023(1st Half)
Operating profit

Consolidated Balance Sheets (As of August 31, 2023)
As of Feb. 28, 2023

Assets(Millions of yen)

Liabilities and Net assets

Composition
ratio

BalanceComposition
ratio

Change(%)

Cash and deposits

43,99527.7%

42,19724.0%(1,798)(4.1)%

Notes and accounts receivable - trade35,73922.5%

45,69626.0%+9,956+27.9%

Inventories

47,72330.1%

50,56928.8%+2,846

+6.0%

Other

3,001

1.9%

4,132

2.4%

+1,130+37.7%

Current assets

130,459

82.2%

142,595

81.1%+12,135+9.3%

Non-current assets

28,32617.8%

33,15518.9%+4,829+17.0%

Total

158,785

100.0%

175,750

100.0%+16,965+10.7%

26,75516.9%

28,65016.3%+1,894

+7.1%

9,620

6.1%

11,1096.3%+1,488+15.5%

36,37622.9%

39,75922.6%+3,383

+9.3%

606

0.4%

644

0.4%

+37

+6.2%

Total Liabilities

36,98323.3%

40,40423.0%+3,420+9.2%

Total net assets

121,80276.7%

135,34677.0%+13,544+11.1%

Total

158,785

100.0%

175,750

100.0%+16,965+10.7%

Notes and accounts payable - trade

8

Balance

As of Aug. 31, 2023

Other current liabilities
Current liabilities
Non-current liabilities© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Consolidated Statements of Cash Flows (1H FY2023, Results)(Millions of yen)
Cash and cash
equivalents at end of
period(4,683 )+7,327(4,693 )43,519As of February 28,
2023

Cash and cash
equivalents at
end of period+251(1,798) million yen

Operating CF

Investment CF

Financial CF

41,721

Effect ofexchange ratechanges

As of August 31,
2023(Millions of yen)

Cash flows from operating activities

ChangeCash flows from investing activities

ChangeProfit before income taxes

17,072

Purchase of property, plant andequipment(4,583)

Depreciation

1,285

Acquisition of intangible assets(198)

Proceeds from redemption of securities

100

Others(1)

61

Decrease in inventories
Increase in working capital(7,421)

Income taxes paid

(3,067)(602)

OthersTotal

9+7,327

Total

Cash flows from financing activities
Dividends paid

(4,677)

Others(4,683)© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Change(16)
Total(4,693)

▶ FY2023 First Half Consolidated Results▶ FY2023 Consolidated Forecast▶ Topics•

Production Capacity Expansion (New Factories in Japan and the US)•

Current orders and order backlog•

Challenges in electrification of construction equipment▶ Reference Materials
10© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2023 Earnings Forecasts (full year)
Previous forecast (announced on April 11, 2023)(Millions of yen)

1st half

2nd half

Full year

Revised forecast (announced on October 12, 2023)

1st half(results)

2nd half

Full year

Change

(%)

Japan

1,260

1,200

2,460

1,094

1,235

2,330

(130)

(5.3)%

North America

51,51050,570102,080

56,61053,489110,100+8,020+7.9%

Europe40,90038,68079,58044,31842,881

87,200+7,620

+9.6%

Asia

90

90

180

60

119

180

-

-

Others

2,440

2,260

4,700

3,092

2,097

5,190

+490

+10.4%

Total net sales

96,20092,800

189,000

105,176

99,823205,000+16,000+8.5%

Operating profit

14,5009,500

24,00016,96916,13033,100+9,100+37.9%

Ordinary profit

14,4009,500

23,90017,072

16,127

33,200+9,300+38.9%

Profit attributableto owners of parent

10,3006,900

17,20012,67011,52924,200+7,000+40.7%(1) Robust demand for products in 2H (the second half of the year)⚫ Market softening expected in the UK, but strength to continue in other major European countries and the US(2) Pre-shipments of work-in-process inventory lacking electronic components will becompleted in 3Q⚫ All this work-in-process inventory will become finished goods available for sale to customers → Increasing
unit sales in 2H(3) Forecasting record-high net sales and profits⚫ Increases exceeding previous forecast due to higher unit sales, additional price increases in 2H, and theweaker than expected yen

11© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Expected Consolidated Financial Highlights for FY2023
FY2022(Millions of yen)

FY2023 (forecast)

Full year

Sales ratio

1st half(results)

2nd half

Full year

Sales ratio

Change(%)■

Net sales

178,966-

105,176

99,823205,000-+26,033+14.5%■

Operating profit

21,221

11.9%

16,96916,13033,10016.1%+11,878+56.0%■

Ordinary profit

21,37911.9%

17,072

16,127

33,20016.2%+11,820+55.3%■

Profit attributable toowners of parent

15,9798.9%

12,67011,52924,20011.8%+8,220+51.4%

Capital investment

8,629

4.8%

4,798

4,251

9,050

4.4%

+420

+4.9%

Depreciation

2,039

1.1%

1,285

2,318

3,604

1.8%

+1,564+76.7%

335.19Dividend
payoutratio
29.2%

265.81-507.68+172.49+51.5%--

158.00

Dividend
payout ratio
31.1%+60.00+61.2%

40,000Net sales

Operating profit

Ordinary profit

24,20015,97913,348

9,765

9,091

12,0006,000(Millions of yen)

33,20021,37918,08013,29833,10012,40318,00021,221

24,000
Units sold
1H: +5.5%
2H: +4.2%
FY: +4.9%(YoY)

17,764205,000

178,966

30,000

Profit attributable to owners of parent

00
FY2019 2020 2021 2022 2023

12

36,00013,20780,000Including a commemorative dividend of 5 yen for the 60th anniversary of the company's founding

12,649120,000

98.00

140,892

160,000

112,254200,000

115,913

Earnings per share(yen)
Dividends per share(yen)

FY2019 2020 2021 2022 2023 FY2019 2020 2021 2022 2023 FY2019 2020 2021 2022 2023
© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Earnings Forecast by Region for FY2023
FY2022(Millions of yen)

FY2023 (forecast)

Sales ratio

1st half(results)

2nd half

Full year

Sales ratio■ Japan

2,036

1.1%

1,094

1,235

2,330

1.1%

+293

+14.4%■ North America

98,50655.0%

56,61053,489110,100

53.7%+11,593+11.8%■ Europe

73,90641.3%

44,31842,881

87,20042.5%+13,293+18.0%■ Asia

495

0.3%

60

119

180

0.1%

(315)

(63.7)%■ Others

4,020

2.2%

3,092

2,097

5,190

2.5%

+1,169+29.1%

Total net sales

178,966

100.0%

105,176

99,823205,000

100.0%+26,033+14.5%

JPY/USD

133.12-138.45137.00137.30

-

+4.18

+3.1%

JPY/GBP

162.58-172.16174.00173.26-+10.68+6.6%

JPY/EUR139.81-149.84149.00149.56

-

+9.75

+7.0%

JPY/RMB

19.49

-

19.55

18.70

19.12

-

(0.37)(1.9)%

013

FY2019 2020 2021 2022 2023

FY2019 2020 2021 2022 2023

87,200FY2019 2020 2021 2022 2023(%)+/-1 yen/USD±145 million yen+/-1 yen/GBP±0 million yen+/-1 yen/EUR±5 million yen*Profit increase with yen depreciation

Asia

FY2019 2020 2021 2022 2023

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

5,190

4,020

3,449

2,327

1,179

180

495

153

Others181

65,74973,906

Units sold
1H: +7.0%
2H: +0.6%
FY: +3.8%(YoY)

ChangeForeign exchange sensitivity(operating profit/2H)

384

2,330

2,036

2,832

2,508

25,000813

50,000

Units sold
1H: +3.6%
2H: +9.6%
FY: +6.5%(YoY)

54,98875,000Europe60,31353,222100,000

68,706

North AmericaJapan

52,248125,000

98,506(Millions of yen)

110,100

Full year

FY2019 2020 2021 2022 2023

Factors of Increase/Decrease in Operating Profit (FY2023 Full year forecast)(Millions of yen)

Cost of sales +2,515M- Other than US : +1,589M- US +926M
SG&A expenses +443M

40,000+5,69435,00030,000+3,99825,000+7,121

Effect ofincreased
sales

20,000Effects of
FOREX
rates

15,000Price
increases└ Decrease in unit price: -6,458M└ Increase in shipping volume: +758M└Transfer to COS: -968M(3,959)
Increasein cost(Rawmaterial
price)+810(2,768)Start-upof new
factories
(US,
Aoki)

(2,959)Investment inhuman
capitalUS factory: +1,587M
Aoki factory: +1,181M(968)

Transportationcosts for
SKD
production(COS)

21,221

10,000Transportation costs: -6,667M+4,911
Decreasein SG&A
expenses(Excluding
effects of
FOREX
rates andInvestment in
Humancapital)Others33,100Transportation costs└ WIP for SKD production in the U.S.: Inventory→Cost of Sales└ Finished goods for sale to customers: SG&A expenses

5,000
FY2022(Full year)
Operating profit

14+11,878 million yen© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2023(Full year)
Operating profit

Capital Investment Plan
FY2023 Capital Expenditure Plan Breakdown(Millions of yen)

Capital investment
Depreciation

10,000

8,629

9,050

Aoki Factory

5.0 bn Payment for this fiscal year: 5.0 bn
Payment already made (construction in progress): 6.0 bn

US. Factory

1.5 bn Solar panels (US office and factory): 0.48 bn
Slat conveyor: 0.45 bn
Factory machinery and equipment: 0.4 bn etc.

Employeedormitories

1.5 bn Construction on land adjacent to the home office factoryand Aoki Factory

Others

1.0 bn Jigs, molds, prototypes, and maintenance and renewal
equipment

Total

9.0 bn

8,000

6,000

4,420
4,000

3,056

FY2020: Takeuchi US warehouse expansion(approx. 0.54 bn)

1,734

2,000

3,604

1,529

1,676

1,586

2,039

FY2019FY2020

FY2021

FY2022

Jan. 2020

FY2021: US training center (approx. 0.5 bn)

Mar. 2021

0

FY2023

FY2022 Capital investment Breakdown
Aoki
Factory

3.0 bn Payment for this fiscal year (construction inprogress): 3.0 bn

FY2022: US Factory (approx. 4.7 bn)

US Factory

4.7 bn land/buildings/equipment

Sept. 2022

Others

1.0 bn Jigs, molds, prototypes, and maintenance andrenewal equipment

Total

8.7 bn15© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

[NEW] FY2023: Aoki Factory (approx. 11.0 bn)

Sept. 2023

▶ FY2023 First Half Consolidated Results▶ FY2023 Consolidated Forecast▶ Topics•

Production Capacity Expansion (New Factories in Japan and the US)•

Current orders and order backlog•

Challenges in electrification of construction equipment▶ Reference Materials
16© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

The Third Mid-term Business Plan (FY2022~FY2024)
(yen)
250

➢ Slogan, Numerical targets
Increase Sales by 100 billion Yen
by Power Up, Speed Up, and Scale Up

Net sales
CAGR+70.3%+19.5%

205.0
40

178.9
33.1

FY2021

FY2024

Change(%)

Net sales

140.8 bn240.0 bn+70.3％

Operating profit

17.7 bn24.0 bn+35.1％

12.6%

10.0%

Earnings per share (yen)279.91377.00+34.7％

ROE

13.8％

14.0％

-

JPY/USD

111.72115.00+3.28

JPY/GBP

153.06152.00(1.06)

JPY/EUR

130.57127.00(3.57)

JPY/RMB

17.12

18.00

+0.88

30

140.8

150

24.0bn115.9 112.2
100

Note: Based on the following CAPM formula, we recognize a cost of equity of 8%.
Risk free rate (1%) + beta (1.2) × Market risk premium (6%)

17240.0bn(Average growth rate)

200

Increase consolidated net sales from(140.8 billion yen to 240.0 billion yen)

└ rateNet sales (left)
Operating profit (right)

21.2
20

17.7
12.6

13.2
10

50

3rd MTP00
FY2019 FY2020 FY2021 FY2022 FY2023 FY2024© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Production Capacity Expansion■ Track loader■ Excavator (Compact/Hydraulic)
Decrease due toparts and materials
supply shortages

100%
100%

148%

̶ Full operation: Planned for FY2024

138%
125%

US Factory (started operation on September 23, 2022)

140%

̶ Start production of track loaders using the semi knock down (SKD)
method.
̶ Temporarily prioritize TL production for Europe over SKD production
for the US.
̶ Increase track loader production at the home office factory after thetransfer of excavator production from the home office factory to the
Aoki factory is completed.

99%
95%

Aoki Factory (started operation on September 1, 2023)
FY2021 = 100%

100%

140%
100%

150%

̶ Full operation: Planned for FY2024
̶ Transfer production of medium-weight class excavators (4to 9 tonnes) from the home office factory to the Aoki
factory.
Home Office
US
Aoki
Factory
Factory Factory

FY2021 Results

FY2022 Results

At thethe endendof
ofAt
FY2023 Plan
FY2023Plan

Medium-Term
Medium-Term Excavator
Business
Plan
Business
Plan
Target (atTarget(at thetheendendofofFY2024)
FY2024)

Less than 4 tonnes

○

-

-

4 -9 tonnes

-

-

○

9 – 15 tonnes

○

-

-

○/SKD

SKD

-

Track loader

18© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Operations of the US Factory (May 2023: Introduction of the slat conveyors)
Production Volume of Track
Loaders (per day)
150%

140%

130%
125%
100%

100%

Continue production
at HO factory as well

95%

75%
50%
September 2022
The US factory is in operation.

25%
0%
FY2021

FY2022At theend of
FY2023Plan

At theend of
FY2024Plan➢ Production capacity of Track loaders(HO factory + US factory)
Aug. 2023
Results75%
19© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Feb. 2024 Plan

Aug. 2024 Plan

90%

100%

Outline of Aoki Factory

Aoki Factory Started Operation (September 2023)

Exit

1-E

8

1-D
5

Site area: approx. 50,000 m2
Building area: approx. 27,800 m2
Total floor space: approx. 31,600 m2

3

4

2
2

6

1-C

7
1-B
1-A

Entrance

1. Delivery entrance (five locations: A to E)
2. Painting
3. Docking line (undercarriage)
4. Mainline (engine, hydraulics, boom & arm, etc.)—After process 4, products become self-propelled
5. Performance & test drives
6. Outfitting line (operator’s seat, cabin, lights, etc.)
7. Final inspection (checking the interior and exterior)
8. Shipping
20

The Aoki Factory operates mostly on solar power generation.
Combined with CO2-free power, the factory runs on 100% green energy.

➢ Production capacity of the Aoki factory
Aug. 2023 Results

Feb. 2024 Plan-

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

60%

Aug. 2024 Plan

100%

Features of Aoki Factory
Logistics management (receiving & shipping)Reservations and management through IT system for parts delivery and product shipments,
enabling information sharing between the factory and shipping companies✓ Staggered work schedules to reduce truck waiting times and avoid congestion at the factory and on
nearby roads✓ Monitoring parts and materials delays to quickly modify production plans, if needed

Introduction of robotics
Improves safety along with labor savings (factory is safe and easy to work in for all)✓ Automatic guided vehicles (AGVs) for parts delivery to production lines✓ Painting robots

Receiving area at Aoki Factory21

AGV (runs on a magnetic guide)© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Painting robot

Orders received entering adjustment period (expect continued robust product demand)
33.3% down
year on year

Net Sales, Orders Received, and Order Backlogs by Half Year
■ Net sales (bn)■ Orders received (bn)■ Order backlogs (bn)Orders exceedingproduction capacity>> backlogs increase

105.0 92.9

86.0

87.3

105.1

130.8
66.6
116.7
Declinedue to COVID-19

74.2
113.1
83.7

41.8 53.1
31.5
End of
Feb.
2020

190.7

178.6

59.0

172.8

133.8
83.7

20.1
End of
Aug.
2020

44.8
End ofFeb.
2021

FY2021
End ofAug.
2021✓ Order adjustments by both customers and Takeuchi to normalize
accumulated backlogs>> Normal level of order backlogs: 3 to 4 months of sales✓ U.S. Factory and Aoki Factory expand production capacity by about 1.5 times>> Growth in production and sales to reduce orderbacklogs

22

Normalization of order backlogs

1st half of
FY2023

FY2022End ofFeb.
2022

End of
Aug.
2022

End ofFeb.
2023

End of
Aug.
2023

FY2022

FY2023

1Q

2Q

3Q

4Q

1Q

2Q

Net sales

42.4

43.6

46.8

46.0

53.0

52.1

Orders received

66.5

64.2

47.0

57.9

47.6

39.6

Order backlogs

158.0

178.6

178.8

190.7

185.3

172.8

(Billions of yen)

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Challenges for Electrifying Construction Machinery
1. Battery cost reduction and performance improvements (longer operating time, shorter charging time)✓ Battery powered construction machinery is more expensive than diesel (approx. 2–3x)>> Batteries account for most of this cost premium✓ Compared with passenger vehicles, construction machinery that requires a lot of power(for digging, rough terrain travel, etc.) needs a large-capacity battery>> Leads to higher sales prices and long charging times

2. Necessity of charging infrastructure development✓ Even in urban areas, charging infrastructure is not widespread, and virtually nonexistent at construction
sites in mountainous regions.
>> Considering the locations where construction equipment must operate, 100% electrification seems unlikely>> Other low-GHG technologies should also be considered (biofuels, fuel cells, etc.)

3. Creating low-GHG power generation infrastructure✓ The current power infrastructure leads to indirect emissions (Scope 2) when charging>> Shift from fossil fuel-based power generation to non-fossil fuel sources, such as hydro, wind, and solar

Although there are many external challenges to electrifying construction machinery,

We aim to have a range of under-6-tonne battery powered excavators
Larger hydraulic excavators and track loaders to follow

23© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Product Lineup
1

2

3

4

5

Compact excavators andhydraulic excavators

Compact excavators

Battery operated

TB20e

Standard models

TB219

TB235-2

TB250-2

TB240

TB260

TB257FR
TB325RTB217R

TL6R

New

Launched
March 2023
TL10V-2

TL8R-2

TL12R-2
TL12V-2

24

Launched
March 2023
TB280FR

TB350R

TB335RTB2150R

TB395W
TB370

FR series & Short tail swing models

Crawler Dumper～～

15 (tonnes)

TB290-2

TB230

Track Loaders

9

TB290

Launched
October 2023

TB215R

8

Hydraulic excavators

TB225
TB320

TB210R

7

TB2150

TB216[From now on] Priority will begiven to electrification ofcompact excavators (weighing
less than 6 tonnes)

6

TCR50-2© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

TB320(2 tonnes)

Shareholder Return and Dividend Payout Ratio
Basic Policy:

Strive to maintain a stable dividend payout with a target consolidated dividend payout
ratio of 30% in mind, while securing the internal reserves necessary to strengthen the
management structure and develop future businesses
Share buybacks:Implement share buybacks as appropriate, taking into consideration stock price levels,
capital efficiency, and other factors.

158

(yen)

160
140

Dividend per share and consolidated
dividend payout ratio

153

120

98

100
80
60

45

26.2%

40

20

35.0%

53
29.2%
25.9%

31.1%

30.0%
25.0%

24.3%

20.0%

18.8%

15.0%
10.0%

0

FY201825

60th Anniversary
Commemorative
dividend

Consolidated
dividend payout
ratio

68
50

5

FY2019FY2020

FY2021

FY2022© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2023(forecast)▶ FY2023 First Half Consolidated Results▶ FY2023 Consolidated Forecast▶ Topics•

Production Capacity Expansion (New Factories in Japan and the US)•

Current orders and order backlog•

Challenges in electrification of construction equipment▶ Reference Materials
26© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Corporate Policies and Business Philosophy

Corporate
Policies

CreationWith deep sensitivity, we will develop products thatmeet or exceed needs.

Challenge

With dreams and youthful drive, we will take bold
action toward higher goals.

Cooperation

With a commitment to harmony and compassion, we
will strive for well-balanced coexistence with society.

Business Philosophy

From World First to World Leader,
We will pursue manufacturing excellence by working hard in the spirit of Creation,
Challenge, and Cooperation.

With a global perspective and awareness, we will provide products and services that are
trusted by our customers.
Leveraging the abilities of every employee, we will help to create an environmentallyfriendly, prosperous society.
27© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Corporate Profile
Name

TAKEUCHI MFG. CO., LTD.

Representative

Toshiya Takeuchi
President and Representative Director

Home Office

205, Uwadaira, Sakaki-machi,
Hanishina-gun, Nagano Japan

Established

August 21, 1963

Accounting Period

February

Capital3,632 million yen（As of February 28, 2023)

Sales (Consolidated)

178,966 million yen（FY2022）

Employees (Consolidated) 1,173（As of August 31, 2023)
Listed Market

Subsidiaries

28

Tokyo Stock Exchange, Prime Market,
Securities code: 6432
US

Takeuchi Mfg. (U.S.), Ltd.
(Established February 1979）

UK

Takeuchi Mfg. (U.K.) Ltd.
(Established October 1996）

FranceTakeuchi France S.A.S.
(Established May 2000）

China

Takeuchi Qingdao Mfg. Co., Ltd.
(Established April 2005）

Main ProductsCompact excavators and hydraulicexcavators
̶ We developed and began production of theworld’s first compact excavator (September
1971)̶ Compact excavators: Products weighing lessthan 6 tonnes
̶ Hydraulic excavators: Products weighing 6
tonnes or more
Main applications
̶ Foundation work for housing construction
̶ Piping work for water, gas and other supplies
̶ Landscaping work to plant trees in parks andgardens̶ Demolition and renovations of dilapidated
buildings

Track Loaders̶ We developed and began production of theworld’s first track loader (September 1986)̶ Faster traveling speed thancompact/hydraulic excavators, suitable fortransportation work̶ Demand and sales mostly in North America

Main applications
̶ Transportation of earth and sand excavatedby compact excavators
̶ Excavating and leveling the ground̶ Various operations are possible by changing
the bucket© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Business Performances(Millions of yen)

FY2020

FY2021

FY2022

Forecast
FY2023
Change2,330+293
110,100+11,593
87,200+13,293
180
(315)
5,190
+1,169205,000+26,033
33,100+11,878
33,200+11,820

FY2018FY2019Japan
North America
EuropeAsia
Others
Net sales
Operating profit
Ordinary profit
Profit attributable toowners of parent
Earnings per share (yen)Dividends per share (yen)JPY/USD1 (yen)JPY/GBP1(yen)JPY/EUR1(yen)JPY/RMB1(yen)940
50,69655,5611,000
1,977
110,175
15,411
15,496813
53,22260,313384
1,179
115,913
12,64912,403

2,508
52,24854,988181
2,327
112,254
13,207
13,2982,832
68,70665,749153
3,449
140,892
17,76418,0802,036
98,50673,906495
4,020
178,966
21,221
21,37911,391

9,091

9,765

13,34815,97924,200+8,220238.8345.00
110.06145.91
129.16
16.64

190.6450.00
109.21139.49121.4615.82

204.7853.00
106.13137.88122.91
15.41

279.91
68.00
111.72153.06130.5717.12

335.1998.00
133.12
162.58139.8119.49

507.68158.00137.30173.26149.5619.12+172.49+60.00+4.19+10.68+9.75(0.37)Net assets
Total assets
Equity ratio
ROE2
ROA3

77,180103,557
74.5%
15.7%
15.9%

83,683
108,982
76.8%
11.3%
11.7%

89,908
115,525
77.8%
11.3%
11.8%

104,083
137,201
75.9%
13.8%
14.3%

121,802
158,785
76.7%
14.1%
14.4%

*1 Exchange rates are the average rates for the 12-month period.
*2 ROE (Return on Equity) = Net profit / Net assets × 100 (Net assets are the average of the beginning and the end of the period)*3 ROA (Return on Assets) = Ordinary profit / Total assets × 100 (Total assets are the average of the beginning and the end of the period)29© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

(Yen)
USD
GBP
EUR
RMB

1H(results) 2H(Assumption))
138.45137.00172.16174.00149.84149.0019.55
18.70

Market Outlook
350

S&P/Case-Shiller Home Price Index<20-city composite Jan. 2000=100>
300

250

200
*seasonally adjusted

Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July
Sept.
Nov.
Jan.
Mar.
May
July

150

2017

2018

2019

2020

2021

2022

2023
(source) S&P

30© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Market Outlook̶̶̶From February to April 2020, housing demand plummeted due to the COVID-19 pandemic.
Since May 2020, economic activity has resumed, achieving a V-shaped recovery and maintaining a high level after that.
Since March 2022, demand for housing had been weak due to US interest rate hikes, but the demand remains firm andrecovered to the same level as before the pandemic.

(10,000 houses)(10,000 houses)

US Building Permits(seasonally adjusted)

200

180

180

160

160

140

140

120

120

100

100

80

80
2019

2020

2021

2022

2019

2023

60

2020

2021

2022

2023

60
Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

31

US Housing Starts(seasonally adjusted)

200

Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Production Volume Trends
By Month
Decrease in operatingdays due to Golden
June, 148%
Week holidays

150%

Apr., 132%
Mar., 151%

By Fiscal Year

Decrease inoperating days due
to summer vacation

133% 131%

July, 134%

100%
125%
May, 119%

Aug., 118%

70%
100%

75%
1st year of thepandemic

March 2020=100%
50%

Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb.
FY202032

FY2021

FY2022

FY2023© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

FY2020

FY2021

FY2022

FY2020=100%

FY2023(1H)

List of Material Issues
#

E

1

○

S

G

SDGs

13

2

○

13

Social Issues

Mitigate climate change

3

○

4

○

12

5

○

12 13

6

○

7

○

7

13

6

Realizing a circular economy

12
12

○

8

Theme

Goal

Develop, manufacture, and sell battery-powered compact excavators

1

Reducing GHG emissions at factories

2

Improving factory energy efficiency
Expanding the use of renewable energy

2

3R factory initiatives
Develop, manufacture and sell construction machinery with reduced environmental impact

1

Reducing our environmental
Reducing chemical emissions and wastewater from factories
impactPreventing pollution
Managing chemical substances Complying with SDSs, REACH regulations, and RoHS Directive

8
Sustainable urban development

Improving productivity and work efficiency at sites where construction machinery is operated, by developing products that precisely meetmarket needs.

9

○

11

10

○

8

11

○

10 16

12

○

10 16

13

○

3

Occupational health and safety
Elimination of work-related accidents and promotion of health management
Employees' health

3

14

○

4

Human resources

Promotion of human resources development

4

15

○

16

○

17

Developing, manufacturing, and selling construction machinery that contributes to building and maintaining resilient cities and infrastructure
Dealing responsibly withcustomers
Respect for human rights
Effective labor practices

Strengthening connections with end users by increasing the amount of information on products and services
Eliminating employment discrimination (employment of handicapped person, etc.)
Prevention of harassment (harassment prevention education)

5

8

Promoting work-life balance

Encouraging the use of internal systems, such as childcare and nursing care leave, and shorter working hours

5

5

8

Promoting female participation

Diversity (promotion of women and foreigners)

7

○

4

16

Developing the next generation
Factory tours at Takeuchi (nonconsolidated), sending out lecturers, and cooperating with special needs schools
in the community

12

○

18

○

○

8

19

○

○

8

20

○

6

12

Establishing and implementing a CSR procurement policy
Establishing an environmentallyand socially conscious supply
Asking suppliers to agree to our CSR procurement policy
chain
Dismantling, collecting, and recycling at the stage of product disposal

4

12

21

○

16

Compliance

Compliance with laws and regulations, and the exclusion of Organized Crime (implementation of education)

22

○

16

Corporate Governance

Strengthening global governance

23

○

16

Risk management

Crisis management systems, BCPs, and information security（IT-BCP）

33

4© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

6

Climate Change Initiatives (Response Measures)
Risk Items
Impact classification(Large, Medium)

Assumptions
and background for2030年の想定・背景
2030(2℃
scenario)（２℃シナリオ）

Influencing Factor(Parameters):Direction of Change

Large
influence

Business Impact/Financial Impact

Mediuminfluence

Smallinfluence

Measures

Rise in steel
pricesIntroduce &expand carbon tax

Carbon price

Carbon price(Material prices)

Rise in rubber
pricesRise in costof salesL
Pass-through to
price

Rise in glass raw
material prices
S
Electricity
shortage
International carbon
emission targets/policies

Strengthening
decarbonization
policies

Transition to low
GHG emission
technologies

Transition to
low- GHG
technology•Stricter emission
regulations• Changes incustomer interests

Stricter emission
regulations for our
products
Demand shift to
low-GHG
products

Investors' trends
Direct link between
climate actions andcorporate reputations
Public reputation

34

Tighter GHG
regulations in the
shipping industry

Low-GHG products(EV, VCV,
Clean-diesel)

Electricity charges

Fuel price
Emission offset

Rise in electricity
usage fee

Rise in costs andSG&A

L
Rise in shipping
costs

Rise in SG&A

R&D expenses
Capital investment

Rise in fixed
costs

Rise in cost of
sales

Sales ratio of lowGHG products

Decrease insales of diesel
products

Decrease inrevenue

Increase in salesof low-GHG
products

Increase inrevenue

Cost of new lowGHG vessels

Stock priceInvestment
selection by
climate actions

N/A

Employment
selection by
climate actions

N/A

Debt cost
Acquisition of
excellent HR© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

Increase in costof capital

Decline incompetitivens

Energy saving
Energy creation
Renewable Energy

Local production,
Local
consumption

M

L

L

◇ Electrification◇ Low GHG fuel◇ Fuel economy
improvement

M

M

Enhancing climate
actions andinformation disclosure

TAKEUCHI MFG. CO., LTD.
Corporate Planning Section and ESG Promotion Section,
Business Management Dept.
TEL: +81-(0)268-81-1200
FAX: +81-(0)268-81-1127
E-mail: ir@takeuchi-mfg.com

Forecasts are based on information that was available when this document was
prepared. The forecast is vulnerable to many uncertainties including, but not limited to,changes in demand and other aspects of market conditions and foreign exchange rate
fluctuations.
Consequently, the actual results of operations could differ significantly from thisforecast because of changes in a variety of factors.

35© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.

© 2023 Takeuchi Manufacturing [JAPAN], Ltd. All Rights Reserved.