Financial Results for the Fiscal Year
Ended March 31, 2022 (FY2021)

May 12, 2022

Naoki Muto
Chief Accounting and Financial Officer
Terumo Corporation

I am the CFO, Muto. I will now explain the results for the fiscal
year ending March 2022.

1

Safe Harbor for Forward-Looking Statements and Use of Document
Among the information that Terumo discloses, the forward-looking statements including financial projections are
based upon our assumptions using information available to us at the time and are not intended to be guarantees
of future events or performance. Accordingly, it should be noted that actual results may differ from those
forecasts or projections due to various factors. Factors affecting to actual results include, but are not limited to,changes in economic conditions surrounding Terumo, fluctuations of foreign exchange rates, and state ofcompetition.
The market share information in this presentation is partly derived from our own independent research.
Information about products (including products currently in development) which is included in this material is notintended to constitute an advertisement or medical advice.

Terumo Corporation
Investor Relations Dept.
E-mail: kouhou_terumo01@terumo.co.jp©TERUMO CORPORATION

2 / 282

Highlights
FY21 Q4/Q4 YTD results
Revenue: Highest-ever quarterly and Q4 YTD revenue driven by solid performance overseas.
Demand of infection control products in Japan was normalized
Adjusted Operating Profit: 16% profit increase in Q4 YTD, despite the negative effects
anticipated at the beginning of the fiscal year, as well as effects of cost inflation and lower
production level

FY22 guidance
Double-digit growth in both revenue and profit
Driven by recovery from the COVID-19 impacts, the growth driver in each company, and positive
FX impact. Although the cost inflation impact remains, expect some relief at the end of the fiscal
year©TERUMO CORPORATION

3 / 28In sales revenue, Japan saw factors including a return tonormal of infection prevention product demand, resulting in aslight increase. However, regions outside Japan and FX rates
drove the Q4 and year-to-date sales result to our highest ever.
In adjusted operating profit, although negative impacts
anticipated at the beginning of the year combined with
inflation and reduced factory utilization as downward factors,
the contributions of strong overseas sales and FX rates
resulted in an annual result of 16% year-on-year growth.
Our FY22 guidance anticipates double-digit growth in bothsales revenue and profit. In sales revenue, the number ofprocedures and other demand are expected to emerge fromCOVID impact, driving growth in each company. FX rates arealso expected to have a positive impact.
Although inflation impact will occur throughout the year, we

3

expect that impact to lessen toward the end of the year. For
this reason, we expect to see an increase in gross profit as well.

3

P&L Results
Revenue: Highest-ever quarterly and Q4 YTD revenue. Cardiac & Vascular demand recovery continued overseas, especially in TIS.
Q4 performance was driven by solid performance in TIS and Neurovascular as well as positive FX impact
Adjusted Operating Profit: Despite the negative impacts of production level adjustment and volume-based procurement (VBP) in China, as well as cost
inflation and lower production level, solid performance overseas and positive FX impact contributed to 16% YTD growth

100 M JPY
Revenue
Gross Profit(%)

SG&A Expenses(%)

R&D Expenses(%)

Other Income and Expenses
Operating Profit(%)

Adjusted Operating Profit(%)

Profit before Tax(%)

Profit for the Year(%)
Average Exchange Rate(USD/EUR)©TERUMO CORPORATION

FY20 Q4 YTD

FY21 Q4 YTD

YoY%

YoY% (FXN)

6,138
3,266

7,033
3,693

15%
13%

10%
8%

(53.2%)(52.5%)

1,795

1,991

11%

6%

(29.2%)(28.3%)

491

518(8.0%)(7.4%)

3
984

-25
1,160

(16.0%)(16.5%)

1,159

1,344

(18.9%)(19.1%)

971

1,145

(15.8%)(16.3%)

6%
18%

12%

16%

10%

18%

773

888

(12.6%)(12.6%)

106JPY/124JPY

112JPY/131JPY

2%

15%

FY20 Q4

FY21 Q4

YoY%

1,652
854

1,798
905

9%
6%

(51.7%)(50.3%)

488

528(29.5%)(29.4%)

132

144(8.0%)(8.0%)

-2
231

-18
215

(14.0%)(12.0%)

274

273(16.6%)(15.2%)

221

215(13.4%)(11.9%)

187

171(11.3%)(9.5%)

8%
9%
-7%
-1%
-3%
-8%

106JPY/128JPY 116JPY/130JPY

4 / 28

Sales revenue was the highest-ever, for both a Q4 and full year.
COVID recovery continued into Q4 in the Cardiac and VascularCompany outside Japan, especially in the TIS business, andNeurovascular was also strong in Q4. FX rates were also apositive factor. As a result, Q4 standalone sales revenue was
179.8 billion yen, and the full year 703.3 billion yen.
Adjusted operating profit experienced the negative impacts
that we anticipated at the beginning of the year, including
production adjustment for safety stock level and pricereductions in China tenders, as well as inflation. However,sales outside Japan were strong and FX rates had a positive
impact, resulting in an adjusted operating profit amount of
134.4 billion yen and 16% growth year-on-year. And we saw
the gross margin down in Q4 due to the negative impact for
unrealized profit from inventory assets with FX rapid change
and the ahead expenditure for global production optimization.
However, both were the temporal.

4

Adjusted Operating Profit Variance Analysis (Q4 YTD)
(100 M JPY)
Gross
marginPrice-32
JP NHI-3
G/P
incrementby salesincrease

SG&A

Production
Adjustment

Gross margin:
Negative effects of cost inflation (freight, rawmaterial, and labor cost), and lower
production level, exceeded the positive
impact of product mix improvement fromsales increase in Cardiac & Vascular,
especially TIS

FX

R&D

G/P increment by sales increase:
The revenue increased in all companies,
particularly Cardiac & Vascular, comparedwith FY20 impacted by COVID

Others
MDR
-0
IT
-4

Price:
Decline mainly due to VBP in China for TIS
products
SG&A:
Large increase compared with FY20 in which
expense usage was slow due to COVID

FY20
Q4 YTDOP

FY20
Q4 YTD
Adj. OP©TERUMO CORPORATION

FY21
Q4 YTD
Adj. OPFY21
Q4 YTDOP

FX:
Positive impact from flow by CNY and EUR
partially mitigated by negative impact fromstock by USD and EUR

5 / 28Gross profit increment by sales increase was positive for allcompanies, to total 35 billion yen, with the previous-yearcomparable being COVID-impacted.
Gross profitability on sales was minus 1.8 billion, as inflationand other factors exceeded the positive effect of product mix
improvement that resulted from increased sales at Cardiac and
Vascular, with TIS as a driver.
Items like Price down and SG&A increment were as initiallyanticipated, with SG&A having a previous-year comparable
impacted by activity restrictions.
FX was a wash, as Chinese Yuan and euro appreciation caused
big positive impacts, while rapid Japanese Yen depreciation in
the year end caused negative impact on unrealized profit oninventory assets.

5

Adjusted Operating Profit Variance Analysis (Q4)(100 M JPY)
G/P increment by sales increase:
Improved recovery level from COVID
and sales increase driven by Cardiac &VascularGrossmarginG/Pincrementby salesincrease

FY20 FY20Q4Q4OP Adj. OP©TERUMO CORPORATION

SG&A

Price
-5
JP NHI
-1

R&D
MDR
-2
IT
-3

Gross margin:
Decrease due to effects of cost inflation(freight, raw material, and labor cost),
and lower production level

FX
OthersPrice:
No additional impact from VBP in China
for TIS products compared with FY20 Q4

Production
Adjustment

SG&A:
Increase in amount and decrease insales ratio compared with FY20 Q4

FY21 FY21Q4Q4Adj. OP OP

FX:
Positive impact from flow by CNY andEUR offset by negative impact fromstock by USD and EUR

6 / 28Gross profit increment was positive 4 billion yen, with Cardiac
and Vascular Company the driver, as it continued to recoverfrom COVID.
On the other hand, gross profitability on sales decreased 1.5
billion yen as the inflation outweighed positives.
Production adjustment was positive as demand recovered.
Production adjustment has been similar level of stock as of theyear end of March 2019, before COVID. Therefore, we willcontrol the appropriate stock level with monitoring the market
trend from FY22. SG&A increased with a previous-yearcomparable in which activities were limited; however, it was
lower % than that of sales while a smaller amount increase,and expense controls due to concerns about the decline inprofit enacted after Q3 were effective.
FX was as I explained for the full year. The positive flow in Q4

6

completely absorbed the negative stock.

6

Revenue by Region
FY21
Q4 YTD
Regional
breakdown(C&V: Cardiac & Vascular, TMCS: Medical Care Solutions,
TBCT: Blood & Cell Technologies, PS: Pharmaceutical solutions)

FY21 Q4 YTD
YoY%

Revenue (100 M JPY)
Q4 YTD
Japan

FY19
FY20
FY21

Q4

1,963
2,018
2,061

485
534
511

() FXN2%

Europe

1,211
1,204
1,404

Americas

1,914
1,808
2,204

31%

China

473 103455 121
594
147

30%
(18%)

8%

Asia and

11%

Others

728
654
770

18%
(12%)

29%

20%

©TERUMO CORPORATION

324
328
364

17%
(10%)
498
497
592

178
172
184

22%
(15%)

Comments
TMCS steady with PS as a driver. C&V growth also continued
with TIS and Neurovascular recovery. TBCT sales dropped
slightly. QoQ (FY21 Q3 to Q4), TMCS and C&V slowed due toseasonal factors combined with COVID impacts on
Pharmaceuticals and TIS. TBCT accelerated

Growth continued in all companies, with TIS and TA leading.
QoQ, TMCS and TBCT were steady, while C&V slowed with
COVID impacts on Vascular graft and Cardiovascular
Growth continued in all companies, with TIS and Neurovascularleading. QoQ as well, all companies accelerated, with TIS,
Neurovascular, PS as drivers
Growth continued in all companies, with TIS leading. In FY20 1H
Neurovascular had negative impact from distributor order timing;
excluding this, China as a whole grew 20%. QoQ, seasonal
factors led to slowing when excluding Neurovascular, which had
a concentration of distributor orders in Q4

QoQ slowing in all companies, after smooth recovery up to Q3.
Timing of tenders at TBCT and TMCS , COVID resurgence
impacts for C&V in Cardiovascular and TIS

7 / 28In Japan, Cardiac and Vascular Company saw TIS and
Neurovascular recover slower than other regions, but therecovery trend nevertheless continued. Medical Care Solutions
saw growth in businesses including Pharmaceutical Solutions,for a steady 2% positive year-on-year growth.
In the EU, TIS and the TA drove the Cardiac and VascularCompany, and all companies saw increased sales. Comparedto Q3, the Cardiac and Vascular Company slowed in the firsthalf of Q4 due to reduced number of procedures amid Omicron
Variant impact; however, the other two companies weresteady.
In the Americas, TIS and Neurovascular drove the Cardiac and
Vascular Company, and all companies saw increased sales.
The slowing seen in Europe compared to Q3 did not happen in
the Americas; instead, strong results continued. The Americas
became the second market after Japan to reach sales volume7

of 200 billion yen, showing that the US market strategy hasentered a new stage.
China also saw TIS driving the Cardiac and Vascular Company,
while each company grew. Year-to-date growth was 30%.
However, results of the Neurovascular business were incomparison to a previous year in which the distributor network
was reorganized in the first half, temporarily increasing
demand in the second; this means that the FY21 second-halfresult actually showed even faster growth than it appears.
Excluding this impact, growth was approximately 20%.
Compared to Q3, seasonal factors including the Chinese New
Year caused some slowing.
In other Asian countries, recovery had continued up to Q3, but
Q4 saw slowing. Tender timing for Medical Care Solutions andBlood and Cell Technologies was concentrated in Q3, while
Cardiac and Vascular was impacted by the Omicron Variant in
the first half. Nevertheless, year-to-date growth was 18%.

7

C&V:

Sales growth in all businesses with continued recovery of number of procedures in US and EU.
Negative effects on 2H profit were mitigated by strong sales and positive FX impact(100 M JPY)

Q4 YTD

Comments

Q4 YTD
Rev. YoY

TIS: Continued recovery outside Japan, centered in US and EU. Overall
low single-digit growth QoQ (FY21 Q3 to Q4) with mixed factors; decline
in number of procedures in early Q4 due to spread of Omicron variant,and quick recovery from the impact driven by Access devices+433

Neurovascular: Continued recovery of aneurysm treatment, led by US
and EU. Aspiration catheter also maintained high growth. Flat QoQ
growth when excluding concentration of China distributor orders in Q4+131

Cardiovascular: In addition to clear recovery of number of procedures in
US and EU, hardware sales were strong as investment by hospitals
resumed. Overall mid-single-digit QoQ decline due to spread of Omicron
variant, while US was strong+58

Vascular graft: Continued recovery pattern in EU and US. Overall midsingle-digit QoQ decline impacted by spread of Omicron variant+64

Q4() FXN

3,971
3,506

3,285

Revenue+21%(+14%)

871

901

1,027
+14%

869

932
744

Adjusted
Operating
Profit+25%(+16%)

181

184

209
+14%

Adj. OP%

FY19

FY20

FY21

FY19

FY20

FY21

25%

23%

23%

21%

20%

20%

©TERUMO CORPORATION

Adj. OP: Positive impacts from strong sales and FX mitigated some of thenegative impact of cost inflation and lower production level in addition to
VBP of TIS products in China, production level adjustment for inventory
level optimization

8 / 28Overall, sales revenue continued to grow in all businesses. Q4growth was 14%, and year-to-date was 21%. Sales grew 2%
from Q3 through Q4.
TIS grew outside Japan, especially in North America andEurope. Although there was some Omicron impact in the firsthalf of Q4, Access products recovered rapidly thereafter. As aresult, even compared to Q3, growth recovered to low single
digits. Amid overall decreased demand in Japan, Cardiology
products grew with the release of the new Ultimaster Nagomi.
In Neurovascular, aneurysm care demand grew especially inNorth America and Europe, while aspiration catheters used instroke treatment also maintained high growth. Compared to
Q3, the Q4 results were affected by China distributor orders
focusing in Q4, so that overall growth was in the double digits;
however, when this impact is excluded, growth wasapproximately flat. In Q4, there was also the news that the8flow diverter FRED X for treating aneurysm was used in the
United States for the first time.
CV also saw a significant recovery in number of procedures inNorth America and Europe, and instrument sales were strongas hospitals resumed investment in such devices. Compared to
Q3, North America continued to grow in Q4, but Omicron
Variant impact in the first part of Q4 brought the whole down
to the mid-single digits.
TA, like CV, saw a recovery of number of procedures in North
America and Europe. And again, similarly, compared to Q3,
North America continued to grow in Q4, but the first part of Q4
brought the whole down to the mid-single digits for TA as well.
In profit for the full year, price erosion of China tenders andproduction adjustment combined with inflation and the rest,
which emerged during the period, to bring gross profit down,cancelling out increased sales and positive FX impact, for an
adjusted operating profit result of 23%.

8

TMCS:

Pumps and infusion sets drove HCS. In 2H, multiple negative factors impacted profit(100 M JPY)

Q4 YTD

Q4

Comments() FXN

1,710 1,755

Revenue* HCS: Hospital care solutions (formerly General hospital products + Pharmaceutical)
LCS: Life care solutions (formerly DM and consumer healthcare)
PS: Pharmaceutical solutions (formerly Alliance)

1,853

+6%
(+4%)

432

465

466
+0%

252

257

Adjusted
Operating
Profit

236
-8%
(-5%)

54

53

FY19

FY20

FY21

FY19

FY20

FY21

15%

15%

13%

13%

11%

9%

©TERUMO CORPORATIONHCS: Demand recovery in needles, syringes, and infusion sets in Asia
and Japan, and COVID-19 pump demand drove high-single-digit
growth. Infection control product demand returned to normal.
Continued strong growth in pain management and adhesion barrier.
Mid-single-digit decline QoQ (FY21 Q3 to Q4) due to demanddecrease impacted by spread of Omicron variant, especially ofpharmaceutical products, despite strong sales of pumps+73

LCS: Thermometer demand returned to normal, blood pressure
monitors remained strong in Asia and Japan. Flat QoQ growth+5

PS: CDMO business drove high-single-digit growth

+20

43
-19%

Adj. OP%

Q4 YTD
Rev. YoY

Adj. OP: Negative impacts from demand decline due to repeated COVID
resurgence, cost inflation, as well as normalized product mix due tothermometer demand and FX impact on manufacturing cost in China partiallymitigated by revenue growth

9 / 28

Sales revenue grew 6% annually. Q4 standalone was similar tothe previous year, and flat compared to Q3. High-demand
pumps and infusion products such as anticancer drug-related
devices grew along with HCS, which saw demand for vaccine
syringes, resulting in the Hospital Care Solutions businessdriving the company as a whole.
In HCS, COVID demand for infection prevention products
returned to normal after spiking, while pharmaceuticals suchas adhesion barrier and pain management continued to grow.
Pumps grew greatly compared to Q3, while Omicron Variant
impact caused slowing in IV solutions as well as disposable
products other than pumps.
LCS (Life Care Solutions) saw high demand shift fromthermometers to blood pressure monitors, driving the whole
to finish the year at +2%. New diabetes products had some
impact, but the whole increased only slightly. Compared9

standalone to Q3 as well, the whole grew only slightly.
Profit stayed down as demand in Japan did not recover fully. In
addition, a return to usual levels of thermometer demandnormalized product mix. This combined with inflation impact
and Chinese Yuan appreciation to raise manufacturing cost;
therefore, several negative factors coincided. Adjusted
operating profitability was 13% of sales for the full year, down
8% year-on-year.

9

TBCT:

Continued demand recovery of whole blood collection. Although negative impacts
on profit grew in 2H, maintained improved profit level in YTD(100 M JPY)

Q4 YTD

Q4

Comments

Q4 YTD
Rev. YoY() FXN

1,072 1,095
Revenue

1,206

+10%
(+5%)

284

151

191

Adjusted
Operating
Profit

285

304
+10%
+7%

208
+9%
(+1%)

46

47

37
-21%

Adj. OP%

FY19 FY20 FY21

FY19 FY20 FY21

14%

16%

©TERUMO CORPORATION

17%

17%

16%

Blood center solutions: Continued recovery of whole blood collection
in EU and US. Component collection was strong in China, absorbed
the impact of decreased COVID-19 convalescent plasma demand.
Mid-single-digit decline QoQ (FY21 Q3 to Q4) with tender and ordertiming in Asia and China, despite strong sales in EU and US+74

Therapeutic solutions: Double-digit growth in US and EU driven by
investment at hospitals to support higher number of procedures. Midsingle-digit decline QoQ, due to order timing in China and Asia

+29

Cell therapy technologies: Following FY20 1H deployment delays due
to COVID, recovery after 2H in US indicates a return to growthtrajectory+8

Adj. OP: Positive effects from sales growth and FX offset some decrease
from cost inflation, lower production level, preparation expenses for the new
business, and accelerated production transfer. Profit level improved in FY20
and maintained in FY2112%10 / 28

Sales revenue grew 10% annually, and 7% in Q4 alone.
Compared to Q3, Q4 was minus 5%; however, this was partly
due to the concentration of tenders in China and other Asian in
Q3. Overall, the company was strong, as whole bloodcollection demand recovered and apheresis grew.
In the Blood Center business, whole blood collection in the US
and Europe, and component collection in China, were eachstrong. Comparing Q4 to Q3, the impact from the sales
fluctuations in China and other Asian countries that I
mentioned before led to Q4 coming out about 5% weaker.
In apheresis, US and European hospitals moved forward withinvestment in systems, leading to double-digit growth. Blood
Center business trended similarly from Q3 to Q4.
Cell Therapy Technologies emerged from its COVID slowdown
to return to a growth trajectory.

10Profit was affected not only by inflation and the rest, but also
the coinciding of ultimately positive investments in plasma
innovation preparation costs and ahead-of-schedule production
transfer activities for the cost reduction. Amid this situation,
sales remained strong while FX rates were a positive impact,
resulting in the company maintaining 17% adjusted operating
profitability for the year.
Further, in March during Q4, the Plasma Innovation solution
Rika received FDA approval. This was very good news.

10

FY22 Guidance: Double-digit growth in both revenue and profit
Driven by recovery from the COVID impacts, the growth driver in each company, and positive FX impact
Although the cost inflation impact remains, expect some relief at the end of the fiscal year() FXN

Amount (100 M JPY)

FY21 Actual

FY22 Guidance

YoY%

Revenue

7,033

7,750

10% (6%)

Operating Profit

1,160

1,320

14% (9%)

(%)

16.5%

17.0%

Adjusted Operating Profit

1,344

1,510

(%)

19.1%

19.5%

Profit for the Year

12% (7%)

888

1,000

Exchange Rate (USD/EUR)

112 JPY/131 JPY

125 JPY/135 JPY

13%

FY22 by Company(100 M JPY)

Revenue() FXN

Amount

C&V

4,445

TMCS
TBCT
©TERUMO CORPORATION

Adjusted Operating Profit
YoY%

AmountYoY%

12% (6%)1,134

22% (10%)1,923

4% (2%)

223-6% (1%)1,380

14% (9%)182-13% (-3%)

11 / 28

Our market assumption is that overall, COVID impact will end
and demand, including number of procedures, will recover.
Although inflation impact will occur throughout the year, we
expect that impact to lessen toward the end of the year.
With this assumption, and the growth drivers in each business,
we will aim for double-digit growth and 775 billion yen in sales
revenue. We also expect FX rates to remain a positive factor.
In adjusted operating margin, we will aim for double-digit
growth to 151 billion yen, or 19.5% in adjusted operating
profitability. and income will reach to 100 billion yen as ourhighest ever.
We stated sales and adjusted operating margin by company inthe table below.
We will aim for ROIC over 10% as we stated in the11announcement of GS26 in the five years.

11Adjusted Operating Profit Variance Analysis (FY22 Guidance)(100 M JPY)
Gross
marginGP increment by sales increase: Increase in
all companies, led by C&V

Price
FX

SG&A
G/P
incrementby salesincrease

Gross margin: Positive impacts from
improved plant utilization and product mix
surpass negative impacts from cost inflation(freight, raw material, and labor cost)

R&D

Price: Impact from JP NHI reimbursement
price revision
SG&A: COVID impact rebound. Strategic
investment in the new business
FX: Effect from JPY depreciation against
CNY, EUR

FY21 FY21
OP Adj. OP©TERUMO CORPORATION

FY22 FY22
Adj. OP OP

12 / 28First, all companies will see increased sales, led by Cardiac and
Vascular, and we anticipate a 22.8-billion-yen gross profit
increment by sales increase. Product mix improvement andrecovery from reduced factory utilization will have a positive
impact of 4.1 billion yen, to exceed inflation impact.
The size of price down is expected to shrink year-on-year withthe reimbursement price revision in Japan and other impacts.
SG&A will increase along with activity in support of expanded
sales, as well as Plasma Innovation strategic investment costs;
all this increase is positive and necessary for growth.
FX rate, we anticipate 125 yen per a dollar, 135 yen per a euro
and 19.2 yen per a Chinese yuan with considering its truck
record in April. FX impact is expected totally positive. Dollar
will be neutral, euro and Chinese yuan will be favorable by thedepreciation of yen; however, positive or negative varies

12depending on each company.

12improve OP% 2pts.

Actions for Profit Improvement

Improvement (OP%)

Effectiveness（acceleration in thelater years of GS26)

Commenced activities in 4 areas
FY21

Production

Best Practice sharing of manufacturing
operations towards newly built facilities

Logistics

FY22: review and analyze current
manufacturing process, create
implementation plans
FY23: implement improved process

Procurement

FY23

FY24

FY25

FY26

Consolidate and/or establish US
distribution centers based on
optimized logistics network
FY22: Create heatmap based on businessvolume and review optimized location
FY23 onwards: contribute to reduction oflogistics cost ratio to sales

Direct material cost review, arrange forstable inflow of materials

Supportfunctions

FY22: Risk analysis and create BCM.
Implement global policy for BCM
FY23: Review alternative materials, improveforecast accuracy and aim for cost reduction©TERUMO CORPORATION

FY22

Planning for establishment of GBS,
consolidation of office at timing of
renewal, global insurance policy, etc.
FY22: Create shared services for someaccounting processes
FY23 onwards: Expansion of sharedservice function to reduce SG&A ratio

13 / 28

Regarding the Group-wide earnings improvement efforts
outlined in GS26, FY22 will include full ramp-up of activities in
the four areas of production, procurement, logistics, andindirect.
In production, areas to be improved will be selected. In
procurement, efforts will include direct material priceoptimization and supply stabilization. Logistics efforts will
include specific themes such as consolidation of US distribution
centers, office consolidation for better efficiency in indirect
departments, comprehensive insurance contracts, andestablishing shared services across businesses.
We will be able to see the effect onset by this activity in thelatter part of GS26. Starting this fiscal year, we will also share
the progress of these efforts at each earnings announcement.

13

Dividend Proposal and Acquisition of the Company’s Own Shares
FY21 annual dividend: 34.0 JPY (increased by 2.0 JPY from the guidance)
Stably increasing, and aim for the target dividend payout ratio of 30% over the mid- to long-term
Continue to increase FY22 annual dividend up to 36.0 JPY

FY21 Results

FY22 GuidanceProfit for the Year (100 M JPY)

888

1,000

EPS (JPY)

117

134

Dividend proposal/share

34.0 JPY

36.0 JPY

Interim 16.0
Year-end 18.0

Interim 18.0
Year-end 18.0

Dividend payout ratio

28.9%

26.9%

Maximum total value of shares to be acquired: 50 B JPY
Resolved to cancel the shares after acquisition©TERUMO CORPORATION

14 / 28

During FY21, we proposed a 2-yen dividend increase; however,
we will add further to that for a total 34-yen annual dividend.
In FY22 we plan to maintain this dividend-increase trend, to
36 yen for the year, while continuing to enact stable increases
toward the mid- to long-term goal of a 30% dividend payout
ratio.
We also announce that our board of directors has resolved toprovide 50 billion yen as the maximum total value foracquisition of treasury shares and to cancel the shares after
acquisition.

14

FY21-22 Product Pipeline and Topics
Major product launches and Indications
Businessarea

Product name

Until FY21

FY22 plan

FY23 and/or later

TIS

Drug-eluting
coronary stent

General name

Ultimaster Nagomi

Selling in JP

Launch in EU

Launch in
Asia & Latin America

Neurovascular

Flow diverter

FRED X

Vasculargraft

Thoracic stent graft

Relay family

HCS

Infusion pump

Terufusion infusion
pump type 18

Selling in EU & US

Expansion in US, regional expansion

Selling in EU, obtained
indication of RelayPro for
aneurysm in US & JP

Obtain additional
indications; dissections &traumatic transections in
US & dissections in JP

Selling in JP

Launch in
EU & Latin America

LCS

Insulin patch pump

Medisafe With series

Selling the current modelin JP & EU

Launch updated version
in JP

TBCT

Cell expansion
systemQuantum Flex

Selling Quantum globally

Launch Quantum Flex
as an addition to portfolio

Additional Relay
platform derivatives,
RelayBranch clinical trial“FRED X”

Launch in Asia
Develop AID systemwith Diabeloop, consider
regional expansion
Aim at double-digit growthof Cell therapy
technologies business“Thoraflex Hybrid”

Major Topics• Corporate: Announced commitment to achieve carbon neutrality by 2040 and support for the Task Force on Climate-related Financial Disclosures(TCFD) and its recommendations• C&V: Announced U.S. FDA approval for the surgical hybrid stent graft Thoraflex Hybrid• TMCS: Announced collaboration on new solution for diabetes data sharing• TBCT: U.S. FDA cleared the new Rika Plasma Donation System“Rika”(C&V: Cardiac & Vascular, TMCS: Medical Care Solutions, TBCT: Blood & Cell Technologies, HCS: Hospital care solutions, LCS: Life care solutions)©TERUMO CORPORATION

15 / 28We also have high expectations for products launched in FY21
to expand regionally and in application, toward further growthof our results in this year and beyond.
Group-wide topics include our announcement of Carbon
Neutrality by 2040.
This concludes my explanation of our earnings. Thank you.

15

Reference©TERUMO CORPORATION

16 / 2816

Revenue by Segment and Region©TERUMO CORPORATION

17 / 28

17

Quarterly Trend of Revenue and Operating Profit
Revenue: Increase by +9% YoY. +13% overall growth against FY19 Q4, driven by +18% increase in C&V with positive impact of FX
such as EUR
Operating Profit: The negative GP impact from cost inflation, lower production level, and VBP in China partially mitigated by strong
sales and positive FX impact(100 M JPY)
1,629 1,653

1,548 1,520

1,525

1,798

1,788

1,729

1,717

1,588

1,652

1,313

TBCT (Revenue)
TMCS (Revenue)
C&V (Revenue)
Total (Operating Profit)

292

181

362

300

FY19 FY20 FY21
Q1

©TERUMO CORPORATION

238

296

271

FY19 FY20 FY21
1

Q2

334

286

244

FY19 FY20 FY21
1

Q3

231

215

FY19 FY20 FY21
1

Q4

1

18 / 28

18

P&L (Quarterly Results)(100 M JPY)

Revenue

FY20 Q4(Jan-Mar)FY21 Q1(Apr-Jun)

Q2(Jul-Sep)

Q3(Oct-Dec)

Q4(Jan-Mar)

1,652

1,717

1,729

1,788

1,798

Gross Profit

854 (51.7%)

943 (54.9%)

920 (53.2%)

926 (51.8%)905 (50.3%)

SG&A Expenses

488 (29.5%)465 (27.1%)

490 (28.4%)

507 (28.4%)

528 (29.4%)

R&D Expenses

132 (8.0%)

117 (6.8%)

130 (7.5%)

128 (7.2%)

144 (8.0%)

Other Income
and Expenses

-2

1

-3

-5

-18

Operating Profit

231 (14.0%)362 (21.1%)

296 (17.1%)

286 (16.0%)

215 (12.0%)

Adjusted
Operating Profit

274 (16.6%)

402 (23.4%)

339 (19.6%)

330 (18.5%)

273 (15.2%)

Average
Rate

USD

106 JPY

110 JPY

110 JPY

114 JPY

116 JPY

EUR

128 JPY

132 JPY

130 JPY

130 JPY

130 JPY©TERUMO CORPORATION

19 / 28

19

Operating Expenses (Quarterly Results)(100 M JPY)

Salaries & Wages
Sales Promotion
Logistical Costs
Depreciation & Amortization
OthersSG&A Expenses Total(%)

FY20 Q4(Jan-Mar)FY21 Q1(Apr-Jun)

Q2(Jul-Sep)

Q3(Oct-Dec)

Q4(Jan-Mar)

240
43
37
49
119
488

249
30
38
48
99
465

249
40
39
50
112
490

255
44
39
51
118
507

256
45
41
54
132
528
(29.4%)(29.5%)(27.1%)(28.4%)(28.4%)

R&D Expenses

132

117

130

128

144

(%)

(8.0%)(6.8%)(7.5%)(7.2%)(8.0%)

Operating Expenses Total(%)
Average Rate©TERUMO CORPORATION

USD
EUR

620

581

621

635

672

(37.5%)(33.9%)(35.9%)(35.5%)(37.3%)

106 JPY
128 JPY

110 JPY
132 JPY

110 JPY
130 JPY

114 JPY
130 JPY

116 JPY
130 JPY

20 / 28

20

Operating Expenses (YTD and Quarterly Results)(100 M JPY)

FY20 Q4
YTD
Salaries & Wages
Sales Promotion
Logistical Costs
Depreciation &Amortization
OthersSG&A Expenses Total(%)

R&D Expenses(%)

Operating Expenses Total(%)©TERUMO CORPORATION

FY21 Q4
YTD

YoY

YoY%

YoY%
(FXN)

FY20 Q4

FY21 Q4

YoY

YoY%

9%
24%
10%

4%
20%
6%

240
43
37

256
45
41

16
2
4

7%
6%
10%

928
128
144

1,010
160
157

82
31
14

191

203

12

6%

3%

49

54

5

11%

404
1,795

461
1,991

57
196

14%
11%

10%
6%

119
488

132
528

12
40

10%
8%

(29.2%)(28.3%)(29.5%)(29.4%)

12

9%

51

8%

491

518

(8.0%)(7.4%)

2,286

2,509

(37.2%)(35.7%)

27

6%

2%

132
(8.0%)

223

10%

5%

144
(8.0%)

620

672(37.5%)(37.3%)

21 / 28

21

Adjusted Operating Profit: Adjustments(100 M JPY)

FY20 Q4 YTD

FY21 Q4 YTD

984

1,160

231

215

Adjustment 1. Amortization of acquired
intangible assets

146

161

38

42

Adjustment 2. Non-recurring profit or loss

29

24

5

16

1,159

1,344

274

273

Operating Profit

Adjusted Operating Profit

FY20 Q4

FY21 Q4<General examples of adjustment items>• Acquisition related cost
• Lawsuit settlement• Impairment loss
• Restructuring loss
• Nonlife insurance income• Loss on disaster• Other one-time profits & losses©TERUMO CORPORATION

Main items in
Adjustment 2. Non-recurring profit or loss

FY21 Q4
YTD

FY21 Q4

Business reorganizing cost

16

10

Others8

622 / 28

22

CAPEX, Depreciation and R&D Expenses(100 M JPY)

FY18

FY19

FY20

FY21

FY22
Guidance

CAPEX
Depreciation

608
440

895
477

772
484

692
532

900
635

Amortization of acquired intangible assets

146

157

146

161

173

Others

294

320

338

371

462

CAPEX = C.i.P. record basis, lease depreciation (IFRS16) is not included in Depreciation

FY21 (69.2 B JPY): Continued investment mainly for TIS, Neurovascular, PS, and Blood & Cell Technologies in
production capacity and space, R&D as well as IT infrastructure (SAP)
Continue investment on the above projects in FY22FY18

R&D Expenses©TERUMO CORPORATION

477

FY19

506

FY20

491

FY21

518

FY22
Guidance580

23 / 2823

Cash Flows (Q4 YTD)
Operating CF+1,415589
Depreciation
andamortization
1,145

305
Incometaxes

14Working
capital

692

CAPEX

2,008

©TERUMO CORPORATION

407
Debt
repayment&
redemptionof bonds

Profitbefore tax

Cash atthe end of
FY20(100 M JPY)

Investing & Financing CF-1,370235

36

Dividends

OthersCAPEX = C.i.P. record basis
Cash at the end of each period is equal to “cash and cash equivalents” on B/S

2,053

Cash atthe end of
FY21

24 / 28

24

Cash Flows (Q4)
Operating CF
+431
30
156
215
Profitbefore tax

Depreciation
andamortization

Incometaxes

Investing & Financing CF-428
91
Working
capital

200
CAPEX

299
72
Debt
repayment©TERUMO CORPORATIONOthers

2,053

2,049

Cash atthe end of
FY21 Q3(100 M JPY)CAPEX = C.i.P. record basis
Cash at the end of each period is equal to “cash and cash equivalents” on B/S

Cash atthe end of
FY21

25 / 28

25

FY21 FX Impact Breakdown (Flow and Stock)+7.1 B JPY FX impact vs FY20: No change from +7.1 B JPY Q3 YTD level+8.7 B JPY for year (+1.8 B JPY in Q4) from flow: Positive impact of JPY depreciated against EUR and CNY(JPY)

FY20 average

FY21 average

Variance

EUR

124

131

7

CNY

15.7

17.5

2

-1.6 B JPY for year (-1.8 B JPY in Q4) from stock: FX impact on elimination of unrealized profit in inventories• Rapid JPY depreciation in Q4 vs Q3, larger gap between period-average and end-of-period rates led to negative impact(JPY)
FY21 Q3
averageUSD
EUR©TERUMO CORPORATION

114
130

At the end of
Dec. 2021

Variance

115
131

1
0

(JPY)
FY21 Q4
average

USD
EUR

116
130

At the end of
Mar. 2022

Variance

122
137

6
6

26 / 28

26

Foreign Exchange Sensitivity
Annual impact of 1 JPY depreciation(100 M JPY)

USD

EUR

CNY

Revenue17

835

Adjusted Operating Profit

0

5

15

<Reference> Impact when JPY is depreciated by 10%

Adjusted Operating Profit©TERUMO CORPORATION

EMEA

Asia

North
America

Latin
America

EUR

OthersCNY

Others

-1

10

65

13

23

36

27 / 28

27

Adjusted Operating Profit Variance Analysis (Q3 YTD)
(100 M JPY)
Gross
marginPrice-27
JP NHI-2

G/P
incrementby salesincrease

SG&A

Production
Adjustment

MDR
-2
IT
-2

Gross margin:
Negative effects of cost inflation (freight, rawmaterial, and labor cost), and lower
production level, exceeded positive impact of
product mix improvement from sales increasein Cardiac & Vascular, especially TIS

FX

R&D

G/P increment by sales increase:
The revenue increased in all companies,
particularly Cardiac & Vascular, comparedwith FY20 Q3 YTD impacted by COVID-19

OthersPrice:
Decline mainly due to VBP in China for TIS
products
SG&A:
Large increase compared with FY20 Q3 YTD
in which expense usage was slow due to
COVID-19

FY20
Q3 YTDOP

FY20
Q3 YTD
Adj. OP©TERUMO CORPORATION

FY21
Q3 YTD
Adj. OPFY21
Q3 YTDOP

FX:
Positive impact from flow mainly by CNY and
EUR. Small impact from stock

28 / 2828

29