FY18Q4
F i n a n c i a l
R e s u l t s
May 7, 2019 @Station Conference Tokyo

7741.T[ADR:HOCPY
H O YAUS]C O R P O R AT I O N[With Memo]
Please be aware that this memo isposted for reference and is not averbatim record of all statements
made at the meeting.
© 2019 HOYA CORPORATION All Rights Reserved

11. Financial Results [Ryo Hirooka, CFO]
2. IT Business Overview
3. Life Care Business Overview
4. Summary & Outlook
5. Q&A© 2019 HOYA CORPORATION All Rights Reserved22Financial Overview(¥bn)

Q4 FY17Q4 FY18

YoY

YoY(%)

Sales

135.9

141.5

+5.6

+4%

Pretax Profit

26.2

31.4

+5.2

+20%

Net Profit

19.5

29.2

+9.7

+50%

cf. Profit fromordinary operating
activities*

33.0

35.1

+2.0

+6%

*Herein after “Operating Profit”© 2019 HOYA CORPORATION All Rights Reserved

3➢Revenue amounted to ¥141.5 billion, up ¥5.6 billion (+4%) year on year
➢Quarterly profit before tax was ¥31.4 billion, up ¥5.2 billion (+20%)➢Profit for the quarter amounted ¥29.2 billion, up ¥9.7 billion (+50%)

3

Constant Currency Basis (CCB)
Previous
Rate (A)Current
Rate (B)FX Impact

YoY

YoY(%)

Sales

142.7

141.5

-1.2

+6.8

+5%

PretaxProfit

31.2

31.4

+0.2

+5.0 +19%

Net Profit

29.0

29.2

+0.2

+9.4 +48%

Average Rates(A)Q4 FY17(B)Q4 FY18

Variance

US$
EURO
BAHT

¥107.47¥132.29¥3.43¥110.27¥125.27
¥3.50

-2.6%
+5.3%
-2.0%

(¥bn)

© 2019 HOYA CORPORATION All Rights Reserved

4➢Assuming exchange rates level with the same period in the prior year, real sales growthwould have been ¥6.8 billion (+5%)➢Meanwhile, foreign exchange had little or no appreciable impact on profits➢The impact of foreign currency exchange on quarterly profit before tax was a +¥200
million; in real terms growth was ¥5.0 billion (+19%)4

Notes RE: Non-Operating Items
Comprehensive Income Statement
(¥bn)
Sales
Finance Income
Other Income
Total Revenue
ExpensePretax Profit

1

Q4 FY17
135.9
0.4
0.7
137.1
110.9
26.2

Q4 FY18
141.5
0.7
1.4
143.6
112.2
31.4

YoY
+5.6
+0.3
+0.6
+6.5
+1.3
+5.2

1

One-off expenses increased due to reorganization of
acquired companies. However, total expense remainedlevel, as there was an impairment loss related to ourforeign subsidiary the year-ago quarter.

© 2019 HOYA CORPORATION All Rights Reserved5➢ We recorded an impairment loss of 5.6 billion yen related to our subsidiary in Brazil during
the same period in the prior fiscal year. This year, we recorded a smaller 1.1 billion yen in
impairment loss.
➢ At the same time, we recorded 1.1 billion in equity in losses of affiliates this period basedon a more conservative accounting for a medical devices company in India. We recorded nosuch amount for equity in losses of affiliates for the same period in the prior fiscal year.
*See P.7 and P.11 of Summary of Consolidated Results, Supplementary Information for more.

5Life Care Earnings
Q4 FY17Q4 FY18

YoY

YoY(%)

Sales*

91.9

96.3

+4.4

+5%

Pretax Profit

10.9

15.8

+4.9

+45%

cf.Operating Profit

18.1

18.1

-0

-0%

19.7%

18.8%

-0.9pt(¥bn)

cf.OP Margin*External Sales© 2019 HOYA CORPORATION All Rights Reserved

6➢Life Care segment sales amounted to ¥96.3 billion, an increase of ¥4.4 billion year on year
➢Segment profit (profit before tax) rose ¥4.9 billion, reaching ¥15.8 billion➢While our operating profit margin declined, this was due to a one-time cost associated with
the integration of locations owned by acquired companies. Accordingly, we do not see any
underlying issues in our fundamentals.

6

Life Care Earnings (CCB)
Previous
Rate

Current
Rate

FX
Impact

Real
YoY

Real
YoY(%)

Sales*

98.0

96.3

-1.7

+6.1

+7%

Pretax Profit

16.0

15.8

-0.2

+5.1 +47%

cf.Operating Profit

18.1

18.1

-0.0

+0.0

(¥bn)

+0%

*External Sales© 2019 HOYA CORPORATION All Rights Reserved

7➢Foreign currency translation had a -¥1.7 billion impact on Life Care segment results; real
sales growth amounted to ¥6.1 billion➢Real segment profit (profit before tax) growth amounted to ¥5.1 billion after excluding theimpact of foreign currency exchange

7

IT Earnings
Q4 FY17Q4 FY18

YoY

YoY(%)

Sales*

42.6

43.7

+1.1

+3%

Pretax profit

15.7

18.4

+2.7

+17%

cf.Operating Profit

16.1

18.3

+2.2

+14%

37.7%

41.8%

+4.1pt(¥bn)

cf.OP Margin*External Sales© 2019 HOYA CORPORATION All Rights Reserved

8➢Information Technology segment sales for the third quarter amounted to ¥43.7 billion, an
increase of ¥1.1 billion year on year
➢Segment profit (profit before tax) rose ¥2.7 billion to ¥18.4 billion

8

IT Earnings (CCB)
Q4
FY17

Q4
FY18

FX
Impact

Real
YoY

Real
YoY(%)

Sales*

43.2

43.7

+0.5

+0.6

+1%

Pretax profit

18.2

18.4

+0.2

+2.5 +16%

cf.Operating Profit

18.1

18.3

+0.2

+2.0 +13%(¥bn)*External Sales© 2019 HOYA CORPORATION All Rights Reserved

9➢Foreign currency translation had a +¥500 million impact on IT segment results; real sales
growth amounted to ¥600 million➢Real segment profit (profit before tax) growth amounted to ¥2.5 billion after excluding theimpact of foreign currency exchange

9Earnings by Sub-Segment
Healthcare Sales
Eyeglass Lenses / Contact Lenses(¥bn)

Q4 FY17Q4 FY18

YoY

YoY(%)

69.1

72.0

+2.9

+4%

Sales*

Constant Currency Basis(¥bn)

Previous Rate

Current Rate

Real YoY

Real YoY(%)

73.3

72.0

+4.2

+6%

Sales**External Sales© 2019 HOYA CORPORATION All Rights Reserved

10➢Health care related products (eyeglass lenses, contact lenses) sales were ¥72.0 billion, up¥2.9 billion (+4%) year on year
➢Foreign currency translation had a -¥1.3 billion impact; real sales growth amounted to ¥4.2
billion after eliminating this impact

10Earnings by Sub-Segment
Medical Sales
Endoscopes / IOLs(¥bn)

Q4 FY17Q4 FY18

YoY

YoY(%)

22.7

24.2

+1.5

+7%

Sales*

Constant Currency Basis(¥bn)

Previous Rate

Current Rate

Real YoY

Real YoY(%)

24.7

24.2

+2.0

+9%

Sales**External Sales© 2019 HOYA CORPORATION All Rights Reserved

11➢Medical-related products (endoscopes, intraocular lenses, etc.) sales were ¥24.2 billion, a¥1.5 billion (+7%) increase year on year
➢Foreign currency translation had a -¥500 million impact on performance; in real terms
growth was ¥2.0 billion (+9%)➢Further, intraocular lenses experienced double-digit growth due to the positive impact ofacquisitions. Eliminating the impact of acquisitions, results were 4% lower, as shown on P.22.

11

Earnings by Sub-Segment
Electronics
Masks & Blanks / HDD Substrates(¥bn)

Q4 FY17Q4 FY18

YoY

YoY(%)

31.9

34.8

+3.0

+9%

Sales*

Constant Currency Basis(¥bn)

Previous Rate

Current Rate

Real YoY

Real YoY(%)

34.4

34.8

+2.5

+8%

Sales**External Sales© 2019 HOYA CORPORATION All Rights Reserved

12➢Electronics related products (glass substrates for semiconductors, LCD-related products,
and hard disk drives) sales amounted to ¥34.8 billion up ¥3.0 billion (+9%) year on year
➢Foreign currency translation had a +¥500 million impact on this business; real sales growthamounted to ¥2.5 billion (+8%)

12Earnings by Sub-Segment
Imaging
Camera Lenses, Etc.

(¥bn)

Q4 FY17Q4 FY18

YoY

YoY(%)

10.8

8.9

-1.9

-18%

Sales*

Constant Currency Basis(¥bn)

Previous Rate

Current
Rate

Real YoY

Real YoY(%)

8.9

8.9

-1.9

-18%

Sales**External Sales© 2019 HOYA CORPORATION All Rights Reserved

13➢Imaging related products sales amounted to ¥8.9 billion, down ¥1.9 billion (-18%) year on
year➢Actual performance was 7% lower after eliminating the impact of abandoned businesses, as
shown on P.18
➢The impact of foreign currency translation on this business was negligible

13Balance Sheet
Q3 FY18(¥bn)

Non-current Assets
Current Assets
CapitalNon-current Liabilities
Current Liabilities
Total

234.8
485.0
596.6
15.6
107.5
719.8

Q4 FY18

255.8
508.1
627.7
24.4
111.8
763.9

QoQ

+21.0
+23.1
+31.1
+8.9
+4.2
+44.2

1

Goodwill and intangible assets increased by ¥18.2bn, partly due tothe acquisition of Mid Labs and Fritz Ruck.

2

Cash and cash equivalents increased by ¥21.1bn.
Other short-term financial assets increased by ¥2bn.

© 2019 HOYA CORPORATION All Rights Reserved

1
2

14

➢Goodwill and intangible assets increased by ¥18.2bn, partly due to the acquisition of Mid
Labs and Fritz Ruck.
➢Cash and cash equivalents increased ¥21.1 billion

14

Cash Flow
Q4 FY17(¥bn)

Q4 FY18

YoY

Operating CF

39.5

46.6

Investing CF-3.4-26.3 -22.9

Financing CF-9.7

Cash & Cash Equivalents
at the end of the term
1

245.8

0.2

+7.1
1

+9.8

293.4 +47.6

Investing CF outlays increased mainly due to theacquisition of Mid Labs and Fritz Ruck, expanding the
product portfolio of our IOL business.

© 2019 HOYA CORPORATION All Rights Reserved

15➢Cash used in investing activities increased ¥22.9 billion year on year mainly due to theacquisition of Mid Labs and Fritz Ruck

15

Shareholder Return
Cash Needs
for M&A

Amount ofFree Cash Flow

Factors toConsiderLevel of Cashon Hand

Capital Efficiency

Approved a maximum ¥60bn share buyback.
HOYA will cancel all shares bought back.
© 2019 HOYA CORPORATION All Rights Reserved

16➢We provide shareholder returns after considering factors related to free cash flow, cash on
hand, cash required for M&A activity, capital efficiency, etc.
➢As a result, we have decided to acquire 8.6 million shares for 60 billion yen in sharebuybacks, as announced in our press release today.
➢We intend to make purchases via discretionary investment contracts over a period of little
less than six months➢We intend to cancel all shares bought back16

1. Financial Results
2. IT Business Overview [Eiichiro Ikeda, COO/CTO]
3. Life Care Business Overview
4. Summary & Outlook
5. Q&A© 2019 HOYA CORPORATION All Rights Reserved

1717

IT Snapshot
YoY Sales Growth (Like-for-Like)

-3%

+20%

-7%

HDD Substrates

Masks & Blanks(LSI/FPD)

Imaging+4%© 2019 HOYA CORPORATION All Rights Reserved

18➢In addition to higher revenues and profits, our Information Technology segment achieved
higher profitability➢Masks & Blanks sales rose 20%, HDD Substrates sales fell 3%, and Imaging sales fell 7%18

Overview by ProductThis Quarter
EUV sales continued to grow, now accounting for 26% ofblanks sales. DUV sales also showed strong growth
mainly driven by 7nm mass production application.

Going Forward
LSI Blanks

Continue to grow sales, mainly from EUV mass
production applications and R&D for next generation
nodes.

This Quarter
Sales declined mainly due to a downturn in the Japanesemarket related to FPD demand.

Going Forward

FPD/LSI Masks

Continue to focus on high-resolution products mainly forsmartphone applications.

© 2019 HOYA CORPORATION All Rights Reserved

19

Mask Blanks for Semiconductors➢EUV sales now account for 26% of blanks sales.
➢EUV exposure device manufacturers have not changed their plan for an annual 30
machines; we expect demand for our EUV blanks to rise in conjunction with exposure device
shipments➢We expect a multiple number of tapeouts in response to the start of 7nm mass production.
Development for 5nm and 3nm next-generation nodes is under way.
➢We achieved higher revenues, despite bearishness in the final market for optical (DUV).
Even more than the number of final markets, blanks are affected by trends in the number oftapeouts. Tapeouts for 7nm mass production among major manufacturers during the current
quarter were strong.
➢The key to growth will be responding to the strong demands of semiconductor
manufacturers for both quality and volume.
FPD/LSI Masks➢Demand for FPD in smartphone applications has fallen sharply among Japanesemanufacturers, resulting in lower revenues.
➢We will focus on sales of high-precision masks to panel makers in the rapidly growing
Chinese market

19Overview by ProductThis Quarter

HDD
Substrates
HDD Substrates

2.5” sales declined due to SSD factors and excess
inventory of HDDs. 3.5” sales more than doubled, now
accounting for 29% of sales.
Going Forward
Expect annual decline of 20% for 2.5” sales. Target
overall growth expecting the currently stagnant data
center to pick up in H2 CY2019.

This Quarter

Imaging
Imaging

Sales of lenses for mirrorless cameras trended favorably.
However, overall sales declined mainly due to contractionof the point-and-shoot camera market.

Going Forward
Continue to develop new applications and high valueadded products.

© 2019 HOYA CORPORATION All Rights Reserved

20

Glass Substrates for Hard Disk Drives➢Sales of 2.5-inch substrates fell 20% (within predicted range), mainly due to theencroachment of SSDs and excess inventory held by HDD manufacturers.
➢Meanwhile, revenues for 3.5-inch products have more than doubled, accounting for 29% of
HDD substrate sales, which was 19% the previous quarter.
➢We expect sales 2.5-inch product to continue to decline approximately 20% as both PCs
and game devices transition to SSDs.
➢We project growth in the ±3% range for the first half of FY19 as 2.5-inch revenue declines
are balanced by 3.5-inch gains.
➢We have one HDD manufacturer as a customer for 3.5-inch product; however, a lack ofsuccess in transition to high-density likely means that the other two manufacturers willchange to multi-layers (=glass)
Imaging-Related Products➢In addition to ongoing contraction in the point-and-shoot market, surveillance camera lenssales are slow in the Chinese market as inventory is building up due to the impact of trade
war and other factors.
➢We will develop new applications, rather than solely relying on the digital camera industry.

20

1. Financial Results
2. IT Business Overview
3. Life Care Business Overview [Hiroshi Suzuki, CEO]4. Summary & Outlook
5. Q&A© 2019 HOYA CORPORATION All Rights Reserved21

21Life Care Snapshot
YoY Sales Growth (Like-for-Like)

+9%
+4%

Eyeglass Lenses+9%

Contact Lenses

Endoscopes

+3%

-4%

Other

IOLs

+6%
© 2019 HOYA CORPORATION All Rights Reserved

22➢By product type, sales of eyeglass lenses increased 4%, sales of contact lenses increased
9%, sales of endoscopes rose 9%, and sales of intraocular lenses fell 4%22

Overview by ProductThis Quarter
While concerns of price decline was a topic in Europe, themarket trended quite stably. Sales increased in all regions.

Going Forward
Eyeglass Lenses

Grow sales, mainly by gaining market share in theAmericas and APAC. Aim for 20% global market share(17% at present) over the medium term.

This Quarter
New store roll-outs and higher unit prices through greater
sales of high-function material products contributed to
growth. New 8/Closed 2

Going Forward
Contact Lenses

Plan to roll out around 20 new stores annually andconduct M&A activity to penetrate regions in Japan withroom for added presence.

© 2019 HOYA CORPORATION All Rights Reserved

23

Eyeglass Lenses➢By region, sales in Japan rose 3%, sales in Europe rose 3%, sales in APAC increased 5%,
and sales in the Americas increased 6%➢We have decided to engage in capital investment again in response to the increase involume (see P.48).
Contact Lenses➢In addition to successes from new store openings, sales have been strong for supreme
comfort lenses and other products using high-function materials such as silicon hydrogel.
➢Half of revenue growth can be attributed to unit price increases; the remainder is due toincreased customer traffic from new store openings, etc.
➢Sales through contact lens specialty retailers and online channels have grown, and we
expect the market to experience further growth in the future.

23

Overview by ProductThis Quarter
Continued to reduce excess inventory at Chinese
distributor. Overall sales declined. Acquisitions of Mid
Labs and Fritz Ruck completed in January.

Going Forward
IOLs

Resolve inventory issue as quickly as possible.
Facilitate integration with the companies acquired recently.

This QuarterAll regions saw sales growth. Launch of new products, aswell as closing a major deal in Europe, contributed to thisgrowth.

Going Forward
Endoscopes

Expect strong sales through gradual launch of new
products, including scopes and video processors.

© 2019 HOYA CORPORATION All Rights Reserved

24

Intraocular Lenses➢Sales remain strong in Japan and Europe, where we sell directly. Sales continue to be weakin China via agents and OEM sales.
➢We completed the acquisition of Mid Labs/Fritz Ruck, which produce ophthalmic surgery
equipment that are highly complementary with intraocular lenses.
Endoscopes➢We expect to see the main impact of new products in FY19 and beyond.
➢We have started development of disposable endoscopes for use in bronchial tube
applications.
➢We expect AI to be adapted to support medical examinations in the future.

241. Financial Results
2. IT Business Overview
3. Life Care Business Overview
4. Summary & Outlook [Hiroshi Suzuki, CEO]
5. Q&A© 2019 HOYA CORPORATION All Rights Reserved

25

Regarding FY19
We want to raise Life Care profitability to a higher level, as depreciation and amortization will
begin to increase during the second half of FY19
We intended to shift toward growth acceleration in our Life Care business; however, we findourselves needing to once again place priority on profits

25

Reviewing the Past Decade
Focused Areas and Results
Historical Net Profit

(¥bn)

150

25%
Net Profit

Net Profit Margin
20%

100

15%
10%

50

5%
0

0%
FY08

FY09

FY10

FY11

FY12

FY13

Expand IT Business market share✓ Intensive investment intechnological development etc.
to solidify an overwhelming
position in key industries.

FY14

FY15

FY16

FY17

FY18

Bolster Life Care growth potential✓ Building a structure enabling stable growth
without sacrificing profitability.
✓ Strengthening sales force, conducting M&A
for future growth.

Resulted in high market share andprofitability for our IT Business© 2019 HOYA CORPORATION All Rights Reserved

26➢ This graph separates the past 10 years into the first five and the second five.
➢Over the first five years, we engaged in R&D and strategic price competition to secure ourposition in the market for our IT Business. Our aim was to sacrifice profits to become the big
fish in a little pond.
➢Over the second five years, we shifted gears to our Life Care Business, creating afoundation supporting sales growth without sacrificing profits.
➢We do not expect our IT Business to grow dramatically over the next 10 years; rather, ourLife Care Business and bolt-on acquisitions will be the likely growth driver.

26

Reviewing the Past DecadeTransition of Business Portfolio✓ Full-fledged expansion into the medical business by buying endoscopy
business in 2007.
✓ Exited from businesses with low growth opportunities and synergies.
✓ As a result, sales composition of Life Care (shown as blue bars) rose from
46% to 65%.
Sales Composition FY08 vs FY18(¥bn)

Digital Cameras Sold in 2011

600

Imaging

500

HDD Substrates
Masks

400

Blanks

300

Other

200

IOLs
Endoscopes

100

Contact Lenses

0Eyeglass Lenses
FY08

FY18

© 2019 HOYA CORPORATION All Rights Reserved27➢ Our Life Care Business has risen to account for 66% of our business portfolio.

27

Reviewing the Past Decade
Initiatives to Maximize Shareholder Value✓ Greater intensity in management and supervisory functions after board shifts
to majority of outside directors in FY08.
✓ Shareholder-friendly management conscious of capital cost; more focus onshareholder returns.
✓ Market cap reached record-high.
No of Board of Directors*Outside directors shown in blue.

FY95 Introduction of outside director system

FY08

FY18

© 2019 HOYA CORPORATION All Rights Reserved

28➢We believe having a board consisting of a majority of outside directors is significant interms of corporate governance.
➢Our management has exhibited a major change in intensity since our board membershipshifted to a majority of outsiders.

28

Reviewing the Past Decade
Global Expansion✓ Allocating production, sales, and management to the most suitable sites.
✓ Globalization of human capital. Ratio of local employees in top management
positions at overseas subsidiaries reached 97%. Hired non-Japanese corporate
executives.
✓ Expansion outside Japan, mostly in Western countries. However, we are still in theprocess of building a competitive management structure in various regions,
including emerging markets.
Ratio of Overseas Sales

Ratio of Employees Outside of Japan

Domestic

62%

FY08

© 2019 HOYA CORPORATION All Rights Reserved

71%

FY18

86%

90%

FY09

FY18

Oversea29➢We are aware that we must understand the relationships between work styles and people
overseas (including emerging economies); we are still working on this aspect of our businessin our push toward globalization.
➢For example, our companies in the U.S. are engaging in “American-style globalization.”
Accordingly, we have no companies to model for the type of true globalization to which we
aspire. We will continue a trial-and-error approach to globalization.

29

HOYA’s Philosophy
Big Fish in a Small Pond
The HOYA philosophy is to leverage creativity and innovation to become the leading
company in niche markets.

Business Portfolio Management✓ Redistributing management resources to growth areas. Determining thelife cycle of each business is key.
✓ Diversify risk by combining businesses with different business models,sensitivity to market conditions, etc.

内視鏡

Star

??

Cash Cow

Dog© 2019 HOYA CORPORATION All Rights Reserved

30➢No change to our philosophy of aiming for global niches.
➢We will enter markets that have as little competition as possible with no dominant player.
➢While there are giants in the eyeglass lens and endoscope markets, we believe we can finda “small pond” with enough time.

30

The HOYA Management System✓ Rapid Cycle PDCA: Review and improve each division every quarter inthe belief that we should not sacrifice short-term earnings for the sakeof long-term growth.
✓ Number-Driven: Every decision should be supported by financial figures.

BOD✓

Executive Officers✓

Rapid Cycle PDCA (Quarterly Review)
Division A

Division B

Division C

Division D

Execute andverifyExecute andverifyExecute andverifyExecute andverify© 2019 HOYA CORPORATION All Rights Reserved✓✓✓

Distribute management
resources
Determine downscaling,
withdrawal

Business strategy
Mid-term plan
Annual and quarterly plan

31

➢One unique feature of HOYA is our management by quarterly budget cycles.
➢Three-year plans are seldom meaningful, since predicting future environmental changes,
etc. with accuracy is too difficult.
➢We engage in a repeated process of detailed and careful analysis on a three-month cycle.

31Key Issues to Tackle in the Next DecadeHistory of the Past 80 Years
Expanded scope of technologies and categories, beginning with optical glasses.
Acquisition of the endoscopy business became a turning point of non-linear
growth.
1988
HDD
Substrates

FPD Masks

2000
EUV
BlanksBlanks1941
OpticalGlasses

1987
Aspherical
Mold Lenses
1962
Eyeglass
LensesIT

1983
Semimasks

1974

2017
Substrates
for Cloud

1990

1972

Life Care

Contact
Lenses1977
IOLs
2007 (M&A)
Endoscopes

Core Technology
Theme

Optical Design

Composition

Photology© 2019 HOYA CORPORATION All Rights Reserved

MeltingLife

Molding
Precision

Polishing

Deposition

Health Care

Microfabrication
Medical3232Key Issues to Tackle in the Next DecadeTransform Business Portfolio✓ Continue bolt-on acquisitions. At the same time, consider adding new pillars
under the major categories of medical services and semiconductors.
✓ Define the “small ponds” in these major categories. Create business
opportunities regardless of acquisitions or internal development.

BoltonBoltonBoltonBoltonBoltonEyeglass
LensesContact
LensesEndoscopes

IOLs

Artificial Bone
etc.

MedicalServices

Blanks

Mask

HDD
Substrates

Imaging

Semiconductors？

© 2019 HOYA CORPORATION All Rights Reserved

Potential Categories？

33➢We are planting seeds in our search for a “small pond” in the semiconductor sector.
➢Over the long term, we are also considering a packaged product (including surgery) in the
medical services sector.

33

Other Issues to be Addressed
Pushing Diversity✓ As part of our diversity program to expand recruitment and occupational
fields for women, HOYA holds career advancement seminars for female
employees and promotes cross-divisional exchange.
✓ Encourage more diversity in nationality and race.
✓ Encouraging more diversity among executive officers and the BOD to bematters discussed in the future.

Succession Plan
✓ Develop next generation of management.
✓ Establish succession plan (driven by outside directors and our nominating
committee).

内視鏡© 2019 HOYA CORPORATION All Rights Reserved

34➢While we have a system for diversity in place, changing hearts and minds is a challenge.
➢One issue we will address is creating a culture in which people work on an equal footing,regardless of race, nationality, or gender.
➢The Nominating Committee, consisting of outside board directors, is considering succession
plans in light of CEO Suzuki’s age (60 years)

34

HOYA’s Aspirations for the Future✓ To be a meaningful company that creates businesses aligned with theneeds of the times.
✓ To be a company that directs the growth of corporate value in harmony
with contributions to society, economy, and culture.
✓ To be a company that contributes to shareholder success throughmaximized corporate value and return of profits.

内視鏡© 2019 HOYA CORPORATION All Rights Reserved

3535

1. Financial Results
2. IT Business Overview
3. Life Care Business Overview
4. Summary & Outlook
5. Q&A© 2019 HOYA CORPORATION All Rights Reserved

36

36

Q&A -1
Q

When do you expect the semiconductor market to recover?

A

The consensus in the semiconductor industry is that it will recover during
the second half of the current year. However, I am personally skeptical.
I’m not sure we will see a recovery in the second half of the year.

* Due to the length of the presentation portion of the meeting, only one question
was taken during the Q&A portion.

© 2019 HOYA CORPORATION All Rights Reserved3737

Appendix© 2019 HOYA CORPORATION All Rights Reserved3838

Consolidated Earnings (Annual)
FY17

FY18

YoY

YoY(%)

Sales

535.6

565.8

+30.2

+6%

Pretax Profit

124.2

144.7

+20.4

+16%

Net Profit

99.2

122.1

+22.9

+23%

129.5

148.5

+19.0

+15%

(¥bn)

cf.Operating Profit

Achieved record-high quarterly sales and profit.
© 2019 HOYA CORPORATION All Rights Reserved3939Life Care Earnings (Annual)
FY17

FY18

YoY

YoY(%)

Sales*

352.9

373.4

+20.5

+6%

Pretax Profit

56.4

69.3

+12.8

+23%

cf.Operating
Profit

63.6

74.2

+10.6

+17%

cf.OP Margin

18.0%

(¥bn)

19.9% +1.9pt*External Sales© 2019 HOYA CORPORATION All Rights Reserved4040IT Earnings (Annual)
FY17

FY18

YoY

YoY(%)

Sales*

178.5

187.5

+9.1

+5%

Pretax Profit

70.0

80.6

+10.6

+15%

cf.Operating
Profit

70.1

79.6

+9.5

+14%

cf.OP Margin

39.2%

(¥bn)

42.4% +3.2pt*External Sales© 2019 HOYA CORPORATION All Rights Reserved

41

41

Cash Flow (Annual)
(¥bn)

FY17

FY18

Operating CF

135.5

146.6 +11.1

Investing CF

-68.5

-70.1

Financing CF-117.3-32.8 +84.5

Cash & Cash Equivalents
at the end of the term

245.8

293.4 +47.6© 2019 HOYA CORPORATION All Rights Reserved

YoY

-1.6

42

42

Life Care QoQ Earnings
Revenuecf. Operating Profit / Margin

91.9

91.3

91.9

93.9

96.3

Q4

Q1

Q2

Q3

Q4

FY17

FY18

(¥bn)

(¥bn)

20.9%
19.7% 19.5% 20.3%
18.8%

18.1

17.8

18.7

19.6

18.1

Q4

Q1

Q2

Q3

Q4

FY17

FY18

*External Sales© 2019 HOYA CORPORATION All Rights Reserved4343

IT QoQ Earnings
Revenuecf. Operating Profit / Margin

(bn)

(¥bn)

37.7%

42.6

Q4

46.6

49.0

48.3

Q1

Q2

Q3

FY17

FY18

43.7

16.1

Q4

Q4
FY17

40.3%

18.8

Q1

42.7%

44.7%

20.9

21.6

Q2

Q3

41.8%

18.3

Q4

FY18

*External Sales© 2019 HOYA CORPORATION All Rights Reserved

44

44Topics[HDD Subs] Ground-breaking in Laos

[Eyeglass] Ground-breaking in Vietnam✓ Held ground-breaking ceremony inFebruary in Laos for a new fab
dedicated to 3.5” subs used in data
centers.
✓ To be on-line on H1 CY2020, target
full capacity by H1 CY2021.

✓ In January, HOYA attended alicensing ceremony for companies
newly entering an industrial park in
Vietnam.
✓ Second eyeglass lens factory in
Vietnam. Construction started.
Scheduled to be ready by end of
CY2019.

© 2019 HOYA CORPORATION All Rights Reserved

4545Notes✓ Accounting standard: IFRS✓ The fiscal year ending March 2019 is referred to as “FY18” throughout thisdocument.
✓ Figures less than ¥100 million are rounded down. Accordingly, some discrepancies
may occur among totals. Ratios are calculated using actual numbers.
✓ Like-for-Like figures exclude foreign exchange and M&A impact as well as otherextraordinary factors.
✓ Profit from ordinary operating activities is calculated as reference
information for investors; calculated by deducting finance income/costs,
share of profits(loss) of associates, foreign exchange gain/loss and othertemporary gain/loss from pretax profit.
✓ We have omitted a detailed breakdown of financial statements.
Please refer to the tanshin or the quarterly report for detailed numbers.
http://www.hoya.co.jp/english/investor/library.html© 2019 HOYA CORPORATION All Rights Reserved

46

46

Disclaimer

This report is provided solely for the information of professional investors andanalysts who are expected to make their own evaluation of the company. This
report contains forward-looking statements that are based on management’s
assumptions and beliefs in light of the information currently available to it andtherefore you should not place undue reliance on them. These forward-looking
statements involve known and unknown risks, uncertainties and other factorsthat may cause our actual results, performance or achievements to differ
materially from that anticipated in these statements. These factors include
changes in economic conditions, trends in our major markets, currency exchange
rates, etc. We accept no liability whatsoever for any direct or consequential loss
arising from any use of this report.

© 2019 HOYA CORPORATION All Rights Reserved

4747