Financial Information
HORIBA, Ltd.
March, 2019
(This material was prepared for the 2019 financial results briefing performed on the 17th Feb., 2019)© 2020 HORIBA, Ltd. All rights reserved.

1

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Shareholder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

2

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Shareholder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

3

Review of 2019

ExternalEvents

 The rise of protectionism (the US-China trade conflict, thedeteriorating Japan-South Korea relationship) BREXIT Slowdown in capital spending on semiconductors
 The accelerating automotive electrification trend and tighter
emission regulations globallyInternalEvents

 Formulation of the Mid-Long Term Management Plan
“MLMAP2023”
 Continual enhancement of R&D bases on a global scale Aggressive launch of new products
 Selected as a “Nadeshiko Brand” and for the “Health & Productivity
Stock Selection Program” by METI and the Tokyo Stock Exchange© 2020 HORIBA, Ltd. All rights reserved.

4

Summary of 2019 Results
Year-on year decrease in sales and profit due to slowdown of thesemiconductor segment

P&L

B/S

Year-on-year decrease in sales and profit of the Semiconductor segment
due to impacts of the market
Due to a change in geographical sales mix and other factors, decline inprofitability of the Automotive segment though the sales increased
Total assets were ¥315.1bn, increase ¥37.7bn, mainly due to increase in
cash caused by issuing corporate debts
Equity ratio: 54.3% (-3.9%)(compared to the end of Dec. 2018)

Operating CF: Cash in ¥26.6bn due to operating profitCFInvesting CF: Cash out ¥12.3bn due to acquisition of tangible
fixed assets

Free CF：＋14.2bn

Financial CF: Cash in ¥19.2bn due to issue of corporate debts© 2020 HORIBA, Ltd. All rights reserved.

5

2019 Results(Billions of Yen)

2018
Results

2019
Forecast(as of Nov. 11)

Results

vs2018vs
Forecast(as of Nov. 11)

Sales

210.5

207.0

200.2

-10.3

-6.7

Operating Profit

28.8

23.0

20.9

-7.9

-2.0

O.P.%

13.7%

11.1%

10.4%

-3.3p

-0.7p

Ordinary Profit

28.3

22.5

20.5

-7.7

-1.9

Net Income attributableto Owners of Parent

22.3

16.0

15.4

-6.8

-0.5

USD/JPY110.44130.35110.00122.00109.03122.03

-1.41

-0.97

-8.32

+0.03

EUR/JPY© 2020 HORIBA, Ltd. All rights reserved.

6

2019 Results by Segment(Billions of Yen)

Sales
2019

2018

Results:Record-highOperating profit

Forecast(as of Nov. 11)

Results

2019

2018
vs2018vs
Forecast

Results

Forecast(as of Nov. 11)

Results(as of Nov. 11)

vs
2018

vs
Forecast(as of Nov. 11)

Auto

79.6

83.0

81.0

+1.3

-1.9

7.7

7.0

6.4

-1.2

-0.5

P&E

19.3

20.0

19.5

+0.1

-0.4

2.0

2.0

1.6

-0.3

-0.3

Medical

26.0

26.0

25.3

-0.6

-0.6

1.8

1.5

1.3

-0.5

-0.1

Semi

57.7

50.0

47.1

-10.5

-2.8

17.0

12.0

10.7

-6.3

-1.2

Scientific

27.7

28.0

27.1

-0.5

-0.8

0.2

0.5

0.7

+0.5

+0.2

Total

210.5

207.0

200.2

-10.3

-6.7

28.8

23.0

20.9

-7.9

-2.0

© 2020 HORIBA, Ltd. All rights reserved.

7

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Shareholder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

8Market Assumptions for 2020
AutoTighter emission regulations mainly in Asia
Strong appetite for investment in the automotive sector due to innovation inelectrification & autonomous driving

P&E

Increase in demand due to tighter environmental regulations in emerging countries
Recovery in investment in the oil industry

MedicalJapan: Favorable sales to doctors in private practiceOverseas: Increase in demand for blood testing equipment in emerging countries

Semi
ScientificTotal© 2020 HORIBA, Ltd. All rights reserved.

Recovery of capital spending by semiconductor manufacturers
Solid demand for semiconductor devices from a mid- to long-term perspective
Robust corporate R&D spending
Accelerating research on new materials for secondary batteries【Impact of COVID-19 (New Coronavirus)】
At present: Limited impacts on production and the supply chain
Longer term: Concerns over impacts of lower production in the automotive andsemiconductor industries
9Exchange Rate(Yen)201820192020
vs2019Results

Results

Forecast

USD

110.44109.03110.00+ 0.97EUR

130.35122.03120.00▲ 2.03

1 yen O.P. sensitivity for 2020 forecast (Yen appreciation)
USD -216 million yen
EUR -21 million yen© 2020 HORIBA, Ltd. All rights reserved.

10

2020 Forecast(Billions of Yen)

:Record-high

2018

2019

Results

Results

2020Forecastvs2019

+14.7

20.9

215.0
25.0

13.7%

10.4%

11.6%

＋1.2p

Ordinary Profit

28.3

20.5+3.9

Net Income attributableto Owners of Parent

22.3

15.4

24.5
17.5

Net profit per share (Yen)

529
14.3%

367
9.3%

414
9.9%

+47

Sales

210.5

200.2

Operating Profit

28.8

O.P.%

ROE© 2020 HORIBA, Ltd. All rights reserved.

+4.0+2.0＋0.6p
11

2020 Forecast by Segment
Sales:Record-high2019

2020

Results

Forecast(Billions of Yen)

Operating Profitvs2019

2019

2020

Results

Forecastvs2019

Auto

81.0

85.0+3.9

6.4

7.5+1.0

P&E

19.5

21.5+1.9

1.6

1.5

-0.1

Medical25.3

27.0+1.6

1.3

1.5+0.1

Semi

47.1

52.5

+5.3

10.7

13.5+2.7

Scientific27.1

29.0+1.8

0.7

1.0+0.2

Total

200.2

215.0

+14.7

20.9

25.0+4.0© 2020 HORIBA, Ltd. All rights reserved.

12

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Shareholder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

13

Auto

2019 Results/2020 Forecast

2019 Results【EMS】【MCT1】【ECT2】

Higher demand mainly in Asia, driven by adoptionof new regulations
Increase in demand for fuel cell test systems
Business expansion in the next-gen automotive
technology development field, but an increase in
1: Mechatronics
expenses
2: Engineering Consultancy & Testing2020 Forecast
【EMS】

【MCT】

【ECT】

Robust sales in Asia
Increase in R&D expenses aimed at enhancing
competitiveness
Sales increase in response to automotive-related
manufacturers’ accelerated investment in electrifiedvehicle development
Improved profitability driven by business expansion© 2020 HORIBA, Ltd. All rights reserved.

(Billions of yen)

A new product in 2019
Driving robot for vehicle development

ADSEVO Automate running tests on
chassis dynamos Realize automation ofemission measurement tests
with high reproducibility

Contribute to highly-efficient R&D environment
for vehicles
Sales

Sales and O.P.
62.2

73.3

O.P.

79.6

7.6

7.7

2017

2018

81.0

6.4

85.0

7.5

3.5
2016

2019

2020(F)

14P&E2019 Results/2020 Forecast

2019 Results【Stack gas analyzers/Air quality monitoring system】
Robust sales of stack gas analyzers in Japan
Increase in demand for air quality monitoring system in Europe
Decline from last year, when a large project was recorded inAsia【Water quality monitoring system】
Increase in sales due to business expansion in Japan and Asia

(Billions of yen)

Topic in 2019
Adopted in JICA’s SDG Support Project The project aims to introduce continuous elemental andparticulate mass analysis with automatic sampling andthe air monitoring system in Morocco.
Increasedawareness ofenvironmental
preservation
globallyBusinessexpansion2020 Forecast【Stack gas analyzers/Air quality monitoring system】
Business opportunities in Asia driven by tightening
environmental regulations【Process measurement equipment】
Anticipating a recovery in investment by customers【Water quality monitoring system】
Robust sales of water quality monitoring system for vessels© 2020 HORIBA, Ltd. All rights reserved.

Sales
O.P.

Sales and O.P.
16.7

17.4

19.3

19.5

21.5

2.0
1.5

1.6

1.5

2019

2020

1.0
2016

2017

2018

(F)

15

Medical 2019 Results/2020 Forecast
2019 Results
 Business expansion in emerging countries
 Enhanced sales of the new product in Japan Decrease in sales from Europe in yen terms
due to the euro’s depreciation against the yen;increase in expenses(Billions of yen)

A new product in 2019: Yumizen M100 Banalyst
 Enables screening of diabetes andinfectious diseases with tiny amount ofblood Used mainly by general practitioners andpediatrics• μTAS technology acquired from Rohm
Co., Ltd• Top-class accuracy measurement
technology in POCT*

Disposable chip
containing liquid
reagent*Point of Care Testing2020 Forecast
 Anticipating a sales increase driven by expansion of theproduct line-up Further business expansion in emerging countries due toan increase in demand Start supplying products to Siemens; uptrend inexpenses© 2020 HORIBA, Ltd. All rights reserved.

Sales

Sales and O.P.
26.5

O.P.

25.1

26.0

1.9

1.8

25.3

27.0

1.3

1.5

2019

2020 (F)

2.8

2016

2017

2018

16

Semi.

2019 Results/2020 Forecast

2019 Results Decline in both sales andoperating profit from the previousyear
 Recovery trend in capital spendingby semiconductor manufacturers
later in the year

(Billions of yen)

Topics in 2019: Contribution to miniaturization and 3D-integration processes

3D-integration & 3D-NAND

Miniaturization & EUV【Pellicle particle detection system】【Hot phosphoric acid concentration monitor】

 Particle detection
for pellicles ofreticles

 Monitor concentration of hot phosphoricacid in the etching process Contamination-free, direct measurement ofheat solutions

PR-PD3EP2020 Forecast
 Anticipating an increase in sales driven by arecovery in investment by semiconductor
manufacturers
 Concerns over the world situation and its
impact on the economy

CS-620F

Sales and O.P.

O.P.

53.3

57.7
47.1

38.8

15.6

17.0
10.79.62016© 2020 HORIBA, Ltd. All rights reserved.

Sales

2017

2018

2019

52.5

13.52020(F)17

Scientific 2019 Results/2020 Forecast
2019 Results Decrease in sales in Asia due to the economicslowdown Increase in sales of high-value-added
products that meet customer needs, andimprovement in profitability

2020 Forecast
 Anticipating a recovery in demand in Asia
 Will standardize successful cases of productsthat meet customer needs and further improve
profitability
 Making use of synergies between businesssegments to capture new markets

A new product in 2019: LAQUA
Collect feedback from people who
implement water analysis bothwithin and outside Japan
Portable pH/water quality
analyzers for the global market

Aim to increase
global market share

Left: D-200/Right: WQ-300
Sales

Sales and O.P.
25.7

26.1

O.P.

27.7

27.1

29.0

1.0

0.9

0.7
0.4

2016
© 2020 HORIBA, Ltd. All rights reserved.

(Billions of yen)

2017

0.2
2018

2019

2020(F)

18

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Share Holder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

19

Priority Measures of MLMAP2023
MLMAP2023 Slogan “ONE STAGE AHEAD”
1. Market Oriented Business To develop analysis and measurement solutions, utilizing HORIBA’s core technologies, in theleading three business fields of the mega trend

2. Solution Provider Beyond Life Cycle Management
 To support customers’ core businesses from all aspects – from product introduction toreplacement

3. HORIBA Core Values “The Next Stage of Super Dream Team”
 To enhance the organizational structure that fosters resilient human resources, which are thedriving force of all businesses BlackJack Project/Stained Glass Project/HORIBA Premium Value© 2020 HORIBA, Ltd. All rights reserved.

20

Market Oriented Business
Energy&Environment

Accelerate Business in Electrification Area
Global increase in demand for electrified vehicles
Enhance the field of evaluationof fuel cell and power-train systems

Establish a production system that
responds to demand
HORIBA FuelCon’s new facility
Technologiesof HORIBA
FuelConMCT
business

Open the test facility for evaluation of batteries for electrified vehicles “CELL 0”

Fuel cell
evaluation
roomBattery
evaluation
room

Useful in evaluating
electrified vehicles and fuel cells© 2020 HORIBA, Ltd. All rights reserved.

Magdeburg in Germany (architectural rendering)
Construction to be completed at the end of 2021
Total cost: approx. 3.5 billion yen Enable connection from CELL0 up to CELL3
 Total evaluation system "Test in the Loop" Offer value-added measurement solutions

Expand production capacity
Shorten lead times with strategic facilities

Become a center of excellence
for electrification business
21

Market Oriented Business
Energy&Environment

Growing Needs for Environmental Measures【Water monitoring】
Water monitoring system for vessel emission gas scrubber【Gas monitoring】
Air pollution monitoring system

Emission gas regulations targeting vessels(SOx Regulation)

Air pollution such as PM2.5 is a global-wide issue

Monitor intake- and drain-water fromexhaust gas scrubbers
Monitorfor intake
waterSpecify the air pollution source
Identify the causal mechanism

Emission gas

Exhaust gas scrubber
Monitorfor drain
water

Input

Water monitoring system forvessel emission gas scrubber
EG-100Emission
gas

VesselOutputImplement corrective measures
promptly and appropriately【U.S.】
 Air monitoring at several
points, using PX-375 installed
on a vehicle,

PM2.5 analyzer with
automatic sampling
PX-375

Sea water

Respond to globally expanding environmental regulations© 2020 HORIBA, Ltd. All rights reserved.

22Market Oriented BusinessContribute to the entire semiconductor
manufacturing process

Materials&
Semiconductors

Diverse product line-up contributing to the overall semicon manufacturing process
Material assessment

Raman spectrometer

Manufacturing process

Cathodoluminescencemeasurement system

Reticle/mask particle
detection systems

End-point monitor*TypicalproductexampleQuality control &waste water treatment

pH meterIndustrial water
quality analyzer

Ultra-thin Mass Flow Controller (MFC)

New chemical concentration monitor

Gas flow conditions used in a chamber are becoming more complex as
semiconductor devices become increasingly miniaturized and highly integrated

The issue: chemical leakage in the chemical treatment process
Enable measurement ofchemicals delivered throughpiping without touching them

Increase in the number of
MFCs installed in a chamber

Gas box size is limited© 2020 HORIBA, Ltd. All rights reserved.

Ultra-thin Mass Flow Controller“DZ-100” is 3 times thinnerthan existing models

Non-Contact Chemical
Concentration Monitor“CS-900”Exclude factors causing
leaks or contamination

23

Market Oriented Business
Bio&Healthcare

Medical: Expand and Maintain Production BasesJapanFrance

Emerging countries

Renovate the production line at
Aso Plant, HORIBA STEC

Purchase of the land adjacent
to HORIBA ABX

Prepare for the expanding
Medical business

Reinforce adaptation to the global standard

 Establish a base for production, storageand logistics
 Respond to an increase in production
under the partnership agreement withSiemens Healthcare Diagnostics Inc.

India, China
 Strengthen the reagent supplysystem Enhance local production

Strengthen the structure globally to expand business in the focus market© 2020 HORIBA, Ltd. All rights reserved.

24Market Oriented Business
Bio&Healthcare

Contribute to Research in Life Sciences
Analyzers for life sciences

Transmission Raman

Confocal Raman Microscope

Nanoparticle measurement
instrument

Fluorescence analyzer

ViewSizer™ 3000

DUETTALabRAM HR Evolution

 2D analysis of medicinal
elements in pills⇒Analyze therapeutic
drugs for Parkinson’s
disease Label-free cell analysis⇒Evaluate differentiationof ES cells and iPS cells

 Particle distribution
analysis of exosomes**Granular materials, diameter 50150nm, secreted by variouscells

2020 Masao Horiba Awards【Theme】
Research in the field of life sciences, notably state-of-the-art
optical/spectroscopic measurement technologies© 2020 HORIBA, Ltd. All rights reserved.

Analyze interaction between
molecules
 Simultaneous measurement forabsorption and fluorescence spectra⇒Effective in quality control ofvaccines

Support technology development in
the field of cutting-edge drug
discovery and medicine manufacture
25

Solution Provider Beyond Life Cycle Management

To Change to a Solution-proposal Style BusinessAlways with You
Support customers in all waysArchitectural Rendering

Building a new HQ for HORIBA TECHNO SERVICEIntegrate functions and enhance abilities to gather/transmit information
Expand the analysis lab, the maintenance facility and the training
space
MLMAP2023

Maintenance services using
operating data
In the same premises as HORIBA HQ, Kyoto
Construction to be completed in Nov. 2020
Total cost: approx. 3.8 billion yen

Consulting using
measurement data

Integrate equipment sales with high-value-added support

Aim to create a new business to provide data and solutions based on analysis technologies© 2020 HORIBA, Ltd. All rights reserved.

26

Solution Provider Beyond Life Cycle Management

Start construction of a new facility in China
Integrate strengths of all businesses and R&D/production/service functions
Architectural rendering

Automotive testing labs
 Install battery/fuel cell test systems, chassis dynamo, and drive test systems
 Enable tests that combine vehicles/real machines and simulation

Scientific analysis application center Profit from being based in China’s new energy development area
 Collaborate with academia and companies in application development

Manufacturing
 Enhance local engineering and supply capacity for gas and water monitoringsystems
 Establish a production system to supply the semiconductor market in ChinaJiading, Shanghai
Construction to be completed in April 2021
Total cost: approx. 9.0 billion yen

Technical center Provide services according to the product life cycle, from installation to aftersales service

Aim to further expand business in the Chinese market© 2020 HORIBA, Ltd. All rights reserved.

27

HORIBA Core Values “The Next Stage of Super
Dream Team”

A "Super Dream Team" to Embody "Joy and Fun"
Activities to create new value and realize a strong HORIBABlackJack Project

Stained Glass Project

Basis for multi-product low-volume manufacturing
and a global business

Promote diversity as a management strategy

Expand across the entire group

Close contact between thefront-line and top management【BlackJack Project】
HORIBA's unique operational improvement initiative began in 1997 withthe objective of changing the awareness and activities of employees

Aim to be a truly flat organization

Encourage change in awareness and action toachieve both "job satisfaction" and a "comfortableworking environment"
Think about employees' healthcare from themanagement perspective
Issued the "Physical and Mental
Health Promotion Declaration" by
top management and carried out
various activities【Example】
Promote healthmanagement
activities
through meals

Improve productivity and enhance competitivenessHighly evaluated from the ESG investment perspective© 2020 HORIBA, Ltd. All rights reserved.

28

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Shareholder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

29

Shareholder Return
 Dividend payment + Share buyback = 30% of Consolidated net profit to be targeted Remaining earnings are retained internally for strategic investment (i.e. facilities, M&A)

Basic policy

Dividends per share and Share buybacks

Ordinary dividend: 125yen
Commemorative dividend for the65th anniversary of the company
foundation: 20yen 2018 Results 145yen [Interim 50yen/Year-end 95yen] 2019 Forecast 130yen [Interim 50yen/Year-end 80yen] 2020 Results 130yen [Interim 50yen/Year-end 80yen]

Per-share dividend (from 2004 to 2020 Forecast)160

Ordinary Div. (yen)140

Commemorative Div. (yen)Div. Total (yen)Total Return Ratio (%)

44.0%14560.0%2050.0%12035.4%

10019.0%80
60

17.0%
17.0%

18.0%

162832526

2004

2005

2006

40
200

29.0%

20.0%

17.0%

392007

200813172009

2010

26.8%

27.6%

50

40402011

2012

30.0%
116

109.0%
44

28.2%

30.6%

60

67

70

2013

2014

2015

27.4%
125

31.3%

30.0%
130

130
20.0%

85

10.0%
0.0%
2016

2017

2018

2019

2020(F)© 2020 HORIBA, Ltd. All rights reserved.

40.0%

30

Contents
2019 Results2020 Forecasts
Business Segments Outline
Progress of MLMAP2023
Share Holder ReturnOther Topics© 2020 HORIBA, Ltd. All rights reserved.

31

Expand Core Technologies and Contribute to SocietyHORIBA Jobin Ybon IBH received the Business
Innovation Award from the Institute of Physics in the UK Award theme: Development ofFLIMERA, fluorescence lifetime
microscope camera
 Joint development project
members: Prof. Henderson,
University of Edinburgh (backrow, third from left), Prof. Burch,
University of Strathclyde (frontrow, third from left), and others

Montajir Rahman, HORIBA Instruments (US),received the SAE/InterRegs Standards & Regulations
Award 2020 Montajir Rahman (center)obtained a doctorate
degree from a university inJapan Awarded for his work andinvolvement in numerous
regulations and industrystandards related toemissions reduction

Institute of Physics Business Innovation AwardSAE/InterRegs Standards & Regulations AwardAwarding companies which realize successful innovation
utilizing physics

Rewards and encourages engineers' participation instandards and regulations

Fluorescence lifetime microscope camera,FLIMERA Applicable technology in observation of living
cells in the bio and life-science field© 2020 HORIBA, Ltd. All rights reserved.

 SAE (Society of Automotive Engineers): A US non-profit organization
with members who are experts in the mobility field InterRegs: A UK organization which collects information related tovehicle safety and emission regulations and provides such information
online32

© 2020 HORIBA, Ltd. All rights reserved.

33

© 2020 HORIBA, Ltd. All rights reserved.

34