Business Results for the 1st Half
ended May 31, 2013

July 9, 2013

Contents

1. Overview of FY2013

2-8

2. FY2013 1st Half Results
FY2013 Full Year Forecast

9–21

䠍

Overview

Quarterly Financial Results and Forecast

OperatingIncome(Billions of yen)
㻢Net Sales
50
Net Sales
45.5
Operating Income

41.1 41.6

43.9 43.9 43.2
39.5

37.8

40

43.2

41.3
㻠

3.9

3.9
3.5

3.3
2.8

3.1
2.8
2.5

30

2.2

㻞

2.3

䡚
䡚㻜

20
0
11/1Q

2Q

3Q

4Q

12/1Q

2Q

3Q

4Q

13/1Q

2Q

3Q

4Q

䠎FY2013 1st Half Results & Full Year Forecast

Overview(Billions of yen)

FY2013

FY2012
1st Half

Full Year(rate of increase)

Net Sales(-2.7%)

85.1(-11.7%)[7.0%] 5.9 [6.2%] 10.6 [6.3%] 5.2 [7.4%] 13.0

[6.0%] 5.0(+31.7%)[5.3%] 9.1 [6.5%] 5.3 [6.9%] 12.0(-14.3%)Net Income

175.0(+22.2%)(+5.0%)

Ordinary Income

Full Year(+1.6%)

82.8

172.2

[profit ratio on net sales]

Operating Income

1st Half

2.6

4.5(+30.8%)

2.26.0䠏Overview

Historical Financial Result and Forecast

OperatingIncome(Billions of yen) 20Net Sales250㻺㼑㼠㻌㻿㼍㼘㼑㼟㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㻵㼚㼏㼛㼙㼑200㻝㻡㻚㻡㻝㻢㻚㻣㻞㻜㻠㻚㻤㻣㻚㻢㻝㻠㻣㻚㻞 㻝㻟㻟㻚㻥㻤㻚㻞㻝㻥㻟㻚㻢㻝㻟㻠㻚㻤㻝㻜㻣㻚㻡㻝㻤㻢㻚㻣㻟㻚㻠 㻟㻚㻤㻝㻟㻚㻜15㻝㻣㻡㻚㻜㻝㻣㻞㻚㻞10㻝㻜㻚㻢㻝㻜㻚㻜50㻝㻠㻚㻢㻝㻟㻚㻞

150100㻝㻡㻚㻡㻝㻣㻢㻚㻜㻝㻢㻢㻚㻜5㻝㻡㻤㻚㻤㻝㻠㻢㻚㻢0䕧㻟㻚㻞
䕧50

FY 01

02

03

04

05

06

07

08

09

1011

1213

14

15
䠐

Full-Scale Operations at Chinese New Plant

Overview

䕿NACHI (JIANGSU) INDUSTRIES CO., LTD. (from Feb. ‘13)
Product line䠖Robot, Hydraulic equipment for construction/
Industrial machinery, Car control valves, andPrecision Cutting Tools
Established together with Technical Center
Catch local demands,
by exploiting Showroom and R&D CenterShowroom

R&D Center䠑Overview

Start bearings production in India

䕿 NACHI KG Technology India Pte. Ltd. (began from July ’13)
For the main base of Bearing business in India

Product line䠖
Bearings for industrialmachinery and motor vehicles
For targeting the manufacture of 1 million units per month in FY2015,
Working on customer acquisition, like local motor vehicles makers
and industrial machinery makers
䠒Reconstructing of Overseas Production SystemOverview

Reorganization and Expansion of Main Oversea Plants
Reconstructing of supply chain of bearings and cutting tools
䠘North America䠚䞉Bearings䞉Cutting Tools (precision andround tools)

䠘Shanghai䠚䞉Bearings

䠘Thailand䠚䞉 Bearings

䠘ASEAN䠚䞉Cutting tools and round tools䠓Expand the Products, Lineup

Overview

Hydraulic Equipments for 8-tonConstruction Machine
The demand is increasing in the world
Customer development and Share up
by selling 5equipments set.

Super-high speed robot
䇾SRA Series䇿
Expand the lineup;increasing size type, sliming type,and advanced featured type

Carbide drill “AQUA series”
Expand Sizes, Series, andobtain Market Share䠔䠕Consolidated Financial Highlights of FY2013 1st Half FY2013 1st Half
(Billions of yen)

FY2012FY2013

1st Half (A)

1st Half(B)Net Sales

85.1(profit ratio on net sales)

Increase/Decrease(Proportion)(B) – (A)82.8(-2.7%)-2.3

Operating Income(7.0%)

5.9(6.3%)

5.2(-11.7%)-0.7

Ordinary Income(6.0%)

5.0(6.5%)

5.3(䠇5.0%)+0.2

Extraordinaryincome

00.3

+0.3

Extraordinaryloss

0

1.1

+1.1

2.6

2.2

Net Income(-14.3%)-0.4
䠍䠌FY2013 1st Half

Consolidated Financial Data

(Billions of yen)

FY2012
st1 Half (A)Total Assets

197.1

Stockholder's equity(stockholder's equity ratio)

Interest-bearing debt
(Net D/E ratio)

Increase/Decrease(Proportion)(B) – (A)FY2013
st1 Half(B)
209.6

+12.4

(31.0%)

61.2(33.9%)

71.1

+9.9

(0.8X)

73.5(0.6X)

72.2-1.3

Capacity investment

5.9

6.7

+0.8

Depreciation andamortization

4.9

4.9+0.0

Number of employees

5,834

6,010+176

Exchange rate (USD)

78 yen87 yen(Euro)

104 yen

113 yen

8 yen depreciation
against USD
9 yen depreciation
against Euro䠍䠍FY2013 1st Half

Sales by Region and Market Segment(Billions of yen)

Sales by region

Sales by market

85.1

㻥㻜85.182.8

Europe 4.2

Europe 4.0

America 8.0

America 9.6+19.7%

Asia 18.9

Asia 18.6-1.6%

Japan 53.8

Japan 50.4

-6.3%

㻢㻜㻟㻜㻜

Energy andinfrastructure
15.2

+7.0%

Industrial
machinery /Marketsales 27.1

Industrial
machinery /Marketsales 24.1

-11.1%

Automobiles
43.8

Automobiles
43.5

-0.7%

FY2012
1st Half

FY2013
1st Half

FY2013
1st Half

FY2012
1st Half

82.8

Energy andinfrastructure
14.2

-4.8%

FY2013 1st HalfSales by Business(Billions of yen)1510㻝㻞㻚㻡

CuttingTools
㻝㻟㻚㻞Machine Tools㻝㻟㻚㻡 㻝㻟㻚㻢 㻝㻟㻚㻟Robots㻝㻟㻚㻤㻝㻝㻚㻞㻝㻜㻚㻣㻝㻜㻚㻡㻤㻚㻜50㻡㻚㻡’11-1H-2H’12-1H‘13-2H -1H’11-1HBearings30㻟㻝㻚㻝㻟㻞㻚㻥 㻟㻞㻚㻡 㻟㻝㻚㻜

䠍䠎-2H’12-1H‘13-2H -1H’11-1H㻠㻚㻤

㻠㻚㻥-2H’12-1HHydraulicequipment

㻡㻚㻤

㻢㻚㻢

‘13-2H -1HOther㻟㻜㻚㻟20㻝㻠㻚㻣10㻝㻢㻚㻢 㻝㻢㻚㻜㻝㻡㻚㻤 㻝㻡㻚㻟㻢㻚㻥 㻤㻚㻜 㻣㻚㻠 㻢㻚㻥

0’11-1H-2H’12-1H‘13-2H -1H’11-1H-2H’12-1H‘13-2H -1H’11-1H-2H’12-1H㻢㻚㻠‘13-2H -1H䠍䠏FY2013 1st Half

Sales and Operating Income by Business Segments(Billions of yen)

FY2012
st1 Half (A)(%)

FY2013
1st Half(B)(B)䠉(A)

Machinery & Tools
Net Sales
Operating Income

29.0(9.2%)(8.5%)

2.6

30.7(+5.7%)+1.6

2.6(-2.3%)-0.0

Components
Net Sales
Operating Income

48.6(4.4%)

2.1(4.5%)

45.6(-6.1%)-2.9

2.0(-2.7%)

-0.0

6.4

(-13.5%)

-1.0

0.5

(-49.1%)-0.5

82.8(-2.7%)-2.3

5.2(-11.7%)-0.7

Materials & Others
7.4

Net Sales
Operating Income(15.0%)(8.8%)

85.1

Total Net Sales
Total Operating Income

1.1(7.0%)

5.9(6.3%)

䠍䠐FY2013 1st Half

Factors for Change in Operating Income(Billions of yen)

(Profit up 2.5 billion yen)
(Profit down 3.2 billion yen)㻤㻢

Cost reductions;+1.3

Price down;-1.4

Effect ofexchange rate;+1.2

Effect of Salesand Outputs
reduction; -1.2

-0.7
Billion yen

Raw materials
up;-0.6

㻠

5.9

5.2

㻞

㻜

FY2012
1st half

FY2013
1st half䠍䠑䠍䠒Consolidated Financial Highlights of FY2013 Plan

Forecast of FY2013(Billions of yen)FY2012
Actual (A)Net Sales

FY2013
Forecast(B)172.2(profit ratio on net sales)

Increase/Decrease(Proportion)(B) – (A)

175.0(+1.6%)+2.7

Operating Income(6.2%)

10.6(7.4%)

13.0(䠇22.2%)+2.3

Ordinary Income(5.3%)

9.1(6.9%)

12.0(䠇31.7%)+2.8

Extraordinary
income

0.0

0.4

+0.3

Extraordinaryloss

0.3

1.3

+0.9

4.5

6.0

Net Income(+30.8%)+1.4
䠍䠓Forecast of FY2013

Consolidated Financial Data

(Billions of yen)

FY2012
Actual (A)Total Assets

FY2013
Forecast(B)

187.1

Stockholder's equity(stockholder's equity ratio)

Increase/Decrease(Proportion)(B) – (A)

204.0

+16.8

(33.1%)

61.9(36.7%)

74.8+12.9(0.7X)

60.7(0.6X)

58.5

-2.2

Interest-bearing debt
(Net D/E ratio)

Capacity investment

13.3

10.0

-3.3

Depreciation andamortization

10.1

10.3

+0.1

Number of employees

5,845

6,000+155

Exchange rate (USD)

78 yen102 yen

91 yen
119 yen

13 yen depreciation
against USD
16 yen depreciation
against Euro(Euro)䠍䠔Forecast of FY2013

Sales by Region and Market Segment(Billions of yen)

Sales by region
172.2
Europe 7.9

㻝㻡㻜America 17.6

Sales by market

175.0
Europe 8.5

䠇䠒.䠔%Energy andAmerica 20.5 䠇䠍䠒.䠏% infrastructure
31.0

Asia 36.3

Asia 40.0

Japan 110.2

Japan 106.0

䠇䠕.䠕%Industrial
machinery /Marketsales 54.7

㻝㻜㻜-䠏.䠕%Automobiles
86.5

㻡㻜

㻜

172.2

FY2012
Actual

FY2013
Forecast

FY2012
Actual175.0
Energy andinfrastructure 䠇䠒.䠑%33.0

Industrial-䠔.䠒%machinery /Marketsales 50.0

Automobiles
䠇䠒.䠐%
92.0

FY2013
Forecast䠍䠕Forecast of FY2013

Sales by Business(Billions of yen)

30

CuttingTools㻞㻡㻚㻣20㻞㻣㻚㻝

Machine Tools

Robots㻞㻤㻚㻡㻞㻠㻚㻟㻞㻝㻚㻝㻞㻞㻚㻜㻝㻥㻚㻞

10㻝㻠㻚㻜㻝㻞㻚㻟㻝㻜㻚㻟 㻝㻜㻚㻤㻣㻚㻜0
FY10 111213

FY10 11Bearings
60㻡㻤㻚㻢㻢㻠㻚㻝

1213

FY10 11Hydraulicequipment

1213Other㻢㻟㻚㻢 㻢㻠㻚㻠

4020㻞㻠㻚㻡㻟㻝㻚㻠 㻟㻝㻚㻥 㻟㻞㻚㻥㻝㻝㻚㻜 㻝㻡㻚㻜 㻝㻠㻚㻟 㻝㻟㻚㻞0

FY10 111213

FY10 111213

FY10 111213

䠎䠌Forecast of FY2013

Sales and Operating Income by Business Segments(Billions of yen)

FY2012
Actual (A)FY2013
Forecast (B)Change(%)(B) – (A)Machinery & Tools
Net Sales
Operating Income

62.3(8.8%)

5.5(9.6%)

64.5(+3.4%)+2.16.2(+12.6%)+0.6

97.3(+1.9%)+1.7

5.4(+80.5%)+1.9

13.2(-8.0%)-0.8

1.4(-15.3%)-0.1

175.0(+1.6%)+2.7

13.0(+22.2%)+2.3

Components
Net Sales
Operating Income

95.5(3.6%)

3.4(5.5%)

Materials & Others
Net Sales
Operating Income

14.3(11.5%)

Total Net Sales
Total Operating Income

1.6(10.6%)

172.2(6.2%)

10.6(7.4%)

䠎䠍Forecast of FY2013

Factors for Change in Operating Income(Billions of yen)

(Profit up 7.1 billion yen)
(Profit down 4.8 billion yen)Fixed costs,
sales overhead, etc;-1.9

Cost reduction; +3.0

Price down; -1.9

㻝㻡㻚㻜Raw materials up; -1.0

Effect of exchange
rate; +3.0

+2.3
Billion yen

Improved operating
capacity; +1.1

㻝㻜㻚㻜

13.0
10.6

㻡㻚㻜

FY2012
ActualFY2013
Forecast

Forecast of FY2013

Historical Financial Result and Forecast

Operating
Income(Billions of yen) 㻞㻜Net Sales
250
㻺㼑㼠㻌㻿㼍㼘㼑㼟㻻㼜㼑㼞㼍㼓㼕㼚㼓㻌㻵㼚㼏㼛㼙㼑200

㻝㻡㻚㻡㻝㻢㻚㻣

㻝㻠㻚㻢㻞㻜㻠㻚㻤㻣㻚㻢㻝㻠㻣㻚㻞 㻝㻟㻟㻚㻥㻤㻚㻞㻝㻥㻟㻚㻢㻝㻟㻠㻚㻤㻝㻜㻣㻚㻡㻝㻤㻢㻚㻣㻟㻚㻠 㻟㻚㻤㻝㻟㻚㻜㻝㻡㻝㻣㻡㻚㻜
㻝㻣㻞㻚㻞

㻝㻜

㻝㻜㻚㻢

㻝㻜㻚㻜

50

㻝㻡㻚㻡㻝㻟㻚㻞

150

100

䠎䠎

㻝㻣㻢㻚㻜㻝㻢㻢㻚㻜㻡㻝㻡㻤㻚㻤㻝㻠㻢㻚㻢㻜䕧㻟㻚㻞䕧㻡

0

FY 0102030405

06070809101112131415䠎䠏http://www.nachi-fujikoshi.co.jp/

These materials describe our future earnings forecasts and business plans,
and are based on the assumption of an economic environment andbusiness policies that remain fixed as they are now. Therefore, please
note that actual earnings are subject to numerous factors, including
market fluctuations and currency fluctuations, which may result in adifferent earnings forecast.