Earning Presentation
for Nine months ended December 31, 2023

February 13, 2024

1

Financial Results for 3Q of FY 2023

2

My name is Toshiyuki Furukawa, in charge of the Public & Investor Relations
Department.
I will provide an explanation on the financial results for the third quarter of fiscal 2023.

2

Financial Results for 1-3Q (Apr-Dec) of FY 2023
FY2022（Unit︓billion yen)

FY2023

1-3Q

1-3Q(Apr-Dec)(Apr-Dec)

ResultResultYoY Change
Amount％Net sales

230.1

238.8

+8.7

+3.8%

Operating profit

21.0

23.4

+2.3

+11.3%

Operating margin

9.1%

9.8%

-

-

Ordinary Profit

24.4

27.4

+3.0

+12.4%

19.6

20.6

+0.9

+5.0%

¥135/USD¥143/USD¥140/EUR¥154/EUR

Profit attributable toowners of parent

Exchange rate Net sales

Sales increased, reflecting continuing growth in the mainstay Watches segment

 Operating profit

Profit increased, mainly driven by the Watches segment
3

This is the outline of the statement of income for the third quarter.
Net sales increased 3.8% to JPY 238.8 billion, reflecting strong performance mainly in
the Watches segment.
Operating profit rose 11.3% to JPY 23.4 billion, mainly driven by the Watches segment.
The operating profit margin stood at 9.8%.
Ordinary profit and profit attributable to owners of parent climbed 12.4% and 5.0%
respectively, to JPY 27.4 billion and JPY 20.6 billion.

3

Result by Business Segments for 1-3Q (Apr-Dec) of FY 2023
Net sales

FY2022

FY2023

1-3Q(Apr-Dec)

1-3Q(Apr-Dec)

ResultResult(Unit︓billion yen)

YoY Change
Amount％Watches

117.3

127.2

+ 9.8

＋ 8.4%

Machine Tools

63.3

62.1

( 1.1 )

( 1.9% )Devices and Components

34.1

32.5

( 1.6 )

( 4.9% )Electronic and Other Products

15.2

16.9

+ 1.7

＋ 11.3%

Consolidated Total

230.1

238.8

+ 8.7

＋ 3.8%+ 2.6＋ 16.9%( 0.9 )

( 10.9% )

+ 0.5

-

+ 0.3

＋ 33.7%( 0.2 )-

+ 2.3

＋ 11.3%Operating Profit(Unit: billion yen, %:operating margin)

Watches
Machine Tools
Devices and Components
Electronic and Other Products
Eliminations or general corporate

Consolidated Total

15.7

18.4

13.4%

14.5%

8.4

7.5

13.3%

12.1%

(0.1)

0.4

( 0.5% )

1.3%

0.9

1.3

6.4%

7.7%

(3.9)

(4.2)

21.0

23.4

9.1%

9.8%

4

This list shows financial results by business segment.
The Watches segment continued to perform strongly, achieving an 8.4% year-on-yearincrease in net sales and a 16.9% year-on-year increase in operating profit, or theoperating margin of 14.5%.
The Machine Tools segment posted a 1.9% decline in net sales amid the ongoing
adjustment phase and a 10.9% decrease in operating profit, mainly reflecting thedecrease in net sales and the impact of the higher cost of purchased materials.
Devices and Components recorded a decline in net sales, but moved into the black interms of operating profit.
Electronics and Other Products segment posted an increase in both net sales andoperating profit.

4

Financial Results for 3Q (Oct-Dec) of FY 2023

（Unit︓billion yen)

FY2022

FY20233Q(Oct-Dec)

3Q(Oct-Dec)

ResultResultYoY Change
Amount％Net sales

82.4

85.9

+3.4

+4.2%

Operating profit

8.6

9.8

+1.1

+13.8%

10.5%

11.5%

-

-

7.6

10.0

+2.4

+31.7%

7.0

7.3

+0.2

+3.6%

¥144/USD¥149/USD¥144/EUR¥160/EUR

Operating margin
Ordinary Profit
Profit attributable toowners of parent

Exchange rate5

Next, I will describe the consolidated financial results for the third quarter.
Net sales increased 4.2% to JPY 85.9 billion. Operating profit climbed 13.8% to JPY 9.8
billion, with an operating margin of 11.5%.
Ordinary profit and profit attributable to owners of parent rose 31.7% and 3.6%,
respectively, to JPY 10.0 billion and JPY 7.3 billion.

5

Result by Business Segments for 3Q (Oct-Dec) of FY 2023
Net sales(Unit︓billion yen)

FY2022

FY20233Q(Oct-Dec)

3Q(Oct-Dec)

ResultResultYoY Change
Amount％Watches

43.9

48.7

+ 4.7

＋ 10.8%

Machine Tools

22.4

20.7

( 1.7 )

( 7.7% )Devices and Components

11.2

10.3

( 0.9 )

( 8.5% )Electronic and Other Products

4.7

6.1

+ 1.4

＋ 29.6%

Consolidated Total

82.4

85.9

+ 3.4

＋ 4.2%+ 1.2＋ 18.2%( 0.6 )

( 21.1% )

+ 0.2

-

+ 0.3

＋ 171.7%

+ 0.0

-

+ 1.1

＋ 13.8%Operating Profit(Unit: billion yen, %:operating margin)

Watches
Machine Tools
Devices and Components
Electronic and Other Products
Eliminations or general corporate

Consolidated Total

6.9

8.2

15.9%

16.9%

2.9

2.2

13.0%

11.1%

(0.1)

0.0

( 1.7% )

0.3%

0.2

0.6

4.9%

10.2%

(1.2)

(1.3)

8.6

9.8

10.5%

11.5%

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We are now looking at financial results by business segment for the third quarter.
While Watches and Electronic and Other Products segments achieved growth in net
sales, Machine Tools and Devices and Components segments saw a decline in net sales.
The operating margin of the Watches segment improved by 1 percentage point, to16.9%.
I will provide an overview of each business in the next slide.

6

Watches （Operating Performance)
3Q (Oct-Dec)
 Finished watch sales

A trend toward recovery was seen in the domestic market. Additionally, sales increased as
the European market remained brisk.

 Movement sales

Sales increased due to solid sales of mechanical movements despite sluggish growth ofanalog quartz movements

Net sales (billion yen)

Operating profit (billion yen)

■FY2022 ■FY2023■FY2022 ■FY2023

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7

I will first explain the Watches segment.
Finished watch sales increased mainly because the European market remained brisk,
and also because a modest recovery trend was maintained in the domestic market.
In sales of movements, analog quartz movements did not grow as expected. Even so,
net sales increased because mechanical movements remained firm.

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Watches Net sales growth rate by region
Rate of change year on year

* The rate of change in total sales of CITIZEN brand watches and BULOVA
brand watches only for North America. For other regions, the rate of change
only in sales of CITIZEN brand watches.
* Rate of change based on local currency



Japan

Personal spending recovered only moderately, but sales of ATTESA remained strong.



China

Consumption remains weak, but sales increased thanks to a rise in reaction to the city lockdowns in
the previous year.

Asia (except China)

While sales in Hong Kong were sluggish, inbound demand was firm in Singapore, among othercountries.

America

Sales slightly increased due to the cautious attitude of jewelry chains, department stores, and otherretailers despite strong sales of e-commerce.

EuropeThe TSUYOSA Collection and other mechanical watches led sales, which remained strong.

8

Next, I would like to talk about year-on-year changes in net sales by region on a local
currency basis.
The chart on the left shows year-on-year changes for the third quarter alone.
The red bar shows Japan, where the recovery in consumption was moderate but net
sales increased because core brands such as ATTESA led the overall business.
Light yellow is China, where net sales increased due to the absence of the lockdown in
the previous year, more than offsetting the continued weak consumer confidence.
In Asia, shown in light green, net sales increased due to strong inbound demand in
Singapore, among other countries, more than offsetting the weak performance in Hong
Kong.
In North America, the region indicated by the light blue bar, jewelry chains, department
stores and others showed a cautious attitude toward purchases. Still, net sales
increased due to strong e-commerce sales.
Europe, indicated by the light purple bar, recorded an increase in net sales, led overall
by the strong performance of the TSUYOSA Collection and other mechanical watches.

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Watches: Premium brands
The CITIZEN with a date display, mechanical model Caliber 0210
 The model limits the average daily time gap to between -3 seconds and +5 seconds using thefree-sprung system that excels in long sustainability of time accuracy.
 It features a beautiful layout of wheel train parts, component precision, and detailed finish.

Release date: December 2023
Recommended retail price: 880,000 yen (tax included)
Specific store only model

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I would like to introduce a new product with The CITIZEN, the top-end model of the
CITIZEN brand watches, as our initiative to strengthen our premium brands.
We have released this mechanical model with a date display, which is equippedwith Caliber 0210, a new high-precision mechanical movement.
The model limits the average daily time gap to between -3 seconds and +5 seconds
using the free-sprung system that excels in long sustainability of time accuracy.
Based on the design concept of achieving both high precision and aesthetic merit, thismodel, which is available only at specific stores, features a beautiful layout of wheel
train parts, component precision, and detailed finish.

9Watches: Global brand
PROMASTER The brand’s 35th anniversary: Release of the first full-scale mechanical GMT watch of the brand It is equipped with a function to check time in two different time zones.
 The design is such that the bezel has a curved shape like the body of an airplane to make the
GMT function stand out.

Release date: January 2024
Recommended retail price: 132,000-137,500 yen (tax included)

10

PROMASTER, which we have been strengthening as a global brand, will celebrate the35th anniversary of its establishment this year.
In commemoration of this milestone, we have released the first PROMASTER
mechanical watch equipped with a GMT function.
Equipped with full-fledged GMT for flyers, this watch enables the wearer to check thetime in two different time zones.

10Watches: Topics“CITIZEN FLAGSHIP STORE NEW YORK” opened on Fifth Avenue, New York.


The flagship store of the Citizen Watch Group in North America opened on December 6, 2023.
The store sells one of the world’s largest collections of the core brands of the Group, including BULOVA,
ACCUTRON, Frederique Constant, and Alpina with a focus on CITIZEN.

11In December last year, we opened a flagship store on Fifth Avenue, New York.
The flagship store sells one of the world’s largest collections of the core brands of theGroup, including BULOVA, ACCUTRON, Frederique Constant, and Alpina with a focus on
the CITIZEN brand.
We will promote the appeal of the brand by taking advantage of the location, or Fifth
Avenue in New York, which attracts people from all over the world.

11

Watches: Topics
Passing down of skills and improving technologyReceived a Gold, Silver, and Bronze prizes and Fighting Spirit award in the Watch Repair category of the 61st
Skill Olympics National Tournament.
Technologies are passed down and engineers’ skills are improved through activities for the Skill Olympics as
Manufacture d'horlogerie capable of manufacturing everything from the parts of a watch to assembly andadjustment of a finished watch, all in house.

in the Watch Repair category

CITIZEN WATCH MANUFACTURING CO., LTD.
Gold Prize: Kenta Kawakami
Bronze Prize: Miku Yamazaki

Silver Prize: Mashiro Kobayashi
Fighting Spirit Award: Mana Ito

12

In the Watch Repair category of the 61st Skill Olympics National Tournament that washeld in November last year, our engineer received a Gold prize. Our engineers also won
a Silver and Bronze prizes and Fighting Spirit award.
In the Skill Olympics National Tournament, technicians aged 23 or younger compete to
be No.1 in Japan in skill level in each job category.
Through activities for the Skill Olympics, we endeavor to pass down engineers' skills andimprove our technologies as Manufacture d'horlogerie capable of manufacturing
everything from the parts of a watch to assembly of a finished watch, all in house.

12Machine Tools （Operating Performance)
3Q (Oct-Dec)Domestic sales Sales decreased due to cautious stance on capital expenditures.
Overseas sales Sales decreased due to sluggish Chinese and Asian markets despite strength maintainedby European and American markets.

Net sales (billion yen)

Operating profit (billion yen)

■FY2022 ■FY2023■FY2022 ■FY2023

13

Now, I will provide an overview of the business results in the Machine Tools business forthe third quarter.
Net sales were JPY 20.7 billion, down 7.7% year on year. Operating profit decreased by
21.1％ from the year-ago level, to JPY 2.2 billion.
Domestic sales decreased, despite steady sales for the construction machinery andmedical equipment industries, which was more than offset by cautious stance on capital
expenditures.
Overseas sales decreased overall, despite the solid showing in Europe and the Americas
which was more than offset by the slump in China and Asia.

13

Machine tools

Changes in monthly orders received (units) Rate of change year on year (three-month moving average of the numbers of units in orders received)

Rate of change year on year for 3Q (Quarterly number of units in orders received)● Total（26%)

Orders bottomed out in 2Q and remained stable toward recovery● Japan(58%)

Market remained weak overall, reflecting the spread of a cautious stance on
capital expenditures particularly for automobiles.

● Asia（18%)

Market remained sluggish due to strong uncertainty about the future.

● America(18%)

Medical products supported sales amid an ongoing slowdown in response torising concerns about a recession.

● Europe（8%)

Sales of medical products etc. remained strong despite limited appetite forcapital expenditures.
14This slide shows the status of orders received by region.
The line graph shows the three-month moving average of orders received and thepercentage change year on year.
The table under the graph shows the rates of change year-on-year in the third quarter.
Orders received in total decreased 26% year on year, but were up 24% compared tothe previous quarter.
Orders received bottomed out in the second quarter and have been recovering modestly.
By region, in Japan, orders received decreased 58% year on year, reflecting thecontinuation of generally weak market conditions due to the increase in the number ofcompanies taking a cautious stance on capital expenditures.
Orders received fell 18% year on year in Asia because the market remained sluggish.
In the Americas, orders decreased 18% year on year, despite being supported bydemand for medical products., due in part to the impact of high interest rates.
Orders received in Europe decreased 8% year on year, although sales of medical
products etc. remained strong, reflecting a cautious stance on capital expenditures
given inflation and concerns over an economic slowdown.

14

Devices and Components（Operating Performance)
3Q (Oct-Dec)
Precision components
Sales of auto components and small motors increased.
Sales of precision components decreased overall, affected by slow sales of other components including crystal devices.



Opto-devices
Sales of opto-devices decreased, mainly due to a drop in sales of illumination LEDs.

Net sales (billion yen)

Operating profit (million yen)

■FY2022 ■FY2023■FY2022 ■FY2023

15

I will explain the Devices and Components segment.
Net sales were JPY 10.3 billion, down 8.5% year on year, but we remained the black interms of operating profit.
Sales of auto components were recovering. Sales of small motors increased with therecovery in market conditions across a broad range of areas, including healthcare.
Meanwhile, sales of precision components decreased overall, affected by slow sales ofother components including crystal devices. In opto-devices, net sales decreased year
on year because sales of illumination LEDs, etc. did not recover.

15

FY 2023 Forecasts

16

16

FY 2023 Forecasts
The previous forecast (November 13, 2023) remains unchanged in terms ofthe consolidated performance and dividends forecasts.
FY 2023 Forecasts
FY2023 (11/13 E)

FY2023 (2/13 E)

2H(Oct-Mar)

Full Year

2H(Oct-Mar)

Full YearNet sales

157.1

310.0

157.1

Operating profit

11.4

25.0

Operating margin

7.3%

Ordinary Profit（Unit︓billion yen)

2H(Oct-Mar)

Full Year

310.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

11.4

25.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

8.1%

7.3%

8.1%

-

-

-

-

11.0

28.5

11.0

28.5

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

7.6

21.0

7.6

21.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%¥145/USD¥142/USD¥145/USD¥142/USD¥155/EUR¥153/EUR¥155/EUR¥153/EUR

owners of parent

Exchange rate impact(1 weaker yen, Annual)

USD

EUR

Net sales

+0.9

+0.4

Operating profit

+0.25

+0.2

(Unit︓billion yen)％

Full Year

Profit attributable to

Exchange rate

Change2H(Oct-Mar)

17

With respect to the consolidated performance forecast, there were no changes from thefigures presented on November 13.

17

FY2023 Forecast by Business Segment
The previous forecast (November 13, 2023) remains unchanged.
FY2023 Forecast(11/13 E)

Net sales

FY2023 Forecast(2/13 E)

Change2H(Oct-Mar)

Full Year

2H(Oct-Mar)

Full Year

Watches

87.4

166.0

87.4

Machine Tools

37.5

79.0

Devices and Components

19.8

Electronic and Other Products

Consolidated Total(Unit︓billion yen)％

2H(Oct-Mar)

Full Year

2H(Oct-Mar)

Full Year

166.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

37.5

79.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

42.0

19.8

42.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

12.2

23.0

12.2

23.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

157.1

310.0

157.1

310.0

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

+ 0.0

+ 0.0

-

＋ 0.0%

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

+ 0.0

+ 0.0

-

-

+ 0.0

+ 0.0

＋ 0.0%＋ 0.0%

Operating Profit(Unit: billion yen, %:operating margin)

Watches
Machine Tools
Devices and Components
Electronic and Other Products
Eliminations or general corporate

Consolidated Total

9.4

19.7

9.4

19.7

10.9%

11.9%

10.9%

11.9%

3.9

9.2

3.9

9.2

10.6%

11.6%

10.6%

11.6%

(0.2)

0.2

(0.2)

0.2

( 1.0% )0.5%( 1.0% )

0.5%

1.2

1.9

1.2

1.9

10.0%

8.3%

10.0%

8.3%

(3.1)

(6.0)

(3.1)

(6.0)

11.4

25.0

11.4

25.0

7.3%

8.1%

7.3%

8.1%

18

Forecast by segment also remains unchanged from the previous forecast.

18

This presentation contains forward looking statements that are
based on current expectations and assumptions.
Actual results could differ materially due to risks and uncertainties,
which includes, but not limited to, currency fluctuation andcompetitive activity.

That concludes my presentation.
Thank you for your attention.

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