First Quarter FY2019

Financial Results
USHIO INC.
July 31, 2019
This report contains forward-looking statements, including earnings forecasts,
which are based on information currently available to the Company and on certain
assumptions deemed to be reasonable. Please be advised that actual results may
differ substantially from those forward-looking statements due to various factors.
* All figures in the material have been rounded down to the nearest billion yen.

* FY2019 starts from April 1st, 2019 through March 31st, 2020.

1Q FY2019 Overview■ YoY 1Q for FY2019 (Result):Causal Analysis on Net Sales and Earnings Decreased■ YoY for FY2019 (Full-year Forecast)：
Reasons on Financial Result Forecast Remained unchanged
Initial Annual Forecast:
Net Sales: 170.0 billion yen Operating Income: 10.0 billion yen© Copyright 2018 Ushio Group. All Rights Reserved.

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2

AgendaI. Financial Results for 1Q FY2019
II. Forecasts for FY2019
III. Supplementary Information© Copyright 2018 Ushio Group. All Rights Reserved.

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Highlights of Financial Results for 1Q FY2019
Net Sales down 2.6% year on year to ¥38.9 billion
Operating Income down 15.3% year on year to ¥2.1 billion
Achievement Rate to Initial Plan: Net Sales 22.9％ Operating Income 21.5％

Net Sales：38.9 billion yen (▲1.0 billion yen YoY, ▲2.6%)
売上高： 1,651億円（前年比▲83億円、▲4.8%）

Light Source Business：

Imaging Equipment Business：- Demand for lamps decreased due to conversion to solid-state light sources- Semiconductor・FPD market slowdown- Digital Cinema Projector sales decreased

営業利益： :85億円（前年比▲16億円、▲16.1%）
OperatingIncome2.1 billionyen (▲0.3 billion yen YoY, ▲15.3%)
Operating Income decreased due to lower sales
親会社株主に帰属するProfit
Attributable to Owners of Parent : 1.2 billion yen(▲1.0 billion yen YoY, ▲44.5%)
FOREX sensitivity: Amount of impact from 1 yen fluctuations (full-year)*FOREX FY2019_1Q : 1US＄ = 111 yen
against USD© Copyright 2018 Ushio Group. All Rights Reserved.

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Net Sales

Operating IncomeApprox.￥1.0 billion

Approx. ￥0.15 billion

4Summary of Financial Results(billion yen)FY181Q

YoY

FY19１Q

Changes％

39.9

38.9

▲1.0▲2.6

Operating Income

2.5

2.1▲0.3▲15.3

Operating Income (%)

6.4

5.5

▲0.8P－Ordinary Income

3.9

▲0.9

▲24.7

Profit Attributable toOwners of Parent

2.2

2.9
1.2

▲1.0▲44.5

EPS (yen)

17.67

10.02

▲7.65

▲43.3

USD108111＋3-

EUR

130124▲6-

Net SalesForex (yen)© Copyright 2018 Ushio Group. All Rights Reserved.

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5YoY Variation Analysis of Operating Income(billion yen)

2.5+0.1▲0.８+0.3

Forex

2.1+0
Light Source Equipment Business（based on Gross Profit）
Business（based onGross Profit)

OthersImaging Equipment ▲0.1
Optical Equipment +0.1

▲0.3 billion yen
Operating Income
FY18_1Q

Operating Income
FY19_1Q

Note: Figures for “Light Source Business (based on Gross Profit) to “Others” exclude Forex impact.
© Copyright 2018 Ushio Group. All Rights Reserved.

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Financial Results by Business Segments(billion yen)

+0.8+4.00.00.0+0.0－0.00.4+0.4P－

17.3

15.4

▲1.8

▲10.6

Operating Income

2.5

1.9▲0.6▲24.2

Operating Income（%）

14.8

12.5

▲2.3P

－

Net Sales

0.7

0.7

▲0.0▲9.3

Operating Income

0.00.0

▲0.0

▲24.6

3.0

2.5

▲0.5P

－

▲0.0

0.1

+0.1

－

Operating Income

Net Sales

OthersOperating Income（%）

Eliminationand corporate％

22.7

Operating Income（%）

Light
Sources

Changes

21.8

Net Sales

Equipment

YoY

FY191QFY181Q

Operating Income

Sales Allindicatessales to当社の事前承諾なく、unaffiliated customers.
Operating income ratio indicates the ratio of operating income against sales to unaffiliated customers.
© CopyrightNote：Net
2018 Ushio Group.
Rights Reserved.
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7Business Segment Overview
Equipment Business
NetSales（billion yen）
（億円）

21.8
0.3

22.7
0.3

13.3

OpticalEquipment

7.6+0.8 billion（+4.0%）

Light Source Business
Net Sales（billion yen）

17.3

15.4

▲0.0 billion（▲3.5%）

Imaging
Equipment

13.7

YoY

8.9

▲0.4 billion（▲3.1%）

14.4（+17.2%）

FY19_1Q

FY18_1Q

Note：Net sales indicates sales to unaffiliated customers.
© Copyright 2018 Ushio Group. All Rights Reserved.

▲1.8 billion（▲10.6%）

Discharge
Lamp

12.8

▲1.6 billion（▲11.1%）+1.3 billion

2.8
FY18_1Q

YoY

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HalogenLamp

2.6▲0.2 billion（▲8.1%）

FY19_1Q

8

Business Environment and Business Segment Overview
BusinessField

Business Environment
Semiconductors- and Electricalcomponents-related markets

Electronics
Field

・Solid demand for electronic devices（Smartphone, automotive application, etc.)
・Investment and operation slowdown in semiconductor
and print circuit board・New demand increased for next generation packaging

FPD-related markets
・Large-size panel: continuous investments in LCD
market in China
・OLED: continuous control on equipment investment
・Middle-size panel (LCD・OLED): operation slowdown

VisualImaging
Field(YoY：Cure Equipment: +64%

Cinema: ▲9%・Solid demand for OA products

Lamps for cinema: ▲21%・Price dropped due to intensified competition
・Expansion of extended lamp usage

General Imaging: +3%

Lamps for data projectors: ▲18%・Sales increased of RGB projector forentertainment market

・Lamp demand decreased due to conversion
to solid-state light sources

ーImpact of U.S.-China trade friction© Copyright 2018 Ushio Group. All Rights Reserved.

UV Lamps: ▲12%・Solid demand for large size LCD panels・Operation slowdown for OLED,
semiconductor and print circuit board

・Demand increased of LCD-related equipment
for large-size panel
・Demand decreased for photo-alignment
equipment
・DCP sales number decreased
・RGB laser projector ratio gradually increased

・Solid demand for visual imaging
・Expansion of laser projectors

Discharge Lamp▲11.1％、Halogen Lamp▲8.1％)

UV Equipment: ▲1%・Solid demand for projection lithographyequipment in electronic devices
・Demand decreased for direct Imaging
exposure systems

・Installation slowdown of new movie theaters
・Expansion of laser projectors

General Imaging field

Light Source Business(YoY： Optical equipment＋17.2％,Imaging equipment▲3.1％)

Cinema field

OA field

OverallEquipment Business

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Lamps for OA: +2%
・Demand increased for value added
environment-friendly lamps

Minor Impact

9I. Financial Results for 1Q FY2019
II. Forecasts for FY2019III. Supplementary Information© Copyright 2018 Ushio Group. All Rights Reserved.

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10Full-year Forecasts
Remain unchanged
FY191Q(billion yen)

FY19
Initial Forecast

Achievement Rate(%)

38.9

170.0

22.9

Operating Income

2.1

10.0

21.5

Operating Income (%)

5.5

5.9-

Ordinary Income

2.9

12.0

24.8

Profit Attributable toOwners of Parent

1.2

11.5

10.9

EPS（yen）

10.02

94.17

10.6

ROE（％）-

5.4-

Dividend per share（yen）-50-

Payout Ratio（％）

-

53.1-

USD

111110-EUR124

125-

Net SalesForex（yen）© Copyright 2018 Ushio Group. All Rights Reserved.

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11

Net Sales by Sub-segment / Comment on after 2Q
FY19(billion yen)

Initial plan

Equipment
Light Sources
Othe
rsAchievement
Rate（％）

Comment on after 2Q

Imagingequipment

59.0

13.3

22.6

Shipping for large-scale projects starts from 2Q

Opticalequipment

40.0

8.9

22.4

Acceptance inspection of latest IC package
board projects will be in 2H

Illuminationand others

2.00.3

18.8

101.0

22.7

22.5

Sub-totalNetSales

FY191Q

Dischargelamps

54.0

12.8

23.8

・Recovery of semiconductor- and middle-small
size panel markets will be after FY20
・Demand decrease of lamps for cinema is
within expectation

Halogen lamps

11.5

2.6

23.0

Lamps for OA field is solid

Sub-total

65.5

15.4

23.6

3.5

0.7

20.6

170.0

38.9

22.9

Machinery forindustrial use
and otherTotal© Copyright 2018 Ushio Group. All Rights Reserved.

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12FY2019 Growth DriverImaging Equipment

New RGB laser projector sales expansion

CinemaGeneral Imaging

Order expansion of various projectors
with RGB laser

Order expansion of D4K40 with RGB laser for
general imaging

Christie RealLaser projector

Christie D4K40-RGB

Orders from leading cinema chain companies
Huaxia Film, Cinema21, Cineworld and more
※Cineworld newly installation（slide #24）

• Expo 2020 Dubaiwith more than 250 projectors• Amusement parks and more

Exposure equipment new demand expansion
Optical
露光装置の新規需要増加
光学装置Equipment
Large Field Stepper

Roll to roll Lithography Tools（UX-5 series）（UFX series）

Increase demand for servers
for data centers with high-capacity
and high-speed data processing
due to IoT evolution→ New demand increase
for latest IC package board© Copyright 2018 Ushio Group. All Rights Reserved.

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Increase demand fornarrow framed displays andOLED used for smartphones→ New demand increase
for flexible circuit board

13

Shareholder Returns

Share Buyback
As per notice concerning status of purchase of treasury shared in December 2018
Announcement on Dec. 20th, 2018（as of June 30 th, 2019）

Max 10 billion yen(Max 8 million shares)

From Dec. 21, 2018 to Dec. 20th, 2019

Total amount of shares purchased： 4.64 billion yen
progress：about 46%
Dividend per share（FY2019 plan）

50 yenpayout ratio：53.1％© Copyright 2018 Ushio Group. All Rights Reserved.

Shareholder return policy
Ushio always recognizes that profit return to shareholders is oneof the most important duties as a listed company. The basic
policy is to return profits to shareholders in a stable andconsistent manner. Ushio purchases own treasury shares, taking
flexible approach. We retain our treasury shares of approximately
5% of the total number of issued shares at maximum and cancel
the excess portion of the treasury shares in each year.

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14

I. Financial Results for 1Q FY2019
II. Forecasts for FY2019
III. Supplementary Information© Copyright 2018 Ushio Group. All Rights Reserved.

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15

Reference: Summary of Quarterly Financial Results
FY18(billion yen)

FY19

FY19

FY18

FY19

1Q - 1Q

1Q

2Q

3Q

4Q

1Q

39.9

42.6

39.742.7

38.9

▲1.0

▲2.6▲3.8▲9.0

Operating Income

2.52.8

1.5

1.6

2.1

▲0.3

▲15.3+0.5+34.1

Operating Income
Ratio (%）

6.4

6.6

3.9

3.8

5.5

▲0.8P－+1.8P－

Ordinary Income

3.9

3.2

2.2

1.9

2.9

▲0.9

▲24.7+1.0+53.2

Profit Attributable toOwners of Parent

2.2

1.2

2.1

5.6

1.2

▲1.0

▲44.5

▲4.3

▲77.8

EPS（Yen）

17.67

9.79

16.97

44.54

10.02

▲7.65

▲43.3

▲34.52▲77.5

USD108111113110

111＋3－+1－EUR

130129130126124▲6－▲2－Net Sales

Forex (Yen)© Copyright 2018 Ushio Group. All Rights Reserved.

Changes

FY181Q - 4Q

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％

Changes％16

Reference: Summary of Quarterly Financial Resultsby business segments
FY18(billion yen)

1Q

FY192Q

3Q

4Q

1Q

FY19

FY18

FY19

1Q - 1Q
Changes

FY181Q - 4Q％

Changes％

Equipment Business
Net Sales

21.8

24.8

21.9

26.0

22.7

+0.8＋4.0

▲3.3

▲12.7

Operating Income

0.00.1▲0.4▲0.00.0+0.0－+0.1－Operating Income Ratio（%）

0.00.7▲2.1▲0.10.4+0.4P－+0.5P－

Net Sales

17.3

17.2

17.1

15.5

15.4

▲1.8▲10.6▲0.0▲0.4

Operating Income

2.5

2.3

1.8

1.6

1.9

▲0.6

▲24.2+0.2+17.4

Operating Income Ratio
（%）

14.8

13.4

10.8

10.6

12.5

▲2.3P

－+1.9P－

Net Sales

0.7

0.6

0.7

1.1

0.7

▲0.0▲9.3

▲0.4

▲39.1

Operating Income

0.0

0.0

0.0

0.00.0

▲0.0

▲24.6

▲0.0

▲36.9

Operating Income Ratio（%）

3.03.6

3.6

2.4

2.5

▲0.5P

－+0.1P－Light Source BusinessOthers© Copyright 2018 Ushio Group. All Rights Reserved.

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17

Reference: Sales Ratio by region
Others1.0%

FY18_1Q
Net Sales
39.9
billion yen

FY19_1Q
Net Sales
38.9
Billion yen

JapanNorth America

Asia

Europe

21.3%

27.2%

41.0%

9.5%

Japan

North America

Asia

Europe

20.8%

23.7%

45.7%

8.9%
Others0.9%© Copyright 2018 Ushio Group. All Rights Reserved.

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18

Reference : R&D Expenses/
Capital Expenditures, Depreciation and Amortization
R&D Expenses（billion yen）
Ratio of R&D Expenses to net sales (%)

Capital Expenditures (billion yen)
Depreciation and Amortization (billion yen)

10.66.3

5.7

6.2

6.1

6.8

10.2
7.9

6.4

6.5

6.7

6.7

8.5
6.7

5.0
11.2

FY15

9.8

FY16© Copyright 2018 Ushio Group. All Rights Reserved.

10.6

FY1710.1

11.51Q
Result1Q
Result2.5

2.5

FY18

FY19
FY19Plan計画

FY15

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FY16

FY171Q
Result1Q
Result2.1 1.6

2.0 1.7

FY18

FY19
FY19Plan計画19Reference: Balance Sheet◆Assets
306.6

Changes

291.2

85.6

70.9

39.4

38.9

62.4

61.3

8.1

8.1

43.0

43.5

63.4

64.7

2019/3

2019/6

4.4

306.6

▲15.3

21.6

▲14.7 Cash and Bank Deposits

47.9▲0.5 Marketable Securities

23.8▲1.1 Notes and AP▲6.4 Other Current Liabilities+1.1 Long-term Liabilities

24.9▲1.0 Inventories+0.0 Other Current Assets
Property, Plant and+0.4 Equipment
Intangible Assets+1.2 Investments and OtherAssets

2019/3

2019/6

Receivable-trade

3.0

3.0Inventories

4.24.8© Copyright 2018 Ushio Group. All Rights Reserved.

291.2
20.5
41.4

Changes▲15.3▲0.8 Notes and AR (Trade)

3.5●Turnover (month)(billion yen)

◆Liabilities/Total Net Equity(billion yen)

213.2

204.3

2019/3

2019/6●Equity Ratio (%)

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▲8.9 Total Net Equity

2019/3

2019/6

69.5

70.1

20

Reference: Cash Flow(billion yen)
Operating CF + Investing CF▲0.7+2.7

66.0

Operating CF + Investing CF▲4.0▲3.474.6▲2.5

Operating Investing
Activities Activities+0.863.5

Financing Effect ofActivities exchange
rate change▲4.2＋0.2▲7.3

Operating Investing
Activities Activities▲1.062.1

Financing Effect ofActivities exchange
rate change

Cash and cash
equivalents at
beginning ofperiod

Cash and cash
equivalents at
end of period

FY18_1Q© Copyright 2018 Ushio Group. All Rights Reserved.

Cash and cash
equivalents at
beginning ofperiod

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Cash and cash
equivalents at
end of period

FY19_1Q

Reference: Features of USHIO Group’s Light Sources
Laser
Light Source

RGB Laser
CP2309-RGB
CP4330-RGB

CinemaLumen (lm)<40,000

GeneralImaging

Lamp

LaPH

Xenon Lamp

SuperHigh-Pressure
UV Lamp

CP2308

No Lineup

Lumen (lm)<45,000

No Lineup

D4K40-RGB

CrimsonGS Series

RoadieBoxer

Lumen (lm)<40,000

Lumen (lm)<30,000

Lumen (lm)<45,000

Lumen (lm)<30,000

Price

Medium－High

MediumMediumLow

LifeLong

MediumMedium－High*

Medium*Color

★★★

★

★★

★ or ★★

** Lamp replacement is necessary. Some lamp projectors、Mercury Lamp for general projection,
Xenon Lamp for Cinema, may have longer life than LaPH projector.
© Copyright 2018 Ushio Group. All Rights Reserved.

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22

Release：Received First Acceptance of EUV Light Sourcefor Mask Inspection to EUV Lithography Mass Production Process
Accelerating EUV Business by highly recognized performance in the R&D Equipment
USHIO INC. announced that the company has received the first acceptance of the EUV light source for mask
inspection equipment used in an EUV lithography mass-production process (hereinafter “EUV light source”) on July.

EUV lithography technology is indispensable to the manufacturing process of more highly integrated nextgeneration semiconductor devices, and major device manufacturers are verifying the practical use of thetechnology. Meanwhile, the mask inspection with EUV light source to detect defects in high-precision masks
must be implemented in order to establish an EUV lithography mass-production technologies.
USHIO has been conducting research and development of the high-brightness EUV light source and has improved
the performance and reliability by providing research and evaluation service using USHIO’s high-brightness laserassisted discharge-produced plasma (Sn LDP) EUV light source※ in the EUV exposure and analysis facility (“EBL2”)of the Netherlands Organization for Applied Scientific Research (“TNO”) from March 2017.
In addition to the activity in TNO, this acceptance had been made by the high performance achievement of the EUV
sources previously delivered and currently operated for inspection tool development at an inspection equipment
manufacturer. This high-brightness EUV light source enables “actinic” mask inspection for EUV lithography that isrequired for next-generation semiconductor mass-production process.
※ SnLDP（Laser-assisted discharge-produced plasma EUV light sourceThis method retrieves EUV light by evaporating the tin on the electrode with laser trigger and exciting the evaporated tin with the dischargeproduced plasma. This method is characterized by higher intensity and more space saving compared to the LPP/Sn method, which retrieves EUV
light by exciting the tin that produces plasma with laser, and the DPP method, which retrieves EUV light by exciting the xenon with the dischargeproduced plasma.

Release : https://www.ushio.co.jp/en/news/1002/2019-2019/500468.html (released on July 17th, 2019)© Copyright 2018 Ushio Group. All Rights Reserved.

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23

Release / Installation Example： RGB Laser Projector
Cineworld acquires more than 1,000 RGB pure laser cinema projectors
Cineworld group*, the world’s second largest cinema chain, has signed an agreement to acquire
more than 1,000 of Christie’s next-generation, RGB pure laser cinema projectors featuring
Christie RealLaserTM illumination technology, beginning with rollout to Regal screensin the United States.
*Cineworld operates almost 9,500 screens across 10 territories in Europe and U.S.

Christie offers various RGB laser projectors for from small screens to Premium LargeFormat (PLF) and supports one-stop shopping for replacement demands for cinema
complex with various size screens.
Release : https://www.christiedigital.com/en-us/about-christie/news-room/pressreleases/cineworld-to-acquire-more-than-1000-christie-rgb-lasers (released on June 18th, 2019)

Christie RGB laser projectors were installed to newly opened
cinema complex in TokyoOn July 19th, big cinema complex Grand Cinema Sunshine (hereinafter, GCS),
which has 12 screen, such as, 「IMAX® Laser」 theater and 「4DX with Screen X」 theater,has opened in Japan. GCS is the first cinema complex to install laser projectors in allscreens and Christie’s RGB laser projectors are installed in 11 screens.
Xebex, a wholly-owned subsidiary of USHIO Inc., installed cinema systems, such as,
RGB laser projectors, screens, sound related products, cinema servers and so on.

© Copyright 2018 Ushio Group. All Rights Reserved.

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24

Glossary
DCP

Digital Cinema Projector

EUV

Extreme Ultraviolet Radiation

FPD

Flat Panel Display

IoT

Internet of Things

OA

Office Automation

OLED

Organic Light Emitting Diode

PLF

Premium Large Format

RGB

Red Green BlueUVUltraviolet© Copyright 2018 Ushio Group. All Rights Reserved.

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25

© Copyright 2018 Ushio Group. All Rights Reserved.

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