Jan. 25, 2018



Outline1䠊Business Overview of FY2017

2~82䠊Business Forecast of FY2018

9~14

3. Mid-term Management Plan

15~25





Consolidated Financial Highlights of FY2017

FY2017(Billion yen)

FY2016(A)
Net Sales

FY2017(B)Year on Year(䠂) (B) – (A)㸩㸣 㸩

OperatingIncome㸣㸣 

㸩㸣㸩

OrdinaryIncome㸣㸣 

㸩㸣

㸩 㸩Net IncomeConsolidated Financial Data

FY2017(Billion yen)

FY2016(A)

Year on Year(䠂) (B) – (A)FY2017(B)

ROE㸣㸣㸩 SRLQWV

Total Assets

㸩㸦㸣㸧 㸦㸣 㸩㸦㸧㸦㸧 㸩

Facility Investment

㸫

Depreciation andamortization

㸩

Number of Employees(man)





㸩

Exchange rate (USD)(Euro)(RMB)

\HQ
\HQ\HQ

\HQ
\HQ\HQ

\HQGHSUHFLDWLRQ
\HQGHSUHFLDWLRQ

Stockholder's equity(stockholder's equity ratio)

Interest-bearing debt
(Net D/E ratio)

History of Cosolidated Sales and Income

FY2017

Operating Income(Billion yen)

Net Sales(Billion yen)

㻟㻜㻜

㻟㻜

1HW6DOHV
2SHUDWLQJ,QFRPH㻞㻜㻜㻞㻜㻞㻡㻝㻡㻝㻜㻜㻝㻜㻡㻜㻜㻞㻜㻝㻜㻞㻜㻝㻝㻞㻜㻝㻞㻞㻜㻝㻟㻞㻜㻝㻠㻞㻜㻝㻡㻞㻜㻝㻢㻲㼅㻞㻜㻝㻣

Sales by Business Segment and Region
㸺Sales by Business Segment㸼
(Billion yen) 

㻹㼍㼏㼔㼕㼚㼑㻌㼀㼛㼛㼘㼟㻴㼥㼐㼞㼍㼡㼘㼕㼏㻱㼝㼡㼕㼜㼙㼑㼚㼠   㻱㼡㼞㼛㼜㼑 㻭㼟㼕㼍㻔㼑㼤㼏㼑㼜㼠㻌㻯㼔㼕㼚㼍㻕 㻮㼑㼍㼞㼕㼚㼓㼟㻯㼡㼠㼠㼕㼚㼓㻌㼀㼛㼛㼘㼟㻭㼙㼑㼞㼕㼏㼍㻾㼛㼎㼛㼠㼟

㸺Sales by Region㸼

FY2017㻯㼔㼕㼚㼍  㻶㼍㼜㼍㼚  㻻㼠㼔㼑㼞㼟 㻲㼅㻞㻜㻝㻢㻲㼅㻞㻜㻝㻣㻲㼅㻞㻜㻝㻢㻲㼅㻞㻜㻝㻣

Factors for Change in Operating Income䠄 Profit up 䠖11.8䠅
(Billion yen)FY2017

䠄 Profit down䠖 6.8䠅Rise in material price-1.0

Effect ofexchange rate
+1.2

Decrease in Sales price-1.3
Increase in fixed cost and SGA-4.5

Cost reduction+3.2


Operating rate
Improvement+7.4+5.0



㻝㻢㻚㻝

㻝㻝㻚㻝

㻲㼅㻞㻜㻝㻢

㻼㼞㼛㼒㼕㼠㻌㼡㼜㻼㼞㼛㼒㼕㼠㻌㼐㼛㼣㼚㻲㼅㻞㻜㻝㻣



Sales and Operating Income by Business Segments

FY2017(Billion yen)

Others C o m p o n e n t s Machinery&tools

FY2016(A)
Cutting Tools
Machine Tools
RobotsNet Sales
Operating Income䠄㻢㻚㻞䠂䠅

Bearings
Hydraulic Equipment
Net Sales
Operating Income䠄㻠㻚㻡䠂䠅Net SalesOperating Income䠄㻢㻚㻣䠂䠅

Total Net Sales
Total Operating Income䠄㻡㻚㻟䠂䠅FY2017(B)Year on Year(䠂) (B) – (A)㻟㻞㻚㻣㻞㻜㻚㻜㻞㻞㻚㻠㻣㻡㻚㻞㻠㻚㻢㻣㻞㻚㻤㻠㻥㻚㻠㻝㻞㻞㻚㻞㻡㻚㻡㻝㻟㻚㻥㻜㻚㻥㻟㻟㻚㻢㻝㻤㻚㻤㻟㻠㻚㻝㻤㻢㻚㻣䠄㻣㻚㻢䠂䠅㻢㻚㻢㻣㻤㻚㻟㻡㻣㻚㻡㻝㻟㻡㻚㻥䠄㻢㻚㻠䠂䠅㻤㻚㻢㻝㻠㻚㻣䠄㻡㻚㻟䠂䠅㻜㻚㻣㻞㻝㻝㻚㻠㻞㻟㻣㻚㻠㻔䠇㻝㻞㻚㻟䠂㻕 䠇㻞㻢㻚㻜㻝㻢㻚㻝㻔䠇㻠㻠㻚㻤䠂㻕㻌㻝㻝㻚㻝䠄㻢㻚㻤䠂䠅㻔䠇㻞㻚㻤䠂㻕㻌䠇㻜㻚㻥㻔㻙 㻡㻚㻥䠂㻕㻌㻌㻙 㻝㻚㻝㻔䠇㻡㻞㻚㻡䠂㻕㻌 䠇㻝㻝㻚㻣㻔䠇㻝㻡㻚㻟䠂㻕㻌 䠇㻝㻝㻚㻡㻔䠇㻠㻟㻚㻞䠂㻕㻌㻌㻌 䠇㻞㻚㻜㻔䠇㻣㻚㻢䠂㻕㻌䠇㻡㻚㻡㻔䠇㻝㻢㻚㻢䠂㻕㻌䠇㻤㻚㻝㻔䠇㻝㻝㻚㻞䠂㻕㻌 䠇㻝㻟㻚㻣㻔䠇㻡㻢㻚㻜䠂㻕㻌䠇㻟㻚㻝㻔䠇㻡㻚㻢䠂㻕㻌䠇㻜㻚㻣㻔㻙 㻝㻢㻚㻢䠂㻕㻌㻌㻌 㻙 㻜㻚㻝䠇㻠㻚㻥

Consolidated Financial Highlights of FY2018 Plan

FY2018 e(Billion yen)

FY2018
Forecast(B)FY2017(A)Net SalesOperatingIncome㸣  OrdinaryIncome㸣Net Income

Year on Year(䠂) (B) – (A)㸩㸣㸩㸣㸩㸣㸩㸣㸩㸣㸩㸩㸣㸩



Consolidated Financial Data

FY2018 e(Billion yen)

FY2017(A)FY2018
Forecast(B)Year on Year(䠂) (B) – (A)ROE㸣㸣㸩SRLQWV

Total Assets

㸩㸣 㸣 㸩  㸩

Facility Investment

㸩

Depreciation andamortization

㸩

Number of Employees(man)

Exchange rate (USD)(Euro)(RMB)

\HQ\HQ\HQ\HQ\HQ\HQ\HQDSSUHFLDWLRQ

Stockholder's equity(stockholder's equity ratio)

Interest-bearing debt
(Net D/E ratio) Sales by Business Segment and Region
㸺Sales by Business Segment㸼
(Billion yen)㸺Sales by Region㸼㻾㼛㼎㼛㼠㼟㻭㼙㼑㼞㼕㼏㼍 㻯㼡㼠㼠㼕㼚㼓㻌㼀㼛㼛㼘㼟㻹㼍㼏㼔㼕㼚㼑㻌㼀㼛㼛㼘㼟㻱㼡㼞㼛㼜㼑 

 㻭㼟㼕㼍㻔㼑㼤㼏㼑㼜㼠㻌㻯㼔㼕㼚㼍㻕 㻯㼔㼕㼚㼍㻮㼑㼍㼞㼕㼚㼓㼟 

 




FY2018 e 
 㻶㼍㼜㼍㼚㻴㼥㼐㼞㼍㼡㼘㼕㼏㻱㼝㼡㼕㼜㼙㼑㼚㼠  㻻㼠㼔㼑㼞㼟 㻲㼅㻞㻜㻝㻣㻲㼅㻞㻜㻝㻣㻲㼅㻞㻜㻝㻣㻲㼅㻞㻜㻝㻤

Factors for Change in Operating Income䠄 Profit up 䠖7.8䠅

(Billion yen)



FY2018 e

䠄 Profit down䠖 5.9䠅Effect of exchange rate-0.4
Rise of material price -1.0
Decrease in Sales price -0.5
Increase in fixed cost and SGA-4.0

Cost reduction+3.8
Operating rate
Improvement +4.0



+1.9



㻝㻤㻜

㻝㻢㻝



㻲㼅㻞㻜㻝㻣

㻼㼞㼛㼒㼕㼠㻌㼡㼜㻼㼞㼛㼒㼕㼠㻌㼐㼛㼣㼚㻲㼅㻞㻜㻝㻤Sales and Operating Income by Business Segments

FY2018 e(Billion yen)

Others C o m p o n e n t s Machinery&tools

FY2017(A)Cutting Tools
Machine Tools
RobotsNet Sales
Operating IncomeBearings
Hydraulic Equipment
Net Sales
Operating Income
Net SalesOperating Income
Total Net Sales
Total Operating Income

FY2018
Forecast (B)Year on Year(䠂) (B) – (A)㸩 㸩㸣㸩㸣  㸩 㸩㸣 㸩㸩㸣 㸩㸩㸣 㸩㸦㸣㸧 㸦㸣㸧 㸩㸣  㸩㸩㸣 㸩㸩㸣 㸩㸦㸣㸧  㸦㸣㸧  㸩㸣  㸩㸩 㸩㸣㸦㸣㸧  㸦㸣㸧 㸩㸣  㸩㸦㸣㸧㸦㸣㸧

㸩㸣 㸩㸩㸣  㸩History of Cosolidated Sales and Income
Net Sales(Billion yen)

Mid-term Plan
Operating Income(Billion yen)

Long-term VisionNet sales䠖400 billion yen Operating income:60 billion yen㻠㻜㻜

㻠㻜㻜



Management Policy
Becoming a comprehensive machinery manufacturer
with its robotics business at its core.

㻟㻜㻜㻢㻜㻡㻜㻠㻜㻞㻜㻜㻟㻜㻞㻜㻝㻜㻜 㻝㻜㻜㻜㻝㻜㻝㻝㻝㻞㻝㻟㻝㻠㻝㻡㻝㻢㻝㻣

Change of Managemental Environment Mid-term PlanAutomobiles
Shift to EVs & autonomous driving
㸺Automobiles demand forecast(Nachi ' s estimate)㸼

- Electronic motor &deceleration mechanism- Lightweight & comact- Quietness

8,000
6,000
4,000
2017

EVEngine vehicle䞉HV䞉PHV
202020232026Automobiles with internal combustion
engine and transmission will decline

2029

Industrial machinery & manufacturing Expanding demand for automatic andunmanned production line
࣭Shortage of manpower,
low birthrate and longevity
࣭Rising labor wages,
work-style reforms- Shift to robotics- Utilizing IT- Shift from one product to systemNew Mid-term Policy and Overall Strategy ձMid-term Plan

For progress of automobile and manufacturing,

Innovate in manufacturing worldwide
with advanced FA systems and mechatronics.
Robotics technology 㸩 Machining technology 㸩 component&production
technology

䞉Cutting, grinding, forming,lapping䞉Shaping, cutting-off,heart treatment
䞉Degreasing, coating, etc.

䞉Automobile component
䞉Industial machinery component-construction, aircaft, railroads,
electric
䞉Buliding production lines

Providing diverse FA system and solution

New Mid-term Policy and Overall Strategy ղ Mid-term Plan
Expandingbusiness for EVs
Machinery& tools

䞉Machining power train
䞉Machining EPS & brake-Composite Processing
technology-Noise reduction
technology
䞉Power train components

Components

Material

䞉EPS & brakecomponents-low torque and noise
reduction technology
䞉Materials for motor &battery
䞉Lightweight technology

Promoting FA
Producing modelline

Providing robot
and robotic system

䞉Unmanned line
䞉Machine cells
䞉Shortening lines andcycle time
䞉Utilizing IT,
life expectancy

䞉 Machining technology
䞉Cutting, grinding䞉Forming, lapping䞉Shaping, cutting-off䞉Expanding unmannedline for from machining
to assemble
䞉Utilizing IT,
preventive maintenance䞉Component & production
technology-Automobile-Indusrial machinery䞉Expanding unmannedline
䞉heat treatment cells
䞉 Utilizing IT,
preventive maintanance䞉Processing technology-heat treatment,
degreasing-coating, joiningNew Mid-term Policy and Overall Strategy ճNet Sales(Billion yen)

Mid-term PlanAs the milestone to achieve long-term vision

Operating Income(Billion yen)

Target in FY2020

㻠㻜㻜



Net Sales

300 billion yen

Operating Income27 billion yen

Operating Income rate㻟㻜㻜㻡㻜9%
㻞㻜㻜㻢㻜㻠㻜㻟㻜㻞㻜 

㻝㻜㻜

㻝㻜

㻜

㻜㻝㻜㻝㻝

㻝㻞

㻝㻟

㻝㻠

㻝㻡

㻝㻢

㻝㻣

㻝㻤

Business Development (Robot)㻲㼅㻞㻜㻞㻜



Mid-term Plan

Providing high-performance robot and FA system&ROODERUDWLYHURERW㹁㹘
Sales & Development
䞉Utilizing IT and AI.
䞉Launching collaborative robots
and expanding small-sized robots.
-Opening R&D center(Tokyo)
䞉Providing robot cells and FA system.
㹋㹘㸯㸰-Alliance with system integrators.
(North America, China, etc.)-Expanding Technical Centers andService Centers around the world.
Production
7HFKQLFDO&HQWHULQ6KDJKDL䞉Buliding integrated production line with automatic assembly cells.
䞉Establishing production system at the each areawith high demand.
ĺExpanding robotic plants(Japan, China ,etc.).
ĺBuliding new plants for robotics system.
(North America, ASEAN).
3ODQWLQ&KLQD㸦㹌㹈㹇㸧 

Business Development (Cutting&Machine tools) Mid-term PlanProviding high-performance Round Tools and multi-functional&DUELGHGULOOVmachining techonology㸿㹏㹓㸿 㹃㹖Sales& Development
䕿Expanding product lineup of taps,carbide drills and end mills.
-Launching new products made of new material andnew coating ingredient onto the market around the world.
䕿Launching new series of composite processing machine.
-Composite processing machine for components of EVsand small-sized speed reducers (integrated cutting tools with machine).
-Machine cells with robots.
Production
䕿Establishing unmanned production line for Round Tools.
䕿Establishing production system at the each areawith high demand.
-Expanding the plants for Round Tools.
(Japan, China, North America, and ASEAN)
6NLYLQJFXWWHU+\SHU=7DSV,QWHJUDWHGVNLYLQJJHDUVKDSLQJPDFKLQHBusiness Development (Components)

Mid-term Plan

Expanding product lineup of high-performance components for EVs
and industrial machinery
Sales& Development
䕿Developing new products for fuel-efficient cars such as EVs.
-Weight-saving,lower-torque, and low noise bearings%HDULQJVIRUVSHHG
-Electric actuators
UHGXFHU
䕿Expanding product lineup for construction and industrial machinery.
-Constuction machinery: Launching new model-Industrial machinery: Expanding high-pressured equipment,
preventive maintenance-Thin-walled and precision bearings
Production
䕿Establishing automatic production line of bearings.
䕿Enhancing the production system at each areaaround the world with high demand.
-Bearings䠖 Thailand(material and product) and China-Hydraulic equipment and car control valves:
Japan and China+LJKSUHVVXUHSLVWRQSXPS

3ODQWLQ7KDLODQG

Consolidated Financial Data

Mid-term Plan(Billion yen)

FY2017(A)

FY2020Plan (B)Year on Year(䠂) (B) – (A)Net Sales 㸩

OperatingIncome㸣 㸣  㸩

ROE㸣㸣 DQGXS㸩SRLQWVStockholder's equity ratio㸣㸣 DQGXS㸩SRLQWVFacility Investment

 \HDUV WRWDO 

Number of Employees(man)

\HQ
\HQ\HQ

\HQ
\HQ\HQ

\HQDSSUHFLDWLRQExchange rate

(USD)
(Euro)
(RMB)




Sales and Operating Income by Business Segments Mid-term Plan(Billion yen)

Others C o m p o n e n t s Machinery&tools

FY2017(A)Cutting Tools
Machine Tools
RobotsNet Sales
Operating Income
Bearings
Hydraulic Equipment
Net Sales
Operating Income
Net Sales
Operating Income

FY2020Plan(B)

Year on Year(䠂) (B) – (A)㸩 㸩㸣㸩㸣  㸩 㸩㸣 㸩 㸩㸣  㸩㸦㸣㸧  㸦㸣  㸩㸣 㸩 㸩㸣 㸩 㸩㸣 㸩 㸩㸣 㸩㸦㸣㸧  㸦㸣 㸩㸣㸩㸩
 㸩㸣㸩㸦㸣㸧  㸦㸣 㸩㸣

Total Net Sales㸩㸣 㸩

Total Operating Income㸦㸣㸧  㸦㸣㸩㸣 㸩㼔䡐䡐䡌㻦㻛㻛㼣㼣㼣㻚㼚㼍㼏㼔㼕㻙㼒㼡㼖㼕㼗㼛㼟㼔㼕㻚㼏㼛㻚㼖㼜㻛

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.

