Financial Results forQ2 FY2024
September 6, 2024

Sanden Corporation© 2024 SANDEN CORPORATION

Financial Results for Q2 2024
1. Key points of Q2 financial results
2. Sales by Segment
3. Variance analysis from the previous year
4. Key Indicator Trends
5. Consolidated Balance Sheet
6. Status of Activities under
the Medium-Term Business Plan
１６

© 2024 SANDEN CORPORATION

１．Key points of Q2 financial results

Sep. 6, 2024
Sanden Corporation［ Revenue ］

1

While global vehicle production in the second quarter was broadly in line with the previous year, demand in Europe, our main market, waslower than in the previous year.
Revenue increased by ¥6.7 billion year-on-year. Excluding the impact of foreign exchange rates, which was +¥8.5 billion, revenue decreasedby 1.8 billion yen.
In China, sales remained strong, including for EV vehicles, and in Asia, sales to local OEMs grew, and sales continued to increase. In theAmericas, sales decreased, particularly for the aftermarket, and in Europe, sales decreased excluding the impact of exchange rates due to anincrease in imported EVs and a decrease in demand for trucks due to the economic slowdown.

［ Profit ］

2

Sales were sluggish, while raw material costs were on the rise, and we continued to negotiate prices to mitigate this impact. In Asia, we
achieved productivity improvements and cost reductions by increasing the capacity utilization rate as sales increased. Operating profit
increased by ¥1 billion year-on-year. Regarding the increase in logistics costs, the decrease in volume, and the deterioration in productmix, in addition to cost reductions and SG&A and productivity improvements, there was also an impact from foreign exchange rates, andthere was an improvement compared to the previous year. However, the increase in profit was reduced due to the allocation of profits togrowth investments. Net income increased by 800 million yen, and a profit of 500 million yen was secured, compared with a loss in theprevious year.
EBITDA was 4.7 billion yen, an increase of 2.7 billion yen from the previous year, mainly due to the increase in ordinary income.

［ Measures ］

3Strengthened and implemented measures to respond to environmental changes that became evident
in the first quarter. Negotiated prices and reduced costs in response to rising fuel and raw material
costs due to the continued depreciation of the yen. Reduced air and ocean freight costs in response tolonger lead times for shipments to Europe due to the Red Sea crisis.
© 2024 SANDEN CORPORATION

3/19

１． Key points of Q2 financial results
Overview of Consolidated Financial Results[Unit：¥100M]

Year-on-YearFY2023

FY2024Jan – Jun 2023

Jan – Jun 2024

Revenue

Difference

Rate ofChange

Sep. 6, 2024
Sanden Corporation
Periodover-PeriodFY2023
Jul – Dec 2023

Difference

875

942

677.7％

918

24869934

657.5％

911

2358360.0%

71

Operating profit△44△3410－△6632

Equity in net income of affiliates

252616.5%

197Exchange

1522752.7%△1841

Ordinary profit△101424－△7488

Net Income Attributableto Owners of the Parent△358－△3035EBITDA

194727140%

△4289

US＄

¥135

¥152

¥17

¥146

¥6EUR

¥146

¥164

¥19

¥158

¥6

AutomotiveComponents

Other

Exchange*Actual results are rounded off to the nearest 10 million yen.
*Exchange rate: Market average rate© 2024 SANDEN CORPORATION

4/19

２． Sales by Segment: by Region

Sep. 6, 2024
Sanden Corporation
Regional Composition

Sales: ¥93.4 B +¥6.5 B (+7% year-on-year)

JapanAsia（Exchange rate impact was +85）

7%19%

※Automotive segment only. Excludes other businesses.

A decline in demand for EVs
Weak truck market[Unit：¥100M]+20332400352
40200

ExchangeRate
ImpactAmericas

Growth for local OEMs
Growth in China for EVs

Growth in OEM andconstruction machinery

Increase in electric vehicles
Decrease in aftermarket and forLatin America

349+3538525300200Exchange
RateImpact

360

312
100100400

400

300

300

200

200

100+1%
69+1

Jan – Jun2024

0© 2024 SANDEN CORPORATION

Jan – Jun
2023

0Jan – Jun
2024

5/19

Jan – Jun
2023

+6%
119

70+7127100

4 Exchange

66
Jan – Jun
2023

AmericasJapan+10%

300

014%

China/Asia Area

+6%
400

Europe22%

ChinaEurope Area

38%

Jan – Jun
2024

Rate
Impact14 Exchange

113
0

Jan – Jun
2023

Jan – Jun
2024

Rate
Impact２． Sales by Segment: by ProductSep. 6, 2024
Sanden Corporation

Product Composition

Sales: ¥93.4 B +¥6.5 B (+7% year-on-year)

EC22%MC（Exchange rate impact was +85）

2% ITMS

51%※Automotive segment only. Excludes other businesses.

25%HVACECITMSHVACEU Truck Market Slowing Down

ECH and new energy vehicles
are driving sales growth.

MCIncreased demand in China andother parts of Asia

Increase in sales of PXcompressors[Unit：¥100M]

+9.3%

500

500

500

400

400

400

300

300

▲1.8%300

209

▲3206
200

100

100

Jan –Jun
2023

＋11%

433

+41474400+242000500

Jan –Jun
20240© 2024 SANDEN CORPORATION

208232300+16%200

200

+3100

100

19
Jan –Jun
2023

220Jan –Jun
2024

6/19

Jan –Jun
2023

Jan –Jun2024

0Jan –Jun
2023

Jan –Jun2024

３．Variance analysis from the previous year: EBITDA

Sep. 6, 2024
Sanden CorporationComparison with the first half of 2023

2023

2024

Difference

Sales

875

942+67

EBITDA

1947+28

Significant improvement over the previous year
⚫ Profitability has improved over the previous year as a result of cost reductions, productivity
improvements, and reductions in SG&A expenses⚫ On the other hand, there was an increase in logistics costs due to the Red Sea crisis and airfreight (▲0.3%)⚫ Growth investments for the future are also increasing.
[Unit：¥100M]
単位：億円

70+3060

4750

▲1440

R&D▲14+53020

1019+0▲2+1+3+2▲10© 2024 SANDEN CORPORATION

7/19+4［Reference］ New Mid-Term Business Plan “SHIFT2028”

Sep. 6, 2024
Sanden Corporation

From a component supplier to a “Full Solution System Supplier”.
Grow as a leading company in integrated thermal management systems based on our established business foundation.

Mid-Term Business Plan SHIFT2028（2024-2028）

Business Reconstruction（2020-2023）

Achievements

Mid-Term Business Plan Targets

Management
PolicyReconstruction of earningpower

A leading company inIntegrated Thermal Management System

Basic
Strategy

Component SupplierGrowthArea

Compressors for ICEs
Compressors for EVs
Actions for EV shift

Investment
for Growth

Ranked the 2 nd in compressors.

Full Solution System Supplier
Compressors for EVs+ Integrated Thermal Management System
Investment in R&D and production for EV shift and ITMS
V2X and smart system（Synergy）(Strengthening R&D and production
plants)Regional
PolicyRanked the 2nd in Europe Further expansion in European and Chinese markets#1 in the EV market in Americas
and the 1st in China© 2024 SANDEN CORPORATION

8/19

［Reference］ Overview of New Mid-Term Business Plan （1/2）

Sep. 6, 2024
Sanden Corporation

Focused on the NEV market and with electric compressors at the core, we provide integrated thermalmanagement system solutions that are competitive, adaptable and close to our customers.
Revitalization Period （2020-2023）

Mid-Term Business Plan （2024-2028）

Reconstruction of Earning Power

Providing integrated thermal management system solutions that are both competitive and adaptable

Regional Strategy
Extensive customer access as an independent
1 manufacturer.

Strengthening our presence in the Chinese2 market through synergies with our joint
venture partners in China.
Advanced Technology Development of3
Integrated Thermal Management Systems
Technology and trust built up through the4 production of 400 million units.
Enhancement of global production system.
5 Optimization of mature product production and4-region electric compressor production structure
Strengthen cost competitiveness through6 procurement synergies with Hisense© 2024 SANDEN CORPORATION◼ Develop region-specific marketing by leveraging the strengths of an independent
manufacturer.
◼ In addition to our existing joint venture partners in China and through synergies with Hisense,
we will build a foundation of competitive advantage in China, the world's largest automotive
market, and support Chinese OEMs in their growth and global OEMs in their entry into theChinese market.

NEV Enhancement of the resources for the Integrated ThermalManagement System◼ Realization of a high value-added business model through evolution from a component supplier to an
integrated thermal management supplier◼ Increase flexibility by promoting the platforming of products

Future growth areas through technology synergies with Hisense◼ V2X, Smart system
Thorough utilization of existing production system and supply chain
ICE ◼ By using optimized existing assets, reduce investment and secure stable revenue.
◼ Strategic partnerships with suppliers

Reinforcement
OfFoundationSustainability◼ Biodiversity initiatives as well as carbon neutrality◼ Strengthening disclosure of non-financial information as part of global
companies' social responsibility, such as CSRD

9/19

［参考］新中期計画の概要（2/2）

Sep. 6, 2024
Sanden Corporation

2028 Target: ¥300 Billion in sales and ¥9 Billion in ordinary profit【China】 Capitalize on the rapid

Expand market share by1.【Europe】
2. growth of China's thermalstrengthening sales of NEV-related

products to global OEMs in Europe.

Regional
StrategyMarket
Size

¥200B

¥500B

8%

16%

management markets bymaximizingCAGR
synergies with Hisense+68%
Market¥660B
Size

Accelerate expansion
3. 【Americas】
of NEV products in the Americas.
NEV productsales inAmericas
¥100M

¥50B
2023

2028

2023

2028

【Development/Product】 Leverage the strengths of an

Strategy
Themes2023

2028

manufacturer to serve multiple customers.
4. independent
5. supply chain, and achieve sustainability compliance
Achieve flexibility in meeting customer needs through platforming.

【SCM・sustainability】 Optimize global production layout and3 Regions (current) Expand to 5 Regions
Production• China• China• Japanplants of•Europe•
Japan(Enhancement）
systems•
Americas•Asia• Asia（HVAC/ITMS）

Semi-customized product development# of supportedmodels

2023

2028

111

165

Reinforcement 6. Digitalization】
Reinforce human resource【Human Resources/OfFoundation¥40B

development and improve theefficiency of organizational
operations.

© 2024 SANDEN CORPORATION

Human Resource Development/
Assessment

Investment⚫ Investment in R&D⚫ Investment in IT⚫ Acquisition of key personnel⚫ Retention, selection, and development of humanresources⚫ Systematic management development⚫ Optimization of incentive system

10/19

Project Management⚫ Set up CFT(Cross-functional team)and put the team on projects.
⚫ Systematic management of projectprogress and profitability

［Reference］Sales Strategy

Sep. 6, 2024
Sanden Corporation

Product Portfolio Strategy

Sanden Mid-Term Business Plan
ICE / NEV Sales Ratio Trend
Growing Rate
(CY28 vs CY24)

3,000
2,600

NEV ratio
NEV比率
NEVRatio
単位：億円
Unit: ¥100M

1,780

1,800

Overall
167%

62%

2,200

ICE
94%

1,900

33%
NEV
317%

The size of the circle represents the size of sales.
：Current© 2024 SANDEN CORPORATION： Sales forecast usedin mid-term business plan
11/19

CY23

CY24

CY25

CY26

CY27

CY28

［Reference］Mid-Term Business Plan Targets
Item

CY23

CY24

CY25Sep. 6, 2024
Sanden Corporation

CY26

CY27

Unit:¥100M

CY28

Revenue

1,793

1,800

1,900

2,200

2,600

3,000

Operating Profit-110-68-38-23842

Ordinary Profit

-84

-28

2205490

EBITDA-22

4180

123181

242

Revenue

Ordinary Profit

EBITDA

242

3,000
181

2,600
2,200
1,7931,800

123

1,900

9080542CY23CY24

CY25CY26

CY24CY25CY26CY27© 2024 SANDEN CORPORATIONCY28CY27CY28

CY23(22)(28)
CY234120(84)
12/19

CY24

CY25

CY26CY27CY28４． Key Indicator Trends: Revenue, Ordinary Profit, EBITDA

Sep. 6, 2024
Sanden Corporation[Unit：¥100M]
Revenue: Increased for the third consecutive year, partly due to foreign exchange gains.
Ordinary profit: Improved due to foreign exchange gains, and equity gains also remained strong.
EBITDA: Increased depreciation and amortization due to continued strengthening of capital investments forfuture growth, in addition to ordinary profit.

Revenue

Ordinary Profit

EBITDA

942
875
824
46.9
14.1

18.8
7.7

-9.8
-15.6
ActualJan-Jun
2023

Jan-Jun
2023

Jan-Jun2024© 2024 SANDEN CORPORATION

Actual Jan-Jun

2023

Jan-Jun2023
13/19

Jan-Jun2024

Actual Jan-Jun

2023

Jan-Jun
2023

Jan-Jun2024

４． Key Indicator Trends: Acquisition of new commercial rights / Growth investment

Growth Investment Expenses

Status of acquisition of new commercial rights※Total Lifetime Sales of Acquired Commercial Rights (total amount of sales generated
from the start of mass production to the end of the product's life for each project)
6000

Sep. 6, 2024
Sanden Corporation

180

162

160
[Unit：¥100M][Unit：¥100M]

Vehicle types of new commercial rights
acquired in the first half of the year

128

140

5000
120

Internal
combustion engine

4000

36%

New energy vehicle

64%

3000

100

9480
60

2000

Delay

1H
Actual
1,883

1000

02022
2022年
Actual2023年
2023
Actual実績

1H
Actual
1,330

2024年
2024
計画
Plan

顧客都合
Share of priority regions in newcommercial rights acquired in the firsthalf of the year

Japan/Asia●Most recent major commercial rights acquisition
China： Air-conditioning system for a Chinese EV manufacturer
Europe：PX compressor for a key customer in Europe
Japan：ITMS for a construction machinery manufacturer
PX compressor for a key Japanese customer
Americas： Air-conditioning system for a US EV manufacturer© 2024 SANDEN CORPORATION

1H
Actual
64

40

19%

20

R&D +141H
Actual Depreciation +4

87

Exchange +50

Priority Regions
EuropeAmericas
China

81%

14/19

2022年
2022
Actual

2023年
2023
実績
Actual2024年
2024
Plan計画●Key drivers of 2023-2024 increase- Increase in depreciation- R＆D expense
expenses due to capital
・ ITMS development
・ EC platform development investment
・ EC line in Americas
・ Next generation EC
・ EC line in Europe
development
・ ECH line in China

５．Consolidated Balance Sheet

Sep. 6, 2024
Sanden Corporation*Number of days: Year-end balance / (most recent 3 months revenue / 90)*Individual items are rounded off, so the total may not match.

Asset

Liabilities・Net Assets[Unit：¥100M]

1,708

Cash andDeposits

265360Trade
Receivables （72days）

Inventory

OtherFixed Asset

1,625
227

341
（65days）
313

352（71days）（59days）

131

84

600

659

1,730
166369（70days）
344（65days）

1,708

TradePayables（84days）

Loans
Payables（Net Debt）

570（304）

390

370

Other538

Net Asset

229

2024/6

USD:145
EUR:158

USD:142
EUR:157

USD:161
EUR:172381（83days）（13.4％）

2023/6208（86days）

599
（433）

572
(345）

486

464

752

2023/12

1,730

1,625

98

2023/6© 2024 SANDEN CORPORATION[Unit：¥100M]（12.8％）

2023/12255（14.7％）

2024/6（Owned Capital 220）
（Owned Capital 202）（Owned Capital 246）（12.9％）

15/19（12.4％）（14.2％）

６． The progress of MTP Strategy: Area Strategy

Sep. 6, 2024
Sanden CorporationFocused on the NEV market and with electric compressors at the core, we provide integrated thermal
management system solutions that are competitive, adaptable, and close to our customers.
EuropeChinaAmericas●Started construction of a new assembly line for nextgeneration electric compressors.
Received a ¥2 billion grant from the French government.

●Strengthening production capacity for HVAC

●Acquisition of commercial rights for two emerging
EV manufacturers in North America
November 2023: Started production of electriccompressors
Started study of HVAC production in Mexico.

●Collaborating with Vitesco
Accelerating the development of ITMS
that comply with PFAS regulationsin the China area
Annual production capacity of 4.5 million units

Tianjin

Chongqing●Started ECH high voltage 800V MP※ECH=Electric Coolant Heater×© 2024 SANDEN CORPORATION

16/19

MexicoUSA (Dallas)●High durability wobble plate variabledisplacement compressor
January 2024: Production begins at the
Indian plant(for trucks in the Americas)

６． The progress of MTP Strategy:
Strategic Themes (Technology Development)

Sep. 6, 2024
Sanden Corporation

NEDO Promotion Programs to Achieve a Decarbonized Society
The innovative and original "New Compressor" was selected.

High Efficiency

Low Noise

Low Cost

Greatly improves
both compression
efficiency andmotor efficiency.

Reduces noise with highrotation speed andstructure with excellent
quietness.

Reduce production
costs by reducing thenumber of components
and developing uniqueproduction methods.

Till 2025
Technology Development© 2024 SANDEN CORPORATION

2026～2028

Product Development

17/19

From 2029

Start Mass Production

６． The progress of MTP Strategy:
Strengthening the Foundation (Sustainability)
Accelerating Sustainability Initiatives

Sep. 6, 2024
Sanden Corporation●Progress of CO2 reduction activities throughout the supply chain
25,000

1K ton CO220,000●Global activities accelerate toward carbon neutrality goal

2019

Forecast0

Actual5,000

CO2 Emission

Actual

10,000

Reference Value

15,000

2022

2022

2024

Actual reduction amount =Third-party assurance obtained2025

2026

2027

● Activities to comply with the CSRD disclosure requirements
Phase 1
・Double Materiality Assessment
Complete・（ESRS）GAP Analysis
・Development of an activity roadmap© 2024 SANDEN CORPORATION

Reduction Target

18/19

2028

Disclaimer
The purpose of this document is to provide information about our management policies, plans, financial condition, etc., and is notintended to solicit investments or sales, such as the purchase of our stock.
The forward-looking statements contained in this document are based on information available as of the date of this document andcertain assumptions and expectations.
Accordingly, actual results, outcomes, performance, etc., may differ materially due to various risks and uncertainties, including
economic trends, market price conditions and exchange rate fluctuations, etc., but the Company assumes no responsibility for any
damages arising from the use of the information in this document.
In addition, we undertake no obligation to update any of the forward-looking statements contained in this document.

For questions or inquiries regarding this matter, please contact
Email :sdhd.prcsr.jp@g-sanden.com