Presentation on Business Results
for the 1st-Half of Fiscal YearEnding March 31, 2020
November 19, 2019
This presentation contains forward-looking statements relating to expected future performance as of Nov. 19, 2019.
Such statements are based on the views and assumptions of company management and involve risks anduncertainties such as changes in the business environment that may cause the actual results to differ materially fromexpectations.
Copyright © 2019 Harmonic Drive Systems Inc.

Performance
Summary2
Copyright © 2019 Harmonic Drive Systems Inc.

1st-half consolidated results(versus original forecasts for the period)

Net sales

Original forecasts(announced May 10)

1st-half
FY ending Mar.31,2020(millions of yen)Vs. original forecasts
for the period

AmountPercent (%)

AmountPercent (%)

ChangeRate(%)

21,000100.0

21,577

100.0

577

2.7

OperatingincomeOrdinary
income

450

2.1

1,383

6.4

933

207.5

450

2.1

1,613

7.5

1,163

258.5

Net income

0

0.0

280

1.3

280

－

EPS （yen）

0

－

2.91

－

2.91

－

※ Net Income refers to net income attributable to owners of parent.

3
Copyright © 2019 Harmonic Drive Systems Inc.

1st-half consolidated results (year-on-year change)(millions of yen)

1st-half
FY ended Mar.31,2019

1st-half
FY ending Mar.31,2020

Year-on-year change

AmountPercent (%)

AmountPercent (%)

ChangeRate (%)

Net sales

34,474100.0

21,577100.0▲12,896▲37.4

Gross profit

15,655

45.4

7,412

34.4

▲8,243▲52.7

OperatingincomeOrdinary
income

8,914

25.9

1,383

6.4

▲7,530

▲84.5

9,337

27.1

1,613

7.5

▲7,724▲82.7

Net income

5,908

17.1

280

1.3

▲5,627▲95.3

EPS （yen）

61.37

2.91

▲58.46▲95.3

10,506

5,779▲4,726

▲45.0

2,784

3,635

850

30.6

1,204

1,166

▲38

▲3.2

Capitalinvestment
Depreciation
costs
R&D costs※ Net Income refers to net income attributable to owners of parent.
※ Capital investment amounts are the amounts of tangible and intangible fixed assets acquired in the term.

4

Copyright © 2019 Harmonic Drive Systems Inc.

Performance of main group companies for 1st-halfof fiscal year ending March 31, 2020
(millions of yen)
Equitystake
Harmonic Drive
Systems Inc.
*2
*5

*3
*4
*6

－

Net income

Net sales
AmountChange(%)

AmountChange(%)

10,527 ▲58.3

253 ▲95.1

3,610

323

HD Systems, Inc.
(Harmonic Drive L.L.C.)(U.S.A)

100%
(51%)

Harmonic AD, Inc.

100%

Harmonic Drive Systems(Shanghai) Co., Ltd.

100%

2,365

7.7

Harmonic Drive AG(Germany)

74.7%

7,410

▲8.0

11.9

967 ▲39.4

38.7

15 ▲89.5199

31.7577 ▲55.9

Percent change(%) indicates increase or decrease from same period of previous fiscal year.
*1 For overseas subsidiaries and affiliates, the fiscal year ends December 31.
*2 Exchange rates: Jan. – Jun., 2018 1US$ = 108.68 yen, Jan. – Jun., 2019 1US$ = 110.05 yen*3 Exchange rates: Jan. – Jun., 2018 1CNY = 17.09 yen, Jan. – Jun., 2019 1US$ = 16.20 yen*4 Exchange rates: Jan. – Jun., 2018 1€ = 131.64 yen, Jan. – Jun., 2019 1€ = 124.32 yen*5 Net income of US subsidiaries (consolidated) is after excluding non-controlling interests.
*6 Net income of German subsidiaries (consolidated) is before excluding non-controlling interests.

5

Copyright © 2019 Harmonic Drive Systems Inc.

1st-half non-consolidated results(millions of yen)

1st-half
FY ended Mar.31,2019

1st-half
FY ending Mar.31,2020

Year-on-year change

AmountPercent(%)

AmountPercent(%)

ChangeRate(%)Net sales

25,229100.0

10,527100.0▲14,701▲58.3

Gross profit

10,415

41.3

2,804

26.6

▲7,610

▲73.1

7,205

28.6

354

3.4

▲6,851

▲95.1

7,510

29.8

679

6.5

▲6,831▲91.0

Net income

5,196

20.6

253

2.4

▲4,942▲95.1

EPS （yen）

53.98

2.64

▲51.3

▲95.1

8,716

3,651

▲5,065

▲58.1

966

1,551

585

60.6

805

841

36

4.5

OperatingincomeOrdinary
incomeCapitalinvestment
Depreciation
costs
R&D costs

6
Copyright © 2019 Harmonic Drive Systems Inc.

Net sales by application (non-consolidated)(millions of yen)
30,00025,22925,00021,04817,93420,00015,00010,0005,000
012,843
2,123
84
850
615

6,215

13,904
2,276
84

2,230
203

318
1,137
1,076

449
1,320
1,210

3,309
475
1,314
1,204

887
968

12,941

841
820

6,310

2,575

3,300

24,020

9,890
1,165

11,457

10,527
13,326

739
488

1,431

1,768

844

1,554

1,797

2,237

3,341

2,455

1st-half

2nd-half

1st-half

2nd-half

1st-half

2nd-half

FY ended Mar.31,2017

FY ended Mar.31,2018

Semiconductor equipment
Gearbox for motor manufactures
Optical devices
Excavation system for the oil, etc.

Flat panel equipment
Machine tools
Transporter
Others

4,926

1,044

1,325

1,383

2,326
126

FY ended Mar.31,2019

200

1,163
1st-half

FY ending Mar.31,2020

Robotics
Printing machines
Measuring machines

7
Copyright © 2019 Harmonic Drive Systems Inc.

Factors in year-on-year change in 1st-half
non-consolidated operating income
Lower income(millions of yen)

7,205 ▲8,204

Lower fixed Lower SG&A
manufacturing+760
costs, etc.

354

+759

1st-half of FY ended
March 31, 2019

Lower
marginal profit
ratio, etc.

▲166

1st-half of FY ending
March 31, 2020

8
Copyright © 2019 Harmonic Drive Systems Inc.

Status of consolidated assets(millions of yen)

140,000
120,000
100,000

137,995

134,694

18,822

21,457

Cash & bank deposits
and securities

17,384

8,866

7,370

6,904
1,401

Trade receivables
Inventories
Other current assets

40,852

46,602

Tangible fixed assets

39,53836,403

Intangible fixed assets

12,71813,058Investments andother assets

March 31, 2019

September 30,2019

1,308

80,00060,00040,00020,0000

9Copyright © 2019 Harmonic Drive Systems Inc.

Status of consolidated liabilities and net assets(millions of yen)

140,000
120,000
100,000

137,995

134,694

3,513
12,0002,311
11,769
625
3,589

2,655
3,947
9,959

Trade payable
Other current liabilities
Long and short-term borrowings

11,976

Other fixed liabilities
Stock option
Minority interests

625

4,312

80,00060,000104,186

101,21740,000Equity ratio
75.5%

20,000Owned capital

Equity ratio
75.1%

0March 31, 2019

September 30,201910

Copyright © 2019 Harmonic Drive Systems Inc.

Status of consolidated cash flows(millions of yen)

1st-half of FY ended
Mar.31,2019

1st-half of FY ending
Mar.31,2020

Cash flow from operating activities

3,555

8,756

Cash flow from investing activities▲8,415▲9,638Cash flow from financing activities▲1,126

3,522

Effect of exchange rate changes on cash
and cash equivalents

▲168

▲50

Net increase (decrease) in cash andcash equivalents▲6,156

2,590

Cash and cash equivalents at end of year

22,164

20,19011

Copyright © 2019 Harmonic Drive Systems Inc.

Performance Forecast
For Fiscal YearEnding March 31, 2020

12
Copyright © 2019 Harmonic Drive Systems Inc.

Revised consolidated results forecast for
fiscal year ending March 31, 2020
(millions of yen)
Original forecasts(announced May 10)

Net sales

Revised forecasts(announced Nov. 12)

Vs. original forecasts

AmountPercent (%)

AmountPercent (%)

42,000100.0

36,700100.0

ChangeRate (%)▲5,300 ▲12.6

OperatingincomeOrdinary
income1,000

2.4▲1,500－▲2,500

－

1,000

2.4

▲1,300－▲2,300－Net income

50

0.1

▲1,500－▲1,550－EPS （yen）

0.52－▲15.58－▲16.10－※ Assumed exchange rate for FY20/3 forecasts 1USD ＝ ¥105.00 1EUR ＝ ¥118.00※ Net income refers to net income attributable to owners of parent.

1CNY ＝ ¥15.00

13
Copyright © 2019 Harmonic Drive Systems Inc.

Revised non-consolidated results forecast for
fiscal year ending March 31, 2020
(millions of yen)
Original forecasts(announced May 10)

Net sales

Revised forecasts(announced Nov. 12)

Vs. original forecasts

AmountPercent (%)

AmountPercent (%)

22,000100.0

18,000100.0

ChangeRate (%)▲4,000 ▲18.2

OperatingincomeOrdinary
income10

0.0▲1,000－▲1,010

－

150

0.7

▲700

－

▲850

－

Net income

100

0.5

▲500

－

▲600

－

EPS （yen）

1.04

－

▲5.19

－

▲6.23

－

※Assumed exchange rate for FY20/3 forecasts 1USD ＝ ¥105.00

1EUR ＝ ¥118.00

1CNY ＝ ¥15.00

14
Copyright © 2019 Harmonic Drive Systems Inc.

Consolidated performance forecast for
fiscal year ending March 31, 2020
FY ended Mar. 31, 2019

Forecasts
FY ending Mar. 31, 2020

(millions of yen)

Year-on-year change

AmountPercent (%)

AmountPercent (%)

ChangeRate (%)

67,809100.0

36,700100.0▲31,109▲45.9

16,90324.9▲1,500－▲18,403－

17,46425.8▲1,300－▲18,764－

Net income

11,60117.1▲1,500－▲13,101－

EPS （yen）

120.52－▲16.10－▲136.10－23,876

－

7,800

－

▲16,076

▲67.3

6,247

－

7,200

－

952

15.3

2,476

－

2,300

－

▲176

▲7.1

Net sales
OperatingincomeOrdinary
incomeCapitalinvestment
Depreciation
costs
R&D costs※ Net income refers to net income attributable to owners of parent.
※ Assumed exchange rate for FY ending Mar.31, 2020 forecasts 1US$ = ¥105.00 1€ = ¥118.00 1CNY=¥15.00※ Depreciation costs include depreciation cost of tangible assets and amortization cost of intangible assets and goodwill.

15

Copyright © 2019 Harmonic Drive Systems Inc.

Forecasts of main group companies forfiscal year ending March 31, 2020

*2
*5

*3
*4
*6

Net sales(millions of yen)

Net income

Equitystake

AmountYear-on-yearchange (%)

AmountHarmonic Drive
Systems Inc.

－

18,000▲63.5▲500 ▲104.8

HD Systems, Inc.
(Harmonic Drive L.L.C)(U.S.A)

100%
（51%）

6,100

▲11.0

410

Harmonic AD, Inc.

100%

1,600

▲52.5

▲40 ▲111.0

Harmonic Drive Systems(Shanghai) Co., Ltd.

100%

3,600

▲11.1

200

2.6

Harmonic Drive AG(Germany)

74.7%

12,700

▲20.4

680

▲70.8

Year-on-yearchange (%)▲17.0

Percent change(%) indicates increase or decrease from same period of previous fiscal year.
*1 For overseas subsidiaries and affiliates, the fiscal year ends December 31.
*2 Exchange rates: Jan. – Dec., 2018 1USD = 110.43 yen, Jan. – Dec., 2019 forecast 1USD = 105.00 yen*3 Exchange rates: Jan. – Dec., 2018 1CHY = 16.72 yen, Jan. – Dec., 2019 forecast 1CYN = 15.00 yen*4 Exchange rates: Jan. – Dec., 2018 1EUR = 130.42 yen, Jan. – Dec., 2019 forecast 1EUR = 118.00 yen*5 Net income of US subsidiaries (consolidated) is after excluding non-controlling interests.
*6 Net income of German subsidiaries (consolidated) is before excluding non-controlling interests.

16

Copyright © 2019 Harmonic Drive Systems Inc.

Non-consolidated bookings by application (quarterly)(millions of yen)

10,000

9,546
1,712
166
641
553

6,183
1,407

5,000

4,548

203
385
443

2,793

2,839

999

960

624

124

502

598
70

869
77

2Q

3Q

4Q

2,638
335

0

1,126
1Q

4,102

161

1,078
46
259
409

1,373

FY ended Mar. 31, 2019

Semiconductor equipment
Gearbox for motor manufactures
Optical devices
Excavation systems for the oil, etc.

Flat panel equipment
Machine tools
Transporter
Others

45
232
227

372

3,092
794
59
206
195

76
191
187

1,170

192

325

1Q

2Q

85

FY ending Mar. 31, 2020
Robotics
Printing machines
Measuring machines

17 17

Copyright © 2019 Harmonic Drive Systems Inc.

Non-Consolidated performance forecast for
fiscal year ending March 31, 2020
FY2019/3

FY2020/3 forecasts(millions of yen)

Year-on-year change

AmountPercent (%)

AmountPercent (%)

ChangeRate (%)

Net sales

49,249100.0

18,000100.0▲31,249▲63.5

Operatingincome13,79828.0▲1,000－▲14,798－

Ordinary
income14,213

28.9

▲700

－

▲14,913－

Net
income10,413

21.1

▲500

－

▲10,913－

EPS (yen)108.18

－

▲5.19

－

▲113.37－

Capitalinvestment
Depreciation
costs

15,945

－

4,200

－

▲11,745

▲73.7

2,458

－

3,300

－

841

34.2

R&D costs

1,629

－

1,700

－

70

4.3

※ Assumed exchange rate for FY20/3 forecasts 1USD ＝ ¥105.00

1EUR ＝ ¥118.00

1CNY ＝ ¥15.00

18

Copyright © 2019 Harmonic Drive Systems Inc.

Factors in year-on-year change in non-consolidated
operating income (fiscal year ending March 31, 2020 forecast)Lower income

13,798 ▲17,600(millions of yen)

Lower SG&A
costs

＋1,400Lower fixedmanufacturingcosts, etc.

FY ended Mar. 31,
2019

Lower
＋1,700marginal profit
ratio, etc.

▲298

▲1,000FY ending Mar. 31,2020 forecast
19
Copyright © 2019 Harmonic Drive Systems Inc.

Sales trend line (non-consolidated)
Four-year average
34,680 mil. yen(millions of yen)

50,00038,98240,00030,00020,00023,74011,892

26,74749,24924,02021,04818,00013,90425,22910,00011,848

12,843

FY ending Mar.
31,2016

FY ending Mar.
31,2017

7,473

17,934
10,5270

1st-half

FY ending Mar.
31,2018

FY ending Mar.
31,2019

2nd-half

FY ending Mar.
31,2020

forecast

20

Copyright © 2019 Harmonic Drive Systems Inc.

Future Outlook

21
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅰ．Orders and Initiatives

22
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅰ-1. Consolidated orders, by region
External environment
Prolonged US–China trade friction is prompting concerns about a global economic slowdown.
→ Manufacturers are less willing to make capital investments, adopting a wait-and-see attitude.
An “overheating of investments” in industrial robots mainly for China in 2017 and 2018 is now
undergoing correction.
→ Overall orders are in a downtrend (according to Japan Robot Association).
“Advance orders” we received in previous years have led to inventory adjustments.
→ Distributors and customers alike are adjusting inventories (but cancellations and requests
fordelayed deliveries have recently toned down).
Internal environment
Customers are still satisfied with our products; customer relations are solid (no change in ourcompetitive advantage).
By increasing our production capacity, we have worked through order backlogs and normalized leadtimes.
FY2019Harmonic Drive AG becomes subsidiary(Millions of yen)
25,00020,00015,00014,43910,0005,000
014,022

15,715

15,645
9,526

11,544
5,820

6,543

1,707

2,076

1,894

2,006

1,867

6,449
2,247

3,901
1,562

3,117
1,030
3,029

3,181
1,478
3,016

2,629
746
4,695
4,442
1,269
4,264
4,088
3,994
3,834
3,681
1,035
2,202
1,301
1,133
941
495
435
402
Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019
5,412

EuropeNorth America

Asia

23

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅰ-2. Initiatives to counter a prolonged downturn in demand Freeze some capex plans Reduce overhead expenses
 Lower personnel costs

Maintain business foundations to allow
response to future market recovery
and growth24
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅱ．Trends in Main Fields ofApplication25
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅱ-1. Worldwide outlook for number ofindustrial robots sold
 Downward revision due to slowdown in Chinese market growth Meanwhile, robust appetite for investment in labor-saving and automation
International Federation of Robotics

26
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅱ-2. Collaborative robots (co-bots)
 Expanding adoption in the manufacturing and service
sectors
 Robust demand, centered on Europe
 Business alliance between Omron and Techman Robot Inc.
 Business alliance between Canon and Universal Robots

Courtesy of Techman Robot Inc.

27
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅱ-3. Semiconductor manufacturing equipment,
LED and OLED manufacturing equipment
Semiconductor manufacturing equipment
 Growth in the smartphone market is decelerating.
 Capex by large US IT companies is currently leveling off, but signs
point to a startup in investment.
 Non-memory demand is starting to recover.
 Demand is solid for AI, VR, and CASE (automobile-related).
 We also expect 5G-related investment to fuel demand.
⇒Demand in related markets is beginning to emerge (base stations,
new smartphone models).
(3G [voice] → 4G [data] → 5G [video])

LED and OLED manufacturing equipment Demand for small and medium-sized FPDs is falling, as smartphone growth decelerates.
 However, demand is budding for OLEDs used in large TVs and onboard automotive electronics.

28

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ．New Applications

29
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-1. Sales history and growth drivers
New target
marketenvironment(Billions of yen)
50
500
45
450

Aerospace, mobility

Sales (non-consolidated basis)

40
400

FPD manufacturing equipment

35
350

Requirements

30
300

Semiconductor manufacturing
equipment

25
250
20
200

Growth drivers

15
150

Industrial robots (further expansion)

10
100
5
50

0

Advanced medical
technology

Machine tools'71'72'73'74'75'76'77'78'79'80'81'82'83'84'85'86'87'88'89'90'91'92'93'94'95'96'97'98'99'00'01'02'03'04'05'06'07'08'09'10'11'12'13 14 15 16 17 18

 Large hollow structures Ultra flatness
 Ultra compactness
 High precision
 High torque, long life Ultra lightweight Cost reduction
 Response to Industry 4.0,
IoT, and other trends(Fiscal year)

30
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-2. Next-generation motion control

Surgical robots

Flying cars

 All steadily expanding growth markets
 Responding to specific inquiries with a view
toward mass production
Compact

Lightweight

DurableHighprecision

Next-generation
mobility

Reliable

Assist suits
31
Courtesy of Hashimoto Lab, Shinshu University

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-3. Development of new products for new applications
Small collaborative robots,
semiconductor
manufacturing equipment

Tabletop robots

www.mecademic.com

Advanced medicine,amusement

Source: Techman Robot Inc.

Source: Mecademic Inc.

Applications should accelerate further, as demand increases to makevarious types of equipment more compact and lightweight.
Customers have growing expectations for our products.
CSFﾏｲｸﾛｼﾘｰｽﾞ

CSFﾐﾆｼﾘｰｽﾞ

CSF-2UPｼﾘｰｽﾞ

We are developing a new series with market launch scheduled for FY2020.
We plan to exhibit a prototype at the International Robot Exhibition 2019.
32

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-4. Growing areas of application
 Steadily growing market for leading-edge medical equipment
 Increasingly, robotic surgery being covered by medical insurance Growing number of potential players in Japan and overseas

 Customized development to meet customer requirements
 Rollout across our entire product lineup (HD, MT, and AD):
Conceptualize on the basis of ultra compactness and highprecision

 Automotive: Used in variable compression ratio(VCR) engines Surpasses various countries’ environmental restrictions due to substantially
improved thermal efficiency
 Expected use in more than 80% of internal combustion engines by 2040
(IEA forecast) Steadily responding to mass production demand since 2018

 Full-fledged rollout of VCR engines anticipated

Courtesy of Nissan Motor Co., Ltd.

33

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-5. New area of application: the aerospace industry
 MaaS “flying taxis”
 Nearly 100 venture companies around the world
 Responding to demand for reducers in response toshift to commercialization and mass production

 Requirements our products are expected to meet:
Light weight, high torque, high reliability

 Space debris business Growing focus on this new space business We have a track record in space applications, so
have an opportunity to contribute to this businesswith our products

 Continue to monitor trends
34

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅲ-6. New applications:
Hayabusa and Hayabusa2 planetary probes
Hayabusa2 operating its ion engine as it approaches 162173 Ryugu, an asteroid

Image provided by the Japan Aerospace Exploration Agency (JAXA)

Harmonic Drive® used in the actuator of the gimbal mechanism
35
on an ion engine manufactured by Moog (US)Copyright © 2019 Harmonic Drive Systems Inc.

Ⅳ. Initiative for Achieving
Mid-Term Management Plan Targets:Raising QCDS Capability

36
Copyright © 2019 Harmonic Drive Systems Inc.

Ⅳ-1. Roadmap to raising production capacity
1. Strain wave gearing devices
To Jan. 2017

(Numbers indicate units produced per month)Aug. 2017 Apr. 2018

Mar. 2019 (peak)Target production capacity

130,000+

Total for two
factories:
200,000

Hotoka Factory

50,000Japan:
Harmonic
Drive
Systems Inc.

66,00085,000+
Ariake Factory

Ariake Factory(new plant building)

120,000–
150,000
Limburg Factory
Germany:
Harmonic
Drive AGUS:
Harmonic
Drive LLC

10,000+
Boston Factory

2. Crossed roller bearings
Japan:
Harmonic
Precision
Corp.
Germany:
Harmonic
Drive AG

Current factory

3,000

15,000+30,000–50,000

New factory

10,000–30,000Total: 98,000+

Total: 148,000+

60,000+70,000+
New factory

Limburg Factory

10,000+Total: 70,000+

New factory

Total: 240,000–
280,000

120,000–
150,000

150,000

30,000Total: 80,000+

Total: 180,000+37

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅳ-2. Raising capacity at production facilities

Ariake Factory(Azumino, Nagano Prefecture)

Matsumoto Factory(Matsumoto, Nagano Prefecture)

Harmonic Drive LLC’s
new factory (US)Harmonic Drive AG’s
second factory (Germany)

38

Copyright © 2019 Harmonic Drive Systems Inc.

Ⅳ-3. Status of initiatives to raise productivity
and enhance quality
 The production system our Group envisions

We aim to manufacture products that meet the individual needs of customers
to the finest detail, backed by our advanced technology and skills.

 Small-lot, multi-variety production

 Large and medium-lot, small-variety production

 Production management system

 Mass-production lines for FA applications

 Further improve quality

 Mass-production lines for automotive
applications[Applications: small-lot robots, semiconductors, andother general equipment]
1. Our engineers possess advanced skills (processing,assembly, and inspection) that will help flexibly meetcustomer needs.
2. We have an extensive track record of small-lot, multivariety production, leveraging our optimal production
technology and management system.

Use IT to create flexible systems.

Continue reinforcing efforts to cultivate specialists.

 Strengthen partner companies’ capacity

Support efforts to strengthen structures to meet future
growth opportunities.

[Applications: automotive products and massproduction robots]
1. Our production lines are geared toward automation.
2. We also use our long-standing knowledge andexpertise to optimize our automation equipment.
3. Sophisticated production technology and quality
control enable us to maintain a high first-pass yield.

Steadily expand process automation.

With the exception of some existing lines, introduce newlines that are highly automated and provide highly finishedproducts.

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Copyright © 2019 Harmonic Drive Systems Inc.

Ⅳ-4. Status of initiatives to raise productivity
and enhance quality
 Automated lines
 Automated processing line for mainstay products Automated assembly process We maintain quality control by using sophisticated measurement technology.
 Production capacity can be increased without being affected by personnel
numbers.
 We are putting in place an environment to cultivate workers as engineersable to handle more advanced processes and pass on this knowledge.

Hone technologies/skills and achieve automation

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Copyright © 2019 Harmonic Drive Systems Inc.

Ⅴ. Current Mid-Term Management Planand Aiming for Further Growth
toward 2030 and 2050

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Copyright © 2019 Harmonic Drive Systems Inc.

Ⅴ-1.Mid-term management plan and long-term vision

Consolidated sales (billions of yen)
Target20.4

Actual

18.1

21.0

26.0

29.0

25.9

28.2

30.0

35.0

68.5

54.3

67.0

100.0

50th
anniversary

Earlier
mid-term
Previous mid-term
前中期経営計画
management plan management plan
FY2012 to FY2014

FY2015 to FY2017

Current mid-term
management plan
FY2018 to FY2020

Good balance among
three businesses
MT
RD

AD

FY2030 to FY2050

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Copyright © 2019 Harmonic Drive Systems Inc.

The performance targets and other numerical data
presented herein are forecasts based on information
available to the HDS Group at the time this material was
prepared, and are subject to the influence of uncertainties
including those in the economic and competitiveenvironment. Actual performance may therefore differ
materially from the forecasts given in this material.

For more information:
Please contact us as follows for material contents and investor information of all kinds.
Corporate Planning Division, Harmonic Drive Systems Inc.
Ichigo Omori bldg. 7F, 6-25-3 Minami-Oi, Shinagawa-ku, Tokyo 140-0013 Japan
Email: ir@hds.co.jp
Website: https://www.hds.co.jp/

Copyright © 2019 Harmonic Drive Systems Inc.