Consolidated Business Performance for
FY2013 (Year Ended March 2013)1

2013/5/13

1. Consolidated Business Performance for FY2013
2. Topics
3. Challenges and Efforts
4. Consolidated Full-Term Forecasts for FY2014

22013/5/13

1

Consolidated Business
Performance for FY2013

32013/5/13

Consolidated Business Performance for FY2013(Billions of yen)
FY2012
Ratio to sales

FY2013

FY2013

Announced
forcasts(3/22)(Actual)% change

－9.0
－1.9%

Sales

477.4

469.0

468.3

Operating
Income

31.0

24.7

24.8

Ordinary
Income29.7

Net Income

21.2

6.5%

5.3%

22.2
4.7%

6.2%

4.4%－2.2
－0.5%

45.3%

23.0
4.9%

－2.0
－0.4%

YoY

－6.1
－19.9%－6.6－22.4%－23.2－109.8%2013/5/13

2

Performance by Segment

52013/5/13

Performance by Segment in FY2013(Billions of yen)

FY2012FY2013
MarginSales

Operating
IncomeMarginSales

Operating
IncomeIndustrial gases

291.0

21.7

7.5%

298.0

21.3

7.2%

Electronics

115.2

5.9

5.1%

96.5

－0.5

－0.6%

Energy

38.8

1.6

4.3%

40.0

1.8

4.5%

Other

32.2

2.7

8.5%

33.7

3.2

9.8%

Adjustments

Total

－0.9
477.5

31.0

－1.0
6.5%
6468.324.8

5.3%

2013/5/13

3

Industrial Gases BusinessSales
291.0

298.0

(Billions of yen)

Operating Income＋7.0(＋2.4%)＋16.8(＋18.3%)－0.4(－1.8%)－9.8(－5.0%)* The graph contains figures for both Japan and overseas sales.

7

2013/5/13

Major Industrial Gases Business (Sales)
Separated Gases

114.1

116.7

Other Gases

80.7＋2.6(＋2.3%)(Billions of yen)

78.8－1.9(－2.4%)＋2.9(+10.7%)＋1.1(＋3.8%)－0.3(－0.3%)－3.0(－5.9%)≪Overseas≫≪Overseas≫◆Sales increased in Asia due to the effectsof new consolidations, changes to theaccounting periods of some of ourconsolidated subsidiaries in this reporting
period, and other factors≪Japan≫◆◆≪Japan≫◆ Previous year’s sales increased due to effects
from changes to the accounting periods of someof our consolidated subsidiaries◆ Decline in demand for carbon dioxide◆

Increase in oxygen sales due to strong onsite supply to steel industries
Decline in nitrogen sales due to a fall insales to chemical industries

8

Increase in sales due to the effects of newconsolidations

2013/5/13

4Major Industrial Gases Business (Sales)
Gas-related Equipment, etc.

26.0

25.9

Cutting and Welding Equipment and Materials

45.2－0.1(－0.6%)(Billions of yen)

49.3
＋4.1(＋9.1%)－0(－0.8%)＋7.1(＋31.4%)－0.1(－0.6%)－3.0(－13.8%)≪Overseas≫◆≪Overseas≫

Sales remained at the same level in NorthAmerica≪Japan≫◆◆◆◆Effects of newly consolidated subsidiaries
Firm sales of non-gas products in NorthAmerica≪Japan≫Strong sales of gas supply equipment
Decline in PSA-type nitrogen gas
generator equipment sales◆◆9Previous year’s sales increased due to effects
from changes to the accounting periods of someof our consolidated subsidiaries
Decline in large-scale orders for cutting andwelding equipment

2013/5/13

Major Industrial Gases Business (Sales)(Billions of yen)
Plants and Machinery
12.7
10.4－2.2(－17.4%)＋1.6(＋59.3%)－3.9(－39.1%)≪ Overseas ≫◆ Sales increased primarily in Asia
≪ Japan ≫◆ Sales fell due to a decline in large-scaleorders◆ Orders for space simulation chambers
steadily increased10

2013/5/13

5Electronics BusinessSales

Operating Income(Billions of yen)

115.296.5－18.7(－16.3%)－3.0(－9.6%)－15.7(－18.7%)－6.4(－109.1%)

11

2013/5/13

Major Electronics Busines (Sales)
Separated Gases
23.6

22.3－1.3(－5.6%)

Electronic Material Gases
51.4
45.1

(Billions of yen)

－6.3(－12.2%)－0.3(－19.0%)－2.2(－9.5%)－1.0(－4.8%)－4.1(－14.5%)≪ Overseas ≫≪ Overseas / Japan ≫◆ Decline in nitrogen sales in NorthAmerica◆ Decline in sales due to reduced
production of semiconductors, LCD
panels and solar cells and the saleof the SDS business≪ Japan ≫◆ Decline in argon sales due to reduced
production of silicon wafers

12

2013/5/136

Major Electronics Busines (Sales)
Electronics Related Equipment andInstallation(Billions of yen)

MOCVD Equipment

23.6
14.4－9.2(－39.3%)

3.2－0.5(－11.7%)

2.2－1.0(－31.7%)－0.5(－58.5%)－8.7(－45.8%)－0.5(－21.1%)≪ Overseas ≫≪ Overseas ≫◆ Decline in equipment andinstallation projects in Taiwan◆ Orders declined in Taiwan, South
Korea, and other places in Asia

≪ Japan ≫≪ Japan ≫◆ Substantial decline in large-scaleequipment and installation orders◆ Multiple unit orders to powersemiconductors for research
projects will contribute to sales in
the next period13

2013/5/13

Energy BusinessSales

Operating Income(Billions of yen)

＋1.2(＋3.0%)＋0.2(＋8.4%)

14

2013/5/13

7Major Energy Business (Sales)
LP GasEquipment and Installation, etc.

(Billions of yen)

＋1.1(＋3.2%)＋0.1(＋3.9%)≪Japan≫≪Japan≫◆ Volume declined due to downtime in industrial operations
and a fall in consumer demand◆ Slight rise in import prices◆ GHP and Ene-Farm inquiries
increased due to the rise inelectricity charges and otherfactors

15

2013/5/13

Other Businesses
SalesOperating Income
32.2(Billions of yen)

33.7

＋1.5(＋4.7%)＋0.1(＋6.2%)＋0.5(＋20.9%)＋1.4(＋4.6%)

16

2013/5/138

Major Other Businesses (Sales)
Thermos Business

Medical Business
17.9

18.3 ＋0.4(＋2.1%)
11.7

12.9＋1.2(＋9.9%)－0.1(－16.1%)＋0.7(＋6.7%)＋1.3(＋12.7%)－0.2(－3.6%)≪Japan≫◆◆◆≪Overseas≫

Decrease in sales of medical-use oxygen due
to shorter hospital stays and other factors
Sales of home-use medical equipment heldfirm
Strong sales of hospital equipment◆Sales subsidiary established in South
Korea in the previous period excluded
from the scope of the consolidation≪Japan≫◆17

Strong sales of portable mugs and othernew products

2013/5/13

Topics18

2013/5/13

9Topics◆Japan➢TAIYO NIPPON SANSO GAS & WELDING launched◆North America➢Initiatives by Matheson Tri-Gas◆Asia➢Initiatives by Leeden Limited➢Progress in building new plants◆Hydrogen stations◆High-temperature superconducting
19

2013/5/13

TAIYO NIPPON SANSO GAS & WELDING Launched➢Corporate Profile・Merger format: Merger by absorption of companies Futaba Bussan and Toei Kagakuby Saan-Tech, with Saan-Tech being the surviving company
・Effective: April 1, 2013
・Shareholder composition: Taiyo Nippon Sanso 100%・Performance in first fiscal year (forecast): Net sales of ¥22.0 billion
・Number of employees: Approximately 400
・Sales composition: Gas business 60%, welding business 39%, other 1%

20

2013/5/13

10

TAIYO NIPPON SANSO GAS & WELDING Launched➢Purpose of establishment
・Strengthen the downstream business centered on cylinders
・Reduce costs accompanying the consolidation of purchasing
・Strengthen M&A functions for dealers
・Consolidate the management divisions and simplify the organization➢Business plan・Target net sales of ¥40.0 billion by restructuring inside and outside theGroup and absorbing welding materials trading companies
・Develop more in-house products and establish a new revenue baseIn-house products21

2013/5/13

Initiatives in the U.S.
Business restructuring completed➢Restructured the U.S. industrial gas
business from six areas to four areas
which are overseen the package gas
and bulk gas businesses

Organizational structure of the industrial
gas business➢Integration of acquired companies suchas Valley National Gases, Linweld, andthe consolidation of back-office
departments completed➢Improve profitability by strengthening
marketing capability and streamlining
the business

WestZone

NorthZone

WestZone

North EastZone
North CentralMidwestZone
Zone
SouthZone

Back-office
departments

EastZone

SouthZone

South EastZone
22

2013/5/13

11

Initiatives in the U.S.
Expansion of the liquefied gas business➢ New ASUs
・Lakeland, Florida
Commenced operation March 2013
・ Dickinson, North Dakota
Commenced operation May 2013
・ Mesa, Arizona
To be completed June 2014

Network of liquefied gas production basesin the United States
Dickinson➢ In relation to shale gas and oil,demand for industrial gas, inparticular nitrogen, is expected togrow.
We will capture this demand andexpand the network of liquefied gas
production bases.
Mesa
Lakeland23

2013/5/13

Initiatives in the U.S.
Aggressive investment in the on-site hydrogen businessOn-site hydrogen production bases➢Concluded a total of three onsite contracts in Florida andMississippi (for bio-fuel andchemical industries)➢Seek to capture small andmedium-sized on-sitebusinesses targeting 1,00015,000Nm3/h users

24

2013/5/13

12

Initiatives in the U.S.
Acquisition of distributors➢Four acquisitions in 2012
・US Airweld, Inc.
・A&F Welding Supply, Inc.
・Whitmer Welding Supplies, Inc.
・Evergreen Supply, Inc.

Business areas of acquired distributors
Evergreen➢ Aim to expand business andimprove earnings by continuallyacquiring distributors andcultivating the synergies of ASU
and other core businesses

US Airweld

A&F

Whitmer25

ASU bases

2013/5/13

Initiatives in India
Strengthening of the supply and sales network
Major business bases of Matheson K-Air➢ Construction of ASU in Pune
Scheduled for completion at around endof 2013
➢ New manufacturing and sales bases
・Helium and general industrial gas fillingstations opened in Bhiwadi, Rajasthan
and also a marketing office in Gurgaon,
Haryana in 2012
・Helium filling station in Bangalore opened
January 2013

GurgaonBhiwadiAurangabad
Pune
ASU underconstruction

Headquarters
General industrial gas
filling station
Helium filling station

Currently expanding business areas tonorth and south India, in addition to the
mid-west areas such as Pune where theheadquarters is locatedMarketing office

Bangalore

Blue... existing bases
Red... new bases

26

2013/5/1313

Initiatives in Singapore
Acquisition of the HART Group by Leeden➢ Overview
・Acquired via Leeden the HART Group, whose main
businesses are supplying fire control equipment
engineering, building and fire control products
・Acquired a 70% equity interest in the company fromits existing shareholders
・Closing planned for end of June 2013

Millions of yen

HART Group performance

1,800

Net Sales
売上高

1,600

営業利益
IncomeOperating

1,400
1,200
1,000

➢ HART Group performance
Net sales:¥1, 466 million
Operating Income:¥149 million

800600400➢ Purpose of the acquisition
Maximize synergy effects by partnering with the HART
Group in the safety equipment business, one of themajor business areas of Leeden

2000
2009年
2009
Results
実績

2010年
2010
Results
実績

2011年
2011
Results
実績

27

2012年
2012
(Forecast)
見込

2013年
2013
(Plan)
計画

2013/5/13

Initiatives in Singapore
HART Group: Major Products Handled28

2013/5/13

14

Construction of New Plants in Southeast Asia
◆ The Philippines➢ Operations commenced at the new plant in Mindanao inJanuary 2013
➢ Operations scheduled to commence at the new plant inLuzon in July 2014
Operation
Commencement Date

Location

Capacity (Nm3/h)

Online in October 1997

LON 4,000

Online in April 2008

LON 10,000

Luzon Island

Scheduled for July 2014 LON 10,000 + nitrogen gas
Mindanao Island

Online in January 2013

LON 2,000

New plant in Mindanao◆Vietnam➢The new plant in Hưng Yên Province in the north ofVietnam in scheduled to be completed in January 2015
Region
Northern Hưng Yên Province
Region (on the outskirts of Hanoi)Southern
RegionDong Nai Province, Bien-hoa
Bà Rịa–Vũng Tàu Province(on the outskirts of Ho Chi Minh)

Operation Commencement Date

Capacity (Nm3/h)

Online in April 2011

LON 2,500 + nitrogen gas

Scheduled for January 2015

LON 2,900 + nitrogen gas

Online in December 1998

LON 1,000

Online in July 2005

LON 2,500

Online in February 2012

LON 5,000 + oxygen and nitrogen gas

29

2013/5/13

Environment and Energy (Hydrogen Stations)
Packaging made possible for D7,000mm × W2,000mm × H2,590mm

小型容器

ｾﾙﾊﾞﾝｸｼｽﾃﾑ

セルバンク

30

2013/5/13

15

Environment and Energy (Hydrogen Stations)

ｾﾙﾊﾞﾝｸｼｽﾃﾑ

セルバンク

小型容器

31

2013/5/13

Marketability of high-temperature superconducting technology
Empirical research is gathering
pace, targeting widespread
introduction by around 2020

Electronics
Medicine

Electricity

Fields ofapplication

Research

Increase in need for refrigeration
systems

Transportation

Stable supply ofelectricity to asmart city

Neon Turbo Refrigerator Unit
Conducting transformer

Conducting transformer

Superconducting cableLiquid nitrogen
Neon gas

Subcooler unit

Trailer A

Trailer B32

2013/5/13

16

Neon-refrigerant Turbo Refrigerator Unit
[Device features]
Utilizes neon gas refrigerant for improved refrigeration efficiency andreliability
Employs magnetic bearings in the rotating components to make the unit
maintenance-free
Wide-ranging adjustment of the refrigeration capacity
is possible[Device specifications]
Refrigeration capacity: 2kW
Cooling temperature: 65K (－208℃)
Power consumption: 48kW

External view of the new turbo refrigerator unit(prototype)33

2013/5/13

Challenges and Efforts34

2013/5/13

17

Important Challenges◆Organizational restructuring centered on industrial gases andelectronics-related businesses◆Expansion of overseas businesses including boosting theearning capability of North American business◆Strengthen response capabilities of plant engineering◆New business creation to become new earnings pillars

Raise earnings by ¥5.0 billion
over the short term35

2013/5/13

Measures to Improve Profitability

1) Revise industrial gas prices
2) Strengthen partnerships with distributors3) Improve profitability from the electronics businesses4) Improve profitability from business in North America5) Expand our business in Asia

36

2013/5/13

18

Consolidated Full-Term Forecasts for FY2014

37

2013/5/13

Consolidated Full-Term Forecasts for FY2014(Billions of yen)

FY2013

FY2014(Results)(Forecast)

Sales

468.3

514.0

Operating
Income24.8

31.5

Ordinary
Income23.0

Net Income

－2.0

5.3%

6.1%

29.3
5.7%

4.9%

17.1
3.3％

－0.4%

38

Change% change

45.6

9.7%

6.6

26.6%

6.2

27.1%

19.1

－2013/5/13

19

Industrial Gases Business Segment Forecasts for FY2014
Sales400

Operating Income
335.9

298.0

300＋37.9(＋12.7%)

132.9

108.7＋24.2(＋22.3%)(Billions of yen)

5040

21.3

3026.0＋4.7(＋21.9%)

2001000203.0

189.3

20＋13.7(＋7.2%)

10FY2013
JapanFY2014 (Forecast)

0FY2013

FY2014 (Forecast)

Overseas* The graph contains figures for both Japan and overseas sales.

39

2013/5/13

Electronics Business Segment Forecasts for FY2014
Sales

Operating Income

150(Billions of yen)

20

96.5

99.3
＋2.8(＋2.9%)

15100

50

28.1

30.1

68.4

69.2＋2.0(＋7.1%)

105＋0.8(＋1.2%)

2.2＋2.7(－%)-0.50FY20130FY2014 (Forecast)Japan

FY2013

FY2014 (Forecast)

Overseas40

2013/5/1320

Energy Business Segment Forecasts for FY2014
Sales
50

Operating Income
40.0

42.0

(Billions of yen)

4＋2.0(＋4.9%)

40

330

1.9

1.8

2＋0.1(＋5.1%)

20

1100

FY2013

FY2014 (Forecast)

0FY2013

FY2014 (Forecast)41

2013/5/13

Other Businesses Segment Forecasts for FY2014
Sales
4030

36.8
33.7

1.7＋3.1(＋9.1%)

32.0(Billions of yen)

102.4＋0.7(＋41.2%)

34.4

20

Operating Income

53.2＋2.4(＋7.5%)

2.8－0.4(－14.9%)

1000
FY2013
JapanFY2014 (Forecast)

FY2013

FY2014 (Forecast)

Overseas42

2013/5/1321

Disclaimer● This material is not intended for purposes of disclosure forsecurities transactions, and it is impossible to guaranteethat the information contained in this presentation isaccurate and complete.
● This presentation and report contain forward-looking
statements (estimates and forecasts) regarding the futureplans, strategies, activities and performance of Taiyo
Nippon Sanso Corporation. Forward-looking statements
reflect management’s assumptions and beliefs based on
information available as of the time of writing. Risks anduncertainties include, but are not limited to, changes ingeneral economic and specific market conditions, currency
exchange rate fluctuations, tax systems, and regulations.
● Actual results may thus differ substantially from the said

forward-looking statements, and investment decisions
should not be made solely on the basis of the information
provided herein.
43

2013/5/13

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22