Mid-Term Plan MG20R - Maxell Growth 20 Revised · Mid-Term Plan MG20R - Maxell Growth 20 Revised - Maxell Holdings, Ltd. President and Representative Director Yoshiharu Katsuta Maxell

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Mid-Term Plan MG20R- Maxell Growth 20 Revised -

Maxell Holdings, Ltd.President and Representative Director

Yoshiharu Katsuta

Maxell Holdings, Ltd. DirectorMaxell, Ltd.President and Representative Director

Keiji Nakamura

2019/5/31


Table of Contents

1. Purpose of Today’s Business Briefing

2. MG20R Overview

3. Business Portfolio and MBP Overview

4. Main Products by Division


Purpose of Today’s Business Briefing

Maximize the corporate value by

promoting business strategy and capital policy altogether

Pursue

an optimal capital structure

Enhance

profitability

Business strategy Capital policy

Maximize the

corporate value

✓ Realize synergy effects of MBPs (1)

– Already invested 34 billion yen

into 5 projects

✓ Business portfolio strategy

– Introduction of ROIC(2)

– Selection and concentration

✓ Address the unprofitable businesses

✓ Decrease equity

– Enhance shareholder returns

✓ Increase financial leverage

– Based on the disciplined fiscal

policy

Today’s

ExplanationExplained on April 26

(1) MBP：Maxell Business Platform

Structure of create strong business with sharing business resources each other based on “co-creation and co-prosperity”

(2) ROIC : Return On Invested Capital


Table of Contents

1. Purpose of Today’s Business Briefing

2. MG20R Overview



Maxell Holdings, Ltd. DirectorMaxell, Ltd.President and Representative Director

Keiji Nakamura


2. MG20R Overview


Revision of Targets of MG20

Downwardly revised the targets as of FY2020; operating income to 10 billion yen and ROE to 6.0% or above

Original TargetsMG20

Revised TargetsMG20R

Difference

Net Sales(billion yen)

200 173 (27)

Operating Income(billion yen)

15 10 (5)

Operating Margin % 7.5% 5.8% (1.7%)

ROE 8.0% or above 6.0% or above (2.0%)

✓ Revised the targets taking current business environment into consideration

✓ Keep trying to achieve the original targets early years in the next mid-term (FY2021-2023)


Operating Income Change (FY18 -> FY2020)

Operating IncomeFY2018

Operating IncomeFY2020

Energy±05.4

10

Industrial Materials

+2.6

Electronic Appliances and Consumer Products

+2.0

Advance cost for FY19

(2.5)

Accrued advance cost in FY19Achieved operating income of 10 billion FY20

・Launch Maxell brand projector・Launch Brands of beauty care product・R&D of new products

Advance Cost for FY2019 (2.5)

Advance cost contribute to the expansion of operating income in Industrial Materials segment, and Electronic Appliances and Consumer Products segment

No advance cost for FY20+2.5

✓ Adhesive tape✓ Electric parts/materials✓ In-car camera lens✓ LED headlamp lens

✓ Beauty care products

✓ Projector

(Unit: JPY billion)




Strategy of Business Portfolio

Horizontal development of “strength”

Vert

ical develo

pm

ent

of

“str

ength

”

Introduction of ROIC

ROE improvement

Promotion of “Replacing Old with New“ throughSelection and Concentration

Pursuing growth potential

Maximizing “Business Strength”Maximizing

“Corporate Value”

＋Existing

Technology and Sales

Force

Expansion of

technologies

Expansion of sales channels

Maximize corporate value by promoting business portfolio strategies


Business Portfolio Strategy (1) Energy

Specialty Business

Vehicle Energy Japan*

MBP (Energy Segment)

Horizontal Development of “Strength” (Channel Expansion)

Vert

ical develo

pm

ent

of “s

trength

”(T

echnolo

gy E

xpansi

on)

Micro battery Expansion as growth driver

*Vehicle Energy Japan is not a consolidated subsidiary

【Existing Business Area】

Shift to automobile

ShrinkLithium-ion battery for consumer use

Technology expansion


Business Portfolio Strategy (2) Industrial Materials

In-car camera lensLED headlamp lens

Electric components

Functional film

Ube Maxell Kyoto

KurehaElastomer

Expansion in ADAS,electrification market

Expansion of EF2*

Expansion in semiconductor and construction market

Marketexpansion with new

technology

MBP (Industrial Material Segment) *EF2：Electro Fine Forming technology


Vert

ical develo

pm

ent

of “s

trength

”(T

echnolo

gy E

xpansi

on)


Technology Expansion


Business Portfolio Strategy (3) Electronic Appliances andConsumer Products

Projector

Beauty care productsConsumer products

Launch Maxell brand

✓ SSL*1 Projector✓ Visual System✓ In-car Device (HUD*2)

Business integrationLineup expansion

MBP (Electronic Appliances and Consumer Products Segment)

Tech

nolo

gy

exp

an

sio

n

Launch Maxell brand

Maxell Izumi

*1 SSL: Solid State Lighting*2 HUD: Head Up Display


Vert

ical develo

pm

ent

of “s

trength

”(T

echnolo

gy E

xpansi

on)



Purpose of MBP and Timing of contribution to Earnings

*Vehicle Energy Japan is not a consolidated subsidiary

-Expand area of battery related business-Propose new battery solution

MG20R period FY21-23 periodMBP result in FY2018

- Develop multi-cell LIB packs- Develop distribution of electrode applied products

-Expansion to industrial and automotive applications-Globalization of electrode applied products

- Integrate Health and beauty

care product business

- Develop hydraulic tools with

new concepts

- Expansion of market

share of health and beauty

care product and hydraulic

tools

- Increase production

capacity

- Strengthen development

of cutting edge technology

Business expansion corresponding to market demand increase

- Strengthen development of

new product

- Implement new investment

Expansion of business:

- Construction rubber

materials for overseas

- Electromagnetic wave

absorber

Specialty BusinessChargers, Battery Pack,

Electrode applied products

-Synergy of integrate health and beauty care product businesses-Strengthen and expand Hydraulic tools business

Maxell IzumiElectric home appliances

and hydraulic tools

-Strengthen coated separator business

-Increase production capacity to meet

EV market expansion

Ube Maxell Kyoto

Coated Separator

-Expand rubber material business relating to construction-Enter highly functional materials market for automotive

Kureha Elastomer

Industrial rubber

Already invested 34bn yen in FY18 out of 40bn yen in MG20 period for growth

- Vertical start of production

of LIB for HEV

- Achieve sales over 60 bn

yen

-Enhance and expand LIB

business for HEV

-Establish new pillar of business

Vehicle Energy Japan*

Automotive LIB

Establish integrated management structure,realize mid-long term synergy

Sales：Approx. 35 bnOPM: over 5% OPM: over 10%


Business Portfolio

Energy✓Expand micro battery as growth driver, shift of LIB from consumer to automobile.Industrial Materials

✓Expand automobile related business and mask for organic EL panels as growth driver.Electronic Appliances and Consumer Products✓Enhance focus on profitability and achieve high cash flow margin with less investment


Disciplined Financial Management

Introduce ROIC✓ Start activity throughout all the division in FY2019

Strengthen PIPJ activity✓ Control costs by model for more than 8,000 models.

Classification Division Products By Item

Fiscal Discipline

ROIC ABC-XYZ PIPJ※※P/L Improvement by Model

Project

KPI

Return On Invested Capital

・Sales Growth ratio・Net Sales - SG&A Expenses ratio・Net Sales - R & D Expenses ratio・Net Sales - Cost ratio・Working Capital turnover・Fixed Assets turnover

50/20/50 Concept・Growth Rate・Sales・Operating Margin・Products Category Number・Market/Competitor・NPV

Operating Income・Amount of profit by model・Number of profitable models・Deficits amount by model・Number of unprofitable models

Effect

Enhance corporate value and ROE

・Maximize profit・Clarify source of profitability・Optimizing invested capital

Judgement ofinvestment/withdrawal

・Strengthen growth business・Create competitive product

groups・Visualize unprofitable business・Accelerate implementation

Deficit cutting・Get rid of unprofitable models・Increase profitable models・Strengthen cost planning

- Achieve target of Operating Income

- Establish Business Portfolio

focusing on profitability

Establish proactive business management method




Division Segment Main ProductsSales

FY2018 FY2020 vs FY2018

EnergyEnergy

Consumer LIB Over 14.0 bn Over 6.0 bn (60%)

CLB Several Hundred mn Approx. 1.0 bn double

Heat-Resistant CR Batteries Approx. 7.0 bn Approx. 8.0 bn +10%

Cylindrical CR Battery Over 4.0 bn Approx. 5.0 bn +20%

Sub Total Approx. 38.0 bn Approx. 35.0 bn (10%)

SliontecIndustrial Materials

Adhesive Tapes Approx. 18.0 bn Under 20.0 bn +10%

Film Products (incl. Kureha Elastomer)*1 Mid. 1.0 bn Mid. 7.0 bn 4 times

Sub Total Under 21.0 bn Over 29.0 bn +40%

Optronics

Industrial MaterialsIn-car camera lens Under 4.0 bn Over 5.0 bn +40%

LED Headlamp lens, molding product, etc. Approx. 8.0 bn Mid 9.0 bn +20%

Electronics/Consumer

Projector Approx. 27.0 bn Under 26.0 bn flat

Automotive business (HUD) - Over 1.0 bn -

Imaging business - Mid. 1.0 bn -

Sub Total Approx. 53.0 bn Under 57.0 bn +10%

Life Solution

Industrial MaterialsEF2 Approx. 2.0 bn Approx. 3.0 bn +50%

Card (incl. E-passport) Approx. 1.0 bn Over 1.0 bn +10%

Electronics/Consumer

Health & Beauty care(Incl. Maxell Izumi) Approx. 12.0 bn Under 17.0 bn +40%

Skin diagnosis camera - Several Hundred mn -

Hydraulic tools*2 Mid. 2.0 bn Mid. 5.0 bn double

Sub Total Mid. 35.0 bn Approx. 40.0 bn +10%

Others Industrial Materials, etc Coated Separator, etc *3 Under 3.0 bn Over 12.0 bn 4 times

150.6 bn 173.0 bn +15%

Energy 38.3 bn 35.1 bn (8%)

Industrial Materials 52.4 bn 74.1 bn +41%

Electronics/Consumer 59.9 bn 63.8 bn +7%

Main Products by Division

*For more detail of these main products,please refer to presentation of each division.

*1 Kureha Elastomer has contributed to FY2018 sales since Jan-19. (3 months)*2 Hydraulic tools has contributed to FY2018 sales since Oct-18. (6 months)*3 Coated Separator has contributed to FY2018 sales since Jan-19. (3 months)



Notes about statements about the future

Parts of this document contain predictions about the future that are based on our current expectations and beliefs.These statements are provided as background material

for investors.We cannot ensure or guarantee that any such statement will prove to be correct.Please keep in mind that actual outcomes might differ

from anticipated results.

Documents

Mid-Term Plan MG20R - Maxell Growth 20 Revised · Mid-Term Plan MG20R - Maxell Growth 20 Revised - Maxell Holdings, Ltd. President and Representative Director Yoshiharu Katsuta Maxell