HANWA CO., LTD. IIIINNNNTTTTEEEERRRRIIIIMMMM
RRRREEEESSSSUUUULLLLTTTTSSSS
for the Year Ending March 2016
November 24, 2015
HANWA CO., LTD.Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 1
Overview of Interim Results
As for the interim result for this fiscal year, net sales has reached to 788.2 billion yen, decreased by 8.5%, due to the decline in petroleum and steel product prices.
On profit side, operating income have decreased by 9.4%, due to decrease profit in food businesses. Net income, however, went to high level thus reaching 6.0 billion yen, increased by 52.0%, mainly due to decrease in exchange loss and entry of extraordinary gain.
Annual earnings forecast：
Net sales 1,650 .0billion yen Operating income 20.0 billion yen
Ordinary income 18.0 billion yen
Net income 12.0 billion yen
We pay 8yen as interim dividend and plan to pay additional 8 yen as the end of this fiscal year dividend.
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 2
Operating Results ( consolidated )（Millions of yen）
changes
2015/9 2014/9 Rateof Net sales 788,216 861,116 -8.5% Gross profit 27,431 27,369 +0.2%SG&A expenses 19,260 18,350 +5.0%
Operating income 8,170 9,019 -9.4%Non-operating income 2,337 1,301 +79.6%
Non-operating expenses 3,555 3,460 +2.7%
Ordinary income 6,953 6,861 +1.3%Extraordinary gain/loss 1,908 - +100.0%
8,861 6,861 +29.2%
Income before income taxes and others
Net income | 6,055 | 4,009 | +51.0% |
Owners of the Company | 6,053 | 3,981 | +52.0% |
Minority interests | 1 | 27 | -96.3% |
Comprehensive income | 1,393 | 7,388 | -81.1% |
・Net sales have decreased by 8.5% for the same period of the
previous year, due to due to revenue decline in petroleum & chemicals and steel businesses.
・SG & A expenses increased by 5.0% for the same period of previous year, including 3.0% of newly consolidated subsidiaries. Our employment cost increased by 0.6 billion yen. Expenses of overseas subsidiaries were pushed up by weaker yen.
・Reversal entry of allowances for doubtful account were recorded
0.6 billion yen, thanks to decline in the bad debt ratio. Even with the reduced exchange losses, loss on investment in affiliates was recorded 1.3 billion yen.
.・EPS was 29.22 yen (+10.01 yen)
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 3
Changes in Business results （（（（ consolidated ））））
Net sales （billions of yen）
The U.S. economy was, although not
strong, generally healthy and the direction of the European economy was
2,000.0
1,500.0
Year ended
Interim period 1,682.5 1,737.3 1,650.0
1,511.3
unclear. Economic growth slowed in China and emerging country economies were sagging due to financial environment and geopolitical risks.
In Japan, the benefits of 'Abenomics' and the Bank of Japan's monetary easing
1,000.0
500.0
0.0
735.5 790.7
（forecast）
861.1 788.2
were diluted with flat construction
FY2012 FY2013 FY2014 FY2015
Net income （ millions of yen）
demand and weak exports.
12,500
Year ended
12,000
In the first half of this fiscal year, sales decreased because of lower prices of
petroleum, steel and other commodities.
10,000
7,500
Interim period
7,896
9,086
（forecast）
Although net income increased, earning profits was difficult in this operating environment.
5,000
2,500
0
4,720
-87
3,792
3,981
6,053
-2,500
FY2012 FY2013 FY2014 FY2015
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 4
Financial Position ( consolidated )（Millions of yen）
2015/9 2015/3 Rateof change Total assets 632,783 651,456 -2.9%Current assets 484,573 510,377 -5.1%
Fixed assets 148,209 141,078 +5.1%
Total liabilities 490,133 508,706 -3.7%
Interest-bearing
debt 261,739 272,575 -4.0%
Net assets 142,649 142,749 -0.1%Equity capital 131,281 126,320 +3.9%
Accumulated other
comprehensive income 10,002 15,094-33.7%
Minority interests 1,365 1,334 +2.3%
・Total assets have decreased by 2.9% from the end of the previous year, due to decrease of trade receivables and inventories correlated with decrease of sales.
・Interest-bearing debt decreased by 4.0%, due to the decrease in short term loans and commercial paper. Net debt-equity ratio was turned into 167.5%.
・Despite increase of accumulated earnings from quarterly net income, total net assets have decreased by 0.1% from the end of the previous year, due to the decreased carryover of hedge gains and net unrealized holding gains on securities.
Shareholders' equity ratio was 22.3%.(+0.6 pts.)
・BPS was 681.84 yen.(-0.62 yen)
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 5
（Millions of yen）
・Net cash provided by operation was 29.3 billion yen due to collection of working capital progressed with decrease in net sales.
Operating activities 29,313 (24,679) +53,992
Investing activities (12,395) (2,036) -10,359
Financing activities (17,754) 31,946 -49,700
Cash and cash・Net cash used in investment was 12.3 billion yen due to completion of Osaka Head Office and execution of long-term loan.
・Net cash used in
equivalents at end of the period 24,634 21,559 +3,075financing was 17.7 billion
yen due to decrease in short term loans and commercial paper.
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 6
Segment Information ( consolidated )Net sales Segmentincome
（Millions of yen）
2015/9 2014/9 Rateof
change
2015/9 2014/9 Rateof
change
Steel | 406,318 | 423,679 | -4.1% | Steel | 6,348 | 6,810 | -6.8% |
Metal & alloys | 73,966 | 65,447 | +13.0% | Metal & alloys | 1,303 | (27) | －－－－% |
Non-ferrous metals | 45,264 | 41,584 | +8.8% | Non-ferrous metals | 515 | 175 | +194.3% |
Foods | 47,705 | 43,920 | +8.6% | Foods | (164) | 593 | －－－－% |
Petroleum & chemicals | 150,042 | 231,193 | -35.1% | Petroleum & chemicals | 1,006 | 1,204 | -16.4% |
Total for reportable segments | 723,296 | 805,825 | -10.2% | Total for reportable segments | 9,009 | 8,757 | +2.9% |
Other | 129,230 | 115,930 | +11.5% | Other | 518 | 355 | +45.9% |
Total | 852,527 | 921,755 | -7.5% | Total | 9,528 | 9,112 | +4.6% |
Adjustment | (64,310) | (60,639) | -6.1% | Adjustment | (2,575) | (2,251) | -14.4% |
Consolidated | 788,216 | 861,116 | -8.5% | Consolidated | 6,953 | 6,861 | +1.3% |
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 7
（Millions of yen）
2015/9 | Net sales 406,318 | Segment income 6348 | Profit ratio 1.6% |
2014/9 | 423,679 | 6,810 | 1.6% |
Domestic steel demand for building construction and civil engineering is not growing due to delays in many projects caused mainly by shortage of construction workers. Also, demand for manufacturing decreased because of lower exports.
The amortization of all goodwill of equity-method affiliate CosmoSteel Holdings due to its lower stock
price was another reason for the decline in earnings.
1,000,000
800,000
7777 1111 8888 ,,,,1111 7777 0000
《Net sales》
8888 1111 1111 ,,,,0000 9999 6666
8888 7777 8888 ,,,,7777 1111 5555
（Millions of yen）
2nd half 1st half
600,000
3333 6666 2222 ,,,,5555 5555 2222
4444 3333 1111 ,,,,9999 4444 3333
4444 5555 5555 ,,,,0000 3333 6666
400,000
200,000
3333 5555 5555 ,,,,6666 1111 8888
3333 7777 9999 ,,,,1111 5555 3333
4444 2222 3333 ,,,,6666 7777 9999
4444 0000 6666 ,,,,3333 1111 8888
0
FY2012 FY2013 FY2014 FY2015
Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 8
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