Nippon Sheet Glass : FY2017 3rd Quarter Financial Results Presentation

GROUP

(from 1 April 2016 to 31 December 2016)

Nippon Sheet Glass Co., Ltd.

2 February 2017

Chief Executive Officer

Chief Operating Officer

Chief Financial Officer

2 February 2017 FY2017 Quarter 3 Results 3

(from 1 April 2016 to 31 December 2016)

Key Points Financial Results Business Update Summary

Agenda

2 February 2017 FY2017 Quarter 3 Results 4

• Significant increase in trading profit from the previous year despite translational impact of yen appreciation

• Steady improvement in cash generation

• Increasing trend in value-added volumes

2 February 2017 FY2017 Quarter 3 Results 5

(from 1 April 2016 to 30 December 2017)

Key Points Financial Results Business Update Summary

Agenda

2 February 2017 FY2017 Quarter 3 Results 6

(JPY bn)

Change from FY2016

Revenue

Trading profit

-10% 2

37% 3

Amortization 1

Operating profit Exceptional items Finance expenses (net)

Share of JVs and associates Profit/(loss) before taxation Profit/(loss) for the period

Profit/(loss) attributable to owners of the parent

EBITDA

1. Amortization arising from the acquisition of Pilkington plc only

2. Increase of 3% based on constant exchange rates

3. Increase of 64% based on constant exchange rates

90%

6%

Profits improved despite foreign exchange movements

2 February 2017 FY2017 Quarter 3 Results 7

Trading profit

30

Q3 FY2016

25

20

15

10

5

0

Q3 FY2017

Improved market conditions and lower input costs

2 February 2017 FY2017 Quarter 3 Results 8

(JPY bn)

Gain on disposal of non-current assets

Gain on disposal of investments in associates Gain from exit of business

Gain on dilution in an associate Restructuring costs

Impairment of non-current assets Settlement of litigation matters

Exceptional gains from disposal of non-current assets

2 February 2017 FY2017 Quarter 3 Results 9

(JPY bn)

Profit/(loss) for the period Depreciation and amortization Impairment

Gain on disposal of assets and exit of business Tax paid

Others

Net operating cash flows before movement in working capital

Net change in working capital

Net cash flows from operating activities

Purchase of property, plant and equipment Disposal proceeds

Others

Steady improvement in cash generation

Net cash flows from investing activities Cash flows before financing activities

2 February 2017 FY2017 Quarter 3 Results 10

31-Dec-16

372

5.9x

3.7

FY2017 Q3

3.4x

5.3%

31-Mar-16

Net Debt (JPY bn) 381

Net Debt/EBITDA 6.3x

Net Debt/Equity Ratio 3.4

FY2016 Q3

EBITDA Interest Cover 3.4x

Operating Return* on Sales 3.5%

* trading profit

Profitability ratios improved

2 February 2017 FY2017 Quarter 3 Results 11

(from 1 April 2016 to 31 December 2016)

Key Points Financial Results Business Update Summary

Agenda

2 February 2017 FY2017 Quarter 3 Results 12

¥ 430.7 billion

Auto

North America 14%

Auto Japan

9%

Auto - ROW 5%

Technical 8%

Architectural

Europe

15%

Architectural Japan 12%

Auto Europe 22%

Architectural

North America 6%

Architectural - ROW 9%

FY2017 Quarter 3

Diversified geographical coverage

2 February 2017 FY2017 Quarter 3 Results 13

Q3 FY2016 v Q3 FY2017

Revenues

Trading profit

€m €m

1,500

Q3 FY2016

Q3 FY2017

80

67 60

Architectural

• Strong demand leading to a robust

  pricing environment

• Profits benefitted from high level of capacity utilization and lower

  1,000

  500

  0

  525 532

  21 40

  778 800

  20

  0

  Arch Auto Trading profit

  energy costs

  Automotive

• Recovery of light-vehicle sales in the region

• OE profits benefitted from

  improved operational performance

• Robust volumes in AGR

Businesses benefitted from improved market conditions

2 February 2017 FY2017 Quarter 3 Results 14

Q3 FY2016 v Q3 FY2017

Revenues

Trading profit

JPY bn JPY bn

100

80

Q3 FY2016

Q3 FY2017

8.0

Architectural

• Effect of reduced volumes partially mitigated by lower input costs and cost savings

  54 50

  5.2

  604.3

  40

  20 4241

  0

  Arch Auto Trading profit

  6.0

  4.0

  2.0

  0.0

  Automotive

• Revenues and profits fell slightly from the previous year

• Market volumes improving in Q3

Profitability affected by softened market conditions

2 February 2017 FY2017 Quarter 3 Results 15

Q3 FY2016 v Q3 FY2017

Revenues

Trading profit

$m $m

800

600

400

Q3 FY2016

242

51

Q3 FY2017

249

70

100

80

60

40

Architectural

• Profitability continued to improve with the increased prices and value-added volumes

  Automotive

• Improved OE revenues and profits reflects increased NSG volumes

  200

  0

  543559

  20

  0

  Arch Auto Trading profit

  • Improved operational efficiency

  • AGR results similar to the previous year

    Markets continue to improve

    2 February 2017 FY2017 Quarter 3 Results 16

    Rest of World

    Q3 FY2016 v Q3 FY2017

    Revenues

    Trading profit

    $m $m

    600

    400

    Q3 FY2016

    387 61

    Q3 FY2017

    84

    359

    100

    80

    60

    Architectural

• Profitability in South America improved, with the previous year having included the effect of a cold repair in Argentina

• Robust demand in South East Asia

  200

  0

  40

  217 214 20

  0

  Arch Auto Trading profit

  Automotive

  • Weak market conditions persist in South America

    Mixed market conditions among regions

    2 February 2017 FY2017 Quarter 3 Results 17

    Technical Glass

    Q3 FY2016 v Q3 FY2017

    Revenues

    Trading profit

    JPY bn JPY bn

    Q3 FY2016

    40

    30

    Q3 FY2017

    1.0

    0.8

    Technical Glass

• Losses in the Display business narrowed following the mothballing of the thin glass float line in Vietnam

  3834

  20

  0.4

  0.3

  10

  0

  Revenue Trading profit

  0.6

  0.4

  0.2

  0.0

• Revenues from components used

  in multi-function printers declined

• Volumes of glass cord used in engine timing belts were robust

• Battery separator segment benefitted from strong demand

  Reduced losses in Display after mothballing the float line in Vietnam

  2 February 2017 FY2017 Quarter 3 Results 18

  Joint Ventures and Associates

  Q3 FY2016 v Q3 FY2017

  (JPY bn)

  FY2016 Q3 FY2017 Q3

  Share of post-tax results (1.0) 0.8

  • Profits were below the previous year at Cebrace, the Group's joint

    venture in Brazil

  • Results of China and Russia Joint Ventures not included following March 2016 impairments

Improving shares of JV results

2 February 2017 FY2017 Quarter 3 Results 19

(from 1 April 2016 to 31 December 2016)

Key Points Financial Results Business Update Summary

Agenda

2 February 2017 FY2017 Quarter 3 Results 20

• Significant increase in trading profit from the previous year despite translational impact of yen appreciation

• Steady improvement in cash generation

• Increasing trend in value-added volumes

• FY2017 full-year forecast maintained

2 February 2017 FY2017 Quarter 3 Results 21

The projections contained in this document are based on information currently

available to us and certain assumptions that we consider to be reasonable. Hence the actual results may differ. The major factors that may affect the results are the economic environment in major markets (such as Europe, Japan, the U.S. and Asia), product supply/demand shifts, and currency exchange fluctuations.

Nippon Sheet Glass Co., Ltd.

2 February 2017 FY2017 Quarter 3 Results 22

2 February 2017 FY2017 Quarter 3 Results 23

FY2016 Q3 v FY2017 Q3

2 February 2017 FY2017 Quarter 3 Results 24

FY2016 Q3 v FY2017 Q3

2 February 2017 FY2017 Quarter 3 Results 25

(JPY bn)

Assets

Non-current assets Goodwill & intangible assets Property, plant and equipment Other

Current assets

Cash and cash equivalents Other

Liabilities

Current liabilities Financial liabilities Other

Non-current liabilities

Financial liabilities Other

Equity

Shareholders' equity Non-controlling interests

Total liabilities and equity

2 February 2017 FY2017 Quarter 3 Results 26

Americas

30%

36%

Europe

Asia

32%

Revenues include:

• Group revenues: JPY 629 bn; and

• Group share of Joint Ventures & associates revenues: JPY 48bn

(Fiscal year ended 31 March 2016)

Balanced presence in Europe, Asia and Americas

2 February 2017 FY2017 Quarter 3 Results 28

110_00

105.00

100.00

95.00

0 90.HO

II 85.00

80.00

75.00

70.00

65.00

• European Union (28 countr ies.)

• Euro areai (19 countries)

GROUP

60.00

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N N N N N N N N N N N N N N N N N N N N N N N N N N N

Source: Eurostat

2 February 2017 1 FY2017 Quarter 3 Results 29

GROUP