Ebara : Six Months Ended June 30, 2023 (Script)

Ebara Corporation

Results Presentation for Six Months Ended June 30, 2023

August 14, 2023

Event Summary

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Presentation

Osaki: Thank you very much for taking the time today to participate in the financial results briefing for the first six months of the fiscal year ending December 31, 2023 of EBARA CORPORATION.

We will start the briefing session from now. At 15:00 today, documents related to the financial results were disclosed on the TSE platform and on the Company's website. Please have the presentation material on hand.

Let me now introduce company representatives. Masao Asami, President, Representative Executive Officer.

Asami: My name is Asami. Thank you.

Osaki: Shu Nagata, President of Building Service and Industrial Company.

Nagata: I am Nagata. Thank you.

Osaki: Takanobu Miyaki, President of Energy Company.

Miyaki: My name is Miyaki. Thank you.

Osaki: Teruyuki Ota, President of Infrastructure Company.

Ota: My name is Ota. Thank you.

Osaki: Hideki Yamada, President of Environmental Solutions Company.

Yamada: I am Yamada. Thank you for today.

Osaki: Tetsuji Togawa, President of Precision Machinery Company.

Togawa: My name is Togawa. Thank you.

Osaki: Shugo Hosoda, Division Executive of Corporate Strategic Planning, Finance and Accounting Division, in charge of IR.

Hosoda: My name is Hosoda. Thank you.

Osaki: I, Osaki of Corporate Strategic Planning Division, will be the moderator. Thank you.

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Today, Mr. Hosoda, in charge of finance and accounting, will give an overview of the financial results, followed by a presentation of the outlook for the current fiscal year by Mr. Asami, President. We will then take your questions. The entire meeting is scheduled to end at 17:30.

You can listen to today's meeting via Zoom on demand. Details will be emailed to you after the meeting.

Now, Mr. Hosoda will explain.

Hosoda: I, Hosoda, Executive Officer, in charge of IR and Finance and Accounting Division, will begin today by explaining the key points in the financial results.

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First, I would like to report our consolidated results for the six months.

Revenue, operating profit, and profit attributable to owners of parent were all record highs for the six months, and I think we can say that the results were generally favorable.

Orders decreased YoY in the precision machinery segment, but were offset by other segments such as energy and building service and industrial. This resulted in the second-highest level of orders received, historically speaking, for the six months, following last year.

Revenue increased in all four segments except the environmental solutions segment. While fixed costs increased overall, the effect of increased revenue outweighed this, resulting in a YoY increase in operating profit as well.

Considering the recent business environment and the progress made in H1, we have revised our full-year forecast for the precision machinery segment slightly downward, while we have revised our full-year forecast for the energy segment upward, exceeding the downward revision for the precision machinery segment.

As a result, the full-year forecast for the entire company has been revised upward for orders, and the targets for revenue and operating profit have been maintained unchanged from the forecast at the beginning of the fiscal year, although there are some changes for each of segments.

The precision machinery segment, which has high profit margins but high volatility, is currently in an adjustment phase. Overall, its negative impact was covered by other segments such as energy, which I believe was a typical result for our group.

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