JCU : Briefing for the Second Quarter of the Fiscal Year Ending March 2023New! (2.54 MB)

JCU Corporation

Q2 Financial Results Briefing for the Fiscal Year Ending March 2023

November 11, 2022

Event Summary

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Presentation

Kimura: Hello, everyone. I am Kimura, Representative Director, President, and CEO.

FY2023 started in a difficult business environment, with the global economy stagnating due to the situation in Russia and Ukraine, the lockdown centered on the Shanghai area due to the Zero Corona policy in China, and the prolonged trade friction between the US and China.

In this environment, we announced the establishment of a local subsidiary in Malaysia as part of our China Plus One initiative. In anticipation of increasing semiconductor-related demand in the future, we have also decided to establish a base in Kumamoto, where the semiconductor industry is growing rapidly.

We will continue to invest in order to maintain stable business activities in an uncertain business environment.

Page two is a summary of our financial results for Q2 FY2023.

Due to the three-month difference in the fiscal year end of our overseas subsidiaries, our domestic non- consolidated business results are for the period from April 2022 to September 2022, while our overseas subsidiaries' business results are for the period from January to June 2022.

In the electronic components field, smartphone shipments declined, but demand for printed circuit boards for other high-performance electronic devices remained flat, with IoT and teleworking as keywords.

In semiconductor package substrates, some customers have moved to reduce inventories, and there are differences by region.

The situation in each region will be explained in more detail later.

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In the automotive sector, the shortage of semiconductors has partially eased, but shortages in the supply of components and disruptions in the supply chain have affected automobile production operations, resulting in a decline in our chemicals sales.

In the equipment business, sales of plating equipment for plating automobile parts increased due to the resumption of projects in which investment had been postponed due to coronavirus disasters.

In addition, in plating equipment used in the electronics field, new investments increased, and orders received and order backlogs increased significantly.

As a result of this business environment, our cumulative consolidated results for H1 FY2023 are as shown on page three of the document.

Net sales, operating income, ordinary income, and net income all increased compared to the same period last year.

In addition, the weaker yen also contributed to the higher-than-expected results, and the Company landed higher than its forecast at the beginning of the fiscal year.

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Page four is the exchange rate.

Our overseas transactions are sold in local currencies and converted into Japanese yen at the time of consolidated closing, so foreign exchange rates affect our business results.

The major currencies used are the Chinese yuan, Taiwan dollar, and Korean won, all using the average rates for the period from January to June 2022.

A 1% change in major currencies has an approximately JPY90 million impact on consolidated operating income.

Compared to the same period of the previous year, the yen weakened significantly in all three currencies, contributing to the increase in operating income.

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