Mitsui Chemicals. CEO Explanation Business Results & Outlook. November 20, 2013 Toshikazu Tanaka President & CEO

Transcription

1 Mitsui Chemicals CEO Explanation Business Results & Outlook November 20, 2013 Toshikazu Tanaka President & CEO 1

2 1.Financial Result & Outlook for FY Progress of Mid-Term Business Plan 3.Investment Plan and Financial Status 2

3 Results of 1 st Half of FY2013 & Forecast for FY2013 (billion yen) ( ) Denotes a minus Items FY2012 FY2013 Increase(decrease) 1st Half Full year 1st Half Full year 1st Half Full year Sales , , Operating income Non-operating income/expenses (4.0) 4.9 (0.3) (4.0) 3.7 (8.9) Ordinary income(loss) (2.5) Special gains/losses (9.0) (10.0) (2.4) (7.0) Net income(loss) before income taxes and minority interes (11.5) (0.8) Net income(loss) (15.3) (8.1) Exchange rate(yen/us$) Domestic standard Naphtha Price(Yen/KL) 55,200 57,500 64,700 64,900 9,500 7,400 3

4 Operating Income/Loss (by business segment) (billion yen) Segment ( ) Denotes a minus FY2012 FY2013 Increase(decrease) 1st Half Full year 1st Half Full year 1st Half Full year Functional Chemicals Functional Polymeric Materials Polyurethane (1.8) (2.6) (4.1) (2.0) (2.3) 0.6 Basic Chemicals (7.0) (18.9) (8.0) (16.0) (1.0) 2.9 Petrochemicals Films and Sheets (1.5) (3.3) 0.9 (0.5) Total (including Others)

5 Operating Income from FY2008 Despite being on the recovery track, the outlook for the 2 nd half is severe (billion yen) (Aug.1 Outlook:16) Accident at Iwakuni Works Lehman Shock -European Financial Crisis -Economic slowdown in emerging countries FY08 年度 09 FY09 年度 10 FY10 年度 11 FY11 年度 12 FY12 年度 13 FY13(Outlook) 年度 ( 予想 ) Denotes a minus 5

6 Operating Income (FY2012 Result FY2013 Outlook) FY2013 Effects of recovery from accident, etc. Operating income forecast 25 billion yen (Operating Income: billion yen) Sales volume increase PP-CPD, Elastomer, MR-monomers, Nonwovens, Agrochemicals 4.3 Sales Volume +6 9 Accident at Iwakuni Works Power trouble at Ichihara Changes in FY at overseas subsidiaries Price, etc +2 FY13 Outlook FY12 年度決算 Result (Factors ( 変動要因 in FY12/FY13) ) FY13 13 Outlook 年度予想 +4 Positive factors Exchange rates Formula gap of polyolefin sales Improved market prices (Elastomer) Negative factors Market downturn (Phenol, Butadiene) Denotes a minus 6

7 1.Financial Result & Outlook for FY Progress of Mid-Term Business Plan 3.Investment Plan and Financial Status 7

8 Changes in Business Portfolio High Functional Products Ophthalmic Lens Monomers, Dental Materials, Nonwovens, Agrochemicals High Value Added Polymers PP-Compounds, Admer TM, Evolue TM, Tafmer TM, EPT, etc. Phenol Chains Fundamental restructuring measures 1 Restructuring measures for volatile volume market business - Phenol, PTA, Polyurethane (TDI) 2 Reinforce High Functional Products and High Value Added Polymers 8

9 Business Portfolio Condition and Challenges - Steady progress for High Functional Products and High Value Added Polymers - Sluggish conditions for volatile volume market products (Phenol, PTA, and Polyurethane) (Operating income: billion yen) Denotes a minus High Value Added Polymers High Functional Products Phenol, PTA, Polyurethane, etc Market slump FY11 FY12 FY13(Estimate) FY13(Outlook) 9

10 Condition of Business Restructuring 10

11 Issues in Volume Business Restructuring of Volatile Business 1 Phenol Chains 2 PTA 3 Polyurethane (TDI) 11

12 1 Phenol - Supply and Demand - Restructuring of Volatile Business Over supply after 2014 from new facilities and production increases in China China Japan (unit: 10 thousand tons) 300 需要 Demand 供給能力 Supply 300 需要 Demand Supply 供給 '12 '13 '14 '15 '16 '17 0 '12 '13 '14 '15 '16 '17 Improvement in supply and demand in 2017 Surplus 300KTA High utility costs 12

13 1 Phenols Conditions and Directions - Strengths in Phenol Business -Sites in emerging ASEAN countries and China -Multiple derivatives and measures for surplus acetone -Cooperation with influential partners Restructuring of Volatile Business Local Production and Local Consumption Cost Reduction Regional Cooperation China Japan Singapore Shanghai 250KTA Under construction JV with Sinopec Chiba Osaka 640KTA Singapore 310KTA -Competitive utility and low materials costs -Strong sales structure Competitive new plants Optimization of plant operations Measures for high utility costs 13

14 2 PTA - Local Production for Local Consumption - Restructuring of Volatile Business SMPC (Thailand): Secure world s top class competitiveness through rationalization (MCI estimate) World s Top Competitiveness SMPC(THA) Company A (THA) Company B (China) Company C (China) 14

15 Nghi Son Project - Secure competitive aromatics - Restructuring of Volatile Business - Competitive large scale refinery and petrochemical complex in rapidly growing Vietnam (Operation commencement: 2017 ) (Idemitsu: 35.1%, KPI: 35.1%, PVN: 25.1%, Mitsui Chemicals: 4.7%) PTA PH PH PH PTA Nghi Son Complex Paraxylene:700KTA PH PTA Benzene:240KTA Secure a stable and competitive source for aromatics (Increase in-house rate of paraxylene and benzene) 15

16 3 Polyurethane (TDI) - Supply and Demand - Restructuring of Volatile Business 単位 : 千 t (thousand tons) 需要 Demand (World) 生産量 Production メーカー在庫 Maker inventory 稼働率 Run rates 87% 77% 79% 81% 83% 84% 80% 78% Jan-Mar 1-3 月 Apr-Jun 4-6 月 Jul-Sep 7-9 月 Oct-Dec 月 Jan-Mar 1-3 月 Apr-Jun 4-6 月 Jul-Sep 7-9 月 Oct-Dec 月 % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Inventory rationalization through production adjustments and demand recovery predicted to bolster improvements in supply and market in second half of FY

17 3 Polyurethane (TDI) Condition and Measures - Restructuring of Volatile Business Japan (thousand ton) Saudi Arabia License for TDI and MDI to SABIC TDI Reduction of export to China Omuta 120 Kashima 117 Expansion of export to ASEAN, Russia, the Middle East, Africa, and South America Measures 1Decrease in export dependence to China (50% 30%) 2Cost reduction (FY15 target 8 billion yen 10 billion yen) 3Reinforcement of system housing business Study further measures 17

18 ~Changes in Business Portfolio~ High Functional Products 18

19 Progress of High Functional Products (1/2) Steady progress in High Functional Products through M&A 2011 FY11 年度 2012 FY12 年度 2013 FY13 年度 2014 FY14~ 年度以降 Ophthalmic Lens Monomers CHE) ACOMON acquisition Further strengthening position as a top player SGP) SDC new base KOR) KOC acquisition Dental Materials Secure global base GER) Heraeus Dental acquisition USA.) DENTCA acquisition Nonwovens Establish 3 bases in Asia 64KTA 94KTA JPN) Increase capacity(+15kta) CHN) New base(15kta) 19

20 Progress of High Functional Products (2/2) 2011 FY11 年度 2012 FY12 年度 2013 FY13 年度 2014 FY14~ 年度以降 2011 年度 2012 年度 2013 年度 2014 年度以降 THA) Acquire stake in Sotus THA) New R&D base Agrochemicals BRA) Acquire stake in Iharabras BRA) Launch of insecticide Establish global bases Progress in legal registration IND) Launch of insecticide USA) Launch of fungicide CHN) Launch of insecticide EUR) Launch of fungicide 20

21 Expansion of Dental Materials High Functional Products - Global dental materials market will stably grow at a rate of 6-7% attributable to ageing of world population - Material shift from metal to plastics Dental Material Market: 800 billion yen (million US$) 10,000 North.America EU Asia (excl. Japan) South America Japan Others 8,000 6,000 4,000 2,000 1Acquisition of Heraeus Dental World s 6 th largest dental materials provider with sales in 22 countries 2Acquisition of DENTCA Dentures using CAD/CAM and 3-D printers 21

22 Business Plan of Heraeus Kulzer High Functional Products Synergy Expansion through global production and sales - Expansion of Heraeus Kulzer sales in Japan and Asia - Sales of Sun Medical products under Heraeus Kulzer brand Joint development of new products using proprietary polymer technology Operating income (million ) 13% ROS(%) Strategies to strengthen competitiveness Synergy 10% 5% 20 0 FY12 FY13 FY14 FY15 22

23 Agrochemicals High Functional Products Acceleration of global deployment through new bases and registration New sales bases Korea, Thailand, India, Vietnam, Brazil, Europe Acquisition of stakes TH) Sotus BR) Iharabras Overseas 37 16% R&D base Establish new R&D base in Thailand (Feb,2014) 40 24% Development Five next generation active ingredients 50 32% (Sales :billion yen) Target % Japan Register IN/insecticide US/fungicide CN/insecticide EU/fungicide Register BR/fungicide (2014) FY11 年度 FY13 年度 FY16 年度 FY22 年度 23

24 ~Changes in Business Portfolio~ High Value Added Polymers 24

25 Progress of High Value Added Polymers (1/2) Major Projects Scheduled for Start Up After FY FY11 年度 2012 FY12 年度 2013 FY13 年度 2014 FY14 年度以降 & after Evolue TM JPN) Increase capacity(+50kta) Strengthen market share in Asia 250KTA 600KTA SGP) new base (300KTA 2015) Tafmer TM Strengthen position as world s top provider 250KTA SGP) Increase specialty Tafmer(8KTA) EPT Strengthen market share in Asia 95KTA 170KTA CHN) New base(75kta) Bio-Polyol IND) New base(8kta 2015) 25

26 Progress of High Value Added Polymers (2/2) PP compounds Secure position as global leader with 8 bases and 1,000KTA capacity 2011 FY11 年度 2012 FY12 年度 2013 FY13 年度 2014 FY14~ 年度以降 2011 年度 2012 年度 2013 年度 2014 年度以降 USA) Increase capacity (+14KTA) +28KTA +14KTA MEX) Increase capacity (+13KTA) +25KTA BRA) Produmaster acquisition (+55KTA) THA) Increase capacity (+18KTA) +15KTA CHN) Increase capacity (+9KTA) +10KTA +14KTA +13KTA Admer TM Secure position as world s top provider CHN) New base 26

27 PP Compounds High Value Added Polymers - Strengthen global capacity through expansions in U.S.A. and Mexico - Study feasibility of establishing R&D base in Europe Contribute to global and local strategies of automobile manufacturers U.S.A. Europe China Japan Mexico India Thailand Production bases Brazil Production and R&D bases Company A MCI-G Global leader with capacity of 1,000KTA (FY2014) 27

28 Topics Polyurethane) Bio-polyol High Value Added Polymers Establishment of New JV for Bio-polyol in India (Operation from Jan 2015) Production of bio-polyol from non-edible castor and contribute to CO2 reduction castor castor oil Bio-polyol polyurethane foam automotive interior * India is the world's largest hub in castor oil production Outline of Joint Venture Jayant Agro-Organics(50%) The world's leading producer of castor oil Mitsui Chemicals(40%) Largest supplier for automotive interior polyurethane foam materials World s only Bio-polyol manufacturer and supplier Itoh Oil Chemical (10%) Japan's leader in castor oil production with high manufacturing technology and high quality control expertise (Joint venture agreement signing ceremony) 28

29 Topics Expanding Bio-polyol in Asia High Value Added Polymers Tianjin Japan castor castor oil Bio-polyol (India) Bio-polyol Foshan Suzhou Thailand Supply of competitive bio-polyol through 7 bases system house in Asia Malaysia Indonesia 29

30 1.Financial Result & Outlook for FY Progress of Mid-Term Business Plan 3.Investment Plan and Financial Status 30

31 Effect of Investments Focus 90% of growth investments on High Functional Products and High Value Added Polymers FY Growth investments Investment effect (50 themes) Others その他フェノール チェーン Phenol Chains High Functional 高機能製品 Products (billion yen) Others Phenol Chains High 高付加価値 Value Added Polymers ポリマー 1, 億円 billion yen High Value Added Polymers High Functional Products Heraeus 歯科材 Dental M&A 1.1 (incl. Heraeus Dental) FY131 FY15 2 FY17 3 Effect of growth investments during Mid-Term Business Plan will result in rapid expansion after FY

32 (Appendix) Investment Themes Over 50 ongoing investment themes (Operating income: billion yen) -Mega solar -Electrolyte solution -Improvement in consumption of acetic acid -Acetone based IPA -New phenol base in China 21 -PP compounds (Capacity increase) -Tafmer (Specialty grade) -New EPT base in China -HZ Million (Capacity increase) 31 Others Phenol Chains High Value Added Polymers 1.1 -Heraeus Dental -ACOMON, KOC, SDC -Agrochemicals -Nonwovens (New base, capacity increase) High Functional Products FY13 FY15 FY17 (reference)

33 Progress in Cost Reduction 1 st Half FY2013 Results : 4.6 billion yen Polyolefin ポリオレフィン Item 項目 汎用樹脂プラントの停止など - Suspension of commodity plants Polyurethane ウレタン コスト構造改革進捗 - Extensive restructuring ( 大牟田など (Omuta ) Works) 13 FY13 年度 1 st Half 上 13FY13 ( Target 計画 ) ( Results 実績 ) Target 9 billion yen Phenol, PTA, others フェノール PTA 他 用役コストダウン -Utility cost reduction 原単位改善 -Improvement in consumption rate 省スチーム化など -Steam saving Film & Sheets 東セロ合理化 -Improvement in productivity 産収率改善 販直費削減など -Reduction of sales & administrative costs その他コストダウン ( 購買 物流等 ) Others (Purchasing, Logistics) Total 合計 st Half FY13 FY13 Target 32

34 Financial Outlook Efforts to improve balance sheet 8, (billion yen) D/E ratio Heraeus Dental M&A 2.0 6, , , Interest-bearing liabilities Equity 386 FY08 FY09 FY10 FY11 FY12 FY13(forecast) Note) excl. projected retirement obligations in FY13 33

35 Conclusion Perfect Change in Business Portfolio Steady progress in expansion of High Functional Products and High Value Added Polymers Clarify restructuring plan during FY2013 and execute the plan during the next Mid-Term Business Plan 34

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