Q3 Results for the Fiscal Year Ending March 31, 2020 (IFRS)
(From April 1, 2019, to December 31, 2019)
LIXIL Group Corporation
January 31, 2020
TSE Code: 5938
Copyright © LIXIL Group Corporation. All rights reserved.
LIXIL GROUP HAS TRANSITIONED TO IFRS FROM FYE2016 CHANGE IN PROFIT LEVEL STRUCTURE IS AS SHOWN BELOW
JGAAP | IFRS (LIXIL Group Financial Reporting) |
Net sales | Revenue |
Cost of sales | Cost of sales |
Gross profit | Gross Profit |
SG&A | SG&A |
Operating profit | Core earnings (CE) |
Non-operating income/expenses | Other income/expenses |
Ordinary income | Operating profit |
Extraordinary income/losses | Finance income/costs |
Share of profit (loss) for using the equity method | |
Profit before income taxes | Profit before tax |
Net profit | Net profit |
attributable to Non-controlling interests | attributable to Owners of the parent |
attributable to Owners of the parent | attributable to Non-controlling interests |
"Core earnings" in IFRS is equivalent to JGAAP's "Operating profit"
2
KEY HIGHLIGHTS
Japan business continues to lead revenue and profit growth over nine months Strong H1 performance in Japan offsets decrease in demand following tax hike(1)
- Revenue: JPY 1,396.5 billion, increased 1.1% year-on-year
Japan:increased 2.8% year-on-year, driven by LIXIL Water Technology (LWT), LIXIL Housing Technology (LHT), and Distribution & Retail (D&R) businesses but impacted from November onward by consumption tax hike
Overseas:decreased 3.5% year-on-year due to changing market conditions in North America, slowdown of markets in Asia Pacific regions, and the impact of the Euro-to-Yen exchange rate(2) (Note: overseas sales increased by 1.0% on a local currency basis) - Core earnings: JPY 51.7 billion, increased 39.3% year-on-year
Japan:all businesses except D&R contributed to higher core earnings, benefitting from strong first- half demand for new housing and renovation prior to the consumption tax hike, cost improvement initiatives, and product price revisions
Overseas:despite decrease in sales, core earnings increased due to changes in the sales mix - Net profit(3): JPY 30.7 billion, increased 28.6 billion year-on-year
Profit before tax increased by JPY 17.0 billion due to increase in core earnings and gain on sales of subsidiaries/interest in former affiliated company (JPY 12.4 billion) in H1
Full-year forecasts remain unchanged while we continue to assess the reactionary impact of the consumption tax hike on demand and the effect of recovering from the delay of medium-term initiatives
(1) Consumption tax hike effective October 1, 2019
(2) Forex: Q3 FYE2019 Results 1EUR = 129.38JPY, Q3 FYE2020 Results 1EUR = 121.46JPY3
(3) Net profit = Net profit attributable to owners of the parent
Q3 FYE2020 CONSOLIDATED BUSINESS RESULTS
Q3 | Q3 | YoY | ||
9 months | 9 months | |||
JPY: billion | FYE2019 | FYE2020 | ||
Results | Results | Increase/ | % | |
decrease | ||||
Revenue | 1,381.2 | 1,396.5 | 15.3 | 1.1% |
Other businesses | 1,260.9 | 1,285.5 | 24.6 | +2.0% |
Permasteelisa | 120.3 | 111.0 | -9.3 | -7.7% |
Gross Profit | 415.2 | 435.7 | 20.5 | 4.9% |
(%) | 30.1% | 31.2% | +1.1pp | - |
Core Earnings (1) | 37.1 | 51.7 | 14.6 | 39.3% |
(%) | 2.7% | 3.7% | +1.0pp | - |
Other businesses | 46.2 | 59.2 | 12.9 | +28.0% |
Permasteelisa | -9.1 | -7.5 | 1.6 | - |
Net Profit(2) | 2.1 | 30.7 | 28.6 | - |
- Revenue:increased due to favorable demand in H1 in Japan (Japan +2.8%, overseas -3.5%(3))
- Core earnings:margin improved by 1.0pp. Improvement of gross profit margin remains +1.1pp. Sales to SG&A ratio remained at the same level as the prior fiscal year.
(Note: core earnings margin excluding Permasteelisa was 4.6%)
(1) Equivalent to "Operating profit" of JGAAP
(2) Net profit attributable to owners of the parent4
(3) Overseas sales grew by 1.0% excluding forex impact
Q3 BUSINESS RESULTS BY SEGMENT (3 AND 9 MONTH PERIODS)
9-monthperiod:Increase in revenue and core earnings continued to be driven by core housing | ||
and water businesses | ||
3-monthperiod:Decrease in revenue and core earnings due to the decline in demand after | ||
consumption tax hike and the absence of demand generated by natural disasters in the previous | ||
fiscal year in Japan | Q3 3 months | Q3 9 months |
FYE2019 | FYE2020 | Amount | FYE2019 | FYE2020 | Amount | |||||
(B)-(A) | (B)-(A) | |||||||||
(A) | (B) | (A) | (B) | |||||||
JPY billion | Forex | Forex | ||||||||
LWT(1) | Revenue | 218.5 | 212.8 | -3.8 | -5.7 | 620.5 | 623.6 | -11.5 | 3.1 | |
CE | 20.6 | 18.9 | -0.3 | -1.7 | 46.1 | 52.2 | -1.1 | 6.1 | ||
LHT(1) | Revenue | 147.9 | 138.1 | 0.0 | -9.8 | 404.9 | 417.1 | -0.2 | 12.2 | |
CE | 11.4 | 8.4 | 0.0 | -3.0 | 16.0 | 26.6 | 0.0 | 10.6 | ||
LBT | Revenue | 72.1 | 66.3 | -2.3 | -5.8 | 202.4 | 193.9 | -7.4 | -8.5 | |
CE | -4.4 | -2.1 | 0.3 | 2.3 | -8.1 | -6.3 | 0.6 | 1.8 | ||
D&R | Revenue | 48.1 | 47.0 | - | -1.1 | 136.0 | 142.2 | - | 6.2 | |
CE | 2.9 | 1.7 | - | -1.2 | 7.6 | 6.9 | - | -0.7 | ||
H&S | Revenue | 14.8 | 13.8 | - | -1.0 | 41.0 | 40.6 | - | -0.4 | |
CE | 1.2 | 0.9 | - | -0.3 | 2.6 | 2.7 | - | 0.1 | ||
Consolidation, adj.Revenue | -8.4 | -7.0 | - | 1.5 | -23.6 | -21.0 | - | 2.6 | ||
& other(1)CE | -8.4 | -10.5 | - | -2.1 | -27.1 | -30.4 | - | -3.3 | ||
LIXIL Group | Revenue | 493.0 | 471.0 | -6.2 | -22.0 | 1,381.2 | 1,396.5 | -19.1 | 15.3 | |
CE | 23.4 | 17.3 | -0.1 | -6.1 | 37.1 | 51.7 | -0.5 | 14.6 | ||
(1) Due to growing importance from Q2 FYE 2020 within the "Housing Technology Business" for some domestic subsidiaries that were
previously classified as the "Water Technology Business", the reporting segment for those subsidiaries are separated to the Housing 5 and Water Businesses
JAPAN BUSINESS HIGHLIGHTS (3 MONTHS PERIOD)
Japan business progressing in line with full-year projections so far despite the decrease in revenue and core earnings following the consumption tax hike. Full-year forecasts remain unchanged while considering impact of consumption tax and initiatives to achieve the MTP
FYE2020 | ||||||||
Q3 3 months | Q3 9 months | full-year | ||||||
f'cst | ||||||||
FYE2019 | FYE2020 | Amount | FYE2019 | FYE2020 | Amount | Progress | ||
JPY billion | (A) | (B) | (B)-(A) | (A) | (B) | (B)-(A) | ||
LWT(1) | Revenue | 117.9 | 114.4 | -3.5 | 325.9 | 333.1 | 7.2 | 76.6% |
CE | 12.8 | 10.3 | -2.5 | 23.1 | 27.4 | 4.3 | 115.7% | |
LHT(1) | Revenue | 145.4 | 136.4 | -9.1 | 396.9 | 410.6 | 13.7 | 77.8% |
CE | 11.1 | 8.9 | -2.1 | 16.2 | 27.1 | 10.9 | 100.7% | |
LBT | Revenue | 29.5 | 30.1 | 0.7 | 82.1 | 82.9 | 0.8 | 71.5% |
CE | 0.4 | 0.8 | 0.4 | 1.1 | 1.4 | 0.3 | 61.8% | |
D&R | Revenue | 48.1 | 47.0 | -1.1 | 136.0 | 142.2 | 6.2 | 75.6% |
CE | 2.9 | 1.7 | -1.2 | 7.6 | 6.9 | -0.7 | 111.4% | |
H&S | Revenue | 14.8 | 13.8 | -1.0 | 41.0 | 40.6 | -0.4 | 71.2% |
CE | 1.2 | 0.9 | -0.3 | 2.6 | 2.7 | 0.1 | 80.5% | |
LIXIL Group | Revenue | 355.8 | 341.7 | -14.0 | 981.9 | 1,009.4 | 27.5 | 76.2% |
CE | 28.3 | 22.6 | -5.8 | 50.7 | 65.5 | 14.8 | 104.9% | |
(1) Due to growing importance from Q2 FYE 2020 within the "Housing Technology Business" for some domestic subsidiaries that were
previously classified as the "Water Technology Business", the reporting segment for those subsidiaries are separated to the Housing 6 and Water Businesses
MEDIUM TERM STRATEGY - "ESTABLISH A PURPOSE-DRIVEN ENTREPRENEURIAL COMPANY FOR SUSTAINABLE GROWTH" (1)
Start of Consideration of Merger between LIXIL Group Corp. and its subsidiary
LIXIL Group Corporation (LGC), the holding company of the LIXIL Group, will start consideration of dissolving the two-tierstructure of LGC and LIXIL Corporation, the largest operating company of LIXIL Group in Japan, to improve management efficiency, and improve corporate governance by increasing the transparency of management(1)
- Background
LIXIL Group is in the process of transforming its operations in order to become an entrepreneurial company that can achieve sustainable competitiveness and growth, in order to fulfill our corporate purpose to contribute to society by making better homes a reality for everyone, everywhere
To achieve this aim, the company is taking steps to transform its operations, including strengthening governance, enhancing productivity and efficiency, as well as becoming a more agile organization that enables better decision-making.
- Future outlook
- Purpose of the merger
- Enable faster decision-making by dissolving the two-tier structure
- Improve efficiency by eliminating duplication of management, operating costs and human resources
- Improve corporate governance by increasing transparency of management
- Future plans
Establish a project team and consider the method of the merger, the timing of the completion of the merger, and the management structure after the merger, etc.
As the considered merger is between LGC and its 100% of consolidated subsidiary, there will be no negative impact on LIXIL Group's consolidated financial performance. LGC will announce the details once it is agreed and determined
(1) Timely disclosure announced on Jan. 27, 2020https://ssl4.eir-parts.net/doc/5938/tdnet/1785907/00.pdf | 7 |
MEDIUM TERM STRATEGY - "ESTABLISH A PURPOSE-DRIVEN ENTREPRENEURIAL COMPANY FOR SUSTAINABLE GROWTH" (2)
Comprehensive HR Program to Revitalize LIXIL's Japan Business
LIXIL has launched a comprehensive series of employee-focused initiatives to transform its Japan operations, in line with its overall strategy to build a more agile, consumer-centric organization to achieve sustainable growth(1)
Employee-focused initiatives
Objectives
- Create a more consumer-centric organization, enhancing customer-experience
- Bring fresh perspectives and energy to management positions
- Enable more flexible working styles, allowing to work more efficiently
Career Option Program (2)
Overview:Permanent employees in Japan who have reached a certain age with certain duration of service can select the option of pursuing opportunities outside the company before the usual statutory retirement age
Duration:5 years
Application period for the 1st year:2020/2/17〜2/28 Costs such as premium payment will be accrued in 4Q
under SG&A
Work Consumer-centrically
Reallocate employees with strong LIXIL DNA, knowledge, and experience in direct consumer engagement roles in Japan
Manage Career Paths
Support career planning, shift to a meritocracy- based system, introduce a new performance review system, offer a "Career Option Program"(2), etc.
Change Working Styles
Encourage employees to take paid holidays, enhance personnel measures such as flextime, teleworking, satellite offices, etc.
(1) | News release announced on November 25, 2019https://www.lixil.com/en/news/pdf/20191125_Kawaranaito_E_Final.pdf | 8 |
(2) | Timely disclosure announced on November 25, 2019https://ssl4.eir-parts.net/doc/5938/tdnet/1773640/00.pdf | |
RESULTS BY BUSINESS SEGMENT
Water | Housing | Building | Distribution and | Housing and |
Technology | Technology | Technology | Retail Business | Services Business |
WATER TECHNOLOGY | ||||||||||||||||||||||||||||||||||
Increase in revenue and core earnings driven by Japan. Overseas revenue and core earnings | ||||||||||||||||||||||||||||||||||
continue to improve following upward trend in H1 | ■ | Americas | ||||||||||||||||||||||||||||||||
Apr-Dec | Q3 FYE2020 | FYE2020 | Despite positive sales from new focus areas such as | |||||||||||||||||||||||||||||||
projects and direct-to-consumer renovation business, | ||||||||||||||||||||||||||||||||||
In JPYbn | (result) | YoY | (forecast) | revenue decreased overall due to the challenging situation | ||||||||||||||||||||||||||||||
in major channels, such as retail and wholesale. | ||||||||||||||||||||||||||||||||||
Americas | 105.3 | -2% | +2% | CE increased due to pricing improvement resulting from | ||||||||||||||||||||||||||||||
(1) | change in sale mix, as well as SG&A efforts | |||||||||||||||||||||||||||||||||
Region | ■ | EMEA | ||||||||||||||||||||||||||||||||
EMEA | 126.5 | +5% | +2% | |||||||||||||||||||||||||||||||
Strong revenue growth in Central Europe, Eastern Europe, | ||||||||||||||||||||||||||||||||||
and the Middle East. Overall, revenue increased by 8% YoY | ||||||||||||||||||||||||||||||||||
Asia Pacific | 79.8 | -3% | +8% | |||||||||||||||||||||||||||||||
by | in Europe. Operations in South Africa stabilizing and | |||||||||||||||||||||||||||||||||
Revenues | degree of losses halved | |||||||||||||||||||||||||||||||||
Japan | 333.1 | +2% | 0% | |||||||||||||||||||||||||||||||
■ | Asia Pacific | |||||||||||||||||||||||||||||||||
Despite China remaining strong, revenue remained flat due | ||||||||||||||||||||||||||||||||||
Adjustments | -21.2 | |||||||||||||||||||||||||||||||||
to US-China trade friction impact spreading to South East | ||||||||||||||||||||||||||||||||||
+3%CE | Asian markets. | |||||||||||||||||||||||||||||||||
Water Technology | 623.6 | +1% | 860.0 | |||||||||||||||||||||||||||||||
CE | ■ | Japan | ||||||||||||||||||||||||||||||||
margins | margins | Despite the reactionary impact from the consumption tax | ||||||||||||||||||||||||||||||||
Americas | 6.3 | +39% | 6% | +51% | 7% | hike from November, revenue and core earnings increased | ||||||||||||||||||||||||||||
(1) | over 9-month period, supported by strong market demand | |||||||||||||||||||||||||||||||||
in H1 | ||||||||||||||||||||||||||||||||||
Region | ||||||||||||||||||||||||||||||||||
EMEA | 14% | 14% | ||||||||||||||||||||||||||||||||
17.8 | +16% | +10% | ||||||||||||||||||||||||||||||||
Sales growth of LWT (overseas) | YoY -4.0(-1.4%) | |||||||||||||||||||||||||||||||||
JPY: billion | +4.2 | +3.3 | -11.5 | |||||||||||||||||||||||||||||||
Asia Pacific | 7.1 | +1% | 9% | +32% | 10% | |||||||||||||||||||||||||||||
by | ||||||||||||||||||||||||||||||||||
294.5 | ||||||||||||||||||||||||||||||||||
earnings | Japan | 27.4 | +18% | 8% | -19% | 5% | 290.5 | |||||||||||||||||||||||||||
Adjustments | -6.5 | |||||||||||||||||||||||||||||||||
Core | Water Technology | 52.2 | +13% | 64.8 | +8% | |||||||||||||||||||||||||||||
+0.9pp | Q3 | Synergy-related All other | FX impact | Q3 | ||||||||||||||||||||||||||||||
Margin | 8.4% | 7.5% | ||||||||||||||||||||||||||||||||
FYE2019 | products & | products | FYE2020 | |||||||||||||||||||||||||||||||
new business | & services | |||||||||||||||||||||||||||||||||
areas | ||||||||||||||||||||||||||||||||||
(1) Region: Management basis, Water Technology Total: Statutory basis |
Statutory basis currency : Q3 FYE2020 Results 1USD=109.10JPY, 1EUR=121.46JPY | 10 |
Management basis currency : Comparing by FYE2020 current & previous year 1USD=115JPY, 1EUR=133 JPY, FYE2020 Assumptions 1USD=115JPY, 1EUR=133JPY |
HOUSING TECHNOLOGY
Revenue and core earnings increased due to favorable demand prior to the consumption tax hike in Japan and lower manufacturing costs. Core earnings margin improved due to favorable sales of exteriors and wooden interior furnishing materials, which contributed to improved product mix
Apr-Dec | Q3 FYE2020 | FYE2020 | |||||||
In JPYbn | (result) | YoY | (forecast) | ||||||
+3%(1) | 0% | ||||||||
by Region | Japan | 410.6 | |||||||
-18%(2) | |||||||||
Overseas | 6.6 | -35% | |||||||
Revenues | |||||||||
■ Japan
Revenue and CE continued to increase over 9-month period despite the reactionary decline in demand from the consumption tax hike and the absence of demand for exterior products generated by natural disasters in the previous fiscal year
CE margin improved by 2.4pp YoY supported by productivity optimization (cost reductions) from favorable sales of exteriors and wooden interior furnishing materials as well as progress of the platform strategy
Sales growth of LHT
Housing | 417.1 | +3% | 535.0 | -1% | ||||
Technology | ||||||||
Core Earnings | Housing | 26.6 | +66% | 25.9 | 25% | |||
Technology | ||||||||
Margin | 6.4% | +2.4pp | 4.8% | |||||
JPY: billion
404.9 -3.8
Q3 Unwinding FYE2019 (overseas)
+15.9 +0.1 417.1
Sales
+1% YoY
Building | Building | Q3 |
materials | materials | FYE2020 |
& others | (overseas) & | |
(Japan) | industrial | |
products |
- +4%YoY growth excluding impact from divestment and other
- +9%YoY growth excluding impact from divestment and other
11
BUILDING TECHNOLOGY
Revenue decreased due to impact of foreign exchange rates and selective order intake. While, negative core earnings improved due to progression of the revitalization plan
Apr-Dec
In JPYbn
by Region | Japan | ||
Overseas | |||
Revenues | |||
Building | |||
Technology | |||
EarningsCore | Building | ||
Margin | |||
Technology | |||
Q3 FYE2020 | YoY | FYE2020 | |||||||
(result) | (forecast) | ||||||||
+1% | +3% | ||||||||
82.9 | |||||||||
+3% | |||||||||
111.0 | -8%(1) | ||||||||
-4% | +3% | ||||||||
193.9 | 263.0 | ||||||||
- | |||||||||
-6.3 | +1.8 | -9.7 | |||||||
Red | - | Red | |||||||
figure | figure | ||||||||
Japan | |
| Revenue and CE increased due to completion of a |
major project in Q3 |
Overseas (Permasteelisa) | ||
| Revenue decreased mainly due to forex impact(1) | |
for yen appreciation. Revenue | decreased 1% for |
euro denominated
Operating loss generally remained at the same level as the previous fiscal year
Implementing business plan(2) to revitalize Permasteelisa by improving cash flow and recovering profitability
- Forex impact due to difference between Q3 FYE2019 Results (EUR 1 = JPY 129.38) and Q3 FYE2020 Results (EUR 1 = JPY 121.46) (Forex in statutory basis)
- Reference: "Announcement Regarding Revision of the Full-year Forecast on Business Performance for the Fiscal Year Ended March 2019 due to Recognizing Loss12 from an Overseas Subsidiary and Recording Extraordinary Loss from a Subsidiary in Japan", disclosed on Apr. 18, 2019
UPDATE ON PERMASTEELISA
About progression of revitalization plan
Quarterly results (accumulated) and annual forecast of Permasteelisa (1) (Unit:EUR million )
1,110 | |||||||||||||||
914 | 976 | 1,000 | |||||||||||||
617 | |||||||||||||||
Expect positive CE | |||||||||||||||
307 | (F'cst) | ||||||||||||||
Sales | |||||||||||||||
CE | |||||||||||||||
NP | Q1 | H1 | Q3 | Full-year | Full-year | Full-year | |||||||||
FYE2020 | FYE2020 | FYE2020 | FYE2020 | FYE2021 | FYE2022 | ||||||||||
CE | -13 | -39 | -61 | -89 | 17 | 35 | |||||||||
NP | -21 | -74 | -98 | -165 | -31 | 3 | |||||||||
Financial results
Sales and profits in line with annual forecast
Revitalization plan updatesImplementing restructuring plan to optimize supply chain in order to reduce fixed costs
Implementing selective order-intake and project management
Injecting cash in order to execute revitalization plan and operate business
(By Q3 in FYE2020: EUR 100 mil.)
After consolidation adjustment figures. CE=Core Earnings, NP=Net Profit13
(1) "Announcement Regarding Revision of the Full-year Forecast on Business Performance for the Fiscal Year Ended March 2019 due to Recognizing Loss from an Overseas Subsidiary and Recording Extraordinary Loss from a Subsidiary in Japan", disclosed on Apr. 18, 2019
DISTRIBUTION & RETAIL AND HOUSING & SERVICES | ||||||
Revenue up due to increase in renovation-related product sales at existing stores. Core earnings | ||||||
decreased due to increased costs, including for distribution | Opened 5 stores over nine-month period. | |||||
Apr-Dec | | |||||
Expect to open 7 stores over the full year | ||||||
In JPYbn | Q3 FYE2020 | FYE2020 | ||||
YoY | | Started operation of new distribution center in | ||||
(result) | (forecast) | |||||
Higashimatsuyama city, Saitama, in September | ||||||
Revenue(1) | 142.2 | +5% | 188.0 +7% | Higher composition of revenue recognized from | ||
sales of renovation-related products (YoY +1.3pp) | ||||||
D&R
42.0% | 40.3% | ||||||||
6.9 | -9% | 6.2 | -20% | 39.6% | 39.7% | 39.7% | |||
40.0% | 39.0% | ||||||||
-0.7pp | 38.0% | |||||||||||||||||||||
Margin(1) | 4.9% | 3.3% | ||||||||||||||||||||
Q3 FYE2019 Q4 FYE2019 Q1 FYE2020 Q2 FYE2020 Q2 FYE2020 | ||||||||||||||||||||||
Aiming for renovation goods revenue ratio of 50% in the | ||||||||||||||||||||||
medium to long term | ||||||||||||||||||||||
Core earnings increased. Maintained revenue composition for businesses other than for new | ||||||||||||||||||||||
houses with BtoC growth despite the absence of sale of a major real estate | ||||||||||||||||||||||
Apr-Dec | Q3 FYE2020 | | Revenue composition for businesses other than for | |||||||||||||||||||
FYE2020 | new houses(2) (YoY 0pp) | |||||||||||||||||||||
In JPYbn | ||||||||||||||||||||||
(result) | YoY | (forecast) | 40.0% | 38.7% | ||||||||||||||||||
38.0% | 35.8% | 37.1% | ||||||||||||||||||||
Revenue | 40.6 | -1%(3) | 57.0 | -1% | 36.0% | 35.8% | ||||||||||||||||
H&S | 34.0% | 33.3% | ||||||||||||||||||||
Core Earnings | 2.7 | +3% | 3.3 | -4% | ||||||||||||||||||
32.0% | ||||||||||||||||||||||
Q3 FYE2019 Q4 FYE2019 Q1 FYE2020 Q2 FYE2020 Q3 FYE2020 | ||||||||||||||||||||||
Margin | 6.5% | +0.2pp | 5.8% | |||||||||||||||||||
Aiming for revenue composition for businesses other than | ||||||||||||||||||||||
for new houses of 50% for mid to long term |
(1) | Distribution & Retail disclosed as of IFRS basis; Reference: JGAAP is applied for disclosure of LIXIL VIVA Corporation (Securities Code 3564) | 14 |
(2) | Existing business - business other than for new houses and new areas of services and markets | |
(3) | +1%YoY growth excluding impact from divestment of Senior Life Company |
CONSOLIDATED FINANCIAL POSITION
[A] | [B] | Increase/ decrease | |||||||||||||||
Mar-2019 | Dec-2019 | Impacts from | Others | [B]-[A] | |||||||||||||
JPY: billion | application | (Increase/ | Total of the increase | ||||||||||||||
of IFRS 16(3) | decrease) | / decrease | |||||||||||||||
Cash and cash equivalents | 141.4 | 145.8 | - | 4.4 | 4.4 | ||||||||||||
Trade and other receivables | 401.7 | 388.8 | - | 1 | -12.8 | -12.8 | |||||||||||
Inventories | 234.6 | 244.7 | - | 1 | 10.1 | 10.1 | |||||||||||
Assets held for sale | 11.4 | - | - | -11.4 | -11.4 | ||||||||||||
Others | Total Assets | 1,270.4 | 1,426.5 | 166.3 | 2 | -10.2 | 156.1 | ||||||||||
2,059.5 | 2,205.9 | 166.3 | -20.0 | 146.4 | |||||||||||||
Trade and other payables | 392.4 | 377.8 | - | 1 | -14.6 | -14.6 | |||||||||||
Interest-bearing debt | 726.0 | 890.0 | 166.3 | -2.3 | 164.0 | ||||||||||||
Liabilities directly associated with | 5.0 | - | - | -5.0 | -5.0 | ||||||||||||
the assets held for sale | |||||||||||||||||
Others | Total Liabilities | 369.0 | 360.3 | - | -8.7 | -8.7 | |||||||||||
1,492.4 | 1,628.0 | 166.3 | -30.7 | 135.7 | |||||||||||||
Treasury shares | -48.9 | -48.9 | - | 0.0 | 0.0 | ||||||||||||
Others | Total Equity | 616.1 | 626.8 | - | 10.7 | 10.7 | |||||||||||
567.2 | 3 | 577.9 | - | 10.7 | 10.7 | ||||||||||||
(1) | Equity Ratio (%) | 25.9% | 24.7% | -1.3pp | |||||||||||||
(2) | Net Assets per Share (Yen) | 1,839.59 | 1,875.00 | 35.41 | |||||||||||||
Number of Shares | 290,095 | 290,101 | 6 | ||||||||||||||
(in thousands) | |||||||||||||||||
Net interest-bearing debt | 584.5 | 3 | 744.2 | 159.6 | |||||||||||||
1 | Increased/ decreased due to seasonal factors | ||||||||||||||||
2 | Decreased due to forex impact (strong yen against the euro) and divestment of a subsidiary, etc. | ||||||||||||||||
3 | Excluding the impact from the application of IFRS16: Equity ratio is 26.7% (+0.8pp from Mar.2019) | ||||||||||||||||
Net interest-bearing debt is JPY577.8 billion (JPY-6.7 billion from Mar. 2019) | |||||||||||||||||
(1) Ratio of equity attributable to owners of the parent | (3) Due to the mandatory adoption of | the new accounting standard | 15 | ||||||||||||||
(2) Equity per share attributable to owners of the parent | (IFRS16 "Leases") from April 2019. Impact amount as of the | ||||||||||||||||
beginning of this term (April 1, 2019) |
CASH FLOW STATUS AND CASH BALANCE | |||||
Q3 FYE2019 | Q3 FYE2020 | Increase/ | |||
JPY: billion | decrease | ||||
Profit before tax | 36.2 | 53.2 | 17.0 | ||
Depreciation and amortization | 51.0 | 80.0 | 1 | 29.1 | |
Income taxes paid | -26.1 | -13.7 | 12.4 | ||
Working capital | -29.7 | -10.2 | 19.5 | ||
Others(1) | -5.4 | -8.5 | -3.1 | ||
Net cash flows from operating activities | 26.0 | 100.9 | 2 | 74.9 | |
Net cash flows from investing activities | -52.3 | -20.6 | 3 | 31.7 | |
(of which purchase of property, plant and equipment and | |||||
intangible assets) | -48.3 | -46.9 | 1.4 | ||
Free cash flows | -26.3 | 80.2 | 4 | 106.5 | |
Net cash flows from financing activities | 15.1 | -77.1 | 1 | 5 | -92.3 |
・・・ | ・・・ | ・・・ | |||
Cash and cash equivalents (Balance at the end of the period) | 130.6 | 145.8 | 15.1 |
1 | The impact of applying the new accounting standard (IFRS 16): |
Net cash flows from operating activities (increase in Depreciation and amortization) JPY +29.1billion | |
Net cash flows from financing activities (increase in payment of lease liabilities) JPY -28.0 billion | |
2 | Net cash inflows from operating activities increased by JPY 74.9 billion from increase in profit before tax and improvement in working capital |
3 | Cash outflows from investing activities decreased by JPY 31.7 billion primarily due to the proceeds from transfer of shares of a consolidated |
subsidiary and sale of interest in former associate | |
4 | Free cash flows increased year-on-year by JPY 106.5 billion (excl. IFRS16 impact: JPY77.5 billion) |
5 | Net cash outflows from financing activities increased due to increase in payment of lease liabilities of JPY 28.0 billion and decrease in |
external procurement of working capital by JPY 92.3 billion, resulting from increase in net cash flows from operating activities. |
(1) primarily, gain on disposal of interest in a former associate, JPY 11.0 billion | 16 |
APPENDIX
Q3 (9 MONTHS) FYE2020 CONSOLIDATED BUSINESS RESULTS (DETAIL)
JPY: billion | Q3 FYE2019 | Q3 FYE2020 | YoY | FYE2020 | ||||||
Results | Results | Amount | % | Full-year | ||||||
Increase/decrease | forecasts | |||||||||
Revenue | 1,381.2 | 1,396.5 | 15.3 | 1.1% | 1,850.0 | |||||
(Existing) Continuing | ||||||||||
operations | 1,260.9 | 1,285.5 | 24.6 | +2.0% | 1,703.0 | |||||
Permasteelisa | 120.3 | 111.0 | -9.3 | -7.7% | 147.0 | |||||
Core Earnings (1) | 37.1 | 51.7 | 14.6 | 39.3% | 47.0 | |||||
(Existing) Continuing | ||||||||||
operations | 46.2 | 59.2 | 12.9 | +28.0% | 59.0 | |||||
Permasteelisa | -9.1 | -7.5 | 1.6 | - | -12.0 | |||||
Operating Profit | 38.3 | 45.7 | 7.4 | 19.3% | 38.0 | |||||
(Existing) Continuing | ||||||||||
operations | 44.9 | 56.0 | 11.0 | +24.6% | 57.9 | |||||
Permasteelisa | -6.6 | -10.3 | -3.7 | - | -19.9 | |||||
Net Profit(2) | 2.1 | 30.7 | 28.6 | - | 15.0 | |||||
(Existing) Continuing | ||||||||||
operations | 24.5 | 42.6 | 18.1 | +73.9% | 36.9 | |||||
Permasteelisa | -22.4 | -11.9 | 10.4 | - | -21.9 | |||||
EPS (yen) | 7.36 | 105.79 | 98.43 | - | 51.71 | |||||
EBITDA(3) | 88.1 | 131.8 | 43.6 | 49.5% | 150.4 | |||||
(%) | 6.4% | 9.4% | +3.1pp | - | 8.1% | |||||
■ Impact of applying IFRS 16 included in EBITDA for Q3 (9 months) FYE2020 is JPY 29.1 billion (increase in EBITDA) | ||||||||||
(1) Equivalent to "Operating profit" of JGAAP | (3) | EBITDA: Core earnings+Depreciation | 18 | |||||||
(2) Net profit attributable to owners of the parent | ||||||||||
Q3 FYE2020 INCREASE / DECREASE OF SALES AND CORE EARNINGS | |||||||||||||||
JPYbn | YoY | +1% | +3% | -4% | +5% | -1% | |||||||||
1,400 | 8.5 | 0.4 | +2.6 | ||||||||||||
1,390 | +12.2 | +6.2 | |||||||||||||
Revenues | +3.1 | ||||||||||||||
1,380 | Japan | +1% | |||||||||||||
1,381.2 | |||||||||||||||
1,370 | |||||||||||||||
Renovation +6% | Renovation +5% | Overseas -8% | 1,396.5 | ||||||||||||
Others | +0% | Others | +3% | ||||||||||||
Japan | +2% | Japan | +3% | ||||||||||||
Overseas-1% | Divestment and other -3.8 | ||||||||||||||
10 | +15.3(+1.1%) | ||||||||||||||
Overseas-18% | |||||||||||||||
0 | |||||||||||||||
Q3 | LWT | LHT | LBT | D&R | H&S | Consolidation | Q3 | ||||||||
FYE2019 | adjustment/ | FYE2020 | |||||||||||||
result | other | result | |||||||||||||
JPYbn | LWT +2.6 | LWT -1.9 | |||||||||||||
60 | LHT +4.7 | LHT +2.8 | |||||||||||||
0.6 | |||||||||||||||
earnings | 50 | LBT + 0.1 | +9.4 | 2.3 | +3.0 | 3.3 | |||||||||
37.1 | +0.9 | ||||||||||||||
40 | +7.4 | Increase of logistics, | Americas | +1.8 | 51.7 | ||||||||||
Purchasing condition+0.1 | |||||||||||||||
decrease of marketing | EMEA | +2.5 | |||||||||||||
30 | LWT -0.3 | LWT +0.5 | Asia Pacific | -0.3 | |||||||||||
LHT | +0.4 | LHT | -2.8 | CE Margin | |||||||||||
Core | 20 | CE Margin | Cost down, etc. +10.6 | LBT | -0.9 | (LWT +0.1, LHT -0.3) | |||||||||
3.7% | |||||||||||||||
LWT +3.3 | Divestment in LHT +0.9 | Permasteelisa | +1.5 | ||||||||||||
10 | 2.7% | LHT +6.3 | Forex & other | -2.5 | |||||||||||
LBT | +1.0 | +14.6 (+39.3%) | |||||||||||||
0 | Divestment in LHT | -1.3 | |||||||||||||
Q3 | Sales in | Mix/pricing | Cost | SG&A | Overseas | D&R/H&S | Consolidation | Q3 | |||||||
FYE2019 | Japan | business | adjustment/Other | FYE2020 | |||||||||||
result | Japan Tech +15.4(+38%) | Overseas +3.0 | result | ||||||||||||
19 |
Q3 FYE2020 OTHER INCOME AND OTHER EXPENSES, FINANCE INCOME AND FINANCE COSTS, PROFIT FROM DISPOSAL OF SHARES OF ASSOCIATES
JPY: billion | Q3 | Q3 | Increase/ | |
FYE2019 | FYE2020 | decrease | ||
Rental income | 5.0 | 4.4 | -0.6 | |
Gains on sale of property, plant and equipment | 0.2 | 1.0 | 0.9 | |
Gains on sales of subsidiaries | - | 1.4 | 1.4 | |
Gains on sale of investment property | 0.6 | 0.6 | 0 | |
Loss recognized on the remeasurement of the disposal | 2.0 | - | -2.0 | |
group held for sale (gain on reversal) | ||||
Other | 3.7 | 4.3 | 0.6 | |
Other Income | 11.6 | 11.8 | 0.2 | |
Costs of rent | 3.2 | 3.3 | 0.1 | |
Losses on sale or disposal of property, plant and equipment | 1.8 | 1.2 | -0.6 | |
Impairment losses | 1.5 | 6.8 | 5.3 | |
Restructuring costs | - | 1.3 | 1.3 | |
Other | 4.0 | 5.3 | 1.3 | |
Other Expenses | 10.4 | 17.9 | 7.4 | |
1.0 | 0.1 | |||
Interest income | 1.1 | |||
Dividend income | 1.5 | 1.5 | 0 | |
Gains on valuation of derivatives | 1.4 | 0.2 | -1.2 | |
Other | 1.3 | - | -1.3 | |
Finance Income | 5.1 | 2.8 | -2.4 | |
Interest expense | 4.0 | 4.7 | 0.8 | |
Exchange difference losses | 3.0 | 1.4 | -1.6 | |
Other | 0.1 | 0 | -0.1 | |
Finance Costs | 7.1 | 6.2 | -0.9 | |
Profit from disposal of share of associates | - | 11.0 | 11.0 |
- Gains on valuation of derivatives is matched with foreign exchange difference losses
Q3
FYE2020
result
Gains on valuation | ||
of derivatives | 0.2 | |
Exchange difference | ||
losses | -1.4 | |
Net | -1.3 | Loss |
(1)
(1)
20
RESULTS AND FORECASTS BY SEGMENT
Q3 FYE2019 Results | Q3 FYE2020 Results | |||||||
JPY: billion | Japan | Overseas | Total | Japan | Overseas | Total | Total YoY% | |
Revenue | 325.9 | 294.5 | 620.5 | 333.1 | 290.5 | 623.6 | 0.5% | |
Core earnings | 23.1 | 23.0 | 46.1 | 27.4 | 24.8 | 52.2 | 13.2% | |
LWT | CE margin | 7.1% | 7.8% | 7.4% | 8.2% | 8.5% | 8.4% | +0.9pp |
Revenue | 396.9 | 8.0 | 404.9 | 410.6 | 6.6 | 417.1 | 3.0% | |
Core earnings | 16.2 | -0.2 | 16.0 | 27.1 | -0.5 | 26.6 | 65.8% | |
LHT | CE margin | 4.1% | - | 4.0% | 6.6% | - | 6.4% | +2.4pp |
Revenue | 82.1 | 120.3 | 202.4 | 82.9 | 111.0 | 193.9 | -4.2% | |
Core earnings | 1.1 | -9.3 | -8.1 | 1.4 | -7.7 | -6.3 | - | |
LBT | CE margin | 1.4% | - | - | 1.7% | - | - | - |
Revenue | 136.0 | 136.0 | 142.2 | 142.2 | 4.6% | |||
Core earnings | 7.6 | 7.6 | 6.9 | 6.9 | -9.1% | |||
D&R | CE margin | 5.6% | 5.6% | 4.9% | 4.9% | -0.7pp | ||
Revenue | 41.0 | 41.0 | 40.6 | 40.6 | -1.0% | |||
Core earnings | 2.6 | 2.6 | 2.7 | 2.7 | 2.7% | |||
H&S | CE margin | 6.3% | 6.3% | 6.5% | 6.5% | +0.2pp | ||
Consolidation, Revenue | -23.6 | -21.0 | - | |||||
-27.1 | -30.4 | - | ||||||
adj. & other(1) | Core earnings | |||||||
Revenue | 981.9 | 422.8 | 1,381.2 | 1,009.4 | 408.1 | 1,396.5 | 1.1% | |
Core earnings | 50.7 | 13.6 | 37.1 | 65.5 | 16.6 | 51.7 | 39.3% | |
LIXIL Group(1) | CE margin | 5.2% | 3.2% | 2.7% | 6.5% | 4.1% | 3.7% | +1.0pp |
FYE2020 Forecasts | |||
Japan | Overseas | Total | Total YoY% |
435.0 | 425.0 | 860.0 | 3.2% |
23.7 | 41.1 | 64.8 | 7.5% |
5.4% | 9.7% | 7.5% | +0.3pp |
528.0 | 7.0 | 535.0 | -1.1% |
26.9 | -1.0 | 25.9 | 25.2% |
5.1% | - | 4.8% | +1.0pp |
116.0 | 147.0 | 263.0 | 2.7% |
2.3 | -12.0 | -9.7 | -74.6% |
2.0% | - | - | - |
188.0 | 188.0 | 6.6% |
6.26.2 -19.7%
3.3% | 3.3% | -1.1pp |
57.057.0 -1.4%
3.33.3 -4.5%
5.8% | 5.8% | -0.2pp | |
-53.0 | - | ||
-43.5 | - | ||
1,324.0 | 579.0 | 1,850.0 | 0.9% |
62.4 | 28.1 | 47.0 | 267.2% |
4.7% | 4.9% | 2.5% | +1.8pp |
(1) Difference between sum total of Japan and Overseas in Revenue and Core earnings and "Total" is the amount of consolidation, adj. & other 21
RENOVATION STRATEGY IN JAPAN
Sales of renovation-related products increased by 4.5% year-on-year, supported by favorable demand in Japan for H1 and sales of new and differentiated products
Sales of Renovation-Related Products
Q3 FYE2019 | Q3 FYE2020 | |||||||
JPY: billion | Results(1) | Results | YoY | |||||
Sales of renovation- | ||||||||
related products* | 236.2 | 246.9 | +4.5% | |||||
Renovation sales ratio | 37% | 37% | +0.2pp | |||||
*Total sales of LIXIL Japan Company | and a building renovation subsidiary (after inter- | |||||||
segment transactions) | ||||||||
YoY | Q3 3 months | Q3 9 months | ||||||
Renovation products | LWT-1%,LHT-7%, Total -4% | LWT+6%, LHT+5%, Total+5% | ||||||
Products other than | LWT-4%,LHT-6%,Total-4% | LWT 0%, LHT+3%, Total+2% | ||||||
for renovation |
Renovation-related products sales ratio by business segment (YoY)
Business segment | Q3 FYE2019 | Q3 FYE2020 | Difference | |
LWT | 44% | 45% | +0.9pp | |
LHT | 32% | 32% | +0.4pp | |
LBT | 27% | (1) | 24% | -3.1pp |
Japan total | 37% | (1) | 37% | +0.2pp |
Number of Member Homebuilders
Stores | Mar | Mar | Dec |
-18 | -19 | -19 | |
LIXIL Reform Shop | |||
(FC) | 546 | 571 | 562 |
LIXIL Reform Shop | |||
(Voluntary) | 12,602 | 11,783 | 11,770 |
LIXIL PATTO Reform | |||
Service Shop | 3,705 | 3,800 | 3,581 |
Super Wall: launched new renovation construction method to improve heat insulation
Approx. 40% of the housing stock in Japan do not have effective insulation(2)
LIXIL newly developed the Super Wall construction method for renovation, which enables houses to be renovated even while staying in the house. LIXIL contributes to making better homes a reality for everyone by accelerating the improvement of the quality of existing homes.
(1) | Sales of renovation product was restated for comparison on the same basis | 22 |
(2) | Reference: Ministry of Land, Infrastructure and Transport "Current state of existing housing stocks" | |
REVENUE BY PRODUCTS AND SERVICES
JPY: billion
Segment | Major products | FYE2019 | Q3 FYE2019 | Q3 FYE2020 | |
results | results | results | |||
YoY | |||||
LWT | Sanitary ware | 103.4 | 77.4 | 80.6 | 4.1% |
Bathroom units | 99.3 | 75.5 | 78.0 | 3.4% | |
Washstand cabinet | 36.9 | 27.2 | 27.9 | 2.6% | |
units | |||||
Kitchens | 112.3 | 83.5 | 85.0 | 1.8% | |
Tiles | 37.7 | 28.0 | 27.2 | -2.9% | |
LHT | Housing sashes and | 186.2 | 140.8 | 145.9 | 3.6% |
related products | |||||
Exterior | 111.0 | 83.1 | 84.7 | 1.9% | |
Wooden interior | 64.1 | 47.4 | 53.1 | 12.0% | |
furnishing materials | |||||
LHT Other | 87.2 | 64.5 | 62.3 | -3.4% | |
LBT | Building sashes | 112.8 | 82.1 | 82.9 | 1.0% |
D&R | Home center revenue | 176.4 | 136.0 | 142.2 | 4.6% |
H&S | Housing and Services | 57.9 | 41.0 | 40.6 | -1.0% |
business | |||||
Overseas | 551.8 | 422.8 | 408.1 | -3.5% | |
Others/ | 95.5 | 71.8 | 78.1 | 8.7% | |
consolidation & adj. | |||||
Total | 1,832.6 | 1,381.2 | 1,396.5 | 1.1% |
Unit: % | ||||||
Quarterly YoY | ||||||
FYE2019 | FYE2020 | |||||
Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 |
-2.8 | -5.0 | -0.6 | -3.8 | 1.4 | 10.9 | 0.2 |
2.8 | -3.2 | -5.3 | -4.9 | -1.4 | 11.2 | 0.8 |
2.0 | -1.9 | -0.5 | 0.3 | 0.6 | 12.6 | -4.4 |
1.6 | -3.2 | -1.9 | 0.0 | 0.2 | 11.3 | -5.4 |
3.6 | -4.2 | 0.7 | -2.6 | -5.0 | 5.1 | -8.2 |
-7.4 | -7.3 | 0.5 | 3.8 | 5.5 | 10.2 | -4.1 |
-3.9 | -3.8 | 12.1 | 11.8 | 5.5 | 13.4 | -10.3 |
0.2 | 0.9 | 10.0 | 13.1 | 16.1 | 20.8 | 1.4 |
3.6 | 4.9 | 8.8 | 0.7 | 7.6 | 4.0 | -19.3 |
6.5 | -0.2 | 7.1 | 10.0 | 0.4 | 0.3 | 2.2 |
-1.0 | 1.7 | 3.4 | 2.4 | 4.9 | 11.8 | -2.3 |
7.6 | 11.3 | -5.1 | 31.9 | 6.0 | -1.0 | -6.9 |
1.6 | -0.9 | 0.4 | -14.0 | -2.6 | -1.2 | -6.5 |
- | - | - | - | - | - | - |
0.9 | -1.4 | 2.7 | -1.6 | 2.1 | 6.2 | -4.5 |
- Definition for Tiles and LHT Other has been changed to match that of internal management. Therefore, past figures and year-on-year ratio for Tiles and LHT Other have been retroactively restated
23
PERFORMANCE OF MAJOR OVERSEAS SUBSIDIARIES
Company | ASB (ASD Holdings) | |||||
Unit | Unit: USD million | |||||
Accounting | Q3 FYE2019 | Q3 FYE2020 | YoY | |||
period | Results | Results | ||||
Exchange rate (Average Rate) | 110.82 | 109.10 | - | |||
Revenue | 929 | 915 | -2% | |||
Core earnings | 39 | 50 | 29% | |||
% | 4% | 6% | +1.3pp | |||
FYE2019 | ||||||
Accounting | Q3 FYE2020 (9 months) | |||||
period | Balance | Amortization | Others(1) | Balance | ||
Exchange rate (Current Rate for balance, | 110.99 | 109.10 | - | 109.56 | ||
Average Rate for amortization) | ||||||
Goodwill | 231 | - | - | 231 | ||
Intangible assets | 235 | -5 | 0 | 230 | ||
Company | Grohe Group (GROHE)(2) | |||||
Unit | Unit: EUR million | |||||
Accounting | Q3 FYE2019 | Q3 FYE2020 | YoY | YoY excluding LIXIL | ||
period | Results | Results | Africa impact(2) | |||
Exchange rate (Average Rate) | 129.38 | 121.46 | - | - | ||
Revenue | 1,094 | 1,146 | 5% | 8% | ||
Core earnings | 111 | 135 | 21% | 13% | ||
% | 10% | 12% | +1.6pp | +0.5pp | ||
FYE2019 | ||||||
Accounting | Q3 FYE2020 (9 months) | |||||
period | Balance | Amortization | Others(1) | Balance | ||
Exchange rate (Current Rate for balance, | 124.56 | 121.46 | - | 122.54 | ||
Average Rate for amortization) | ||||||
Goodwill | 1,210 | - | 3 | 1,213 | ||
Intangible assets | 1,474 | -17 | 0 | 1,457 |
(1) | Forex translation differences, and other | 24 |
(2) | LIXIL Africa (formerly called as GDWT) ,which was formerly under Grohe Group, became a subsidiary of LIXIL Corporation from July 2019 |
PERFORMANCE OF MAJOR OVERSEAS SUBSIDIARIES
Company | Permasteelisa | ||||||
Unit | Unit: EUR million | ||||||
Accounting | Q3 FYE2019 | Q3 FYE2020 | YoY | ||||
period | Results | Results | |||||
Exchange rate (Average Rate) | 129.38 | 121.46 | - | ||||
Revenue | 931 | 919 | -1% | ||||
Core earnings | -72 | -59 | - | ||||
% | - | - | - | ||||
FYE2019 | |||||||
Accounting | Q3 FYE2020 (9 months) | ||||||
period | Balance (2) | Amortization | Impairment | Others(1) | Balance | ||
Exchange rate (Current Rate for balance, | 124.56 | 121.46 | - | - | 122.54 | ||
Average Rate for amortization) | |||||||
Goodwill | - | - | - | - | - | ||
Intangible assets | - | - | - | - | - | ||
Accrual for expected future losses on | 45 | - | - | -8 | 37 | ||
construction projects | |||||||
Orders received | Q3 FYE2020 Order | Q3 FYE2020 Order | |||||||||
Others intake | backlog | Others | |||||||||
Unit | Unit: EUR million | ||||||||||
3% | 3% | ||||||||||
Accounting | Q3 FYE2019 | Q3 FYE2020 | |||||||||
Period | Results | Results | Asia | ||||||||
(3) | 763 | 702 | Asia | 18% | |||||||
Order intake | Europe | Europe | |||||||||
Order backlog | 1,969 | 1,683 | 37% | 40% | 42% | ||||||
North | |||||||||||
North | America | Middle | |||||||||
Middle | 34% | ||||||||||
America | |||||||||||
East | East | ||||||||||
14% | |||||||||||
6% | 3% | ||||||||||
(1) Forex translation differences, net changes of the provision, and other | 25 | ||||||||||
(2) Balance as of FYE2019 was restated in accordance with its presentation in the annual report | |||||||||||
(3) The figure for the FYE19 | Q3 was corrected |
BUSINESS RELATED TOPICS
LIXIL Unveiled New Kitchen and Bath | GROHE Received the | |||
Innovations at KBIS 2020(1) | "Red Dot: Brand of the Year"(2) | |||
• Booth design-Clear distinction between each brand and | • Celebrated for design quality and consistent conveying of | |||
featured new products. | brand value 'Pure Freude an Wasser' | |||
• American Standard-Studio S bathroom and Kitchen | ||||
collection | • Recognizes GROHE's path to emotionally charge brand and | |||
• DXV-Belshire Bathroom collection- received House | products, adding relevance beyond the sanitary industry | |||
Beautiful "Best of KBIS" Award | ||||
• GROHE-Essence and Eurocube chinaware lines | • Out of 8,697 entries, three were awarded | |||
• GROHE Blue Chilled & Sparkling 2.0, received a Beautiful | ||||
Kitchen and Baths' "30 Most Innovative Products" Award. | ||||
• LIXIL received WorldVision Partnership award-product | ||||
donation to most needy | ||||
(1) | News releasehttps://www.lixil.com/en/news/pdf/20200124_KBIS_E.pdf | 26 | ||
(2) | News releasehttps://www.grohe.com/en/corporate/news/category_news/pressreleases/pressrelease/news_14144.html |
ESG RELATED TOPICS (1)
Expanded CR Commitments to contribute to solving social issues(1)
Sanitation for All
By 2025, improve the livelihood of 100 million people through sanitation and hygiene initiatives
Zero Carbon and Circular Living
By 2050, achieve net-zero carbon emissions from housing and lifestyle solutions as well as operations, and become a leading manufacturer based on a model that preserves water and natural resources for future generations
Key Updates
- Remains firmly committed to target but extended target year from 2020 to 2025(2)
- In addition to SATO Social Business, included all businesses and initiatives that improve sanitation and hygiene worldwide
- Incorporated Environmental Vision 2050(3)
- Not only reducing CO₂ but also focusing on water conservation and resource recycling
Inclusive for All | Added Universal Design target | ||||||
By 2020, establish the culture of diversity | |||||||
and inclusion within our organization and | | Expanded UD target to all users irrespective of | |||||
among all employees | their age, gender and the level of disability | ||||||
By 2030, ensure all products and services* | |||||||
are based on LIXIL's Universal Design | * | Scope: Products and services | |||||
concept | in | Japan (as of August 2019) | |||||
(1) Press release announced on Nov. 25, 2019"LIXIL Sets New | (2) LIXIL has improved sanitation for an estimated 15 million people | 27 | |||||
Sustainability Targets to Drive Its Contribution to the World" | (as of November 2019) | 16 | |||||
https://www.lixil.com/en/news/pdf/191115_CR_E_Final_web.pdf | (3) Reference: Page 14 of FYE2020 H1 Results Presentation Material | ||||||
ESG RELATED TOPICS (2)
Contributing to Global sanitation challenges through partnerships
"Toilets for all" initiative in 2019
LIXIL will donate part of the revenue of LIXIL
shower toilets to UNICEF (Period: Jun - Nov 2019)
As a result of activities in 2019, LIXIL will donate a total amount of JPY 25,990,052
Donation will be used to provide infrastructure and education for access to basic sanitation through "Make a Splash! Toilets for All", a new international partnership with UNICEF
Signed a memorandum of
understanding (MOU) with JICA
LIXIL signed a MOU with JICA to collaborate to improve sanitation and access to safe toilet in developing economies
JICA has entered into a collaborative MOU with a private company in the water and sanitation field for the first time. LIXIL and JICA will jointly look into the use of toilets and sanitary conditions in developing countries in Africa and Asia, while raising awareness and stimulating demand for toilets(1)
(1) News releasehttps://www.lixil.com/en/news/pdf/JICA_MOU_E_web.pdf | 28 |
EXTERNAL RECOGNITION
DJSI World | S&P Japan 500 ESG |
Selected for Dow Jones Sustainability World Index | Selected as a component of the S&P Japan 500 ESG, |
(DJSI World) for the first time, created by S&P Dow | created by S&P Dow Jones Indices (June 2019) |
Jones Indices and RobecoSAM (September 2019) | |
FTSE4Good Index Series | MSCI Japan Empowering Women Index |
Became a constituent of the FTSE4Good Index Series | Selected as a constituent of the MSCI Japan |
and FTSE Blossom Japan Index (June 2019) for three | Empowering Women Index (WIN) for three |
consecutive years, created by FTSE Russell(1) | consecutive years, created by MSCI Inc. (June 2019) |
Disclaimer | |
THE INCLUSION OF LIXIL GROUP CORPORATION IN ANY MSCI INDEX, AND THE USE OF MSCI | |
DJSI Asia Pacific | LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A |
SPONSORSHIP, ENDORSEMENT OR PROMOTION OF LIXIL GROUP CORPORATION BY MSCI OR | |
Selected for DJSI Asia Pacific Index for three | ANY OF ITS AFFILIATES. THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI |
AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI | |
consecutive years, created by S&P Dow Jones Indices | OR ITS AFFILIATES. |
and RobecoSAM (September 2019) |
(1) It is a registered trademark of FTSE International Limited and Frank Russell Company. | 29 |
MARKET TRENDS
105 | Trend of new housing starts in Japan | ||||||||||||||||||||||||
(10 thousand houses) | Seasonally adjusted | ||||||||||||||||||||||||
100 | value for annual | ||||||||||||||||||||||||
95 | |||||||||||||||||||||||||
90 | |||||||||||||||||||||||||
Assumption for |
Aluminum price trend
Apr 2017 | Apr 2018 | ||
- Mar 2018 | - Mar 2019 | ||
Assumption for the plan FYE2020 JPY237,000/ton (approx. USD2,061/ton)
Source:LME 3 months (From January 1, 2017 to December 31, 2019)
85 | the plan FYE2020 |
920,000 houses | |
80 | (-3.4% YoY vs FYE2019) |
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
2017 2018 2019
Source:Statics of new housing starts, Ministry of Land,
Infrastructure, Transport and Tourism(2017/1-2019/11)
New housing construction level in Japan(year-on-year)
● Jan-Mar 2019: 5.2% ● Oct-Nov 2019: -10.1%
Jan-Sep 2019: -2.0%
Copper price trend
Apr 2017 | Apr 2018 | ||
- Mar 2018 | - Mar 2019 | ||
Assumption for the plan FYE2020 JPY694,000/ton (approx. USD6,035/ton)
Source:LME 3 months (From January 1, 2017 to December 31, 2019)
●
Jan-Nov 2019 | Apr-Nov 2019 | ||||
(11 months) | (8 months) | ||||
Amount | YoY | Amount | YoY | ||
Total new housing starts | 832,949 | -3.6% | 617,338 | -6.3% | |
Owner occupied(1) | 266,444 | 2.9% | 201,123 | 1.6% | |
Rental homes | 314,678 | -13.9% | 233,568 | -16.0% | |
Condos for sale | 108,846 | 7.8% | 77,016 | -1.6% | |
Detached houses for | 135,095 | 4.4% | 100,323 | 3.3% | |
sale(2) | |||||
Detached houses | 401,539 | 3.4% | 301,446 | 2.2% | |
total(1)+(2) |
Foreign exchange | FYE2020 Forecast | ||
rates | FYE2018 Results | FYE2019 Results | |
(Average rate) | assumptions | ||
US dollars | 110.81 yen | 110.69 yen | 115 yen |
Euros | 129.45 yen | 128.43 yen | 133 yen |
(yen per ton) | |||
Results and | FYE2018 Results | FYE2019 Results | FYE2020 Forecast |
assumptions | assumptions | ||
Aluminum price | 234,000 | 249,000 | 237,000 |
(Purchasing price) | |||
Copper price | 639,000 | 632,000 | 694,000 |
30
Cautionary Statements with Respect to Forward-Looking Statements
Statements made in these materials with respect to plans, strategies and future performance that are not historical facts are forward-looking statements. LIXIL Group Corporation cautions that a number of factors could cause actual results to differ materially from those discussed in the forward- looking statements.
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LIXIL Group Corporation published this content on 31 January 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 January 2020 04:14:06 UTC