2021_1q_omron_e

2/37 ■Summary

There are 3 key points. The first agenda item is OMRON's Q1 FY2020 results. We generated operating income of ￥12.5 billion yen in Q1, up 24% Y/Y. Despite the unprecedented disruption resulting from the COVID-19 outbreak, OMRON was able to demonstrate its resilience. Operating income increased substantially Y/Y in spite of a decline in sales. Three factors contributed to the strong profit growth. First, we were able to capture new demand sparked by the COVID-19 outbreak, thus reducing the magnitude of the sales decline relative to our initial expectations. Second, we made further improvements to our GP margin by enhancing product capabilities, reducing variable costs and ongoing structural reform initiatives. Third, we executed on fixed cost reductions, in line with plan. I will elaborate in more detail later. The next agenda item is our plan for the fiscal year ending March 2021. We are guiding for Y/Y declines to full-year sales and profits, based on our assumption that the operating environment will remain extremely challenging throughout FY2020. Our guidance is conservative and reflects only what we are sure of at this time. However, we do not intend to be complacent: we will focus on capturing every opportunity presented by the outbreak to maximize sales and profits. Despite the challenging conditions, we reiterate our initial full-year DPS guidance of ￥84, which is unchanged Y/Y. Finally, I will discuss the OMRON group's efforts to take on the challenge of addressing the post-COVID-19 world. The COVID-19 outbreak has driven significant changes on a global basis. Reflecting this, OMRON positions FY2020 and FY2021 as a period of transformation in preparation for a post-COVID-19 world. During this period, OMRON will accelerate its efforts to drive an evolution in the business models of each business, transforming OMRON into a robust, resilient organization capable of successfully weathering changes in the operating environment. Our aim is to achieve profitable growth by capturing the new social needs emerging in the post-COVID-19 period. Today, I will showcase 3 specific examples from OMRON’s Factory Automation, Healthcare and Social Solutions businesses.