Fiscal Year Ended December 31, 2014 Unicharm Presentation ......Oct-Dec 3Q Jan-Mar 4Q Apr-Jun 1Q...

Copyright (c) 2012 Unicharm Corporation. All rights reserved. Copyright (c) Unicharm Corporation. All rights reserved.

February 12, 2015

Takahisa Takahara

President and CEO

Unicharm Corporation

Projections stated herein include those based on the Company’s assumptions, forecasts and plans

as of February 12, 2015. Therefore, actual results may differ significantly from projections due to

risks and uncertainties associated with market competition, foreign exchange rates, etc.

Fiscal Year Ended December 31, 2014

Unicharm Presentation Materials for Investor Meeting

Copyright (c) 2012 Unicharm Corporation. All rights reserved.

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Copyright (c) Unicharm Corporation. All rights reserved.

To 10% of Global Market share

2

Market share 2014 （compared to 2011）

World No.3 9.2% (+1.1%)

Asia No.1 25.2% (+1.4%)

Accelerate growth utilizing strength of No.1 position in Asia


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Copyright (c) Unicharm Corporation. All rights reserved. 3

Winning high share in each category

Baby Care 2014 (compared to 2011)

World No.3 9.1% (+0.9%)

Asia No.1 25.2% (+0.7%)

Feminine Care 2014 (compared to 2011)

World No.3 8.9% (+1.4%)

Asia No.1 21.6% (+1.9%)

Health Care 2014 (compared to 2011)

World No.3 10.4% (+1.4%)

Asia No.1 34.8% (+1.5%)


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Highly rated by 14,000 Japanese mothers!

Moony Series wins Best Mother Award!!


Financial Performance Summary:



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2013 2014

Jan-Mar Apr-Jun

1Q

Jul-Sep

2Q

Oct-Dec

3Q

Jan-Mar

4Q

Apr-Jun

1Q

Jul-Sep

2Q

Oct-Dec

3Q

Companies with

fiscal year ending

March

Companies with

fiscal year ending

December

Change closing date of fiscal year from March 31 to December 31 to standardize the fiscal year

for all consolidated subsidiaries

6

①Consolidated FY Ended December 31, 2014. (Afterward: “Financial report basis”) ◆Companies with fiscal year ending March: Apr-Dec 2014

◆Companies with fiscal year ending December: Jan-Dec 2014

②Consolidated fiscal year for comparison of pro forma amount. (Afterward: “Adjusted basis” Compared boxes in red)

◆2013: Jan-Dec 2013 ◆2014: Jan-Dec 2014

2013 2014

Jan-Mar Apr-Jun

1Q

Jul-Sep

2Q

Oct-Dec

3Q

Jan-Mar

4Q

Apr-Jun

1Q

Jul-Sep

2Q

Oct-Dec

3Q

Companies with

fiscal year ending

March

Companies with

fiscal year ending

December

Twelve

months

Twelve

months

Nine

months

Twelve

months

Twelve

months

Twelve

months


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【Consolidated】 Year-on-Year Comparison (Financial report basis)

FY Ended

Dec. 31, 2014

FY Ended

Mar. 31, 2014 Difference※

Difference

(%)※

Net sales 553,661 599,455 ーー

Operating income Operating income margin

61,347

11.1%

67,240

11.2%

ー

ー

Ordinary income Ordinary income margin

65,527

11.8%

67,913

11.3％

ー

ー

Net income

EPS (Yen)

32,731

54.33

38,216

64.10

ー

ー

7

(Millions of yen)

※ Difference is not indicated due to irregular closing account for this consolidated fiscal year.


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Actual operating income margin reached 11.6%

excluding special factors

FY Ended

Dec. 31, 2014

FY Ended

Mar. 31, 2014 Difference

Difference

(%)

Net sales 553,661 599,455 ーー

Operating income Operating income margin

61,347

11.1%

67,240

11.2%

ー

ー

8

Year-on-Year Comparison (Financial report basis) (Millions of yen)

Actual operating income 64,593

Actual operating income margin

Special factor (Reduced operating income)

Relation of changing

fiscal year 1) 1,496 Effect of synchronizing the accounting period

External factor 2) 1,750 Retroaction of last-minute demand due to increasing consumption tax

(Millions of yen)

11.6％


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Segment Information (Financial report basis)

9

Personal

CarePet Care Others Total

Elimination/

CompanywideConsolidated

FY Ended Mar. 31, 2014

Net sales 515,253 78,672 5,530 599,455 － 599,455

Operating income 65,732 1,130 355 67,217 22 67,240

FY Ended Dec. 31, 2014

Net sales 486,960 62,564 4,136 553,661 － 553,661


Japan Asia Others TotalElimination/


FY Ended Mar. 31, 2014

Net sales 255,767 256,253 87,435 599,455 － 599,455

Operating income 35,316 31,548 481 67,345 -105 67,240


Net sales 198,745 272,904 82,011 553,661 － 553,661

Operating income 27,151 32,729 1,520 61,401 -54 61,347

(Millions of yen) Business Segment Information (Financial report basis)

Geographical Segment Information (Financial report basis)


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Copyright (c) Unicharm Corporation. All rights reserved. Copyright (c) Unicharm Corporation. All rights reserved.

23.0%26.9%

31.4%

49.3%

36.9% 37.1% 38.5%42.4%

46.9%

52.6%

64.4%

42.8%38.2%

33.9%

21.5%

57.7%

0

100

200

300

400

500

600

700

800

900

'08/3 '09/3 '10/3 '11/3 '12/3 '13/3 '14/3 '14/12

0%

10%

20%

30%

40%

50%

60%

70%

Sales in Japan (left axis) Sales in Asia (left axis) Overseas sales excluding Asia (left axis)

Sales composition in Asia (right axis) Overseas sales composition (right axis)

Overseas sales composition reached 64.4% driven by steady increasing sales composition in Asia (Adjusted basis 60.5%)

Changes in Japan and Overseas Net Sales (Financial report basis)

10

(Billions of yen)

※Due to changes in the accounting period, the consolidated fiscal year under review is an irregular settlement of accounts.

※


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Executed aggressive marketing investments focused on Asia Actual consolidated operating income margin reached 11.6% excluding special factors of changing fiscal year, etc.

Actual operating income margin by geographical segment (After considering special factors)

4.1%

0.5%

1.9%

13.3% 13.0%

11.6%

13.8%

10.5%11.0%

12.8%

14.2%14.0%

15.5% 15.1%

13.6%

12.3%12.4%

11.7% 12.5%

3.2%

1.5%

7.4%

5.9%

2.6%

12.1% 12.0%

12.4%

9.9%

11.2%

12.6%

10.0%

11.6%

0.0%

5.0%

10.0%

15.0%

20.0%

'08/3 '09/3 '10/3 '11/3 '12/3 '13/3 '14/3 '14/12

Japan Asia Other Consolidated


Financial Results Review:



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Double-digit growth in both net sales and operating income

FY Ended

Dec. 31, 2014 (Adjusted basis)

FY Ended

Dec. 31, 2013 (Adjusted basis)

Difference Difference

(%) Note

Net sales 666,258 580,400 85,857 14.8％

Operating income Operating income

margin

76,227

11.4%

62,823

10.8%

13,404

21.3％

13

※ Financial results after adjustment are management accounting basis.

Year-on-Year Comparison (Adjusted basis※ ’14/1 – ’14/12 vs ’13/1 – ’13/12)

(Millions of yen)


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Pet care business expand Japan sales of high unit price products, while last year’s restructuring sees results improve overseas

Personal

CarePet Care Others Total

Elimination/



Net sales 496,877 76,744 5,394 580,400 － 580,400

Operating income 61,671 737 415 62,823 － 62,823


Net sales 579,360 81,377 5,521 666,258 － 666,258

Operating income 72,992 2,885 349 76,227 － 76,227

Difference

Net sales 82,483 4,633 127 85,858 － 85,858

Operating income 11,321 2,148 -66 13,404 － 13,404

Difference (%)

Net sales 16.6% 6.0% 2.4% 14.8% － 14.8%

Operating income 18.4% 291.5% -15.9% 21.3% － 21.3%

17

Business Segment Information (Adjusted basis ’14/1 – ’14/12 vs ’13/1 – ’13/12)

(Millions of yen)


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Operating income improves with continual high added-value proposals focused on the baby care business in Japan

Japan Asia Others TotalElimination/



Net sales 244,967 247,740 87,693 580,400 － 580,400

Operating income 31,133 32,535 1,811 65,479 -2,656 62,823


Net sales 262,897 305,575 97,786 666,258 － 666,258

Operating income 36,723 39,232 2,421 78,376 -2,149 76,227

Difference

Net sales 17,930 57,835 10,093 85,858 － 85,858


Difference (%)

Net sales 7.3% 23.3% 11.5% 14.8% － 14.8%

Operating income 18.0% 20.6% 33.7% 19.7% -19.1% 21.3%

18

Geographical Segment Information (Adjusted basis ’14/1-’14/12 vs ’13/1-’13/12)

(Millions of yen)


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Impact on sales and operating income due to exchange fluctuation (Adjusted basis) Net sales increased approx. ¥18.0 billion year-on-year, while operating income decreased approx. ¥3.0 billion

Currency Exchange rate for

FY2014

Exchange rate for

FY2013 Change in rate

Taiwan (TWD) 3.50 3.29 +6.4%

Thailand (THB) 3.27 3.18 +2.8%

South Korea (KRW) 0.1009 0.095 +6.2%

Indonesia (IDR) 0.00900 0.00894 +0.7%

Malaysia (MYR) 32.35 31.01 +4.3%

Netherlands (EUR) 140.39 129.68 +8.3%

China (CNY) 17.23 15.90 +8.4%

Philippines (PHP) 2.41 2.32 +3.9%

Saudi Arabia (SAR) 28.31 26.08 +8.6%

India (INR) 1.75 1.69 +3.6%

USA (USD) 106.01 97.65 +8.6%

Russia (RUR) 2.79 3.07 -9.1%

Australia (AUD) 95.52 94.39 +1.2%

Vietnam (VND) 0.0050 0.0046 +8.7%

19


Financial Results Forecasts for

Fiscal Year Ending December 31, 2015


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Double digit growth in sales and profit and expect actual record-high results in the fiscal year ending December 31, 2015

Fiscal year ending

Dec. 31, 2015

Fiscal year ended

Dec. 31, 2014 Adjusted basis

Difference Difference

(%)

Net sales 760,000 666,258 93,742 14.1%

Operating income

Operating income margin

86,000

11.3%

76,227

11.4% 9,773 12.8%

Ordinary income

Ordinary income margin

80,000

10.5%

79,742

12.0% 258 0.3%

Net income

Net income margin

44,000

5.8%

42,321

6.4% 1,679 4.0%

(Millions of yen)


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Foreign exchange rate sensitivity to 1% depreciation of the yen

vis-à-vis local currencies increases net sales and operating

income approx. ¥5 billion and ¥500 million, respectively

Currency Assumed rate for FY

ending Dec 31, 2015

Impact of a 1% change (depreciation of yen) (Millions of yen)

Net sales Operating income

Consolidated Total 5,000 500

Taiwan (TWD) 3.67

Thailand (THB) 3.54

South Korea (KRW) 0.1060

Indonesia (IDR) 0.0091

Malaysia (MYR) 31.81

Netherlands (EUR) 130.66

China (CNY) 18.50

Saudi Arabia (SAR) 30.67

India (INR) 1.87

USA (USD) 115.00

Australia (AUD) 92.43

Vietnam (VND) 0.0052

*Cost of imported raw materials: 1% depreciation of the yen vis-à-vis U.S. dollar increases costs by about ¥100-200 million.


Overview: Corporate Strategy

(Information and data noted here is from Unicharm)


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0 200,000

Japan

China

India

Indonesia

Thailand

Viet Nam

2015 2020 2030

200

In Asia, low usage ratio of disposable diapers and sanitary products and faster progression of population aging than in Japan

24

100%

21%

3%

41%

52%

26%

0%

50%

100%

-

500

1,000

1,500

2,000

2,500

2015 出生数

紙おむつ使用率(日本=100%)

1.0X

17.0X

22.9X

4.3X

0.6X 1.3X

100%

71%

15%

34%

53%

25%

0%

50%

100%

-

100,000

200,000

300,000

400,000

500,000

2015 生理人口数

生理用品使用率(日本=100%)

500

300

400

200

100

13.9X 13.5X

2.7X

0.7X 1.0X 1.0X

Number of births and usage ratio of

disposable diapers

Population of menstruating females

and usage ratio of sanitary products

1.1X

1.8X

1.7X

2.0X

1.9X

2.1X

Number of elderly persons

(aged 65 years and above)

(Million

people)

2015 Number of births

Usage ratio of disposable diapers

(Japan=100%)

(Million

people)

2015 Population of menstruating females

Usage ratio of sanitary products

(Japan=100%)

2015 → 2030

(Million

people)

25

20

15

10

5


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Focus on changes in the environment by closely following the situation on site and build an organizational structure for the speedier implementation of strategies

25

Promoting LMU (Local Management Units)

Strengthening the structure for facilitating local production for local consumption

Aggressively introducing Japanese technology and brands

Actively investing in personnel and delegating authority

Realizing swift decision

making in response to

changes in the environment

Bolstering the supply chain

http://upload.wikimedia.org/wikipedia/commons/archive/f/fa/20091103090801!Flag_of_the_People's_Republic_of_China.svg

http://upload.wikimedia.org/wikipedia/commons/4/41/Flag_of_India.svg

http://upload.wikimedia.org/wikipedia/commons/a/a9/Flag_of_Thailand.svg

http://upload.wikimedia.org/wikipedia/commons/9/9e/Flag_of_Japan.svg


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2013(12ヶ月) 2014(9ヶ月) 2013(1-12) 2014(1-12)2013(1-12) 2014(1-12)

Retail

Sales

Hospital use

26

Japan

Baby Care (BC)

1.0X 1.10X

1.0X

1.63X

■Net sales (over previous fiscal year)

■Operating income (over previous fiscal year)

■Inbound effects (Net sales, over previous fiscal year)

Strengthen brand power with continual new value proposals Substantially improve profitability by

responding to changes in the environment

1.0X

3.2X

• Assurance of Japanese quality

• Number of foreign tourists to

Japan in 2014: 13.41 million

people (+30%)

• Relaxation of visa issue

requirements for China and 5

countries in Southeast Asia

• Weaker yen

• Increase in point-of-sale outlets

for export goods

• Increase in traffic of low-cost

carriers (LCC)

New proposals for low-birth-weight infants Launch as hospital-use products

Extremely low-birth-

weight infants (ELBW)

- 1,000g

Approx. 3,000

infants/year

Very low-birth-weight

infants (VLBW)

1,000g to 1,500g

Approx. 5,000 infants/year

Low-birth-weight infants

(LBW)

1,500g to 2,500g

Approx. 91,000

infants/year For

newborns Small size

(3S)

4S 5S

SS→S→M→L→Big

2013 (12 months) 2014 (9 months)



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0

50

100

2013/4 2014/3 2014/12

2013(4-12) 2014(4-12)

0

10

20

30

40

50

60

2012/12 2013/12 2014/12

27

Japan

Health Care (HC)

No.1 53.6% Share

Competitor A 14.2%

Competitor B 9.5%

Competitor A 14.8%

Competitor B 8.7%

■ Retail market

Create a new segment centering on light incontinence market, and help realize

a society of good health and long life

Light adult incontinence market

No.1 63.2% Share

■Male light incontinence market

No.1 0%→72.8% Share

Competitor A 20.9%

Competitor A 86.8%

Competitor B 4.4%

Competitor C 1.7%

Market scale

1.0X

2.9X

Launched in

April 2014

0

20

40

60

2012/12 2013/12 2014/12



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Pet Care (PC)

Japan

No.1 share in all market entry categories

PC market Food market Toiletry market

0

5

10

15

20

25

2013/12 2014/12

No.1 21.4% Share

No.1 16.1% Share

No.1 42.0% Share

5

10

15

2013/12 2014/12

Competitor A 12.5%

Competitor A 15.7%

Competitor A

14.2% Competitor B 7.5%

Competitor C 6.6%

Competitor B 9.5%

Competitor C 8.3%

Competitor B

6.3%

Competitor C

5.7% 0

10

20

30

40

2013/12 2014/12



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Copyright (c) Unicharm Corporation. All rights reserved. 2012 2013 201429

Japan

Food market Toiletry market

Kg unit (sales price) over previous

fiscal year (tax excluded)

106 107 112

100

105

110

競合A 市場平均 UC

(%)

＜＜

Dog food best market

No.1 44.7% (+2.7%)

Share

Actively cultivate new markets

October 2001

Launch of disposable

diapers for pets

October 2011

Launch of disposable

diapers for male dogs

October 2014

Launch of

manner wear

Change in net sales

1.0X

1.27X

1.67X

Promote best practices and raise the market unit price

Cultivate new markets for revitalization

Competitor A 14.8%

Competitor A Average Market Price



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2008 2009 2010 2011 2012 2013 2014(1-12)

30

Taiwan

Health Care (HC)

Retail market ■Horizontal roll-out of Japanese-style care model

Explaining the features and usage of a Japanese-style care model by professional care advisors

Bringing smiles to care workers and receivers

5

15

25

35

45

55

2012/12 2013/12 2014/12

Changes in net sales

No.1 55.8% Share

Competitor A 21.9%

Competitor B 15.9%

1.0X

3.4X CAGR 22%

Cultivate markets through actively raising awareness in communities with

aging population

(Local currency base)


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Baby Care (BC)

China

Growth in high value-added products in urban markets

Expansion of EC and specialty stores in sales channels

■ By market category, change in proportion Expanding proportion of high unit price,

high value-added products as urban

markets grow

Sharp increase in the use of premium

products and pants-type diapers due to

the spread of a relaxed approach to

child care by mothers from the 1985 era.

Growing need for safe and high-quality

Japanese products

Ongoing rapid Yen depreciation/Yuan

appreciation

Continued expansion in the proportion

of EC and Baby specialty stores in

sales channels

Proportion of EC and Baby specialty

stores;

13 5

26 17

49

40

3 13

8 11

1 14

2010 2014

ﾊﾟﾝﾂ

輸入品

ﾌﾟﾚﾐｱﾑ

ｽﾀﾝﾀﾞｰﾄﾞ

ｴｺﾉﾐｰ

ﾊﾟｯﾄﾞ

29 18

32

21

26

31

14 32

2011 2014

EC

Baby専門店

ﾄﾗﾃﾞｨｼｮﾅﾙ

ﾓﾀﾞﾝ

■ By market and sales channels, change in proportion

2011: 40% → 2014: 63%

Pants

Imported products

Premium

Standard

Economy

Pad

Baby specialty stores

EC

Modern

Traditional


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B=255

Copyright (c) Unicharm Corporation. All rights reserved. 2013 2014 2013 2014

2013 20142013 2014

1.0X

1.66X

1.0X

1.61X

Market growth UC Sales growth ■Change in import volume of Japanese products

■ Change in net sales of pants-type diapers

32

Baby Care (BC)

China

Develop products that meet market needs, and lead the market by focusing on

EC channels

Market EC growth UC EC Sales growth

Premium products sales

Redesign the brand image

Bolster sales of Japanese products

Strengthen EC channels

2013 2014


2013 2014

1.0X 1.06X 1.0X 1.10X

1.0X

1.25X

1.0X

1.74X


(Local currency base) (Local currency base)



R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

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G=102

B=255

Copyright (c) Unicharm Corporation. All rights reserved. 2013 2014


15

25

2012/12 2013/12 2014/12

0

10

20

30

40

2012/12 2013/12 2014/125

15

25

2012/12 2013/12 2014/12

2013 2014


33

Feminine Care (FC)

No.2 17.0%

China

Implement premium marketing also in regional towns and cities

Increase market share by raising brand recognition

All market share

Competitor A 24.6%

Competitor B 11.3%

Shanghai City share

■ CD cities (regional towns and cities) share ■ Net sales (over previous fiscal year)

■ Operating income (over previous fiscal year)

No.1 22.1%

Competitor A 21.3%

Competitor C 19.1%

Competitor B 20.6%

Competitor A 10.5%

No.1 37.1%

1.0X

1.30X

1.0X

1.21X


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


0

50

2012/12 2013/12 2014/12

34

Indonesia

Continue high growth and strengthen regional supply to become even

more dominant in the market

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014


Baby Care (BC)

Past 10 years Changes in net sales

1.0X

30.1X

CAGR 46%

All market share

Competitor B 8.2%

Competitor A 16.3%

No.1 66.1%

Regional towns and cities Surabaya share

No.1 71.3%

0

50

2012/11 2013/11 2014/11

Competitor B 8.3%

Competitor A 10.0%


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


0

25

50

75

2012/12 2013/11 2014/11

5

15

25

35

2012/12 2013/12 2014/1235

Indonesia

Feminine Care (FC)

No.1 38.8% Share

Competitor B 11.6%

Competitor A 35.7%

High value-added products bring FC share close to 40%

HC share expanding as pants-type diaper usage increases

Health Care (HC)

No.3→No.1 8.4%→35.4% (2012/12) (2014/11)

Competitor B

8.4% →1.8%

Competitor A

77.7% → 26.1%

Share


R=255

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B=0

R=255

G=204

B=0

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B=102

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B=204

R=255

G=0

B=0

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G=102

B=255


10

20

30

40

50

60

2012/12 2013/12 2014/12

売上営業利益 (Local currency base)

36

Baby Care (BC)

India

Competitor B 16.4%

Competitor A 54.1%

All India share

No.2 26.6% Share

Achieved record-high share in All India Continue high growth and aim for surplus from 2016

2012 2013 2014

(1-12)

2015E 2016E

CAGR 74%

0

■Net sales Operating income


R=255

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B=0

R=255

G=204

B=0

R=0

G=0

B=102

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G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


22%

33%

48%

0%

10%

20%

30%

40%

50%

2012/12 2013/12 2014/12

パンツ化比率

33%→ 48% 37

Baby Care (BC)

India

No.1 50.1% Share

Delhi City Changes in proportion of share and pants-type diaper usage

Competitor A 30.2%

Competitor B 14.7%

Achieved top share in Delhi by initiating the use of baby pants-type diapers

Progression of pants-type diaper usage strategy

Proportion of pants-type diaper usage

1-diaper pack

Price-setting reflecting economic

level

Unbeatable high quality

Improving customer acquisition

through sales of XS-size pants

Proportion of pants-type diaper usage


R=255

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B=0

R=0

G=0

B=102

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G=51

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G=0

B=0

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G=102

B=255


Plant No.1

Plant No.2

Scheduled for

2015 H1 Operation

India

Neemrana City

Sri City

Pursuing further expansion by strengthening supply system with the construction of a

second factory in Southern India


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5

25

45

2012/12 2013/12 2014/12

0

20

40

60

2012/12 2013/12 2014/1239

Baby Care (BC)

No.1 58.3% Share

Feminine Care (FC)

No.1 50.6% Share

Thailand

Competitor B 6.5%

Competitor A 30.1%

Competitor B 10.4%

Competitor A 36.5%

BC meets markets needs and enjoys steady growth FC achieves 50% market share

with high added value

http://ja.wikipedia.org/wiki/%E3%83%95%E3%82%A1%E3%82%A4%E3%83%AB:Flag_of_Thailand.svg


R=255

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R=255

G=204

B=0

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G=0

B=0

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20

40

2012/11 2013/11 2014/11

10

20

30

40

50

2012/11 2013/11 2014/11

No.1 40.8%

40

Vietnam

Baby Care (BC)

Share

Competitor B 18.0%

Competitor A 34.4%

Feminine Care (FC)

No.2 43.2% Share

Competitor A 44.9%

BC expanding through active promotion of baby pants-type diaper usage

FC almost reaches No.1 from strengthening of high value-added products


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


Baby care (BC)

No.1 64% Share

Competitor B 10.0%

Competitor A 10.0%

Feminine care (FC)

No.1 54% Share

Myanmar

Competitor B 7.0%

Competitor A 7.0%

Competitor C 8.0% Competitor C 5.0%

BC continues expansion and remains undisputed No.1

FC to enjoy further growth backed by formidable brand power


R=255

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B=0

R=255

G=204

B=0

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G=51

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G=0

B=0

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G=102

B=255


Rolled out since 2011 High growth of CAGR 40%

2011 2012 2013 2014

2008 2009 2010 2011 2012 2013 201442

Saudi Arabia

Change in net sales

1.0X

2.50X

CAGR 16% 2008 2009 2010 2011 2012 2013 2014

2008 2009 2010 2011 2012 2013 2014

Overall business Baby Care (BC)

Feminine Care (FC)

Health Care (HC)




1.0X

1.0X

1.0X

2.60X

8.58X

2.72X

Steady growth amid uncertain conditions Expanding market share even in

new segments

Domestic share No.2 30%↑ Increase in imports to nearby countries

Strengthening our brand by investing more in TV commercials, etc.


R=255

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B=0

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G=51

B=204

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G=0

B=0

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G=102

B=255


U.S.

Focus on growth segments (Changes in proportion of net sales)

2010 (before acquisition) 2014

1. Snacks 31%

2. Flea and tick controls 30%

3. Toys 12%

4. Dog Pads 10%

5. Birds and small animals 9%

1. Flea and tick controls 29%

2. Dog Pads 16%

3. Snacks 13%

4. Birds and small animals 10%

5. Toys 9%

6. Snacks 13%

7. Small birds 9%

8. Toys 9%

Changes in share

Flea and tick market Dog Pad market

10

15

20

25

30

35

2012 2013 2014

No.1 32.1% (+1.2%) No.1 21.8% (+14.7%)

2012 →

Competitor A 20.4%

Competitor B 17.1%

Competitor A

20.1%

Competitor B 4.0%

Competitor A

52.8%

Raising profitability by improving our portfolio

Renewed Dog Pad secures No.1 share

2012→

0

10

20

30

40

50

2012 2013 2014


R=255

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B=0

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G=51

B=204

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G=0

B=0

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G=102

B=255


13.9

17.4

13.0

17.2

11.5 11.5

0

5

10

15

20

2010/3 2011/3 2012/3 2013/3 2014/3 2014/12

ROE

2.6

5.6

13.6

15.7

20.9

14.8

0

5

10

15

20

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2010/3 2011/3 2012/3 2013/3 2014/3 2014/12

Net sales, Sales growth rate

売上高売上成長率

(%)

12.6 12.4 12.1 12.0 11.2 11.6

0

4

8

12

16

20

24

28

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2010/3 2011/3 2012/3 2013/3 2014/3 2014/12

Operating income, Operating income ratio

営業利益営業利益率 Operating income

Operating income

Operating income ratio

44

15%

15% 15%

●：Annualized, real ROE

value excluding special

factors (Chinese tax effect)

●：Annualized real

growth rate

(%)

●：Annualized real

operating margin

Three 15%

Growth potential Sales growth rate

G20 plan targets: ¥1.6 trillion in consolidated net sales in 2020

Profitability Operating income margin

Capital efficiency rate

ROE

(9 months) (9 months) (9 months)

(Millions of yen) (Millions of yen)

Net sales Sales growth rate Return on equity (ROE)


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


0

50

100

150

200

250

0

100

200

300

400

500

600

700

2008 2009 2010 2011 2012 2013 2014

連結売上高（左目盛）

有形固定資産簿価（右目盛）

（年度）（注）14年度連結売上高は、13年度の同期間比伸び率を13年度売上に掛けた年率修正値

（十億円）（十億円）

45

Raising corporate value, achieving sustainable growth, creating investment appeal Adhering to corporate management in line with global investment standards

Rais

ing

co

rpo

rate

va

lue

an

d

ac

hie

vin

g s

usta

ina

ble

gro

wth

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(Sh

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rket liq

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Inve

stm

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of in

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rs

2009/3 11,700 people

2010/9 (end) (stock split)

1 share → 3 shares

2014/9 24,400 people

2014/9 (end) (stock split)

1 share → 3 shares

2014/12 36,400 people

Individual shareholders and

stock split Sustainable growth and future-oriented investment

JPX Nikkei 400

3 selection standards

0

500

1,000

1,500

2,000

2008 2009 2010 2011 2012 2013 2014

Market capitalization=(year-end closing share price) x

(number of outstanding shares)

Market capitalization

Corporate and share value

0

50

100

150

200

2008 2009 2010 2011 2012 2013 2014

Three-year cumulative operating income

FY14 has a 9-month account settlement period

(disclosed) calculated on operating income

Profitability

Billions

of yen

0%

4%

8%

12%

16%

20%

2008 2009 2010 2011 2012 2013 2014

(9 months)

● 13.5% 12.3%

(FY)

● Three-year average ROE

(Standard of the JPX Nikkei 400)

FY2014, Three-year average ROE: 12.3%

(FY14 has a 9-month account settlement period;

however, after an annualized rate adjustment and

excluding the factor of a temporary Chinese tax

effect, the three-year average ROE is 13.5%

.

(9 months) (9 months)

Billions of yen Billions of yen

. ●

ROE

Capital efficiency

Billions

of yen

(left axis)

(Note) Consolidated net sales for FY14 is an adjusted annualized rate of the FY13 yoy growth rate

multiplied by FY13 net sales.

(Standard of the JPX Nikkei 400)

“Company with a high appeal for investors,” meeting requirements

of global investment standards

(FY) (FY)

Book value of tangible

fixed assets (right axis)

Consolidated net sales

(FY)


Shareholder Return Policy


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


2.3 2.7 3.0 3.3 3.7

4.9 5.16.0

7.7

9.3

10.711.3

12.7 12.73

14.8

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

'02/3 '03/3 '04/3 '05/3 '06/3 '07/3 '08/3 '09/3 '10/3 '11/3 '12/3 '13/3 '14/3 '14/12'15/12E

47

Steady and continual dividend payments On track for 14 consecutive periods of increased dividends!

Change in dividends

※

(Yen) ¥2.07 increase in dividends

※ Fiscal year ended Dec. 31, 2014 is an irregular fiscal year lasting nine months.


R=255

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B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


We will continue to pay dividends that are consistent with earnings and increase dividends in fiscal year ending Dec. 2015 through the share buy-back, and forecast a 50% total shareholders’ return

※

※ Fiscal year ended Dec. 31, 2014 is an irregular fiscal year lasting nine months.

(Millions of yen)


R=255

G=102

B=0

R=255

G=204

B=0

R=0

G=0

B=102

R=51

G=51

B=204

R=255

G=0

B=0

R=102

G=102

B=255


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