WacomStrategicBusinessPlan SBP-2019 (FY 03/2016...

Wacom Strategic Business Plan

SBP-2019 (FY 03/2016 – FY 03/2019)

Wacom Co., Ltd.

(TSE Sec.1 6727)

All Rights Reserved. Copyright © 2015 Wacom Co., Ltd. 2

Strategic Business Plan Background

Wacom Strategic Business Plan 2019 (SBP-2019), covers the period starting from FY33 (the year ending March 2016) to FY36 (the year ending March 2019).

Responding to rapid changes in the IT industry and User Interface technologies, Wacom continues to transform its business model to mobile and Cloud and seeks new business opportunities and customer segments.

Wacom seeks steady growth by leveraging its global industry leadership in the creative market, and through the end-to-end integration of products and services,while investing in creating new market categories in consumer and business solution.

Technology Solution will face high volatility in market and customer outlook and we need to develop a broader range of customers to improve the stability of business.

Assumed foreign exchange rate: 1USD=110JPY, 1EURO=130JPY


Strategic Business Plan Background

Smartphone, Tablet, and Cloud as the main IT platform

HW, SW, and Cloud integration impacts all lines of business

Wearable and IoT(Internet of Things) will further accelerate Cloud integration

Evolution and globalization of digital design process

Creative market expansion as 3D and 2D merges as one platform

Emerging market design industry continues to gain momentum

Stronger interests for creativity in mobile consumer market

Originality and vital influence becomes high value among mobile consumers

New opportunity for Digital Stationery market

Business and education go mobile

Mobile workflow proliferates as Cloud integration proceeds

Education market embraces tablets for classroom

Wacom Strategic Business Plan

SBP-2019Evolve the business model toward mobile and

Cloud for reaching new customers as well as

expanding existing business. In addition, improve

the speed and profitability by leveraging our global

business infrastructure.

Financial Goals by FY ending March, 2019

• Consolidated sales: 120 billion JPY

• Consolidated operating profit margin: 12%

• Consolidated ROE: 20% or higher


Basic Strategy

Evolve the business toward mobile, Cloud and ecosystems.

Accelerate the growth with a new global business organization and enhanced global integration.

Accelerate creative business with mobile product line expansion, 3D penetration and emerging market investment.

Reach new consumer users with Digital Stationery and Cloud.

Expand the Technology Solution (comp.) business with AES and WILL (Wacom Ink Layer Language).

Enhance business workflow and security solutions by leveraging WILL and digital signature solutions.

Leverage global business system for efficiency, speed and profitability.


Basic Framework of Global Organization

6

CORPORATE STRATEGY DRIVER

BUSINESS DRIVERS

Technology

SolutionCreative Consumer

Platforms &

Applications

Business

Solution

Engineering

Solutions

Design CenterEngineering

& QAOperations

CORPORATE FUNCTIONS

Technology Development, Legal, IP, Internal Audit, Accounting, Treasury, HR, Corporate Brand & PR, Corporate Administration, Investor Relations, etc.

Enabling Functions

Marketing Center

Business Units


Global Business Units (BU)

Technology Solution Business

UI technology solutions for mobile systems EMR, AES Components & modules (feelTM)

Other Business Engineering solution・ECAD dio

Consumer business

Makes daily lives more creative and enjoyable

Bamboo Stylus, Bamboo Pad, etc.

Business solution

Serves society by providing innovative solutions

STU (Signature Tablet), DT (Display Tablet) series, etc.

Creative business

Serves the passion of professional and consumer creativity

Intuos, Intuos Pro, Cintiq Companion, Cintiq

Bra

nd

Pro

du

ct B

usin

ess

Platform &application

Provides

technology,

apps and

platforms

WILL,

Bamboo

Paper,

Sign&

Save


43,62550,300

56,20063,600

75,300

30,277

33,000

36,000

39,500

43,700

655

700

800

900

1,000

0

20,000

40,000

60,000

80,000

100,000

120,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Other biz

Tech. Solution biz

Brand biz

Consolidated Sales

10%

15%

CAGR(Unit: Million JPY)

Consolidated

Sales

13%

(FY32 Act.) (FY33 Fcst) (FY34 Plan) (FY35 Plan) (FY36 Plan)

74,557

84,000

93,000

120,000

104,000


6,1435,500

7,440

10,400

14,400

3,473 3,530

5,068

7,070

9,800

0

5,000

10,000

15,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Operating Profit Net Profit

Consolidated Profits(Unit: Million JPY)


30%

24%

CAGR


Key Financial Indices

8% 7%

8%

10%

12%10%

10%

14%

19%

24%

7%

6%

9%

12%

14%

0%

5%

10%

15%

20%

25%

30%

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

OPM ROE ROA



Business Structure in SBP-201911年3月期 12年3月期

Sales in FY 03/2019

(Plan)

Sales in FY 3/2015

(Actual)

120.0 bn

JPY

Technology

Solution43.7 bn

JPY(36.4%)

Others

1.0 bn JPY (0.8%)

Brand Product

43.6 bnJPY

(58.5%)

Component30.3 bn

JPY

(40.6%)

Others

0.7 bn JPY (0.9%)

Brand

Product75.3 bn

JPY

(62.8%)

74.6 bn

JPY

All Rights Reserved. Copyright © 2015 Wacom Co., Ltd.

Brand Product Business

Mission:

To meet the needs of

creative people from all

walks of life, and to

make this world a more

creative place

Brand Product Business


Growth Strategies: Brand Product Business

Creative Business

Expand the user base from 2D to 3D design and modeling

Enhance display and mobile products with Cloud integration

Accelerate the growth with G2M innovation and global integration

Develop new business to offer new values to customer base

Consumer Business

Develop new Digital Stationery category with digital pen and ink

Provide fully integrated Cloud-based solutions and services

Build new general consumer community and channels

Business Solutions

Develop digital ink based workflow and biometric security solutions

Expand industry specific mobile product line for higher value

Build partnerships to support globally enterprise customers


Brand Product Business: Sales Plan

CAGR(Unit: Million JPY)

Sales

15%

21,981 23,300 23,500 23,600 23,700

3,910 5,400 6,600 8,400 11,400

10,590 12,400

14,700 16,900

20,000

1,554

2,300 2,700

3,500

4,800

5,591

6,900

8,700

11,200

15,400

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Business Solution

Consumer

Creative・Display

Creative・Mobile

Creative・Tablet


43,625

50,300

56,200

63,600

75,300

2%

29%

31%

33%

17%

All Rights Reserved. Copyright © 2015 Wacom Co., Ltd.


Mission:

Provide Wacom UI solutions and

experience to a wide range of

global technology customers to

make digital lives easy, fun and

creative



Growth Strategies: Technology Solution Business Establish the global leadership in all mobile product category

Evolve the business from component vendor to solution partner

Expand Smartphone customer user base by EMR pen evolution

Establish Active ES pen as the industry standard in the Tablet category

Lead the industry partnership to expand the pen standard

Expand users in Education Tablets Leverage government project successes and experiences

Build new partnerships for solution approach

Build new customer base in Digital Stationery categories Partner with traditional stationery companies going digital

Accelerate the adoption by offering digital pen cartridges

Promote WILL (Wacom Ink Layer Language ) partnership Enhance solutions offered in B2B and B2C platforms

Invest in automated production for higher quality and lower cost


Technology Solution Business: Sales Plan

18,331 18,500 18,200 18,000 18,000

8,542 10,500

13,400 16,900

20,700 3,404 4,000

4,400

4,600

5,000

0

10,000

20,000

30,000

40,000

50,000

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

Pen for Notebook PC, etc.

Pen for Tablet

Pen for Smartphone


CAGR

Sales

10%

0%

10%

15%

30,277

33,000

36,000

39,500

43,700


Initiatives: Corporate Function

Leverage global value chain and business IT infrastructure

Leverage digital marketing and direct e-commerce capability

Integrate global branding-marketing-sales activities

Reach new customers with global logistics capability

Global HR system for global performance management

Improve ROI with real-time business information

Accelerate emerging market development

Strengthen investment in China, India, ASEAN, and LATAM

Expand market specific product lines and build brand presence

Enhance innovation in product, technology and business processes.

Enhance business incubation and R&D structure

Develop stronger partnership capabilities for innovation


Global Business Infra. development

Development of customer-centric global value chain Global WEB site to meet product information needs and broader access.

E-Commerce direct sales and fast delivery by a global logistics provider

Improved customer support with global CRM and direct marketing

Global sharing of business information for speedy decisions Shared global KPIs and business intelligence

Higher accuracy for demand and supply planning and sales programs

Improved efficiency by Cloud-based global IT Infra. Integration Unified business processes for speedy expansion of new business and geographic entities


Global Value Chain and Business IT Infrastructure

Global Web Site

E-Store

Digital Marketing

New Website,

Product Info. & E-store

Corporate Information

Integrated Cloud Based Information TechnologyERP System (SAP), SCM System (JDA), CRM System (Microsoft), Procurement (Coupa), Global Infrastructure

Global Info. Sharing and Business IntelligenceCorporate Performance Management (CPM), Operational and Financial Metrics and KPI’s.

Supply & Demand

Planning

Manufacturing

Operations

ODM

Global Logistics

3PL3rd Party Logistic Provider

Call Center

Customer Service

Outsourced Call Center

with expanding Repair

services

Outsourced Logistics,

Warehousing, &

Brokerage

Unified forecasting, PSI

& demand cycle

Procurement & Order

Management


Estimation of Cumulative Net Cash Flow

-80.0

-60.0

-40.0

-20.0

0.0

20.0

40.0

60.0

80.0

FY03/14

FY03/15

FY03/16

FY03/17

FY03/18

FY03/19

FY03/20

FY03/21

FY03/22

Project Investment and Return (Unit: 0.1 bn JPY)

The term of

Wacom SBP-2019

This fiscal year

Estimation of Annual Net Cash Flow

-80.0

-60.0

-40.0

-20.0

0.0

20.0

40.0

60.0

80.0

FY03/14

FY03/15

FY03/16

FY03/17

FY03/18

FY03/19

FY03/20

FY03/21

FY03/22

The term of

Wacom SBP-2019

This fiscal year


Shareholder Returns

0.00

5.00

10.00

15.00

20.00

25.00

30.00

FY 03/15 FY 03/16 FY 03/17 FY 03/18 FY 03/19

(Unit: JPY)


Dividend per share

Dividend Payout Policies

Continue stable payouts to shareholders while maintaining stable financial base necessary for future business development

Payout ratio is targeted for maintaining 40% or more

18.00 18.00


Reference Information


FY 03/15

(FY32)

Actual

FY 03/16

(FY33)

Forecast

FY 03/17

(FY34)

Plan

FY 03/18

(FY35)

Plan

FY 03/19

(FY36)

Plan

CAGR

Sales 74,557 84,000 93,000 104,000 120,000 13%

OP 6,143 5,500 7,440 10,400 14,400 24%

OPM 8.2% 6.5% 8.0% 10.0% 12.0%

NP 3,473 3,530 5,068 7,070 9,800 30%

NPM 4.7% 4.2% 5.4% 6.8% 8.2%

ROE 10% 10% 14% 19% 24%

ROA 7% 6% 9% 12% 14%

Key P/L Financial Indicators


Sales & OP Plan: Brand Product BusinessFY 03/15

(FY32)

Actual

FY 03/16

(FY33)

Forecast

FY 03/17

(FY34)

Plan

FY 03/18

(FY35)

Plan

FY 03/19

(FY36)

Plan

CAGR

Segment Total 43,625 50,300 56,200 63,600 75,300 15%

Cre

ativ

e

Pen Tablet 21,981 23,300 23,500 23,600 23,700 2%

Mobile 3,910 5,400 6,600 8,400 11,400 31%

Display 10,590 12,400 14,700 16,900 20,000 17%

Consumer 1,554 2,300 2,700 3,500 4,800 33%

Business Sol. 5,591 6,900 8,700 11,200 15,400 29%

OP 5,965 9,280 10,890 13,070 16,640 29%

OPM 14% 18% 19% 21% 22%


Sales & OP Plan: Technology Solution BusinessFY 03/15

(FY32)

Actual

FY 03/16

(FY33)

Forecast

FY 03/17

(FY34)

Plan

FY 03/18

(FY35)

Plan

FY 03/19

(FY36)

Plan

CAGR

Segment Total 30,277 33,000 36,000 39,500 43,700 10%

For Smartphone 18,331 18,500 18,200 18,000 18,000 0%

For Tablet 8,542 10,500 13,400 16,900 20,700 25%

For Notebook PC,

etc.3,404 4,000 4,400 4,600 5,000 10%

OP 4,642 4,570 4,730 5,190 5,790 6%

OPM 15.3% 13.8% 13.1% 13.1% 13.2%


our vision

All Rights Reserved. Copyright © 2015 Wacom Co., Ltd. 28our mission


our brand

DisclaimerForward-looking statements regarding future events and

performance contained in this presentation are based on currently

available information and involve risks and uncertainties, including

macroeconomic conditions, trends of the industry in which the

company is engaged and progress in new technologies. Please

note that actual results could materially differ from those expressed

or implied by the forward-looking statements in this presentation

due to these risks and uncertainties.

Investor Relations Inquiries

TEL: +81-3-5337-6502 FAX: +81-3-5337-6519

Wacom Co., Ltd.

Sumitomo Fudosan Shinjuku Grand Tower 31F,

8-17-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo

160-6131, Japan

Wacom Co., Ltd.

http://www.wacom.com

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