Full Year 2024 Bridgestone Corp Earnings Presentation Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Shinji Kakiuchi - Morgan Stanley MUFG Securities - Analyst : Thank you very much. So my first question. Severe business environment indeed. So, there were various initiatives, that you're trying to counter the pressure, and it was very clear. Last year you kept on saying quarter by quarter that the business environment continue to be severe. What about as of today? From looking around here in the business environment, are there any particular reasons or the segments that we made the mood and and and the symptoms are starting to ease, or do you think that the severability that will continue to persist in 2025. So depending on your expectations and your view, that may change the analysis of view. So that's my question number one. So please go ahead. So if I may, I would like to ask my second question. 2025, the financial plans, Mr. Hishinua explained that JPY59 billion is, the selling price in the increase and the how that will have a result, in the end result that you need be quoted so that. Oh, the feedstock and the price will increase to the tune of JPY30 billion. It sounds as though that you will be able to counter that adequately the way some of the positive plans and about the tariff import tariffs and how it is going to be implemented, the indian North America in particular. That I, they understood that as of today, that you did not include, the with expressed numbers, that you gave us a nuanced and quaditative remarks, but if you can share further within reason.

Question: Shinji Kakiuchi - Morgan Stanley MUFG Securities - Analyst : Yeah, just quickly about the truck can tires in North America, Levant on the plant you and decided to close down, how that would possibly affect the supply in the local market, no the negative effect. Correct.

Question: Shinji Kakiuchi - Morgan Stanley MUFG Securities - Analyst : Thank you very much.

Question: Tairiku Sakaguchi - Mizuho Securities - Analyst : Thank you for taking my question. I have two questions. Firstly, this year. Rebuilding resources, will have a JPY100 billion investment, which is quite high, but as far as you have announced, that we don't expect the amount to be that large. So at what space, what sort of specific projects will be announced? Can you give us a clue as to what announcement you're going to do? And if you follow through with this, then in the last final year, the 30% adjusting operating margin and Roy 10%, those are the targets for the final year of the current MDP. So. Are you going to be ready for achieving this? Is that correct? And also the expense that you spend and the results that you get from that. Of course, I know that the business environment is quite uncertain, but what is your vision that you're aiming for, with the results reaping out of the spend? Well, JPY100 billion for this year of that, a majority is for Lavanne plant closure. And the resources that were spent on that, as hisinema will explain later. This really presents a large part. That's what I wanted to say first. And then for 2026, this is the final year of 24 MTP. And the Roy is the pri number one target, the most important target for us, and 10% level is what we're aiming for, and that is the assumption that we frame our activities on. Obviously, in terms of ROE we're getting closer to ROE 11%, and that's our aim and just operating margin. From 12 to 13, we would like to bring that up to 13, so, we have to follow through with, this, to enhance business quality and then we're sowing the seeds for growth and with a better business quality, we would like to change the gear to expand sales and then you can enhance operating. Utilization ratio and further and then in 26, with the lean structure, the top line may be difficult, but in terms of business quality, we would like to bring our numbers to the promised ones as much as possible. That's how we are doing our business. Now hishima, please. Well, in that sense, the expenses for rebuilding, as was explained earlier in 24 and 25, JPY100 billion respectively, so in total about JPY200 billion has been posted, so there is no cash items included, so there is no direct cash outflow, but in terms of expenses, that is the level that we're talking about. And as for 2025. Return on that spend. In terms of that effect, about JPY40 billion return has been incorporated in our plan at the moment. Obviously, to 2026 more return will be incorporated because there will be a cumulative effect and there will be better business quality of our structure. So that's how you are supposed to look at this. So, in the first half, there will be various defense measures to be taken, and then in the second half, you're going to aim for more growth by improving top line and reaping the Results of JPY40 billion or plus out of the two year efforts that you have been doing. Yes, there will be JPY40 billion in 2025 already and then there will be more effects that we will see in 2026, but, especially so the projects are in different timelines. So based on those timelines, so we are going to make announcements. Thank you. And the second question is about optimal balance sheet. So the changes between the end of last fiscal year and this fiscal year. So midterm, 55% of equity ratio is your vision. So in terms of time frame, aspiration 2030. So is that what you're talking about in terms of time frame or in the final year of the current MDP and also the next MTP, is that also something that has been included. So can you give us more colors as to what which timeline are you going to achieve this target? Well, can you give us a clue? Well, it is true that looking at the current situation in this particular year and with the new Trump administration and various initiatives, there could be various scenarios. So, the next fiscal year, we cannot say this and this will be done very quickly. So in terms of midterm, of course you have to go through thorough discussions. That's why we're using the word midterm. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 17, 2025 / NTS, 5108.T - Full Year 2024 Bridgestone Corp Earnings Presentation So, 60% level for this fiscal year. So that would be the peak. And then, in the midterm. In three years' term, when you say midterm. That is the kind of scope that we have in mind. And of course, the 27 MTP obviously, we would like to achieve this. That is the time frame that we have in mind. Okay, thank you very much. Thank you.

Question: Kazunori Maki - SMBC Nikko Securities - Analyst : And thank you very much. I am Maki of SMBC Nico Securities. Because of, one question. I am going to beasking more or less. Abstract, question. I would like to ask you about the succession. For example, in '25, JPY500 billion of profit. And I think you will be going for growth and finance and plan in the past, in that order, but I think they are now in more or less the same parallel level. How are you sort of changing your approach? I think this is something that is welcomed.

Question: Arifumi Yoshida - Citigroup Global Markets Japan - Analyst : Thank you. So one question from myself as well. I just did operating profit in the profit of JPY5,500 billion. And I can see that there's going to be JPY40 billion and of the rebuilding benefits. And I understand you keep saying that the North American truck and bus tire business will hardly keep coming back. This song that I may want to hear there's something more, so I'm just wondering the whether on that that you have other thoughts behind those and this set of. Plans and also by 2026, to get as close to 13% as possible. But between 25 and 26, as you, the transform the shape of the business and the and the rebuilding to what extent do you get closer to the 13% or do you have any already identified initiatives for which you are confident that you will the in the approach in the 13% level more surely. Thank you. 2023 and 24 that the various, the commitments, the level that was made and despite that, we very short of that. Of course, on be it Latin America or Europe, there were changes in the in the business, the externalities, but after all, it remains as a fact that we were not able. To fulfill the commitments was made. Coming out of that this year, the team become stronger in the business foundation, which means that by enhancing the top line, and that we would have the increased profits, but rather than the continuing the focusing on that, only 1 or 2% of the prior level. The wide net focus on their on the cost and expenses. So that is the reason why I have the, I kept on focusing on that. So the top line, the view on the for 2025 that is rather conservative in comparison with our past. So 25 and 26, by the time we get to 2026, and the setting inside the President Trump's administration. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 17, 2025 / NTS, 5108.T - Full Year 2024 Bridgestone Corp Earnings Presentation We expect him to be able to once again steer under the gear of the overall the boat and the towards the growth, so that we can manage profitability and the way more aggressive perito and the revenue enhancement so that we can get them to the next stage in the of the. Business gains. What that means that the ROE Ro come the just the operating profit meg and everything come to all of those, the indus industry should benefit. So, there was a rebuilding the initiatives, of course, I would expect benefits to accrue. Anything from you? Yes, for 2025. About JPY40 billion, the benefits of that, and, as the accumulation that would take effect and by the time we get to the 26, it is going to be bigger than JPY40 billion. However, I cannot have the court to any particular that number rather than forcing ourselves to do that, why not do it exactly that we commit that we will do this year. So that comes first. Thank you very much.