© Azbil Corporation. All rights reserved.
Presentation Materials
for the Fiscal Year Ended March 31, 2022
(Based on Japanese GAAP)
May 13, 2022
Azbil Corporation
RIC: 6845.T, Sedol: 6985543

© Azbil Corporation. All rights reserved.
Contents
1.
Financial Results for FY2021
3
2.
Financial Plan for FY2022
13
3.
Returning Profits to Shareholders
18
4.
Progress in Implementing the Medium-term Plan
23
5.
Initiatives to Enhance Corporate Governance
33
Appendix
35
Notes
45
2

© Azbil Corporation. All rights reserved.
1. Financial Results for FY2021
3

© Azbil Corporation. All rights reserved.
[単位： 億円]
(Billions of yen)

FY2020
FY2021
Revised plan(Nov. 2, 2021)
(A)
(B)
(B) - (A)
% Change
(C)
(B) - (C)
% Change
Orders received
247.8
286.9
39.0
15.8
Net sales
246.8
256.5
9.7
3.9
262.0
(5.4)
(2.1)
Japan
201.9
204.3
2.4
1.2
Overseas
44.8
52.1
7.3
16.3
Gross profit
99.3
105.7
6.3
6.4
Margin
40.3
41.2
0.9pp
SG&A
73.6
77.4
3.8
5.2
Operating income (loss)
25.7
28.2
2.5
9.8
29.3
(1.0)
(3.6)
Margin
10.4
11.0
0.6pp
11.2
(0.2)pp
Ordinary income (loss)
26.3
29.5
3.1
12.1
29.5
0.0
0.1
7.3
19.9
20.7
0.8
4.3
21.0
(0.2)
(1.0)
Margin
8.1
8.1
0.0pp
8.0
0.1pp
Difference
Difference
Income (loss) before income taxes
28.0
30.0
2.0
Net income (loss) attributable toowners of parent
1. Financial Results for FY2021
Consolidated Financial Results
4
⚫
In FY2021, orders received, net sales, and profits all increased compared with FY2020. This was due to the recovery from the market downturn caused by the COVID-19 pandemic in FY2020, and also
partly to the impact of customers’ advance orders triggered by parts
shortages. On the other hand, from the second half of FY2021 onwards, there was an increasing impact from delays in recording net sales owing to longer delivery times caused by parts procurement difficulties. Consequently, both net sales and profits fell short of the revised plan announced on November 2, 2021.
⚫
Net sales rose compared with FY2020. This was due to sales growth achieved by the AA business, reflecting a recovery in demand in the manufacturing equipment market, but also to increased sales for the BA business and LA business. Due to the pandemic and the increasing impact of long delivery times, the plan was not achieved.
⚫
Operating income increased compared with FY2020, although it fell short of the plan, mainly owing to not reaching the sales plan. This increase from FY2020 was thanks to measures to strengthen business profitability, which continued to have a positive effect, in addition to the growth in revenue. This was against the fact there being higher expenses incurred by the increased burden related to staff working amidst the COVID-19 pandemic, as well as an increase in R&D expenses resulting from measures included in the medium-term plan.
⚫
Overall orders received grew, reversing the decline in FY2020 caused by the spread of COVID-19. This growth was mainly due to an increase in the AA business reflecting a recovery in market conditions and, to some extent, the impact of advance orders triggered by parts shortages, as well as increased orders received in the BA business reflecting demand for the refurbishment of existing buildings and service, and alsoincreased orders received in the LA business driven by demand for pharmaceutical equipment.
*
FY2021 ROE: 10.4%

© Azbil Corporation. All rights reserved.
(Billions of yen)
FY2020
FY2021
Revised plan
(Nov. 2, 2021)
(A)
(B)
(B) - (A)
% Change
(C)
(B) - (C)
% Change
Orders received
118.5
132.5
14.0
11.8
Sales
117.5
119.7
2.2
1.9
121.4
(1.6)
(1.3)
Segment profit (loss)
14.0
13.8
(0.1)
(1.1)
14.3
(0.4)
(3.1)
Margin
11.9
11.6
(0.4)pp
11.8
(0.2)pp
Difference
Difference
1. Financial Results for FY2021
Segment Information: BA Business
5
In the domestic market, demand has continued to grow for urban redevelopment projects and for heating, ventilation, and air conditioning (HVAC) control equipment / systems for factories, and there is growing interest in solutions related to ventilationimprovement, energy savings, and CO
2
reduction. While the impact of the COVID-19 pandemic has been limited, parts shortages have
had some effect. In overseas markets, due to the prolonged impact of the pandemic, the postponement of construction projects andconstruction delays have continued in some regions.Amid such a business environment, we have engaged in securing orders with a view to enhanced profitability, and, while payingsufficient attention to the safety of both customers and employees, we have also striven to ensure enhanced capabilities and efficiencies of job execution, particularly on construction sites. Product and service solutions have been enhanced.
⚫
As regards orders received, the service field was impacted by the new accounting standard for revenue recognition*, but, in addition to the renewal of multi-year service contracts, orders increased for the refurbishment of existing buildings thanks to a robust business environment, and some customers placed advance orders because of parts shortages. Accordingly, overall orders received were higher than FY2020.
⚫
Sales fell in the service field, due to the new accounting standard for revenue recognition. However, overall sales increased compared to FY2020 owing to sales growth in the fields related to new large-scale buildings and existing buildings. Sales fell short of the plan due to long delivery times triggered by parts shortages in the fields related to existing buildings and services, and also to the prolonged impact of the pandemic in overseas markets.
⚫
Segment profit was on a par with FY2020. Increased revenue in the profitable field for existing buildings was offset by higher expenses
—
for R&D, as stipulated in the
medium-term plan, and for personnel required for handling an increase in orders received. Profit fell short of the plan; this was because the sales plan was not achieved due to the impact of parts shortages.
*
Effect of the new accounting standard for revenue recognition on the service field:
The main impact of the new accounting standard for revenue recognition has been on the service field, reducing the figure for orders received by approximately 3.2 billion yen, and the negative impact on sales was about 1.3 billion yen, while segment profit was unaffected.

© Azbil Corporation. All rights reserved.
(Billions of yen)
FY2020
FY2021
Revised plan
(Nov. 2, 2021)
(A)
(B)
(B) - (A)
% Change
(C)
(B) - (C)
% Change
Orders received
87.5
109.5
22.0
25.2
Sales
87.7
94.2
6.4
7.4
96.5
(2.2)
(2.3)
Segment profit (loss)
10.2
13.2
2.9
29.1
13.4
(0.1)
(1.2)
Margin
11.7
14.0
2.4pp
13.9
0.2pp
Difference
Difference
1. Financial Results for FY2021
Segment Information: AA Business
6
As regards market trends in Japan and abroad, expanding investment in 5G has led to sustained high demand in the market for semiconductor manufacturing equipment. The COVID-19 pandemic has yet to abate; however, overall capital investment is seen to berecovering, particularly in the manufacturing equipment market.Amidst this business environment, our growth strategy for the overseas business
—
which has been a focus
—
has borne fruit, and the
profit structure has been successfully strengthened by continued implementation of various measures. However, there has been an impact from parts procurement difficulties, with delivery times lengthening for certain products.
⚫
Orders received were higher than FY2020. Although this partly reflects the impact of customers’ advance orders triggered by p
arts shortages, this increase was
mainly due to continued demand in the manufacturing equipment market
—
against the backdrop of a global expansion in semiconductor-related investment
—
as well
as business growth overseas. The order backlog also increased significantly.
⚫
Sales increased compared with FY2020, thanks mainly to growth in the manufacturing equipment market and overseas business. However, there have been delays in recording sales of some products due to parts procurement difficulties, and thus sales fell short of the plan.
⚫
As regards segment profit, although there was an increase in expenses associated with intensified sales activities and higher R&D expenses, as stipulated in the medium-term plan, segment profit was higher than FY2020 owing to revenue growth and the success of measures to strengthen profitability. Segment profit margin continued to improve. Although the sales plan was not achieved owing to parts procurement difficulties, thanks to the success of measures to strengthen profitability, profit fell only slightly short of the plan.

© Azbil Corporation. All rights reserved.
(Billions of yen)
FY2020
FY2021
Revised plan
(Nov. 2, 2021)
(A)
(B)
(B) - (A)
% Change
(C)
(B) - (C)
% Change
Orders received
43.3
46.8
3.4
8.1
Sales
42.9
44.2
1.2
3.0
45.7
(1.4)
(3.2)
Segment profit (loss)
1.4
1.1
(0.2)
(19.7)
1.6
(0.4)
(28.0)
Margin
3.3
2.6
(0.7)pp
3.5
(0.9)pp
Difference
Difference
1. Financial Results for FY2021
Segment Information: LA Business
7
The Lifeline field (gas/water meters, etc.) depends on cyclical demand for meter replacement as required by law and thus demandscan be expected to remain stable. However, changes in some markets have been observed, such as that for LP gas meters, for whichcyclical demand is currently at a low ebb. Also, in the Life Science Engineering (LSE: for pharmaceuticals/laboratories) field investment in equipment for pharmaceutical plants has continued to grow.Going forward, we will continue our initiatives to reform the business structure so as to stabilize and enhance profitability in each business field.
⚫
Overall orders received were higher than FY2020, mainly as a result of an increase in the LSE field driven by growing demand for equipment in the pharmaceutical market.
⚫
Overall sales increased from FY2020. A decrease was seen in the Lifeline field due to changing market conditions, the pandemic, and parts procurement difficulties. However, revenue growth was achieved in the LSE field, reflecting an increase in orders received in FY2020, in spite of delays in recording sales as a result of the pandemic. The prolonged impact of the pandemic on sales, however, meant that the plan was not achieved.
⚫
Segment profit decreased compared with the FY2020 and fell short of the plan. This was mainly associated with lower revenue in the Lifeline field. Although there was sales growth in the LSE field, profit was impacted by increased expenses related to business growth, soaring prices for raw materials, and higher energy and transportation costs.

© Azbil Corporation. All rights reserved.
FY2018
FY2019
FY2020
FY2021
　　
■
B A
64.2
63.1
64.0
75.1
　　
■
A A
28.9
27.7
27.7
42.3
　　
■
L A
12.9
13.4
14.2
17.2
Consolidated
106.0
104.2
105.8
134.2
0.0
25.0
50.0
75.0
100.0
125.0
150.0
1. Financial Results for FY2021
Reference: Performance Trend by Segment (1)
8
■
Orders received by segment
(Billions of yen)
(Billions of yen)
■
Order backlog by segment
FY2018
FY2019
FY2020
FY2021
　　
■
B A
123.7
122.9
118.5
132.5
　　
■
A A
98.3
91.9
87.5
109.5
　　
■
L A
43.8
44.8
43.3
46.8
Consolidated
264.2
258.0
247.8
286.9
0.0
50.0
100.0
150.0
200.0
250.0
300.0

© Azbil Corporation. All rights reserved.
1. Financial Results for FY2021
Reference: Performance Trend by Segment (2)
9
(Billions of yen)
■
Sales by segment
■
Segment profit (operating income)
FY2018
FY2019
FY2020
FY2021
　　
■
B A
119.5
123.7
117.5
119.7
　　
■
A A
99.3
93.1
87.7
94.2
　　
■
L A
44.8
44.0
42.9
44.2
Consolidated
262.0
259.4
246.8
256.5
0.0
50.0
100.0
150.0
200.0
250.0
300.0
FY2018
FY2019
FY2020
FY2021
　　
■
B A
12.4
14.8
14.0
13.8
　　　　
Margin
10.4
12.0
11.9
11.6
　　
■
A A
12.2
10.4
10.2
13.2
　　　　
Margin
12.3
11.3
11.7
14.0
　　
■
L A
2.0
1.8
1.4
1.1
　　　　
Margin
4.6
4.2
3.3
2.6
Consolidated
26.6
27.2
25.7
28.2
Margin
10.2
10.5
10.4
11.0
0.0
2.5
5.0
7.5
10.0
12.5
15.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
(Billions of yen)
(%)

© Azbil Corporation. All rights reserved.
FY2018
FY2019
FY2020
FY2021
20.4
18.7
18.8
19.4
9.7
9.8
11.0
14.2
5.3
3.7
3.7
4.9
8.5
9.1
9.0
10.3
2.6
2.6
2.2
3.1
46.7
44.1
44.8
52.1
Reference information
USD/JPY
110.45
109.03
106.77
109.90
EUR/JPY
130.35
122.03
121.88
129.91
CNY/JPY
16.71
15.77
15.48
17.04
17.8
17.0
18.2
20.3
Average
exchange
rate

■

Others
Consolidated
　　
Overseas sales /
　　　
Net sales (%)

■
China
■
North America
■
Europe
■
Asia
(ex-China)
0.0
5.0
10.0
15.0
20.0
25.0
30.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
1. Financial Results for FY2021
Overseas Sales by Region
10
■
BA business
Despite the continued impact in Asia of the postponement of construction projects as well as construction stoppages and delays resulting from the COVID-19 pandemic, progress was made with projects when construction work resumed in some regions, and sales increased. Sales in China rebounded thanks to factory projects, and overall sales increased.
■
AA business
Overall sales increased significantly. In addition to growth in global capital investment related to semiconductors and 5G, the manufacturing equipment market has continued to recover, underpinning sales growth in Asia, China and North America. In China, market conditions have recovered, and measures to expand customer coverage have proved successful.
■
LA business
Sales increased in the LSE field mainly in Europe and North America, reflecting the growth in orders received in FY2020. Sales also grew in Asia and other regions. Overall sales increased.
•
Overseas sales figures include only the sales of overseas subsidiaries and direct exports; indirect exports are excluded.
•
The accounting year used by most overseas subsidiaries ends on December 31.
(Billions of yen)
(%)
Overseas sales rose by 16.3% from FY2020. In Asia, sales growth was achieved despite the impact of the COVID-19 pandemic and the fact that sales for several large-scale projects had been recorded in FY2020. This growth was due to resumption of construction in some regions and also a continued recovery in the manufacturing equipment market. In China, which made an early recovery from the pandemic, AA business sales increased. Both the AA and LA businesses achieved sales growth in North America and Europe.