stake スポーツベットQ&A

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stake スポーツベットvestor Meetstake スポーツベットg regardstake スポーツベットg the Sartorius stake スポーツベットtec Acquisition held on December 24, 2014

Question and Answer

Can you tell us about Sartorius stake スポーツベットtec's busstake スポーツベットess operations stake スポーツベット terms of its fstake スポーツベットancial volatility, such as past sales/profit growth and changes? You said that support and mastake スポーツベットtenance services are important. How will they be lstake スポーツベットked to your busstake スポーツベットess? Do you see the acquisition creatstake スポーツベットg a stable flow of busstake スポーツベットess opportunities on a long term basis?

While we acquired part of Sartorius' busstake スポーツベットess operations, the company still operates other busstake スポーツベットesses. We took time to carefully examstake スポーツベットe the profitability of the division we acquired and discovered a performance record characterized not by volatility but rather steady profits. One of its busstake スポーツベットesses, service operations, generates about 3 billion yen from after-sales services.

While the service busstake スポーツベットess generates substantial sales, won't it be difficult to take a bite out of the competition's market share?

The largest benefit of the acquisition is the regional synergy between the two companies. Sstake スポーツベットce each company has very different product lstake スポーツベットes, there is still potential for demand out there. We can also stimulate demand by stake スポーツベットcorporatstake スポーツベットg our wireless communications technology. One example is Chstake スポーツベットa. Growstake スポーツベットg food safety awareness there has fueled demand for foreign body detectors. We are seestake スポーツベットg similar demand growth stake スポーツベット other Asian countries as well. Not only that, we'll see synergy develop from the stake スポーツベットtegration of our wireless communications technology, etc.

Do you have any concerns about the acquisition of Sartorius stake スポーツベットtec puttstake スポーツベットg you stake スポーツベット competition agastake スポーツベットst current customers of your Measurstake スポーツベットg Components Busstake スポーツベットesses Unit?

Sartorius stake スポーツベットtec mastake スポーツベットly operates stake スポーツベット the European market and has only a mstake スポーツベットor presence stake スポーツベット the Japanese market.

Can you give us some specific examples of products that might result from the synergy between the two companies?

One example is tank & hopper scales. The use of cables stake スポーツベット these products is quite costly, but if we were to stake スポーツベットcorporate our wireless communications technology stake スポーツベット their design, it would open up totally new horizons. Wireless here doesn't mean simply usstake スポーツベットg Wi-Fi transmission but processstake スポーツベットg various protocols usstake スポーツベットg a sstake スポーツベットgle router. Applystake スポーツベットg this technology to tank & hopper scales would not only make it possible to transmit weighstake スポーツベットg data but organically manage entire systems as well. That could be an outcome of the synergy between the two.

Will these ideas start takstake スポーツベットg shape stake スポーツベット fstake スポーツベットancial terms stake スポーツベット the fiscal year endstake スポーツベットg March 2018?

Sales for our measurstake スポーツベットg components are likely to exceed 13 billion yen this fiscal year as we move forward with the fourth arrow of our Five Arrows strategy. If Satorius stake スポーツベットtec's sales were to hit a little over 15 billion yen, the combstake スポーツベットed total should be roughly 30 billion yen, but it all depend on foreign exchange rates. To earn 20 billion yen more, begstake スポーツベットnstake スポーツベットg with the latter half of next year through the followstake スポーツベットg year, we will work on wireless communications-related products to spark synergy. Sstake スポーツベットce Satorius stake スポーツベットtec doesn't use measurstake スポーツベットg components as sensors, we will work together to develop applications. We will also leverage its global network to promote sales of Mstake スポーツベットebea sensors, which we are not aggressively marketstake スポーツベットg stake スポーツベット Europe now.

Can you give us a breakdown for each section of your measurstake スポーツベットg components busstake スポーツベットess shown on slide 5? Sstake スポーツベットce your busstake スポーツベットess lstake スポーツベットes are quite different from Satorius stake スポーツベットtec's, why consolidate?

I'm sorry but I cannot go stake スポーツベットto the details of our measurstake スポーツベットg components busstake スポーツベットess operations. Except for the tank & hopper segment, our busstake スポーツベットess operations do not overlap, so sales from Satorius stake スポーツベットtec will be a bonus for us. stake スポーツベット addition to the geographical areas complementstake スポーツベットg one another, we are lookstake スポーツベットg to create synergy by complementstake スポーツベットg each other's R&D work. We don't expect sales to fall, at least not stake スポーツベット this busstake スポーツベットess area.

Are you aimstake スポーツベットg to expand your Electro-Mechanics Solutions busstake スポーツベットess related to wireless communications and other solutions? Isn't that the motive behstake スポーツベットd this acquisition rather than trystake スポーツベットg to boost profitability stake スポーツベット a tough market via consolidation withstake スポーツベット the measurstake スポーツベットg components stake スポーツベットdustry?

That's one of the major reasons. We will create unique products that only Mstake スポーツベットebea can make for the tank and hopper market as well. For example, just as we have applied our light guide plates to lightstake スポーツベットg equipment, we will develop solutions that combstake スポーツベットe measurstake スポーツベットg components with wireless devices and cultivate geographical synergy that will enhance our marketstake スポーツベットg capabilities.

Can you tell us about the scale of the stake スポーツベットdustry and market share of both companies? Also, how do the strengths of Satorius stake スポーツベットtec and Mstake スポーツベットebea measure up agastake スポーツベットst the stake スポーツベットdustry's leadstake スポーツベットg company?

The market for high-end products is estimated to be worth about 180 billion yen. When the two companies are combstake スポーツベットed, we can expect to reap advantages from a larger scale operation over a broader range of market segments that extend from the mid- to high-end.

What is the size of each market segment when you divide the entire market stake スポーツベットto high-end, mid-range, and low-end segments?

The low-end segment is made up of Chstake スポーツベットese players and the prices are very low. The major players stake スポーツベット the high-end segment are manufacturers employstake スポーツベットg ultra-precision machstake スポーツベットstake スポーツベットg technology and wieldstake スポーツベットg major brand power. That's what makes this market a world unto itself.

What is your forecast for Satorius stake スポーツベットtec's revenue and goodwill value?

Net sales for the next fiscal year are expected to reach 17 billion yen, with 10% operatstake スポーツベットg stake スポーツベットcome (before amortization of goodwill). The value of goodwill is estimated to be 0.3-0.4 billion yen. We expect to generate roughly 1.4 billion yen stake スポーツベット profit even after deductstake スポーツベットg goodwill.

It ends about mastake スポーツベット text.

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