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TOPCON CORPORATION FY2024 Q3 Financial Results President & CEO Takashi Eto January 30, 2025
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⚫ The full-year outlook for FY24 was revised downward, as the downturn in the Positioning Business was sharper than anticipated ⚫ Unshakable confidence in the prospects for medium- to long-term profit growth was maintained with growth scenarios and structural reforms in the two businesses ⚫ The impact of restraint on investment was greater than expected, reflecting the uncertainty of policies by the incoming U.S. administration and the market downturn ⚫ Sustainable growth despite being affected by the impact of the economic cycle; sought to enhance profitability and achieve stabilization through structural reforms ⚫ The FY24 full-year outlook remains unchanged from the initial plan, with a record high expected ⚫ Given the strength of the Screening Business, sales growth was accelerated through expansion to shared care ⚫ Drove business efficiency and profitability improvements through structural reforms ©Topcon Corporation 2 FY24 Q3 Financial Results Financial Results: Key Points and Outlook Consolidated Positioning Business Eye Care Business
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⚫ FY24 Q3 YTD Financial Results ⚫ FY24 Full Year Outlook Consolidated Positioning Business Net Sales Operating Income Eye Care Business Net Sales Operating Income Consolidated｜Revised plan Positioning Business Eye Care Business 3©Topcon Corporation YoY YoY Net Sales ¥211.0B YoY -3% Operating Income ¥7.0B YoY -38% Net Sales ¥153.5B YoY -2% Operating Income ¥0.8B YoY -88% Net Sales Operating Income Net Sales Operating Income YoY YoY FY24 Q3 Financial Results Highlights Profit decreased despite a reduction in fixed costs achieved through structural reforms, given a sharper decrease in sales amid the ongoing slump in demand Despite steady sales, profit declined temporarily due to an increase in allocations for growth investment The external environment will remain challenging, accelerate structural reforms Expect record highs in both net sales and operating income, with the increase in expenses absorbed
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01 FY24 Q3 Financial Results ⚫ Consolidated Financial Results ⚫ Overview｜Positioning Business ⚫ Overview｜Eye Care Business 02 FY24 Full Year Outlook ⚫ Consolidated Full Year Outlook ⚫ Outlook｜Positioning Business ⚫ Outlook｜Eye Care Business 04 Appendix ⚫ Financial Results ⚫ Sales by Region ⚫ Capital Expenditure, Depreciation and R&D / Forex Sensitivity 03 Progress of Each Business ⚫ Positioning Business｜Business Featuring Cyclicity ⚫ Positioning Business｜New Product Releases ⚫ Eye Care Business｜ ⚫ Eye Care Business｜ Further Accelerating Initiatives in the Growth Phase Accelerating Expansion from Screening to Shared Care
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01 ⚫ Consolidated Financial Results ⚫ Overview｜Positioning Business ⚫ Overview｜Eye Care Business FY24 Q3 Financial Results
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01｜FY24 Q3 Financial Results Consolidated Financial Results ©Topcon Corporation 6 (Unit: billion yen) FY2023 Q3 YTD Actual FY2024 Q3 YTD Actual YoY % Net Sales 156.9 153.5 -3.3 -2% Gross Profit 83.2 80.9 -2.3 -3% Gross Profit Ratio 53.1% 52.7% -0.4pt SGA 76.7 80.1 +3.4 +4% Operating Income 6.5 0.8 -5.7 -88% Operating Income Ratio 4.1% 0.5% -3.6pt Ordinary Income 4.6 -2.1 -6.7 - Extraordinary Losses -3.3 -0.4 +2.9 - Net Income 0.4 -2.9 -3.2 - Exchange rate (Average) USD ¥142.76 ¥152.87 +¥10.11 EUR ¥155.19 ¥164.91 +¥9.72 YoY comparisons excluding FX effects -¥11.7B (-7%) YoY comparisons excluding FX effects -¥0.9B (-1%)
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0 01｜FY24 Q3 Financial Results Consolidated｜Operating Income YoY Breakdown ©Topcon Corporation 7 (Unit: billion yen) Positioning Business -7.5 Eye Care Business -1.1 Structural reforms' effects manifested Approx 75% of the target annual amount of ¥6 billion achieved as planned Restrained increase in fixed costs excluding growth investment ECB growth investment -1.8 Other fixed costs -1.5 +4.6 +1.2 -3.3 3.0 FY2023 Q3 Result Sales Volume, Product Mix 原価低減 POB structural reforms, etc. Fixed Cost FX Effects FY2024 Q3 Result -8.6 *1 POB：Positioning Business *1 *2 *2 ECB：Eye Care Business +0.4 Cost reduction
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©Topcon Corporation 8 01｜FY24 Q3 Financial Results Overview｜Positioning Business (Unit: billion yen) FY2023 Q3 YTD Actual FY2024 Q3 YTD Actual YoY % Net Sales 102.0 96.3 -5.7 -6% Operating Income 5.9 2.1 -3.8 -64% Operating Income Ratio 5.8% 2.2% -3.6pt Exchange rate (Average) USD ¥142.76 ¥152.87 +¥10.11 EUR ¥155.19 ¥164.91 +¥9.72 YoY comparisons excluding FX effects -¥11.0B (-11%) ⚫ Profit decreased despite a reduction in fixed costs achieved through structural reforms, given a sharper decrease in sales amid the ongoing slump in demand
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(Unit: billion yen) 15.5 14.1 19.5 17.1 26.1 25.1 40.9 40.0 FY23/Q3 FY24/Q3 North America Europe Japan Asia/Oceania/ Others ©Topcon Corporation 9 01｜FY24 Q3 Financial Results Overview by Region｜Positioning Business Sales by region 102.0 96.3 -0.9 -1.0 -2.3 -1.5 -3.5 -2.5 -2.6 -2.3 Before FX deduction YoY After FX deduction North America Europe Japan Asia/Oceania ✓ IT Agriculture continued to be affected by the restrained investment attributed to the decline in grain prices ✓ The delayed new surveying instruments were released, but their contribution to sales will start in Q4 at the earliest ✓ IT Construction continued to face a slump in sales mainly of OEM, despite the stabilization of market inventories, given the impact of restrained investment reflecting uncertainty about future trade policies ✓ IT Agriculture continued to be affected by the restrained investment attributed to the decline in grain prices ✓ In China, sales of surveying instruments decreased ✓ In Oceania, sales of IT Construction and surveying instruments/lasers decreased
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01｜FY24 Q3 Financial Results Overview｜Eye Care Business ©Topcon Corporation 10 (Unit: billion yen) FY2023 Q3 YTD Actual FY2024 Q3 YTD Actual YoY % Net Sales 54.2 57.0 +2.8 +5% Operating Income 4.2 2.6 -1.6 -39% Operating Income Ratio 7.7% 4.5% -3.2pt Exchange rate (Average) USD ¥142.76 ¥152.87 +¥10.11 EUR ¥155.19 ¥164.91 +¥9.72 YoY comparisons excluding FX effects -¥0.3B (-0%) ⚫ Despite steady sales, profit declined temporarily due to an increase in allocations for growth investment
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(Unit: billion yen) 17.7 17.5 7.5 7.5 14.1 15.9 14.9 16.1 FY23/Q3 FY24/Q3 North America Europe Japan Asia/Oceania/ Others (Unit: billion yen) 01｜FY24 Q3 Financial Results Overview by Region｜Eye Care Business ©Topcon Corporation 54.2 57.0 Sales by region YoY +0.1 +0.9 +0 -1.3 +1.2 +1.8 +0 -0.3 Before FX deduction After FX deduction 11 North America Europe Asia/Oceania ✓ Although there are regional differences, steady sales continued, mainly due to sales to major optical chain stores and large tender wins ✓ In China, sales decreased significantly due to fewer tenders reflecting anti- corruption campaigns and the worsening of hospital management caused by delays and reductions in insurance reimbursement ✓ In India and Asia excluding China, sales increased mainly due to the continuous tender wins ✓ Sales were strong, mainly to major optical chain stores, although the recording of some sales was delayed into Q4 ✓ Business for ophthalmologists was expanded with the effects of the establishment of a direct sales system
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02 ⚫ Consolidated Full Year Outlook ⚫ Outlook｜Positioning Business ⚫ Outlook｜Eye Care Business FY24 Full Year Outlook
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02｜FY24 Full Year Outlook Consolidated Full Year Outlook 13 ©Topcon Corporation (Unit: billion yen) Previous (as of Oct. 30) Current (as of Jan. 30) Comparison FY2023 Actual Net Sales 220.0 211.0 -9.0 216.5 Operating Income 12.0 7.0 -5.0 11.2 Ordinary Income 8.0 3.5 -4.5 8.9 Net Income 4.5 0 -4.5 4.9 ROE 4％ 0% -4pt 5％ Dividend ¥42 ¥42 ¥0 ¥42 Exchange rate (Average) USD ¥145.00 ¥145.00 ¥144.40 EUR ¥155.00 ¥155.00 ¥156.80 ⚫ Assumptions for full year outlook Structural reforms Positioning Business Eye Care Business Assumed rate in Q4Assumed rate from Q3 • IT Construction was more susceptible than before to restrained investment with the generation of a gap with the Company's outlook, which reflected the uncertainty over the policies of the new U.S. administration • IT Agriculture is expected to see prolonged restraint on investment amid falling grain prices • No change from the initial forecast • In order to improve the profit structure further, additional structural reforms* are planned to be instituted, mainly in the Positioning Business *Scheduled to be recorded as an extraordinary loss ⚫ Downward revision ｜ Revised plan
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14 02｜FY24 Full Year Outlook Consolidated Full Year Outlook｜Sales by Business *1 Comparison on a dollar basis *2 OEM：Sold to construction machinery manufacturers and agricultural machinery manufacturers Aftermarket: sales of retrofit systems for IT Construction and IT Agriculture ©Topcon Corporation Segment Solution Main Market FY2024 FY2024 1H 2H(Plan) 1H 2H POB（Positioning Business) Surveying and laser products Surveying & Construction IT Construction OEM Aftermarket IT Agriculture OEM Aftermarket ECB (Eye Care Business) Optometry and diagnostic equipment Medical institutions/major optical chain stores/drugstores Screening and other services Medical institutions/major optical chain stores/drugstores *1 *1 *2 Positive YoY change Same level Negative YoY change ⚫ Revised the forecast on surveying/laser products and the aftermarket in the Positioning Business Changes from the forecast in Q2 Reference: Forecast in Q2
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©Topcon Corporation 02｜FY24 Full Year Outlook Outlook｜Positioning Business (Unit: billion yen) Previous (as of Oct. 30) Current (as of Jan. 30) Comparison FY2023 Actual Net Sales 137.0 128.0 -9.0 140.4 Operating Income 10.0 5.0 -5.0 9.1 Operating Income Ratio 7.3％ 3.9% -3.4pt 6.5% Exchange rate (Average) USD ¥145.00 ¥145.00 ¥144.40 EUR ¥155.00 ¥155.00 ¥156.80 15 ⚫ The external environment will remain challenging, accelerate structural reforms Assumed rate in Q4Assumed rate from Q3
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02｜FY24 Full Year Outlook Outlook｜Eye Care Business ©Topcon Corporation (Unit: billion yen) Previous (as of Oct. 30) Current (as of Jan. 30) Comparison FY2023 Actual Net Sales 82.0 82.0 - 75.2 Operating Income 7.5 7.5 - 6.7 Operating Income Ratio 9.1％ 9.1％ - 8.9% Exchange rate (Average) USD ¥145.00 ¥145.00 ¥144.40 EUR ¥155.00 ¥155.00 ¥156.80 16 ⚫ No change from the initial plan ⚫ Expect record highs in both net sales and operating income, with the increase in expenses absorbed Assumed rate in Q4Assumed rate from Q3
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０ ＋6.0 ＋1.8 ＋0.5 -8.0 -4.5 FY2023 Sales Volume, Product Mix POB Structural Reforms, etc. Fixed Cost FX Effects FY2024 Outlook (Unit: billion yen) 02｜FY24 Full Year Outlook Consolidated｜Operating Income YoY Breakdown 17©Topcon Corporation *1 POB：Positioning Business *1 Positioning Business -9.9 Eyecare Business +1.9 No change from the initial forecast Cost reduction Controlling the increase in fixed costs from Q2
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03 ⚫ Positioning Business｜ Business Featuring Cyclicity ⚫ Positioning Business｜ New Product Releases ⚫ Eye Care Business｜ Further Accelerating Initiatives in the Growth Phase ⚫ Eye Care Business｜ Accelerating Expansion from Screening to Shared Care Progress of Each Business
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©Topcon Corporation 19 03｜Progress of Each Business Positioning Business｜Business Featuring Cyclicity ⚫ Impacts of global inflation and falling grain prices remained longer than expected ⚫ Attempted to enhance profitability and achieve stabilization through sustainable growth and structural reforms, despite being affected by the impact of the economic cycle (5.0) 0.0 5.0 10.0 15.0 20.0 25.0 0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 160.0 180.0 200.0 千 Net Sales (unit billion yen) Sharp fall in grain & resource prices in the U.S. COVID - 19 pandemic Global Financial Crisis Operating income (unit billion yen) Persistent Global inflation & falling grain prices
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©Topcon Corporation 20 2024 Dec.2 (https://www.topcon.co.jp/news/15022/) 2025 Jan.14 (https://www.topcon.co.jp/news/15155/) Deepening Customer Orientation03｜Progress of Each Business Positioning Business｜New Product Releases ⚫ New products were released with effects of the strengthening of the planning and development management system in Japan The quickest, smallest, and lightest in the world Robotic Total Station Released the GT-1500/700 series, which incorporate the Silky Drive® technology • Higher efficiency and more compact dimensions • Developed in pursuit of stability and quiet performance while operating • Twice the tracking performance of conventional units • 10% higher slewing speed Top seller, covering surveying to IT Construction Layout Navigator “Kui-Navi” Released the LN-160, which features a stronger power supply system and expanded measurable range • Longer battery life • Expanded measurable range
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©Topcon Corporation 21©Topcon Corporation 21 03｜Progress of Each Business Eyecare Business｜Further Accelerating Initiatives in the Growth Phase Net Sales (unit billion yen) Operating income (unit billion yen) (1.0) 1.0 3.0 5.0 7.0 9.0 11.0 13.0 15.0 0.0 20.0 40.0 60.0 80.0 100.0 120.0 千 Upfront investment phase Growth phase ⚫ Blossoming of the solution business and expansion from screening to shared care ⚫ Improving business efficiency and profitability through structural reforms Structural reforms • Introduction of divisional system • Establishment of direct sales system in North America • Improvement in efficiency of product planning and development COVID - 19 pandemic
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©Topcon Corporation 22 03｜Progress of Each Business Eye Care Business｜ FY23 Full-Year Financial Results Material (Repost) ⚫ Towards the realization of “Healthcare from the Eye” *DX: Digital Transformation DX* Acceleration
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FY2023 FY2024 ©Topcon Corporation 23 03｜Progress of Each Business Eye Care Business｜Accelerating Expansion from Screening to Shared Care Healthcare from the eye Business stage Shared Care Core Screening outlook Ophthalmological checkups & exam outlook One-touch, fully automatic easy-to operate OCT & Fundus camera Maestro and non-mydriatic fundus camera NW (Total sales in all region) (Total sales in NA) Total IT solutions including Harmony/RDx Data platform Sales revenue of IT solution Screening equipment Unit sales of Maestro・NW FY2023 FY2024 +30%Q3 YTD Q3 YTD Q3 YTDQ3 YTD ⚫ Further expansion of screening solutions and data platform DX* Acceleration *DX: Digital Transformation *1 *2 *1 *2 +60%
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©Topcon Corporation
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04 ⚫ Financial Results ⚫ Sales by Region ⚫ Capital Expenditure, Depreciation and R&D / Forex Sensitivity Appendix
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04｜Appendix Financial Results｜Consolidated Quarterly Annual 47.0 55.7 54.1 58.8 49.7 54.8 52.4 59.6 51.4 54.1 48.0 3.8 5.5 4.6 5.6 1.7 2.1 2.7 4.7 0.7 2.3 -2.2 FY22/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY23/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY24/Q1 Actual Q2 Actual Q3 Actual Sales Operating Income 138.9 137.2 176.4 215.6 216.5 211.0 5.4 6.6 15.9 19.5 11.2 7.0 FY19 Actual FY20 Actual FY21 Actual FY22 Actual FY23 Actual FY24 Outlook Sales Operating Income ©Topcon Corporation （Unit: billion yen） （Unit: billion yen） 26
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©Topcon Corporation 27 04｜Appendix Financial Results｜Positioning Business 93.2 92.2 118.1 147.7 140.4 128.0 9.6 11 17.4 20.5 9.1 5.0 FY19 Actual FY20 Actual FY21 Actual FY22 Actual FY23 Actual FY24 Outlook Sales Operating Income Quarterly Annual 32.8 38.0 36.0 40.9 32.9 36.7 32.4 38.4 33.8 34.4 28.1 4.5 5.8 4.0 6.2 1.8 3.1 1.0 3.2 1.9 2.2 -1.9 FY22/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY23/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY24/Q1 Actual Q2 Actual Q3 Actual Sales Operating Income（Unit: billion yen） （Unit: billion yen）
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04｜Appendix Financial Results｜Eye Care Business ©Topcon Corporation 28 Quarterly Annual 14.1 17.4 17.8 17.6 16.6 17.9 19.8 21.0 17.6 19.5 19.9 0.6 0.9 1.8 0.6 1.1 0.2 2.9 2.5 0 1.4 1.2 FY22/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY23/Q1 Actual Q2 Actual Q3 Actual Q4 Actual FY24/Q1 Actual Q2 Actual Q3 Actual Sales Operating Income（Unit: billion yen） 44.8 44.3 57.4 66.9 75.2 82.0 0.1 0.1 3.2 4.0 6.7 7.5 FY19 Actual FY20 Actual FY21 Actual FY22 Actual FY23 Actual FY24 Outlook Sales Operating Income（Unit: billion yen）
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04｜Appendix Sales by Region 29 Consolidated Positioning Business Eye Care Business ©Topcon Corporation 21% 21% 17% 16% 26% 27% 36% 37% FY23/Q3 FY24/Q3 North America Europe Japan Asia/Oceania/ Others 15% 15% 19% 18% 26% 26% 40% 41% FY23/Q3 FY24/Q3 North America Europe Japan Asia/Oceania/ Others 33% 31% 14% 13% 26% 28% 28% 28% FY23/Q3 FY24/Q3 North America Europe Japan Asia/Oceania/ Others
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04｜Appendix Capital Expenditure, Depreciation and R&D / Forex Sensitivity 30 Capital Expenditure Depreciation R&D 8.6 19.3 9.0 FY22 Actual FY23 Actual FY24 Outlook 10.4 12.2 12.0 FY22 Actual FY23 Actual FY24 Outlook ©Topcon Corporation （Unit: billion yen） 20.7 24.2 24.0 FY22 Actual FY23 Actual FY24 Outlook （impact by ¥1 change）Forex Sensitivity Operating Income USD ¥0.15B～¥0.2B EUR ¥0.07B～¥0.1B （Unit: billion yen） （Unit: billion yen）
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These materials contain forward-looking statements, including projections of future operating performance. Such statements are based on management’s best judgment, given the materials available to them at the time these statements are made. However, please be aware that actual performance may differ from projected figures owing to unexpected changes in the economic environment in which we operate, as well as to market fluctuations. The original disclosure in Japanese was released on January 30, 2025 at 15:30(JST) Corporate Planning & Digital Business Operation Div. Corporate Communication Dept. TOPCON CORPORATION Tel: +81-3-3558-2532 E-mail: investor_info@topcon.co.jp URL: https://global.topcon.com/invest/ Inquiries Cautionary Note regarding Forward-Looking Statements