Business Development in Africa November 1, 2012 Inquiries to: Investor Relation Group E-mail: ttc_ir@pp.toyota-tsusho.com Tel: +81-3-4306-8201 Fax: +81-3-4306-8818
Toyota Tsusho’s Vision & Overseas Regional Strategy ● Aimed at strategies and execution within the four key regions of Asia and Oceania, China, Europe, and North and Central America ● Additional focus on emerging countries and resource-rich countries in other regions with operations directly managed by the head office ● Achievement of a balanced “1:1:1” business portfolio across the three operating fields of the GLOBAL 2020 VISION North and Europe Central Central Asia China America Life & Life & Earth & Earth & Community Community Resources Resources Middle East Mobility Mobility Africa South America Asia Pacific *Circle size reflects scale of net sales as of fiscal year ending March 31, 2012 Africa follows the four key areas in scale ⇒ Discovery and expansion planned in the three business areas 2
Potential in Africa Explosive Population Growth Basic Infrastructure Creation (1 billion people in 2010 ⇒ 2 billion people in 2050) (Basic development of roads, electricity, water, etc.) Accelerated Resource Plentiful Resources Development (Extensive undeveloped resources and energy) (Crude oil, copper, diamonds, rare metals) Expanding Middle-Income Marked Economic Growth Demographic (10-year forecast: 5.2% growth in Sub Sahara vs. 3.3% globally) (Per capita GDP above $3,000: 65 million people in 2012 ⇒ 100 million people in 2015) Rising Standards of Living Accelerated Motorization (Income per capita: $800 in 1980 ⇒ $2,900 in 2016) (2010: 1.45 million vehicles ⇒ 2016: 2.0 million vehicles*) *Toyota Tsusho estimate for car market based on GDP growth prediction by IMF The final emerging region after China, Southeast Asia and Central and South America ⇒ Opportunity for business expansion 3
Initiatives in Africa Initiatives in Africa
History of Business Development in Africa 1933 Alexandria Branch opened; cotton trading began 1933 Alexandria Branch opened; cotton trading began 1964 Exports of completed vehicles from Japan to East Africa began 1964 Exports of completed vehicles from Japan to East Africa began 1991 Minority investments in automobile distributors in Kenya, Angola, Zambia and Zimbabwe 1991 Minority investments in automobile distributors in Kenya, Angola, Zambia and Zimbabwe First headquarters for Africa, TOYOTA TSUSHO AFRICA (PTY) LTD., established 2000 First headquarters for Africa, TOYOTA TSUSHO AFRICA (PTY) LTD., established 2000 in South Africa in South Africa Transfer of business of U.K. company Lonrho plc. in Kenya, Angola, Zimbabwe, Zambia and 2001 Transfer of business of U.K. company Lonrho plc. in Kenya, Angola, Zimbabwe, Zambia and 2001 Malawi Malawi 2008 Investment in drilling of marine gas fields in Egypt 2008 Investment in drilling of marine gas fields in Egypt 2009 Car leasing company established in Kenya and Mauritius 2009 Car leasing company established in Kenya and Mauritius 2011 Order received for Kenya’s largest geothermal energy project 2011 Order received for Kenya’s largest geothermal energy project Track record of about 80 years of business development in Africa 5
Current Business Development in Africa � Automotive business portfolio ■ Northern Africa Portfolio ○ Non-automotive business portfolio Egypt ○ Electric power plant ■ Eastern Africa Portfolio � Automobiles � Logistics business Eastern ○ Energy plant-related/ Chemical products Africa ○ Farm mechanization business ○ Geothermal energy ■ Southern Africa Portfolio Countries with investments in Toyota distributors (7 countries) ⑪ � Automobiles Other Toyota business- Southern � Toyota parts SCM business (South Africa) transferred countries (17 Africa ○ Agriculture (Zambia, Mozambique) countries) ○ Logistics business Countries with investments in Subaru distributors (1 country) Diversified development of the automotive and non-automotive businesses, largely in eastern and southern Africa. 6
Net Sales in Africa by Business, Employees and Bases Net Sales by Business *Net sales for the year ended March 31, 2012 Japan 16.0 billion Parent company export domain Japan 16.0 billion Parent company export domain South Africa 53.0 billion Import, export & wholesale by regional subsidiaries South Africa 53.0 billion Import, export & wholesale by regional subsidiaries South Africa 6.0 billion Steel sheet processing business South Africa 6.0 billion Steel sheet processing business South Africa, Angola, Kenya, etc. 55.0 billion Sales of automobiles & parts; after-sales service South Africa, Angola, Kenya, etc. 55.0 billion Sales of automobiles & parts; after-sales service Total 130.0 billion Total 130.0 billion Employees ： Expatriates 34; National Staffs 2,393; Total 2,427 ＊ as of March 31, 2012 Number of Bases ： 8 bases ＊ as of March 31, 2012 Focus on the automotive business ⇒ Expand the non-automotive business in the future 7
New Developments in Africa Existing Businesses New Businesses Automotive Area Synergy (trusting relationships, personal connections, experience, etc.) Non-Automotive Area Kenya Geothermal energy business ＋ Toyota distributors, etc. Olkaria No. 1 and No. 4 Automotive area is the base (Approx. 280MW – equivalent to 25% of Kenya’s electric power generation) Non-Automotive Area Automotive Area Small-scale CKD Egypt production business Electric power plants, etc. ＋ Joint venture with Non-automotive area is Toyota Motor Corp. the base Fortuna assembly (production of 3,000 units annually) Region where former Toyota Tsusho is strong + Strong business of former Tomen ⇒ Geothermal energy business in Kenya Region where former Tomen is strong + Strong business of former Toyota Tsusho ⇒ Automobile production in Egypt We are promoting business development to extend TRY 1 in Africa, which is a key region 8
New Developments in Eastern Africa Results in Kenya: Results in Kenya: 1. Automotive business Comprehensive agreement concluded 1. Automotive business Comprehensive agreement concluded � Automobile distributors with government of Kenya � Automobile distributors with government of Kenya � Used car sales � Used car sales � Car Leasing Comprehensive programs in the areas of automobiles, � Car Leasing Comprehensive programs in the areas of automobiles, power generation and energy, oil and minerals, 2. Non-Automotive Business power generation and energy, oil and minerals, 2. Non-Automotive Business environment and agricultural industrialization. environment and agricultural industrialization. � Order for geothermal power generation PJ � Order for geothermal power generation PJ Establishment of Eastern Africa regional headquarters Establishment of Eastern Africa regional headquarters (planned for November 2012) (planned for November 2012) Kenya Uganda 1. Integrated management of inventory in the 1. Integrated management of inventory in the Rwanda automotive business automotive business 2. Promotion of business expansion in the EAC*, 2. Promotion of business expansion in the EAC*, Burundi centered on Kenya centered on Kenya Tanzania * EAC (East Africa Community): A community formed * EAC (East Africa Community): A community formed by countries in eastern Africa. Current members are by countries in eastern Africa. Current members are Kenya, Uganda, Rwanda, Burundi and Tanzania. Kenya, Uganda, Rwanda, Burundi and Tanzania. The branch in Nairobi, Kenya is now a subsidiary. As a result, it is the regional axis for initiatives in Kenya and EAC. 9
Investment in CFAO Investment in CFAO
Overview of CFAO Operations include automobile distributor business, pharmaceutical wholesale business, beverage production, and sales business. Largest French trading company specialized in Africa ■ CFAO Established: 1887 Countries with operations: 32 countries + 7 French overseas possessions Corporate Employees: 10,100 (as of Dec. 31, 2011) Group companies: 121 (Sales offices: 261) Net sales: €3,124 mil (as of Dec. 31, 2011) Stock listing: Euronext (listed 12/2009) Overview Automotive Business Operations Non-Automotive Business Operations Automobile Distributor/Dealer Business Pharmaceutical Division Industries Division IT Division (28%) (8%) (4%) Division (60% of net sales) Toyota GM Nissan Suzuki • IT consulting Isuzu business • PC-related Does business with 450 OEM production of 17 7 9 19 equipment 7 pharmaceutical companies, Heineken and Coca sales countries countries countries countries countries handles about 20,000 Cola in Rep. of • Office design Congo, No. 1 share. products. Wholesales to consulting 5,000 pharmacies in 27 business (incl. OEM production and ■ Distribution rights for more than 20 brands in 32 countries countries in western Africa. installation of sales of Yamaha and facilities such Management of supply and demand with optimum efficiency at the Peugeot motorcycles. as elevators) centralized inventory yard in Belgium The major strength is a network covering all regions of western Africa. 11
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