Briefing on FY12/2014 Business Results

Broadleaf Co., Ltd.
2014年11月11日(Securities Code: 3673 / TSE 1st Section)
February 13, 2015

Chapter 1
Overview of FY12/2014 Business Results
Chapter 2
Results Forecasts for FY12/2015

Contents

2

10Chapter 3
Future Vision

16

Chapter 4
Growth Strategies for FY12/2015

20

AppendixCompany Profile, Automotive Aftermarket, Car-uncelor in Your Town,
Sale Domain, Exhibitions

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

26

Chapter 1
Overview of FY12/2014 Business Results
Chapter 2
Results Forecasts for FY12/2015
Chapter 3
Future Vision
Chapter ４
Growth Strategies for FY12/2015

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Chapter 1
Overview of FY12/2014 Business Results

Financial Highlights
POINT

Both net sales and operating income reached a record high.
（Since FY12/2009, the year of establishment）(¥ million)

Operating income

Net sales

4,165

18,894

FY12/
2009

FY12/
2010

FY12/
2011

FY12/
2012

FY12/
2013

FY12/
2014

FY12/
2009

FY12/
2010

FY12/
2011

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

FY12/
2012

FY12/
2013

FY12/
2014

* Since FY12/2010,
the amortization of
goodwill of ¥668
million has beenposted every year.

3Chapter 1
Overview of FY12/2014 Business Results

PL Summary
POINT

Net income increased 14.6% year on year.
Both operating income and net income margins rose.

(¥ million)

FY12/2014
Full-year

FY12/2013

YoY (Ratio)

Full-year

Net sales

18,894+4.8%

18,024Gross profit

14,072+5.7%

13,309Selling, general and administrative
expenses

9,907

+3.5%

9,569

Operating income

4,165+11.4%

3,740

22.0%

-

20.7%

4,098

+12.2%

3,653

21.7%

-

20.3%

2,193

+14.6%

1,914

11.6%

-

10.6%

Operating income margin
Ordinary income
Ordinary income margin
Net income
Net income margin

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4

Chapter 1
Overview of FY12/2014 Business Results

Sales by Category
POINT

Sales in Network Service, a focus category, rose 11.9%, which was a driving
force of the increased net sales, along with Business Application Software.

(¥ million)

FY12/2014
Full-year

YoY (Ratio)

Full-year

13,818+3.4%

13,357

System Support

1,290

+0.5%

1,284

Maintenance

614

+0.4%

612

Provision of consumables

675

+0.5%

672

Network Service

3,785+11.9%

3,382

Stock

2,983
801

+12.9%
+8.3%

2,641
740

680
121

-2.4%
＋176.7%697
44

18,894+4.8%

18,024

Business Application Software

Transaction(PSF) *1
(Order placing and acceptance, etc.) *2

Total
*1
*2

FY12/2013

Payment agency service for recycled parts
BL Parts Order System, Carpod Tab, etc.

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5

Chapter 1
Overview of FY12/2014 Business Results

Factors of the Increase and Decrease in Operating Income
POINT

Operating income increased as the effect of higher sales offset
higher costs due to growth investments.
(Net sales)(Cost of sales)

+869

-106

(¥ million)(Personnel expenses)-130(Advertising expenses)(Others)

-114

-94

4,165

+425

3,740
Highersales

Highercosts

Higher SG&A expenses

FY2014/12

FY12/2013
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6

Chapter 1
Overview of FY12/2014 Business Results

PL Summary (4Q)
POINT

Earnings have accumulated steadily despite quarterly changes.

(¥ million)

Net sales

4Q

5,394

3Q

4,161

Operating income

4Q

5,160
4Q

3Q

2Q

585

2Q
2Q

1Q
FY12/20132013/12期

1,230

3Q

1,084

1,615

4,649

3Q

4Q

1Q

2Q
1Q

1Q
FY12/20142014/12期

FY12/20132013/12期

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

FY12/20142014/12期
7Chapter 1
Overview of FY12/2014 Business Results

Differences from Forecasts
POINT

Operating income exceeded the forecast due to reduced costs.

(¥ million)

FY12/2014
Results

FY12/2014

Differences

Forecasts

18,894-105

19,00013,818+118

13,700

System Support

1,290

-9

1,300

(Maintenance)

614

-15

630

(Provision of consumables)

675

+5

670

3,785

-214

4,000

2,983

-16

3,000

801

-198

1,000

4,165

+165

4,000

Net sales
Business Application Software

Network Service(Stock)(Transaction)
Operating income

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

8

Chapter 1
Overview of FY12/2014 Business Results

CF Summary

BS Summary
POINT

POINT

Interest-bearing debt declined from the end of the previous
fiscal year due to repayment of loans payable.
Goodwill that was posted at the time of establishment wasamortized (amortization over 20 years).

(¥ million)

End of FY12/2014
Results

Results

Change (YoY)+1,50312,802-204

28,343+1,299

6,736

+602

313

-635

Total net assets

7,049
21,294-33+1,332

Interest-bearing
debt

970

-1,387

10,031-668

Goodwill

FY12/2014(¥ million)

15,541

Current assets
Non-current
assetsTotal assets
Current
liabilities
Non-current
liabilities
Total liabilities

Cash and cash equivalents at the end of FY12/2014 increased
due to the creation of operating cash flows.

Change (YoY)

CF from operating
activities
CF from investing
activities
CF from financing
activities

4,849

+263

-1,156-704-2,250-3,741

FCF

3,693

-441

10,671+1,442

Cash and cash
equivalents

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

9

Chapter 1
Overview of FY12/2014 Business Results

Chapter 2
Results Forecasts for FY12/2015
Chapter 3
Future Vision
Chapter ４
Growth Strategies for FY12/2015

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Chapter 2
Results Forecasts for FY12/2015

Results Forecasts
POINT

Both net sales and operating income are expected to reach a new high.
Income margins are also expected to improve.

(¥ million)

FY12/2015 (Forecasts)
Full-year

FY12/2014

YoY change

YoY (Ratio)

Full-year

Net sales

19,600

+705

+3.7%

18,894

Operating income

4,600

+434

+10.4%

4,165

23.5%

+1.5%

-

22.0%

4,550

+451

+11.0%

4,098

23.2%

+1.5%

-

21.7%

2,530

+336

+15.4%

2,193

12.9%

+1.4%

-

11.6%

Operating income margin
Ordinary income
Ordinary income margin
Net income
Net income margin

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11

Chapter 2
Results Forecasts for FY12/2015

Results Forecasts (First Half/Second Half)POINT

In FY12/2015, Network Service, a focus category, will become adriving force for higher sales and income from the second half.
(¥ million)

Net sales

Operating income
19,60018,89418,024

4,600
4,165
3,740

2H 9,556

2H

9,811

2H

10,4002H 2,200

1H 8,468
2013/12期
FY12/2013

1H

9,083

2014/12期
FY12/2014

1H

9,200

2015/12期
FY12/2015

1H 1,539
2013/12期
FY12/2013(Forecasts)
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

2H 2,315

1H 1,850

2014/12期
FY12/2014

2H

2,700

1H 1,900
2015/12期
FY12/2015(Forecasts)
12

Chapter 2
Results Forecasts for FY12/2015

Sales Forecast by Category
POINT

Business Application Software will focus on the acquisition of new customers.
Network Service is expected to increase sales mainly due to the promoted activationof order placing and acceptance transactions.

(¥ million)

Business Application Software
System Support
Maintenance
Provision of consumables
Network Service
Stock
Transaction(PSF) *1
(Order placing and acceptance, etc.) *2

Total

FY12/2015 (Forecasts)
YoY
YoY
1H
Full-year(Ratio)(Ratio)6,400-2.6%
13,700
-0.9%
700
+4.9%
1,400
+8.5%
350
+12.4%
700+13.9%
350
-1.7%
700
+3.6%
2,100
+13.9%
4,500+18.9%
1,650+13.6%
3,400+14.0%

FY12/2014
1H

Full-year

6,572
667
311
355
1,843
1,452

13,818
1,290
614
675
3,785
2,983

450

+15.1%

1,100+37.2%

391

801

350
100

+3.4%
+90.7%

700
400

+2.9%
+228.6%

338
52

680
121

9,200

+1.3%

19,600

+3.7%

9,083

18,894

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13

Chapter 2
Results Forecasts for FY12/2015

Factors of the Increase and Decrease in Operating Income
POINT

While growth investments will continue, the effect of higher sales is
expected to offset them.
(Net sales) (Costs for new business creation)+705(¥ million)-300(Costs to strengthen DB)-100(Others)(Personnel expenses)

+229

4,600

-100

+434

4,165
Highersales

Higher total cost

FY12/2014

FY12/2015(Forecasts)
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14

Chapter 2
Results Forecasts for FY12/2015

Dividends per SharePOINT

In FY12/2015, annual dividends are expected to increase ¥5 to ¥25.

¥25
(24.7%)
Annual dividend(Payout ratio)¥20(26.0%)¥20(23.8%)

YearendYearendYearend¥12.5

Interim¥12.5¥10 *1¥20
Interim ¥10

FY12/20132013/12期

FY12/20142014/12期

FY12/2015
2015/12期(Forecasts)*1. The year-end dividend for FY12/2014 is a projection.

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

15

Chapter 1
Overview of FY12/2014 Business Results
Chapter 2
Results Forecasts for FY12/2015

Chapter 3
Future Vision
Chapter ４
Growth Strategies for FY12/2015

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Innovation in the Automotive Aftermarket

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17

Chapter 3
Future Vision

Innovation leader in the automotive aftermarket
POINT

The use and application of information related to automobiles, where IT is
progressing rapidly, is regarded as a national policy, and Broadleaf, with its
specialty in this area, can become a driving force in forming the market.

Current situation/challenges

National policy/the form desired by the government

MLIT DB

Maintenanceinformation DB

Used car DB
Other DBDB

Automobile-related information is huge andwide-ranging and has yet to be integrated

Vitalization of safe andsecure automobile transactionsex) Traceability, telematics insurance, scanning tools, etc.
Source: Ministry of Land, Infrastructure, Transport and Tourism, “Review meeting of future
vision on the use and application of automobile-related information”

Broadleaf is the only specialty IT company that owns the maintenance history information oftens of millions of automobiles and that can lead tens of thousands of customers.
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

18

Chapter 3
Future Vision

Innovation with “New Generation BL Cloud”
POINT

Integration of automobile-related information and car life-related information willbring an increase in earnings to customer companies through order placing andacceptance transactions and new cost benefits to car owners.

New Generation BL CloudGroup of applications that will
enrich the car life

Automobile data
Auto index data
Auto parts data

2nd
Phase

Super-high speed
search engine

Data provide
business

Alliance companies

NetworksystemseriesRecommendationengine (AI)R&D
Car owners

Automobile
maintenanceinformation

1st Phase

Focus
measures

Trading companies
for parts
Order placing andacceptance transactions

Maintenance and bodywork shops
Finance/insurance/lease/IT/travel
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19

Chapter 1
Overview of FY12/2014 Business Results
Chapter 2
Results Forecasts for FY12/2015
Chapter 3
Future Vision

Chapter ４
Growth Strategies for FY12/2015

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Chapter 4Growth Strategies for FY12/2015

Measures to increase order placing and acceptance transactions
POINT

Strengthen function:

Higher speed, recommendations

Strengthen system:

Arrange a full-time force.

Strengthen strategy:

By area, by customer layer

Number of connections with BL Parts Order System
Parts dealers

Number of companies
participating in transactions

Maintenance shops

Number ofconnections

797

161
679

144
111

112

Dec. 20132013/12月

Mar.
2014
2014/3月

121

Jun. 20142014/6月

Endof Sept.
2014/9月末
2014

Dec. 20142014/12月

493

514

Dec.
2013
2013/12月

Mar.
2014
2014/3月

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

559

Jun. 2014 2014/9月末
End of Sept. 2014/12月
Dec. 20142014/6月
2014
21Chapter 4Growth Strategies for FY12/2015

Measures to increase order placing and acceptance transactions (2)POINT

Realize a higher utilization rate by increasing the speed of parts referral and higher
unit prices with the recommendation function
Instantly analyze
large-scale data ownedby the Company

Maintenanceshops

Parts referral

Parts dealers

High-speed
response

Recommendations
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

22

Chapter 4Growth Strategies for FY12/2015

Schematic diagram of business in the Asian market
Phase 1Chinese business
Used parts

Used parts

Repair shops

Parts dealers

Alliance partners
Phase 2ASEAN businessInsurancecompanies

Database- Used parts- Used cars

Recycling
plantsPhase 3Market priceinformation
provision service
Insurancecompanies- Used parts- Used cars
- Vehicle data
- Parts data
- Price data

Buyers in each country

Provision of market
price information

Recycling plants

Parts buyers

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Repair shops

2323

Chapter 4Growth Strategies for FY12/2015

Financial targets in the Mid-Term Management PlanPOINT

Results forecasts for FY12/2016 are to be revised by the mid-period of the three-year plan.
We are considering the cancellation of some of our own shares purchased by TOB.

Net sales

18.02¥22.5 billion
18.89

Operating income¥7.0 billion

19.60
4.60
4.16

3.74

2013/12期
FY12/2013 2014/12期
FY12/2014 2015/12期
FY12/2015 2016/12期
FY12/2016(Results)(実績)(Results)（実績）(Forecasts)
（計画）
（予想）

(Target)（目標）

2013/12期
FY12/2013 2014/12期
FY12/2014 2015/12期
FY12/2015 2016/12期
FY12/2016(Results)
(実績)

（実績）
(Results)

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

（計画）
（予想）
(Forecasts)（目標）(Target)24

テレマティクス

eコマース

保険サービス

Becoming an Integrated Service Provider
Supporting Car Life with Big Data

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

25

Appendix [Reference Material]

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Appendix (1)Our Profile
Under our principle of maintaining a spirit of gratitude and happiness, we will continue togrow as an integrated service provider that supports enriched car lives and people’s lives
by contributing to the automotive aftermarket with the power of IT and people.
Corporate Name:

Broadleaf Co., Ltd.

President and CEO:Kenji Oyama

Stock Listing:

The First Section of the Tokyo Stock Exchange
Securities Code: 3673 (Listed on March 22, 2013)

Founded/Established:

December 2005/September 2009

Capital Stock:¥7,147 million

Business Outline:

Provision of services on an IT network system that supports the business of the players in theautomotive aftermarket(E.g. development of business applications, platform for collaboration between different businesssectors, marketplace for recycled auto parts, and automotive content）

Head Office Location:

Floor 8, Glass Cube Shinagawa, 4-13-14, Higashi-Shinagawa,Shinagawa-ku, Tokyo

Business Offices:

35 offices in Japan

Development Centers:

3 centers in Japan (Sapporo, Tokyo and Fukuoka)

Number of Employees:816(as of December 31, 2014)

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

27

Appendix (2)Automotive Aftermarket of JAPANThe automotive aftermarket refers to a market of products and services to be used by car owners
after purchase of their vehicles, including gasoline, accessories, safety inspections,maintenance checks, replacement of parts, and sales and scrapping.

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

28

Appendix (3)Sales Domain
We have a single business segment, which consists of IT services,
but sales are classified into the areas below.
Category

Category
MiddleClassification

Small
Classification

Type of Business- Development and sales of business application software for specific businesses.
- Development and sales of package software, such as information security.
- Purchase and sales of PCs and printers, etc., and others

Business Application Software

Maintenance- Provision of maintenance services for business application software and hardware tocustomers to which we sold business application software.

Provision of Consumables- Purchase and sales of special ledger sheets and OA supplies used in businessapplication software.

System Support

Database Provisioning
Service- Provision of automobile-related information and a database of parts-related
information updated daily.

Server Provisioning
Service- Receipt of consideration for server maintenance necessary for the use of network
systems.

Payment Agency
Servicefor Recycled Parts- Operation of “Parts Station NET,” a distribution network for recycled parts that sharesinformation on the inventories of recycled parts.
Providing payment agency services when selling and purchasing recycled parts andcollecting commissions.

Stock

Network Service
Transaction

Electronic parts orderplacing and acceptance- Provision of an electronic order placing and acceptance system for auto parts.
system, tablet-based- Provision of tablet-based business terminals to maintenance shops, etc., and others
business support tools
and others

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29

Appendix (4)Setting up a Booth at Exhibitions
We plan to set up a booth at the 13th International Auto Aftermarket EXPO 2015 (March 2015).
Note) Pictures were taken at EXPO 2014

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

30

Appendix (5)Efforts of “Car-unselor in Your Town”
Attract customers to automotive maintenance shops by increasing the number ofcertified “Car-unselor in Your Town” locations.
1) Easy-to-understandexplanations
2) Short waiting time3) Abundant selection of parts
to select from4) Dependable technicalcapabilities
5) Convincing priceCar owners

1,000 shops

140 shops
Services

Maintenance shops
Solutions
Training
Advertising support
Provision of tools
Consulting

Services

Apr May Jun Jul Aug Sep Oct Nov Dec

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Forecast for theend ofDecember 201531

Disclaimer
Forward-looking statements contained in this material such as results
forecasts and future prospects are forecasts and estimates made by
Broadleaf based on information available at the time of the preparation of thematerial, and are subject to potential risks and uncertainties. Please note that
actual results may differ from the statements contained in this material due tovarious factors.
For inquiries, please contact
Planning Department (Investor Relations)
Broadleaf Co., Ltd.
E-mail: broadleaf-ir@broadleaf.co.jp
URL: http://www.broadleaf.co.jp/english/

Copyright (c) Broadleaf Co., Ltd. All rights reserved.