3Q FY12/2014
Business Results Briefing
Broadleaf Co., Ltd.
(Securities Code: 3673 / TSE 1st Section)

November 11, 2014

Contents

1. Financial Highlights for 3Q FY12/2014

2. Progress of Core Initiatives

3. Reference Materials

11. Financial Highlights for
3Q FY12/2014

Summary of 3Q Results
3Q YTD FY12/2014:Net sales increased 8.7% year on year, and operating income rose sharply by 38.1%.

Forecasts for FY12/2014:
 To be posted as planned(¥ million)
FY12/2014

YoY Change

FY12/2014

YoY Change

FY12/2014

3Q YTD
Results(Previous FY)

Above: YoY (Amount)
Below: YoY (Ratio)

3Q Results(Previous FY)

Above: YoY (Amount)
Below: YoY (Ratio)

Full-Year
Forecasts

Net sales

13,733Operating income

2,934

Ordinary income

2,901

Net income

1,533(12,629)(2,124)(2,033)(982)+1,103
8.7%

4,649

+809
38.1%

1,084

+868
42.7%

1,074

+551
56.1%

590

(4,161)

(585)

(570)

(254)

+488
11.7%

19,000

＋499
85.3%

4,000

+504
88.5%

3,950

+336
132.2%

2,100
3

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

Forecasts for FY12/2014
 For net sales, we forecast ¥19,000 million
as initially planned.
 Costs to be generated in 4Q are projected
as follows:

Costs for promoting “Car-unselor in Your
Town”




Net Sales and Total Cost(¥ million)

19,00018,024

Costs for regional advertising implemented
from October will be generated.
We expect that there will also be costs forcontracting out clerical work (training expenses,
etc.)



Development of the New-Generation BL
Cloud Strengthening of human resources to create
new services

Net sales(Full-Year
Forecast)
15,000(Full-Year Forecast)

14,283

4Q(Results)

4Q(Forecast)

3Q YTD(Results)

3Q YTD(Results)

FY12/2013
Total Cost

FY12/2014
Total Cost
4

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

Sales Trends by Category
 Business Application Software, System Support: Responding to the demand for package licensing renewal
 Network Service:(Stock)(Transaction)

We forecast that the sales of stock-type services will expand amid an increase in the proportion of network
systems licenses.
We project that net sales will increase year on year, but we are taking steps to increase sales further.
(¥ million)

FY12/2014
3Q YTD
Results(Previous FY)
Net sales
Business Application Software
System Support
Maintenance

Provision of consumables
Network Service
Stock
Transaction

13,733(12,629)

9,956(9,170)

969
(958)

463
(459)

506
(499)

2,807
(2,500)2,210(1,954)596(545)

YoY Change

FY12/2014

YoY Change

FY12/2014

Above: YoY(Amount)
Below: YoY (Ratio)

3Q Results(Previous FY)

Above: YoY(Amount)
Below: YoY (Ratio)

Full-Year+1,103
8.7%
+786
8.6%
+10
1.1%
+3
0.8%
+6
1.4%
+306
12.3%
+256
13.1%
+50
9.3%

4,649
(4,161)
3,384(2,982)
302
(314)
151
(153)
150
(160)
963
(864)
757
(674)
205
(190)

+488
11.7%
+401
13.5%
-12
-3.8%
-1
-1.1%
-10
-6.5%
+98
11.5%
＋83
12.4%
+15
7.9%

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

19,00013,700
1,300
630

670
4,000
3,000
1,000
5

Increased Sales of Network Services (1 of 2) With an increased proportion of network systems that provide the base of network
services, the sales of stock-type services are rising.

Proportion of licenses of network systems in the sales of Business Application Software(%, ¥ million)
Proportion of network licenses

Sales of stock-type services
55.4%
50.5%
44.2%
38.9%

1,452

32.0%

1,360

27.1%

1,280
1,194

20.0%
1,102

16.7%
13.0%

1,001
914
851

785
1H end2H endFY12/2010

1H end2H endFY12/2011

1H end2H endFY12/2012

1H end2H endFY12/2013

1H end2H endFY12/2014* Sales of stock-type services (fees for database and server usage)
6
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Increased Sales of Network Services (2 of 2)
 The status of the Carpod Tab and the BL Parts Ordering System, new revenue bases oftransaction-type services, are as follows: With Carpod Tab licenses exceeding 1,000, sales are expanding steadily.
 The number of regional parts dealers and suppliers participating in transaction-typeservices is increasing steadily.
We will focus on measures to increase the distribution volume of parts and, at the sametime, focus on increasing the ratio of transaction-type services.
Number of companies (*parts dealers)participating in transaction-type services

Trend of Carpod Tab licenses
Number of licenses

Number of companies

1,500

200

1,015
879

1,000

662

735

144

150

111

112

End
FY12/2013

1Q
FY12/2014

121

100

500
50

0

0
4Q
FY12/2013

1Q
FY12/2014

2Q
FY12/2014

3Q
FY12/2014

2Q
FY12/2014

3Q
FY12/2014* Number of clients, or parts dealers, that provide the BL
Parts Ordering System
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

7

Balance Sheet at the End of 3Q FY12/2014
 Achieving stronger balance sheet(¥ million)

Current assets

3Q EndEnd

YoY Changes

FY12/2014

FY12/2013

Amount13,651

14,037

- 386

9,142

9,229

- 87

12,487

13,006

- 519

442

481

- 38

11,225

11,791- 565

10,198

10,699

- 501

819

733

85

Total assets

26,13927,044- 904

Current liabilities

5,201

6,133

- 932

Loans payable

750

1,500

- 750

Non-current liabilities

313

948

- 635

147

750

- 602

Total liabilities

5,514

7,082

- 1,568

Total net assets

20,624

19,961

663

Total liabilities and net assets

26,13927,044- 904

Cash and deposits
Non-current assets
Property, plant and equipment
Intangible assets
Goodwill

Investments and other assets

Long-term loans payable

Goodwill- Goodwill arising at the time of MBO
amortized steadily (Amortized over
20 years since FY12/2010)

Loans payable- Repaid steadily

8
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

2. Progress of Core Initiatives

Mid-Term Management Plan (2014-2016):
Outline of Management Policy, Strategies and Initiatives

Management Policy:
Evolving into a comprehensive service provider
by supporting fulfilled car life

Core Initiatives
Marketing
Promote a new service
brand of “Car-uncelor inYour Town”

Platform

Increase the sales ratio of network services
Results in FY2013¥3,382 million
18.8%
Net sales
18,024

Forecasts for FY2016(final year of the mid-term management plan)¥6,500 million
28.9% Net sales
22,500Develop a NewGeneration BL Cloud

Aim to improve
profitability further
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

10

Core Initiative: Promote a new service brand of “Car-uncelor in Your Town”
Progress in training activities
Trend in the number of trainees andshops that finished the basic course
1,000

827

800
639

569

600

64 shops

Core
area

456
400

342

305
229

256

FY12/2013

March 31

Core
area

200
0
June 30

Number of trainees
Number of shops that finished the basic course

September 30

Core
area

Starting TV commercials mainlyin three areas (Yamagata,
Toyama and Aichi) to promoteroadside shops in the media
11

Core Initiative: Promote a new service brand of “Car-uncelor in Your Town”
New services derived from “Car-unselor in Your Town”

Car-unselor
shops

Shop support services• Provision of shop building know-how bycertified, dedicated shop supervisors

Lead innovative changes
in the industry byincreasing our recognition
as one of the industry’s
largest brands

Customer attraction
support service (CRM)• Enhancement of contact points with car owners through “Car-unselor Pass”• Implementation of regional commercials• DM agency service

Education support
service• Workshops for business succession through a joint project
with

Other
derivative services
12Core Initiative: Develop a New-Generation BL Cloud Expand the business domain by reaching car owners (consumers) through the early
operation of the next-generation BL Cloud13

Step Up Business Expansion in Asia
Concluded a strategic partnership agreement with Guangdong Province
Aftermarket Auto Parts Dealers Association

 Concluded a strategic partnership agreement with Guangdong Province
Aftermarket Auto Parts Dealers Association.


The first time a Japanese company has entered into a strategic partnership agreement with
Guangdong Province Aftermarket Auto Parts Dealers Association, China.
 The purpose is to maximize business merits with both parties providing their know-how in auto parts
distribution.

 Aim to expand business in China in earnest by promoting the building of an
auto parts distribution platform.
Broadleaf Co., Ltd.
100% stake
Broadleaf China

51% stake

28% stake(Non-consolidated
subsidiary)

Automotive
Information System
Sales Company(Joint venture)

Beijing Japan-China
Automotive
Recycling Center(Joint venture)

Established in
October 2012

Established inJuly 2013

Established in
April 2013

Strategic
partner

Guangdong Province Aftermarket
Auto Parts Dealers Association

Established in 201314

Step Up Business Expansion in Asia
Auto parts distribution platform in the Chinese market (2/2)

Recycling
companies
Autos to be
dismantled Warehousing

Recycling
companies
Insurancecompanies

Auto parts
distribution
platformParts
registration

Auto repair
shops
Search &purchase(*1) Materials Recycling Association (*2) Guangdong Province Aftermarket Auto Parts Dealers Association(*3) CCRC：China Car Recycle, Business solutions for automotive recycling companies (dismantling factories) in China

Tradingcompanies forparts

Roll out CCRC(*3) to the member companies of China’s largest recycling group(*1)
and Guangdong Province Aftermarket Auto Parts Dealers Association(*2).
Add an auto parts distribution platform to the Chinese market by around FY2015.
15

3. Reference Materials

Our Profile
Corporate Philosophy
Gratitude and Satisfaction: These are the underlying principles
that drive our creation of new corporate value
as we develop enterprise solutions for our partner-clients.
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 platform that supports the business of players in
the automotive aftermarket (e.g. development of business applications andautomotive content, platform for collaboration between different businesssectors, marketplace for recycled auto parts)

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:807(as of September 30, 2014)17
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

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.

18
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Distribution Structure of Auto Parts and Relations to
BroadLeaf
 Introduce a seamless system of order taking and the placing of auto parts by vertically and horizontally linking fragmented
stages of the huge used automotive market, achieving high market shares in all stages from upstream to downstream

Manufacturersof Auto Parts

Electric
WiringCompanies

Glass
Shops

Recycling
Companies

Radiator
Shops

Supply of Auto Parts

Recycled Parts Market
Trading Firms
Used Auto
Parts
Dealers

Auto Parts
Dealers
Scrapping,etc.

Sale andPurchase ofAuto Parts

Supply of Auto Parts

Manage recycled parts
possessed by multiple
auto dismantling shops
as common inventories

Retailers
MaintenanceShops, etc.

Compulsory andOther Inspections

Bodywork
Shops, etc.
Repairing damages due
to auto accidents, slightdamages, dents, etc.

Used Car
Dealers

Sellingused cars

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

19

Domain of Our Sales
 We have a single business segment of IT services, but sales are classified according to the type ofservices that we provide to clients.
Large
Classification

MiddleClassification

Small Classification

Type of Business
Provisioning of business application software for specific businesses.
We sell the rights to use systems mainly to leasing companies, and they lease such rights
to clients, usually for 6 years.

Business Application
Software

Maintenance

We provide maintenance services for business application software and hardware.

Provision ofConsumables

We sell consumables such as special ledger sheets used in business application software.

System Support

Database Provisioning
Service

We provide databases for automobile-related information as well as parts-related
information updated daily, and bill monthly fixed charges.

Server Provisioning
Service

We bill monthly fixed charges to network systems customers for the cost of server
maintenance.

Payment Agency Service
for Recycled Parts

We operate “Parts Station NET,” a distribution network for recycled parts that sharesinformation on the inventories of recycled parts, providing payment agency service whenselling and purchasing recycled parts and collecting commissions at a fixed rate.

Stock

Network Service

Transaction
Service that provides for seamless placing and receiving of orders for auto parts.
BL Parts Ordering System
Through this service we collect payment for monthly fixed charges or charges on measured
Carpod Tab, etc
rates. We also provide tablet-based services to maintenance shops.

20
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Efforts of “Car-unselor in Your Town”“Car-unselor in Your Town” is a service brand started up by BroadLeaf in autumn 2013 for the purpose ofhelping to attract customers to automotive maintenance shops.

Services

Services
Car owners
Solutions
1) Easy-to-understand explanations
2) Short waiting time3) Abundant selection of parts toselect from4) Dependable technical capabilities
5) Convincing priceTraining
Advertising support
Provision of tools
Consulting

Maintenance shops

Services

Evolving from package development and sales
to the provision of total service
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

21

CSR Activities
Basic Policy on CSR
We will contribute to the revitalization of the automotive aftermarket and growtogether with clients in accordance with our corporate philosophy focusing on
Gratitude and Satisfaction. As a company associated with the automobile industry,
we will seek to contribute to the sustainable development of society throughenvironmental conservation and other activities.

Environmental Conservation Activities
Grow Leaf Project
Tree Planting Activities (since 2008)
Under the theme of contributing to the global environment,
we engage in the Grow Leaf Project activities.
We have planted 30,000 trees on land in need of reforestation.
Sponsorship of Musical:
The Fall of Freddie the Leaf: A Story of Life for All Ages (since 2008)
We have been co-sponsoring and promoting this musical for children.
Through the musical, we are conveying the importance of life and theenvironment to future generations.

22
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Cautionary Note

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
the material, and are subject to potential risks and uncertainties. Please note that actual results may differ
from the statements contained in this material due to various 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/
23
Copyright (c) Broadleaf Co., Ltd. All rights reserved.