Broadleaf Co., Ltd.
(Securities Code: 3673 / TSE 1st)
2Q FY12/2013 Business Results Briefing

August 8, 2013

Overview of FY12/2013
Results and Forecasts

Summary of FY12/2013 Results and Forecasts
 1H FY12/2013:

Both net sales and incomes reached the initial forecasts due to the solid
performance of both Business Application Software and Network Service

 Full-year forecasts: No revision from the initial forecasts(¥ million)
1H ofFY12/2013
Results

Net Sales
Operating
IncomeOrdinary
IncomeNet Income

8,468

1,539

1,463727

YoY ChangeComparedto initialforecasts+1,022+167113.7%

102.0%+826+177

216.0%

113.0%+802+169

221.6%

113.1%+489+106

305.4%

117.1%

FY12/2013
Full-year
forecasts

1H FY12/2012
Results

1H FY12/2013
Initial forecasts

17,851

7,445

8,301

4,042

712

1,362

3,952

660

1,294

2,089

238

621

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

2

Changes in Operating Income (Half-Year Periods)
 Automotive aftermarket  Business with more emphasis on the second half
Net Sales
10,000

8,000

9,383
7,857
7,459

8,196
7,445

Operating Income¥ million¥ million

3,0008,468

2,503
2,500

2,000

6,000

1,539
1,401

1,500

1,175

4,000
1,000

596

712

2,000
500

00
FY12/2011
FY12/2012
FY12/20132011年12月期
2012年12月期
2013年12月期
1H
上半期

2H
下半期

FY12/2011
FY12/20122011年12月期
2012年12月期
1H
2H
上半期
下半期

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

FY12/20132013年12月期

3

Sales Trends by Category(¥ million)
FY12/2011
1H
Business Application Software

FY12/2012

Full-year

1H

FY12/2013

Full-year

1H

5,677

11,645

5,347

11,353

6,187

System Support626

1,258641

1,279644

Maintenance274570

298

603

306

Provision of consumables

351

688

342

676

338

1,155

2,412

1,457

3,008

1,636

Network Service

 Business Application Software:
Disposition of dormant licenses was almost completed
Net sales increased due to demand for the renewal of lease contracts (6 years).
 System Support: Both maintenance and the provision of consumables remained firm.
 Network Service: Stock-type services expanded along with the rising proportion of
network-type licenses.
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4

Changes in Proportion of Network-Type Licenses
 The proportion of network systems, which serve as the infrastructure of our Network Service,
has been increasing steadily.
Proportion of licenses of network systems in the sales of Business Application Software
44.2%
38.9%
32.0%
27.1%
20.0%
16.7%
13.0%
9.6%
4.6%

FY endFY12/2008

6.0%

1H

end

FY endFY12/2009

1H

end

FY endFY12/2010

1H

end

FY endFY12/2011

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

1H

end

FY endFY12/2012

1H

end

FY12/20135

Balance Sheets at the End of 2Q FY12/2013
 Achieving stronger balance sheets(¥ million)
End of 2Q
FY12/2013

End of FY12/2012

Changefrom FY12/12
End

11,808
6,833
13,407520
12,161
11,034725
25,216

8,761
3,604
13,857520
12,475
11,368860
22,619

3,046
3,228
(450)
0(314)
(334)
(135)
2,597

Loans payableNoncurrent assets
Long-term loans
payableTotal liabilities

5,406
1,500
1,707
1,500
7,113

5,169
1,500
2,431
2,250
7,600

237
0(724)(750)(487)

Total net assets
Total liabilities andnet assets

18,102
25,21615,01822,619

3,084
2,597

Current assets
Cash and deposits
Noncurrent assets
Property, plant andequipment
Intangible assets
Goodwill
Investments andother assets
Total assets
Current liabilities

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

Cash and deposits- Increased with the issuing of newshares at the time of listing- Increased with the posting ofincomes
Goodwill- Goodwill arising at the time of
MBO amortized steadily(Amortized over 20 years since
FY12/2010)

Loans payable- Repaid steadily

6

Statements of Cash Flows for 1H FY12/2013
 Ample cash flows(¥ million)

1H FY12/2013 1H FY12/2012

YoY Change
AmountNet cash provided by (used in)operating activities

1,811

1,330

480

Net cash provided by (used in)investing activities

(175)

(300)

124

Net cash provided by (used in)financing activities

1,592(1,033)

2,626

Net increase (decrease) in cash
and cash equivalents

3,228

(3)

3,232

Cash and cash equivalents at end of period

6,833

2,920

3,913

Free cash flows (FCF)

1,636

1,030

605

* FCF = CF from operating activities + CF from investing activities

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7

Cost Structure and Ability to Create Cash
 Real total expenses are estimated to be around ¥13.5 billion
 Earnings structure with high marginal income ratio Increase in FCF due to the penetration of Network Service, in addition to the stable client base(¥ million)

Net Sales and Real Total Expenses(¥ million)

6,000

Changes in Free Cash Flows
5,489

3,944

4,000

2,0000FY12/07 FY12/08 FY12/09 FY12/10 FY12/11 FY12/12 FY12/13(forecast)

Real total expenses

Net Sales* Real total expenses = Cost of sales + SG&A expenses – Amortization of goodwill

FY12/07

FY12/08

EBITDAFY12/09

FY12/10

FY12/11

FY12/12FY12/13(forecast)

FCF* FCF = CF from operating activities + CF from investing activities

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

8

Growth Strategies of Broadleaf

Our Growth Strategies
We accelerate our growth in Japan and overseas
as a new type of information service company with its roots in industry,
which supports the creation of users’ business.

Japan: Strengthening the Industrial Platform
Enhancement of Network Service
Expansion of the Industrial Platformin the automotive aftermarket

M&A

Expansion of the Platform to other industries
around the automotive aftermarket

Overseas: Approaching growth markets
Operation of automotive business by drawing
on the expertise we have developed in Japan
Business operations in China

Expansion into ASEAN countries

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

10Japan: Strengthening the Industrial Platform
Growth••Increasing the frequency of use
Expanding network services

 Network Service

Increasing network
system users

 Services provided on the Industrial Platform(Services connecting different businesscategories, Carpod Tab, etc.)

Stock-type orTransactiontype Revenue

 Database provision
 Server provision

Payment agency
service forrecycled parts

Growth System Support (maintenance, provision of consumables)

Flow-type
Revenue(six-year cycle)

Growth Business Application Software
Network systems

Standalonesystems

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

Increasing
the numberof users
11(1) New Marketing Strategies: Efforts for B2B2C

Users• Having difficulty
attracting customers,
despite strong
technical capabilities• Not recognized,
despite having afactory

Increasing
earnings of users

Support toincrease satisfaction
on both sides
Support for
attracting clients
Support for
improving services

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

Car owners
perception• Looks exclusive forthe first time
• Explanation is difficult• Difficult to understandthe content of anestimate• Waiting time is long

Increasing
satisfaction12(1) New Marketing Strategies: Efforts for B2B2C
Specific initiatives

Providing ornament tools to leadcar owners to our user shops

PR through media

Promote incoming

Promote recognition and understanding

Able to consult!
Able to understand!
Shop with mechanic

Operation of search site, etc.
for safety inspection

WEBPromote repeaters

Increase satisfactionof car owners

Increase ourearnings
opportunities
Store support/ sales promotion support• Supporting the use of IT with a tablet terminal• Providing a Wi-Fi spot at the shop
(Supporting the use of our Wi-Fi services)• Website production support service• Holding a seminar to increase customer satisfaction
and share information on success cases

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

1313

* Counselor of cars for car owners

Logo of Car-unselor in Your TownCar-unselor in Your Town

Able to consult! Able to understand!
Car-unselor* in Your Town

Able to consult! Able to understand!
About your car(1) New Marketing Strategies: Efforts for B2B2C

Ornament tools to lead carowners to our user shops

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14

(2) Business Expansion through AllianceEntered into a development outsourcing agreement withJX Nippon Oil & Energy Corporation

Providing services through business-oriented
applications and networks- Enhancing our network services- Accelerating an increase in the number of users

Oct.
2013 -Car owners

JX Nippon Oil &Energy Corporation

ENEOS

Providing individual car owners
with services using a tablet
terminal and a smartphone
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15

Overseas:
Approaching Growth Markets - Operations in China Broadleaf Co., Ltd.
A 100% stake
Broadleaf China(Wholly-ownedsubsidiary)

LicenseSales company ofautomobile
information systems

Introduction ofrecycling
factories(Joint venture)
Established inOctober 2012

Parts
distribution
in China

A 28% stake

A 51% stake

Revenues

Earnings
sourceEstablished inJuly 2013

Revenue

Businessapplication
software, etc.

Beijing Japan-China
Automobile Recycling
Center(Joint venture)

Commissions

Payment

Potential forexpansion
Automobile recycling center
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Established inApril 2013
Technical support
Consulting

Maintenance shops/
Bodywork shops
16

Overseas:
Approaching Growth Markets - Developing Efficient Systems -Industrial Platform in Japan

China

 Common network infrastructure Database construction know-how
 Coding scheme, etc.

ASEAN Countries

Localization of systems

Promoting business with high investment efficiency using commonnetwork infrastructure to extend the Industrial Platform to overseas
17
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

ReferenceSummary of FY12/2013 Business Results and Forecasts(¥ million)

Net Sales

1H FY12/2012
Results

1H FY12/2013
Results

FY12/2012

FY12/2013

Full-year results

Full-year forecasts

7,445

8,468

15,641

17,851

5,347

6,187

11,353

12,982

System Support

641

644

1,279

1,386

Network Service

1,457

1,636

3,008

3,482

Cost of Sales

2,259

2,262

4,616

4,247

5,186

6,205

11,025

13,604

4,473

4,666

8,911

9,561334

334668668

Operating Income

712

1,5392,114

4,042

Ordinary Income

660

1,463

2,035

3,952

Net Income

238

727

815

2,089

10.61

30.63

36.30

86.12

--

5.6%

11.9%

1,407

2,204

3,522

Business Application
SoftwareGross Profit
SG&A Expenses(Amortization of goodwill)

EPS (¥)
Return on equity (ROE)
EBITDA** EBITDA = Operating Income + Depreciation + Amortization of goodwill

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19

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:
President and CEO:
Stock Listing:Founded/Established:
Capital Stock:
Business Outline:

Head Office Location:
Business Offices:
Development Centers:
Number of Employees:

Broadleaf Co., Ltd.
Kenji Oyama
The First Section of the Tokyo Stock Exchange
Securities Code: 3673 (Listed on March 22, 2013)
December 2005/September 2009
¥ 6,793,205,000
Development and sales of business applications, provision ofnetwork services, maintenance services, etc. for specificbusinesses centering on the automotive aftermarket industry
Floor 8, Glass Cube Shinagawa, 4-13-14, Higashi-Shinagawa,Shinagawa-ku, Tokyo
35 offices in Japan
3 centers in Japan (Sapporo, Tokyo and Fukuoka)846(as of June 30, 2013)

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

20

Automotive Aftermarket
The 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.

21

Our Strengths
We connect participants in a very large, divided market with a common network infrastructure andpromote the Industrial Platform to help users improve their operational efficiency and create businesses.
Large shares establishedin each industry

Industrial Platform

A variety of vehicle
information, partsinformation, accessory
information, indexes, etc.

The database of partsinformation, which is essential
for the business, has been
accumulated for 30 years,
creating a high barrier to entry.

CommonInfrastructure

Database

Manufacturers
Recycling companies,
automotive glass shops,
automotive electric wiring
companies, radiator manufacturers

Recycled parts
marketTrading companies
Parts dealers, used parts dealers- Common network infrastructure
We develop systems for multiple businesscategories from the industry’s upstream todownstream on a common network
infrastructure, which enables information
sharing.
- Industry-standard database
BL Code, an industry standard code
unifying information on parts, which differs
between parts manufacturers.

Retailers
Maintenance shops, bodywork shops,
retailers of automobile supplies,
gas stations, etc.

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Car Owners

22Strengthening the Industrial Platform
Direction of the future growth(1) Increasing the frequencyof network usage
Latest specific initiatives(1) Increasing the frequency of network usage

Network ServiceSystem Support- New marketing strategies
 Aiming for (2) in the medium term(2) Increasing - Alliance with scan tools made by Denso
the number- Direct sales of tablet terminals of KDDI (au)of users- Release of new services from CarpodTab(2) Increasing the number of users

Business Application
Software- Conclusion of a development consignment agreement withJX Nippon Oil & Energy Corporation- Business alliance with JMA Consultants Inc. (JMAC)

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23

Specific Initiatives to Strengthen the Industrial Platform
Began
delivering
on June 19,
2013

Launching network systems that visualize automotive
diagnostic results in alliance with scan tools made by Denso

 Delivering SF.NS Failure Diagnostic System Alliance Option that links scan
tool (failure diagnostic system) used for automotive electric system
diagnosis with network system, using DST-2 and DST-i, scan tools madeby Denso
Beganhandling
on July 8,
2013• Directly selling tablet terminals of KDDI (au) equippedwith communication function• Enhancing sales of CarpodTab, application for tablet terminals

Diagnosticresults Began selling CarpodTab together with terminals equipped with acommunication function by registering as the secondary agent forau terminal products

Failure diagnosis

Scan tool

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24

Specific Initiatives to Strengthen the Industrial Platform

Began providing new services from CarpodTab, a tablet terminal
business support tool Supporting quick services tailored to car owners

Beganprovidingin July andAugust 2013

 Began providing new services such as a light bodywork proposal service, BL parts
order system tablet edition, receipt, insurance simulation and business efficiency
support for auto parts dealers from CarpodTab, which has been highly valued since
its launch in July 2012

Cooperating in selling OTRS, a work analysis/ business optimization
system, through an alliance with JMC Consultants Inc. (JMAC)

Concluded
an agreementon July 1,2013

 Promoting sales of OTRS, which has been introduced by some 200
companies since November 2009, earning high marks, through mutual
customer referral with JMAC
Screen sample ofOTRS

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25

Overseas: Approach to Growth Markets
China

The automotive aftermarket has
expanded due to the increase in
car ownership. The market size isparticularly large in China.

12
3

CCRC Menu Screen(Chinese version ofrecycled parts
registration system)

58.1

The recycled parts market is being
formed due to the increase indemand for repairs that has
resulted from the spread of cars.

Japan576

120.89 million
75.59 million
38.3%
79.5%

The Internet infrastructure,
which is the basis of ourservices, is being developed.

Thailand
169.7
Myanmar11.5 million

Vietnam

Car ownership rate(vehicles/1,000 people)

000

23.7%

Malaysia00.0 million
Number of cars owned

380.4

ASEAN Countries

Indonesia
10.74 million

80.0

61.0%

00.0%

19.0 million
Internet penetration rate

Sources:
Car ownership rate:
Automotive Yearbook
Number of cars owned: Automotive Yearbook;
National Bureau of Statistics of China, 2012
Internet penetration rate: ITU, Percentage of individuals using the Internet (excel)

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

18.0%

26

Cautionary Note
Forward-looking statements contained in this material such as results forecasts and future prospects areforecasts and estimates made by Broadleaf based on information available at the time of the preparationof 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
Copyright (c) Broadleaf Co., Ltd. All rights reserved.