Financial Results Briefing for FY03/2022

INFOCOM CORPORATION

2022.04.27

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Contents
Financial Results for FY03/22

Earnings Forecast for FY03/23

Initiatives in Key Businesses
E-Comic
Health IT
Evolve Into a Services-Oriented Business

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Results

Financial Results for FY03/22

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

FY03/22 Results (Consolidated)
Net sales
Operating profit
Net income: Firm Business Solution performance, despite sluggish growth for E-comics: Lower due to HQ relocation costs: New record-high

Net sales

Operating profit

Profit attributable toowners of the parent

－5.1％

－6.6％

＋10.1%

68.0(Billion yen)

64.5

(Billion yen)(Billion yen)

15

60

15

10.8

10.0

10

40

10

6.2
20

5

5

0

0

0

FY03/21

FY03/22
Digital Entertainment

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

FY03/21
Business Solution

3

FY03/22

FY03/216.9

FY03/22

Management Performance (Consolidated)

Net sales(Billion yen)

YoY

FY03/21

FY03/22

68.0

64.5

(3.4)

－5.1％

10.9

+0.1

+1.2%

(0.7)

－6.6％

Change%（16.9%）

Operating profit(Operating margin)

10.8

Cost of HQ relocation (0.8)(15.9％)

10.0(15.6％)EBITDA

12.1

11.4

(0.7)

－5.8％

Ordinary profit

10.9

10.1

(0.7)

－6.8％

6.2

6.9

+0.6

+10.1％

114.61

126.20

11.59

+10.1

16.2

16.1

(0.1)

Profit attributable toowners of theparent

Net income pershare (yen)ROE(%)
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

4

Business Areas and Segment Structure
Digital Entertainment
Group

Business Solution Group

DigitalEntertainment

Health IT

E-comic

Package services
for medical
institutions

・General consumers

・Hospitals
・Pharmaceutical companies
・Nursing care companies
・Health industry

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

5

Business
SoftwareEnterprise Service
Management

ERP
Business package
cloud services

System integration
for major companies

・Companies
・Government offices
・Local governments

・Textile manufacturers
・Trading companies
・Pharmaceutical wholesalers
・Mobile phone companies

Digital Entertainment Results (Consolidated)(Billion yen)

Net sales

YoY

Operating profit

FY03/21(Billion yen)

40.5(Billion yen)
10

40

8

80%

7.9

7.7

30

Change

%

44.0

40.5

(3.4)

－7.9％

Operating profit

7.9

7.7

(0.1)

－1.9％

(Operating margin)(18.0%）(19.1%）Net sales
44.0

FY03/22Net sales
60%・Advertising effectiveness declined due to pirate sites
6→ Reduced advertising

20

40%
4

on unnecessary travel in the previous year

10

20%
2

0

18.0%

0%

FY03/21 FY03/22

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

・Lack of major hits in original content (some medium-sized hits)

Operating profit

19.1%

0

FY03/21 FY03/22

・Decline in special demand stemming from voluntary restraints

Decrease in profits due to decrease in sales
Cost reductions from reduced advertising6

Results of E-Comic Distribution Service(Billion yen)
12.5

10

7.5

5

2.5

0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

FY03/18
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

FY03/19

FY03/207

FY03/21

FY03/22

Business Solution Results (Consolidated)(Billion yen)

Net sales(Billion yen)(Billion yen)
6

30

24.0

80%

24.0
60%

20

YoY

Operating profit

FY03/21

Change%Net sales

24.0

24.0

+0.0

＋0.1%

Health IT

9.7

10.2

+0.5

＋6.1%

Operating profit

2.8

3.1

+0.2

＋9.9%

(12.0%）(13.2%）(Operating margin)4

Excluding HQ relocation costs (0.8)

Net sales

3.1
2.8

10

FY03/2240%

Steady growth despite the impact of COVID-19

2
20%
9.7

Operating profit

10.2
12.0%

0

13.2%

0

FY03/21 FY03/22

0%FY03/21 FY03/22

・Improved profit margin due to higher productivity
from work-style reform (telecommuting, operating
improvements, HQ relocation, etc.)
・Cost reductions

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

8

Investments(Billion yen)
Main Details

Category

Amount(Billion yen)

Business
New business planning, research, demonstration tests, etc.
Development

5

4.25

M&A
Expanding Health IT (converted Medical Create Co., ltd to a
subsidiary)

0.39

4

0.3

Evolve into a services-oriented business (converted
Alterbooth Inc. to a subsidiary)3

2.06

EquityInvestment

Capital increase for South Korean e-comic distribution business(Peanutoon Inc.)

2.0

Investments and business alliances
E-Comic distribution business (established joint venture
AmuLink Corp)

2

Southeast Asia social media platform for doctors

1.79(business alliance with Docquity Holdings Pte. Ltd.)
Fitness app business (business alliance with BeatFit Inc.)

0.44

E-comic

0.17
1

0.90

0

(Systems development, etc.)

1.63
CapitalInvestment

0.26

0.16

FY03/21

FY03/22

R&D Investment
Equity Investment

Capital Investment
Business Development

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Health IT(radiology systems, pharmaceutical company sales, etc.)

1.6

GRANDIT miraimil development
Other (facilities in connection with HQ relocation)
R&D
Investment

AI, new technology research, etc.
90.1

Balance Sheets (Consolidated)(Billion yen,%)

FY03/21
AmountFY03/22

Composition
Ratio

AmountComposition
Ratio

Major Change Factors
YoY

Current assets

43.9

77.9

45.1

78.5

+1.2

Fixed assets

12.4

22.1

12.3

21.5

(0.1)

56.4

100.0

57.5

100.0

+1.0

Total assets

・Income taxes payable

14.2

25.2

12.4

21.6

(1.8)

0.3

0.6

0.5

0.9

+0.1

Total liabilities

14.5

25.9

12.9

22.5

(1.6)

Total net assets

41.8

74.1

44.5

77.5

+2.7

Total liabilities and net
assets

56.4

100.0

57.5

100.0

+1.0

Shareholders’ equity
ratio

73.5%

Current liabilities
Non-current
liabilities

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

76.8%
10

・Retained earnings

Cash Flows (Consolidated)
・Profit before income taxes
・Depreciation
・Change in notes and(Billion yen)accounts receivable-tradeand contract assets(Billion yen)

FY03/21・Purchase of shares ofsubsidiaries
・Purchase of intangible
assets(3.2)

・Dividends

FY03/22

ChangeOperating CF

9.8

7.1

(2.7)

Investing CF

(1.6)

(3.2)

(1.5)

Free CF

8.2

3.9

(4.3)

Financing CF

(1.7)

(2.2)

(0.4)

Effects of exchange
rate changes oncash and cash
equivalents

(0.0)

0.0

+0.0

Change in cash andcash equivalents

6.4

1.7

(4.7)

23.4

29.9

+6.4

29.9

31.7

+1.7

+7.1

(2.2)

30

31.7
29.9

Cash and cash
equivalents,
beginning of
periodCash and cash
equivalents, endof quarter20

Beginning Operating
FY03/22
CF

InvestingCF

Cash andEquivalents
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Financing
CFEnd
FY03/22
Cash andEquivalents

11Forecast

Earnings Forecast for FY03/23

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Management Indicators (Consolidated)
FY03/22 Results
1H

2H(Billion yen)

FY03/23 Forecast

YoY

FY

1H

2H

FY

32.4

32.1

64.5

33.0

３７.０

70.0

4.9

5.0

10.0

4.0

6.5

10.5

(15.4％)（15.9%）（15.6％）（12.1％）（17.6%）（15.0％）EBITDA

5.6

5.7

11.4

4.6

7.2

Ordinary profit

5.0

5.1

10.1

4.0

Profitattributableto owners of
the parent

3.4

3.4

6.9

2.7

Net sales
Operating profit(Operating margin)

Change
+5.4

+8.4％

+0.4

+4.0％

11.8

+0.3

+3.4％

6.5

10.5

+0.3

+3.0％

4.3

7.0

+0.0

+1.3％

+1.3％

Net income pershare (yen)126.20127.80

+1.60

ROE

16.1%

15.2%

(1.0)

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

13%

Digital Entertainment Earnings Forecast (Consolidated)(Billion yen)

Net sales

YoY

Operating profit

FY03/22

10

40

8

+3.4

＋8.6%

Operating profit

7.7

7.0

(0.7)

－9.8％

(Operating margin)(19.1%）(15.9%）

80%

7.7

30

7.0

60%

Net sales
6

40%

20

Aiming for growth recovery through expanded
content and strengthening marketing

4

10

20%
2

19.1%

Operating profit

15.9%

0

0

FY03/22 FY03/23

0%

Cost increase due to strengthened marketing

FY03/22 FY03/23

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

%

44.0

44.0
(Billion yen)

Change40.5

Net sales(Billion yen) 40.5

FY03/23

14

E-Comic Returning to a Growth Path Owing to Aggressive
Investments in Advertising
Continue revised marketing measures of Q4 in the previous year through the firsthalf of this year; invest in advertising
Determine the direction for the second half based on the results of the first half
Adjust advertising strategy

11.6
116

Determine advertising effectiveness

Peak
10.9
109

10.6
106

10.9
109

10.8
108

Ad placements
10.6
106

9.5
95

9.7
97
BottomQ1

Q2

Q3

FY03/21
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Q4

Q1

Q2

Q3

FY03/22
15

Q4

Q1

Q2

Q3

FY03/23

Q4

Business Solution Earnings Forecast (Consolidated)(Billion yen)

Net sales

YoY

Operating profit(Billion yen)(Billion yen)

30

6

80%

26.0
24.0
60%

FY03/22

FY03/23

24.0

26.0

+1.9

＋8.1%

Health IT

10.2

11.5

+1.2

＋11.7%

Operating profit

2.3*

3.5

+1.1

＋50.3%(9.7%）(13.5%）(Operating margin)*Cost of HQ relocation

3.5

Net sales
40%

2.3
10

Increase in sales due to growth of Health IT andevolution into a services-oriented business

2
20%
10.2

11.5

Operating profit

13.5%
9.7%

0

0

FY03/22 FY03/23

0%

Higher profits due to higher sales

FY03/22 FY03/23

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

%

Net sales

420

Change16(0.8)

Shareholder Returns
Annual dividends per share

(Yen)

50.0

50

10 YenCommemorative Dividend

45.0◆ Dividends

40.0

40

37.0

For FY03/2023, we forecast an interim

31.0

dividend of 18 yen and a year-end

27.0

30

dividend of 27 yen, for a total annual

27.0

22.0

dividend of 45 yen

27.0
21.0

20

(35.2% payout ratio)

17.0

10

◆ Shareholder Benefits

18.0
10.0

13.0

10.0

We plan to provide shareholder benefits to

5.0

shareholders owning at least one trading

0
FY03/19

FY03/20

FY03/21

Interim
Net income
87.46
per share (yen)101.32

FY03/22

FY03/23
FY03/23(Forecast)

September 30, 2022

Year-End114.61

unit per the register of shareholders as of

126.20127.80*Dividends per share and net income per share reflect stock split performed on March 1, 2019.
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

17

Strategy

Initiatives in Key Businesses
E-Comic

Health IT

Evolve Into a Services-Oriented Business

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

E-Comic

FY03/22 Initiatives

Expand Content⚫ Bolstered production system for original
comicsOriginal Comics to Other Media⚫ Dramatization of original comics

Strengthen
Systems Foundation⚫ Established joint venturecompany AmuLink Corp.
Researched and adopted technologies
specific to the e-book business⚫ Strengthen collaboration with publishers⚫ Purchased and sold Webtoon titles⚫ Launched manga submission service
Mecha Comic Creators⚫ Collaborations with dramas⚫ Developed and launched
new viewer⚫ Moved systems
infrastructure to the cloud⚫ Joint drama with TV Tokyo

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

19

Launched Manga Submission Website
Works submitted and viewed free of charge
Contest-winning works distributed on Mecha Comic

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

20

Original Comics to Other Media⚫ We have been implementing media tie-ups, mainly for original comics.
⚫ We continue to pursue media in areas other than TV dramas.
Manga artist contests

Dramatization of original titles
Oct. 2021- MBS/TBS×
Jan. 2022- TV Tokyo

Dramatizationof grand prizewinning titles

Winning titles
will bedistributed on

July 2021- WOWOW

Mecha Comic

Comic adaptations of movies and TV shows
TV Drama (Kansai Television)

TV Drama (Fuji TV)

TV Animation (TOKYO MX)

She Was Beautiful

SUPER RICH

Puraore! ～PRIDE OF ORANGE ～Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

21

Oct. 2020- MBS/TBS Mar. 2021- MBS

E-ComicMarket Growth Outlook for the Current Fiscal Year

Despite the impact of pirate sites, the market continues to grow, mainly
through comic apps used by young consumers(Billion yen)

158.4

126.6

93.6

100.0

2017

Apps

2014

2015

Copyright © 202２ INFOCOM CORPORATION. All rights reserved.

2018

INFOCOM
Forecast
Impress
Forecast*

7.7％

E-book Business Research Report 2021

Web

2019

10.5％

*Impress Corporation

0.0

2013

FY03/23 Growth

407.7

379.7

347.3
282.1 65.2

351.6

2016

200.0

282.6
235.6 47.0

224.1
198.1 26.0

300.0

197.6

400.0

455.8
104.2

511.5
137.6

500.0

550.9
163.9

600.0

2020

22

2021

2022

E-Comic

Strategies to Return to Growth(Billion yen)

1. Optimal use of advertising and marketing

50

・Web ⇒ Acquire members in the 30s and 40s age groups
・App ⇒ Try new ways to appeal to young people (20s age group)

40

・Appeal to sense of bargain pricing through free content andmembership points
・Engage in selection and concentration for content investments30

2. Cultivate growth businesses
・Growth of the Mecha Comic app business

20

・Growth of Peanutoon in South Korea
・Begin distribution of Mecha Comic app in the U.S.
10

3. Business field expansion

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

23

2022

2021

2020

2019

2018

2017

2015

・Expand business domains to peripheral markets andoverseas

2016

0・M&A or alliances with other companies in the same
industry, other publishing companies

E-Comic

Optimal Use of Advertising and Marketing

Implement measures according to customer status to activate andencourage regular use, leading to loyal customers
Measures to promotetraffic to the site

Conversion to
loyal customers

On-site measures

In-house media(social media) campaigns

Heavy users
Paid
Subscribers

Convert to paid
subscribers

Bonus points forhigher-priced
options

Other advertising
Sponsorship activities

Content discountmeasures
Dramatization

Free Subscribers

Expand potential
customer base

TV adsOnline video
advertising

Searchengineoptimization

Continued-use
points campaign

Light users

Indifferent(E-book market /paper publishing market /smartphone game market)

Medium users

Web advertising

Re-enrollment
Free
Subscribers

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

24

MonthlymembershipE-Comic

Initiatives for New Business Domains

Increase app users in Japan through stronger promotions.
Transition Korean business to growth track.

Mecha Comic App⚫

Enhance original content throughincreased investment in production
Improve ad performance25

FY21-Q4

FY21-Q3

FY21-Q2

FY21-Q1

FY20-Q1

FY21-Q4

FY21-Q3

FY21-Q2

FY21-Q1

FY20-Q4

FY20-Q3

FY20-Q2

FY20-Q1

FY19-Q4

FY19-Q3

FY19-Q2

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

FY20-Q4< Peanutoon Sales><Cumulative App Downloads>

FY20-Q3⚫
⚫

⚫

Replace viewer for stronger
analytical capabilities
Implement advertising function
Expand linkage with web services

FY20-Q2⚫

PeanutoonE-Comic

Business Development (Concept)
Overseas

Content Acquisition

E-Comic Distribution

Korea

Authors

Asia(Amateur)U.S.

Authors(Pro)

Original
Comics2019～

Q3/2022～

Market Growth

Domestic
Publishers

M&A

DeeperCollaboration

Webtoon(Korea)Business Field
Expansion

Comic Adaptation

Live-action
dramasAnime

DramasNovelsCopyright © 2022 INFOCOM CORPORATION. All rights reserved.

26

Health IT Overall Strategy
4

Hospitals

Expand hospital systems inSoutheast Asia

2. Expand business in healthrelated fields
Expand sales of WELSA
health management service

Domestic

New Business Planning

3. Expand businesses innursing care-related fields

Employee

Employer

Service Domains

1. Overseas expansion

Surgery
Management

ClinicalInformation

Drug Information

Care Staff Management (CWS)3

IT! For Nursing
Care
Care Records

Care Staff
Management(CWS)

2
HealthDiagnosis
HealthAnalysis

Career Change
SupportUser✓ Solasto✓ SOMPO etc

1
Employer

Overseas

Existing Fields

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Pharmaceutical

Nursing
Management

Radiology

HealthDigital Health Connect

Expand sales of SaaS version
of CWS

4. Secure profits inexisting domains

Nursing

MedicalSales
SupportAccelerate transition toservices

Asia Healthcare
Drug Information
Clinical Information
Radiology
27

Personal
HealthServiceHealth IT Healthcare Strategy in Asia (Concept)

FY03/22

Domestic
Products for
Hospitals

Drug
Information
System(DI)

Philippines

Drug database improvement
completedIndonesia

Began building drug database
Provided system for electronic
medical records vendors
Business alliance with Docquity(Developing social media platform
for doctors in Southeast Asia)↓
Overseas
expansion

Creation of new
businesses inSoutheast Asia

FY03/23

MedicalImaging
Information
SystemIndonesia

Developing our own
products in collaboration
with local companies

Developed viewer for mobile
devices
Sales support for Terakorp

Additional investment in
Singapore-based Homage(caregiver matching company)

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Expanded sales ofdrug information
systems

Support for Homage-type services
in Japan⇒ Creation of collaboration
mechanism

28

Business creation
focusing on startup
investments

Health IT Expanding Radiology Systems BusinessIn October 2021, we expanded the scope of our business by acquiring Medical
Create Co., Ltd as a subsidiary (main customers are national hospitals)

Major ProductsRadiology Information
Management System

RiSMEC
Radiation Therapy
Management System⚫ National hospitals
68 (40% share)(1) Expanded product lineup⚫ Other hospitals
54 facilities(2) Expanded scale of sales

３mec
Radiation DoseManagement System

RiSMEC-DOSE
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Expanded market share among
national hospitals
Cross-sales of INFOCOM products

RiSMEC-RT
Medical Device
Management System

Collaboration Results

Hospitals

Hokkaido/Tohoku
17 total

Developed new sales channels(3) Improved service quality

Chugoku/Shikoku
35 total

Kanto/Koshinetsu
27 total

Kyushu/Okinawa
34 total

Tokai/Hokuriku/Kinki
8 total29

Technical capabilities, customer
supportHealth IT CWS Expansion
Nursing Care Companies

MarketEnvironment

Hospitals⚫ Overtime caps for physicians (beginning April
2024)⚫ Leverage ICT adoption enterprises and IT adoption
subsidies⚫ COVID-19-related subsidies will continue in
FY03/23⚫ Begin proof-of-concept tests to relax staffing
standards, conditional on the use of IT and robots⚫ Roughly 10% of medium-sized or larger
hospitals (200 beds or more) have adopted
work management systems

Major Measures

Smart CWS
Work-stylereform for
doctors

CWS
Care staff
management
CWS
Caregiverschedulemanagement

Help physicians reduce
working hours, expand sales

CWS for Care
Care staff
management

Expand market share bycapturing users of caregiverschedule management
Expand by offering simplified
version and leverage sales
companies

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

30⚫ Develop new sales partners⚫ Expand sales through web
marketing⚫ Develop cloud version

Evolve Into a Services-Oriented Business
Areas of Focus to Evolve Into a Services-Oriented Business for
General Enterprise Customers
Crisis management

Documentsand forms

ERP

Target SMEs

Launch newservicebusinesses

Expand to peripheral areas
Strategy(Food temperature control
IoT service)

Packaged

NEOSS

Service*October 2021 start

IoT Services

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

31Evolve Into a Services-Oriented Business

Advance Cloud Services by Building a CCoE Structure
That Leverages Alterbooth Development Technologies
Cloud Center of Excellence

Cloud development technology

Cloud Technology Promotion Office (new)Microsoft Azure Partner

Cloud development support
Establish services as quickly as
possible, reduce costs
Improve reliability, availability, andmaintainability

CWS for CareIoT services

Copyright © 2022 INFOCOM CORPORATION. All rights reserved.

Pursue company-wide use ofcloud computing
Technology sharing
Activate communications among
engineers

Train cloud engineers
Arena in which to foster clouddevelopment engineers

Engineer community

Train engineers

Cloud utilization knowledge
base

Short-term dispatch by
Alterbooth32

Becoming a services company thatdelivers new value through the co-creationof ICT and real-world businesses<Contact>

Infocom Corporation
Corporate Communications Office
TEL: +81 3 6866 3160 Email pr@infocom.co.jp
This document is provided for the purpose of providing information about the Company and its performance, not for the solicitation of investments in securities issued by the Company. In addition, because
yen figures in this document are stated in billions of yen and rounded off after the first decimal place, management indicators, year on year changes, and percentage changes are approximate. With certain
exceptions, this document is based on data as of March 31, 2022. The names of the companies, services, and products stated in this document are trademarks or registered trademarks of their respective
companies.
The opinions and forecasts included in this document are judgments of the Company as of the date this document was prepared. The Company does not guarantee the accuracy or completeness of
information contained herein, which might change as new data becomes available.
Copyright © 2022 INFOCOM CORPORATION. All rights reserved.