For the First Half of the Fiscal YearEnding September 30, 2018

Results ofOperations
Evolable Asia Corp.
TSE 1st Section : 6191
May 15, 2018

Highlights⚫ DeNA Travel, the largest Japanese OTA in overseas air tickets andforeign travel, was made a subsidiary.

⚫ Operating income: strong growth of 209% YoY, satisfactory progress overthe full-year forecast⚫ Successful results of AirTrip promotion campaign

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1

DeNA Travel was made a subsidiary

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2

Summary

1

DeNA Travel, the largest Japanese OTA in overseas air tickets
and foreign travel(*1), was acquired2Upon the above acquisition, the Company became the secondranked general OTA in the industry(*2)

3

Aim for a handling volume of 200 billion yen

4

Holding of a dynamic package system for domestic travel andforeign travel*1 According to a survey undertaken by the Company*2 According to a survey undertaken by the Company; in the Japanese general OTA industry
Copyright © Evolable Asia Corp. All Rights Reserved.

3

Summary of the Terms and Conditions of the Acquisition

Ratio of equity acquired

100%

Method of acquisition

Share transfer

Consideration for acquisition

CashTransfer price1,200 million yen

Date of basic agreement

May 14, 2018

Scheduled date of transfer

May 31, 2018 (scheduled)

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4Outline of the Company Acquired

Trade nameDeNA Travel Co., Ltd.

Foundation

July 1979

Representative

Shuhei Omi

Shareholders

DeNA Co., Ltd.

Address

Shinjuku-ku, Tokyo

Capital

100 million yen

Number of employees

260 persons (as of March 31, 2017)

Business description

Provision of travel products and services,among others

Change in transaction volume(hundred million yen)

800

625
600

502

400

200

706

123

127

162

FY08

FY09

FY10

312

344

FY12

FY13

400

216

0
FY11

FY14

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FY15

FY16

FY17
5

Summary of the Business Acquired

Business of DeNA Travel

General travel sitewith about 2,020,000 members:
DeNA Travel

DeNA Travel
Singapore corporation Giamso

DeNA Travelapps for smartphones

Number of companies
entering the contract: 1,388
Business trip for corporate
customers

General insurance centre

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arukikata.com
6

Impact on the Market

To become the second-ranked general OTA in the industry(*1)
with a handling volume of 140 billion yen in total
Aim for a handling volume of 200 billion yen
The largest OTA indomestic air tickets(*2)

The largest OTA in overseas air
tickets and foreign travel(*2)

Fiscal year ending September 30, 2018

Fiscal year ending March 31, 2018

Estimated handling volume: 70 billion

handling volume: 70 billion*1 According to a survey undertaken by the Company*2 According to a survey undertaken by the Company; in the Japanese general OTA industry
Copyright © Evolable Asia Corp. All Rights Reserved.

7

Contracts with Airlines◼ Contracts with all domestic-line carriergroups◼ Contracts directly with 37 international-line
full-service carriers

The only OTA with a certified agent contract with Japan
Airlines,* ALL NIPPON AIRWAYS, SKYMARK, Peach,Jetstar, Vanilla Air, SPRING AIRLINES, AirAsia, and Fuji
Dream Airlines

Jeju Air/ American Airlines/ Air Canada/ Air France/ Finnair/
EVA Air/ Air Busan/ Air China/ China Airlines/ Cathay
Pacific Airways/ China Southern Airlines/ Delta Air Lines/
Etihad Airways/ Hawaiian Airlines/ Juneyao Airlines/ Hong
Kong Airlines/ Korean Air Lines/ KLM Royal Dutch Airlines/
Lufthansa/ Jin Air/ Swissair/ Malaysia Airlines/ ANA (All
Nippon Airways)/ Air Macau/ Air New Zealand/ Asiana
Airlines/ Philippine Airlines/ Qatar Airways/ Air Seoul/
Scandinavian Airlines System/ Thai Airways International/
Turkish Airlines/ Scoot/ T'Way Airlines/ United Airlines/
Vietnam Airlines/ Easter Jet◼ API link with 15 international-line LCC
carriers
Jetstar Group/ AirAsia Group/ SPRING AIRLINES/ Tigerair
Taiwan/ Vanilla Air/ Scoot/ T'Way Airlines/ HK Express/
Peach* N's Enterprise Co., Ltd., a group company, has the certified agent contract.

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8

Synergies of the Acquisition

1

Expansion of sales channels and merchandise◼
◼

◼

Further increase and improvement of merchandise of the general OTA by mutually complementing the products of
Evolable Asia with strengths in domestic air tickets and the products of DeNA Travel with strengths in overseas air
tickets, foreign hotels and domestic/foreign tours
Cross-selling aimed at the customers of both companies
Members: 2,540,000 persons in total (520,000 members of AirTrip and 2,020,000 members of DeNA Travel);corporate customers for business trips: 2,661 companies in total (1,273 companies of Evolable Asia and 1,388
companies of DeNA Travel)
Increase and improvement of brand strength through the expansion of the share

Domestic
air tickets

2Overseas
air tickets

Foreign hotels

Domestic/
foreign tours

Cost reduction◼
◼
◼

Reduction of the costs for purchases through volume discounts
Reduction of the costs for development through greater efficiency in and sharing of development
Mutual complement of human resources

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9

Impact on the Business Results1

Acquisition with the funds on hand
The consideration for the acquisition of the shares was covered by the funds held by Evolable Asia, without financing by loans orequity capital, and thus there was no impact of dilution.

2

Contribution of DeNA Travel being made a subsidiary to the businessresults of the Company
Estimated contribution to the operating results for the
fiscal year ending March 31, 20193(billion yen)Transaction volume

73.5

Net sales

5.6

EBITDA

0.5

The estimates described on the left are madetentatively at the present time by the Company
based on the information obtained from DeNA
Travel and may be changed upon future close
examination.

Impact on the operating results of the Company on a consolidated basis
The impact of the acquisition on the consolidated operating results is currently being closely examined and will be disclosed assoon as it is ascertained.

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10

Financial Summary

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11

Transaction Volume as Compared to the Forecast

Handling volume: 166% year on year - sufficient pace to achieve the forecast
Actuals for the fiscal year ended September 2017

(hundred
700 million yen)

Actuals for the fiscal year ending September 2018

700

Forecast for the fiscal year ending September 2018600

forecast: 174% YoY

500
400

400

263

300

127

200
100

261

157

72

0
1Q

2Q

3Q

4Q

* According to IFRS (non-audited)
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12

Net Sales as Compared to the Forecast

Net sales: 138% year on year - sufficient pace to achieve the Forecast
Actuals for the fiscal year ended September 2017

(million yen)

Actuals for the fiscal year ending September 2018

7,050

Forecast for the fiscal year ending September 2018

7,000

Forecast: 125% YoY

6,000

5,534

5,000

3,458

4,000

2,498

3,000
2,000

3,968

1,202

1,630

1,000
0
1Q

2Q

3Q

4Q

* According to IFRS (non-audited)
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13

Operating Income as Compared to the Forecast

Operating income: 209% year on year
- satisfactory progress over the full-year forecast(million yen)

Actuals for the fiscal year ended September 2017

1,500

Forecast for the fiscal year ending September 2018

1,400

Forecast: 148% YoY

1,200

1,008

1,000

808

800

581

600
385

400
200

198

137

0
1Q

2Q

3Q

4Q

* According to IFRS (non-audited)
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14

Statement of Income

Both operating income and profit showed strong growth of over 200%
(million yen)
17.2Q

18.2Q*YoY Change

Amount% to Sales

Amount% to Sales

Handling Volume

15,794–26,363–166.9%Net Sales

2,498

100.0%

3,458

100.0%

138.4%

Gross Profit

2,101

84.1%

2,238

64.7%

106.5%

Operating Income

385

15.4%

808

23.3%

209.8%

Profit

248

9.9%

599

17.3%

241.5%* According to IFRS (non-audited)
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15

Changes in Results by Segment

Overall profit grew while promoting investment in the online travel agency business
17.2Q
Japanese GAAP

18.2Q
IFRS*

YoY
ChangeOnline Travel Agency
Business

587

15

-572

IT Offshore
Development Business

59

91

+32

Investment Business

–

951

+951

Expenses of all the businessof the Company

-261

-249

+12

Operating Income

385

808

+423

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Profits gained by the investment
business were appropriated to
growth investment for AirTrip

16

Difference from GAAP

Operating Income (million yen)

1000

Profits frominvestment(not listed)
+352

800

Amortization of
goodwill+88

Others
+10

IFRS
808

Profits frominvestment(listed)
+485

600
400

200
0
-200

J-GAAP-127
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17

Balance Sheet

Promotion of investment for growth; specifically M&A for investment andpromotional campaigns for AirTrip(million yen)
End of FY2017

18.2Q

YoY Change

Current Assets

5,158

8,075

+2,917

Cash and Deposits

2,139

3,307

+1,168Operational investment
securities

1,100

2,007

+907

Non-current Assets

2,320

3,862

+1,542

Total Assets

7,547

11,937+4,390Liabilities

4,252

7,878

+3,626

Interest-bearing Debts

1,400

4,535

+3,135Net Assets

3,294

4,059

+765

Shareholders’ Equity

2,841

3,657

+816

Equity ratio

37.6%

30.6%

-7.0

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18

Forecasts of the Operating Results for FY2018

The impact of the acquisition of DeNA Travel is currently being closely examined[Information provided before] announced on November 14, 2017;
forecasts of the operating results for FY2018
End of FY2017 IFRS

(million yen)
End of FY2018 IFRSYoY Change

Amount% to Sales

Amount% to Sales

Handling Volume

40,116–70,000–174.4%Net Sales

5,633

100.0%

7,050

100.0%

125.1%

Operating Income

1,008

17.9%

1,500

21.2%

148.8%

Profit

652

11.5%

881

12.5%

135.1%

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19

Topics

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20

AirTrip: Renewal

Addition of menus of Shinkansen (bullet trains) and menus of hotels

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21

AirTrip: Results of Branding

Increase the recognition of the brand AirTrip throughtelevision commercials and other media
Change in the popularity of AirTrip

2017/42018/4

Source: Google Trends
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22

AirTrip: Change in the Number of Members

As a result of promotional campaigns,
the number of AirTrip members increased sharply
Number of AirTrip members (ten thousand persons)

53
52
51
50
49

Launch of TV commercial in
Kanto Area

48
47
46

45

2017/122018/04
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23

Online Travel Agency Business: AirAsia

Start of system link between LCC AirAsia Japan and AirTrip

API link

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Domestic/Overseas
Air Tickets
24Online Travel Agency Business: Number of BTM Clients

The number of BTM clients increased steadily

1,097

544

572

16.1Q

16.2Q

619

16.3Q

667

16.4Q

722

17.1Q

1,152

1,207

17.4Q

18.1Q

1,273

782

17.2Q

17.3Q

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18.2Q
25

Inbound Travel Business: Wi-Fi

Destination Japan Inc. was made a subsidiary~ Wi-Fi rental business for foreign visitors ~OEMforeign visitors

MinpakuCamper rental
Outline of Destination Japan Inc.
One of the leading providers of the Wi-Fi rental service for foreign tourists
to Japan, especially for Europeans and Americans. The company is among
the pioneers that commenced the Wi-Fi rental service for foreign visitors toJapan in 2013. Its brand has been established with long-time trust and its
good reputation has spread by word of mouth.

Money
Exchange
WIFI

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26

IT Offshore Development Business: Business Progress

Steady progress, including the group companies
New orders received: 9 companies

About 900 persons

2014

2015

2016

2017

2018

Number of engineers: about 900 persons
Stable growth due to the needs forengineers in the upstream process of“Evolable Asia Solutions,” which
continued from the previous fiscal year

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and six other companies
27

Investment Businesses: Wagokoro Co., Ltd. Listed

Wagokoro Co., Ltd. the company in which Evolable Asia made an investment,
was listed

The 1st listed company in the investment business
Wagokoro is a company that provides products and services filledwith Japanese traditions, culture and arts, mainly targeting foreign
visitors to Japan, under the management philosophy of “spreading
Japanese culture to the world.” Its main business is retail withphysical stores that sell kanzashi, Japanese ornamental hairpins,
and Japanese-style umbrellas, among other items. It also provides
services for dressing up in the kimono, the Japanese traditional
dress, and kimono rental by delivery.
* Evolable Asia’s first listed company in the investment business

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28

Investment Businesses: Results of Investments

Strengthening of investment development:
32 companies; total investment amount: 1.4 billion yen* As of March 31, 2018

Aiming for an increase in corporate value
such as IPO
Returns

Investment anddevelopment

etc.
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29

Impact on the Market

To become the second-ranked general OTA in the industry(*1)
with a handling volume of 140 billion yen in total
Aim for a handling volume of 200 billion yen
The largest OTA
in domestic air tickets(*2)

The largest OTA in overseas air
tickets and foreign travel(*2)

Fiscal year ending September 30, 2018

Fiscal year ending March 31, 2018

Estimated handling volume: 70 billion

Handling volume: 70 billion*1 According to a survey undertaken by the Company*2 According to a survey undertaken by the Company; in the Japanese general OTA industry
Copyright © Evolable Asia Corp. All Rights Reserved.

30

•These materials contain forward-looking statements related to industry trends and the Company’s business development based on the Company’s current expectations, estimates, and forecasts.

•

A variety of risks and uncertainties are inherent in the assertions made in these forward-looking statements. Known and unknown risks, uncertainties, and other factors may result in differences fromthe statements included in assertions related to forward-looking statements.

•

The Company’s actual future business and operating performance may differ from the forward-looking statements contained in these materials.

•

The assertions related to forward-looking statements made in these materials are based on the best information currently available to the Company and will not update or revise any forward-looking
statements to reflect future events or conditions.

Evolable Asia Corp.
19th Fl. Atago Green Hills Mori Tower, 2-5-1 Atago, Minato-ku, Tokyo 105-6219
Phone. +81-3-3431-6191
http://www.evolableasia.com