Earnings Presentation
First Quarter, FYE December 2019
May 2019

AOI TYO Holdings Inc.

Contents
1. Summary of Consolidated Financial Results
2. Appendix - Company Profile, Stock Information, etc

11. Summary of Consolidated Financial Results

2

Financial Highlights
 Net sales remained essentially level year on year, even as (1) strict order acceptanceassociated with work-style reform and (2) experience decreasing print sales.
 Despite underperforming year on year, profits are more than 50% ahead of our firsthalf earnings forecast.
(million yen)

Q1 FY2017

Q1 FY2018Q1 FY2019

YoY Change

Progress Vs. 1HForecast

Net Sales

18,472

15,521

15,470

- 50

48.3％

Operating Income

1,820

1,092633

- 458

57.5％

Ordinary Income

1,776

1,031564

- 467

56.4％

Profit Attributable toOwners of Parent

1,016

842

263

- 579

52.6％

EBITDA

2,094

1,406990

- 415

54.1％
3

Trend of Net Sales by Quarter and Order Backlog
 Q1 net sales were even year on year.
 Order backlog as of the end of Q1 was steady, amounting to 15,912 million yen(+6.2% compared to the end of the year-ago period).
25,00021,13420,00018,472
15,521

15,47015,00015,257

15,343(million yen)
19,424

15,610FY2017

14,504FY2018FY2019Order backlog FY2017

10,00015,9125,000
0Order backlog FY2018

14,261

14,985
Q1

Order backlog FY2019
14,016

14,331
Q2

17,322

13,466
Q3

13,631

13,191Q4
4

Trends of Operating Income by Quarter Q1 operating income underperformed year on year, mainly due to (1) costs
associated with work-style reform and new system operations, and (2) lower printsales.
2,000

1,820

(million yen)

1,500

1,160

1,092

1,101 1,068

1,000633
500
0Q1539654

Q2FY2018

619

Q3FY2017

FY2019

Q45

Net Sales by Business Segment
 Video Advertising Business performance was flat year on year.
 Advertisement-related Business experienced strong orders for movies, TV dramas,and events.
 Solutions Business performance was flat year on year after excluding media sales
related to direct business with advertisers.
10,563(million yen)

10,769

2,273
1,677

2,396

Q1 FY2018

1,611
884

Video Advertising

Advertisement-relatedSolutions

Q1 FY2019

817

Overseas6Overview of Business Segments
BusinessVideo Advertising

Overview
Planning and production of TV commercials,online video, and other video
advertising

Advertisement-related

Planning and production of movies, TV dramas, and events; production of digitalcontent, promotional content, and music videos

Solutions

Solutions that answer customer issues(direct business with advertisers, video
content marketing, etc.)

Overseas

Business in Southeast Asia and other locations overseas; video production
orders received from overseas

7

Net Sales by Customer
 Sales to advertising agencies were essentially level year on year.
 The ratios of direct transactions and Other were also flat.

25.9%
Q1 FY2018

4,027

26.1%
4,050

29.7%
4,611

18.3%
2,833

* Net sales from Dentsu Inc. (non-consolidated) were 3,711 million yen, and net sales from Hakuhodo Inc.
(non-consolidated) were 3,296 million yen.

19.8%
Q1 FY2019

3,062

32.2%
4,977

28.0%
4,328

20.0%

(million yen)

Dentsu Group
Hakuhodo GroupDirect transactions
Other

3,101

* Net sales from Dentsu Inc. (non-consolidated) were 2,682 million yen, and net sales from Hakuhodo Inc.
(non-consolidated) were 3,825 million yen.

8

Net Sales by Medium(million yen)

MediumTV commercial production
Original work
Printed commercial materials

Q1 FY2018

Component
Ratio

Q1 FY2019

Component
Ratio

YoY
Change

9,639

61.3%

8,831

56.3%

- 808

8,481

54.0%

7,822

49.9%

- 659

2.5%

- 138

531

3.4%

393

628

4.0%

616

3.9%

- 12

265

1.7%

534

3.4%

269

2,692

17.1%

3,269

20.8%

577

876

5.6%

791

5.0%

- 85

Other

2,246

14.3%

2,255

14.4%

9Total

15,719100.0%

15,681100.0%- 38

OtherEntertainment contents
Digital contents
Overseas* The results are simple totals of the consolidated financial results of AOI Pro. Inc. and TYO Inc.
9

Summary of Consolidated Balance Sheet(million yen)

FY2018Q1 FY2019

Major Components

Current Assets

35,93736,948Cash and deposits (-147); notes and accounts receivable (-817);
electronically recorded monetary claims (+982); work in process(+727)

Non-current Assets

19,69319,896

Property, plant, and equipment (+28); intangible assets (-156);
investments and other assets (+331)

55,631

56,845

20,114

21,9559,837

9,374

Total Liabilities

29,951

31,330Total Net Assets

25,67925,515

Total Liabilities and Net Assets

55,631

56,845

Total Assets
Current Liabilities
Non-current Liabilities(percentage of total assets)(46.2%)(44.9%)

Accounts payable (-280); short-term loans payable (+2,754)
Long-term loans payable (-485)

Retained earnings (-263)* AOI TYO Holdings adopted Partial Amendment to Accounting Standard for Tax-Effect Accounting (ASBJ Statement No.28, February 16, 2018) as of the beginning of Q1 of the current
consolidated fiscal year.

10Initiatives in the Video Advertising Business Overall effective profit margin decreased, even as we continue to focus on cost
control over external expenditures. Negative factors included receiving orders for
major projects with low effective profit margins and a decrease in print sales.
15,000

40.0%

36.5%

10,000

34.7%

32.8%

(million yen)
35.0%
Production sales (left axis)

30.0%

12,8099,511

5,0000Q1 FY2017

525
Q1 FY2018

Effective profit margin (right axis)

9,921
25.0%

657

Print sales (left axis)

388
Q1 FY201920.0%* Effective profit margin: (net sales external expenditures)/net sales* Calculations for the TV commercial
production department only

11

Initiatives in the Solutions Business (1) Sales increased, mainly owing to an increase in orders for TV commercials,
events for new customers, etc.
Sales at the TYO Offering Management
Business Unit(million yen)

*Excluding media placement purchases

4,000

3,717

3,478

■■ Q1

3,000
2,000
1,0000■1,054

FY2017709

FY2018Full-year946

FY201912

Initiatives in the Solutions Business (2) A decrease in scope for existing major projects drove down sales year on year.
However, orders of online video production and media distribution were steady.

Sales at Quark tokyo
3,000(million yen)

2,416

2,226

■■ Q1

2,000
1,0000■973

FY2017625

FY2018Full-year

528

FY201913

Initiatives in the Overseas Business Sales were level year on year.
 In July, we plan to acquire shares to convert APRIL to an equity-method affiliate
and convert K&L-ISC to a consolidated subsidiary.
*APRIL: APRIL ADVERTISING JOINT STOCK COMPANY (Vietnamese digital creative agency)*K&L-ISC：K&L ISC(SOUTHEAST ASIA) SDN.BHD. (Malaysian advertising firm)(million yen)

8,000

Scale of sales in Overseas Businesses* Including equity-method affiliates

6,000

5,824

■■ Q1

4,439

■

4,000
2,000
0739
FY20171,329

FY2018Full-year

1,376

FY201914

2. Appendix - Company Profile, Stock Information, etc

15Company Profile
Company NameAOI TYO Holdings Inc.

Representatives

Hiroaki Yoshida, Representative Director, Chairman & CEO
Yasuhito Nakae, Representative Director, President & COO

Establishment

January 4, 2017

Capital5.0 billion yen

Fiscal Year-end

December 31

Location of Head Office

1-5-1 Osaki, Shinagawa-ku, Tokyo 141-8580, Japan+81 3-6893-5005 (main)

Securities Code3975 First Section of the Tokyo Stock ExchangeURL

http://aoityo.com/en/16Founding of AOI TYO Holdings
Comprehensive
videofollowing
production
company witha focus on
TV Pro.
commercial Foundedin January 2017,
the management
integrationof AOIand TYO.
planning and development.

*As of Mar. 31, 2019.

Consolidated subsidiaries: 35 total
Consolidated employees: 1,644

Akasaka

Shinbashi
Shinbashi

Date of establishment: Oct. 25, 1963

Date of establishment: Apr. 2, 1982

Consolidated employees: 795

Consolidated employees: 695

Osaki

Consolidated subsidiaries: 21 (including AOI Pro.)

Consolidated subsidiaries: 14 (including TYO)

17

Shareholder Return
 Dividends– Policy: 30%-plus consolidated payout ratio– FY2019: Forecast dividend of 20 yen per share
End of Q2

End of FY

Total

Dividend Payout Ratio

FY20188 yen

22 yen30 yen36.4%

FY2019 (forecast)

8 yen

12 yen20 yen36.4%

 Purchase of treasury shares
Period of Purchase

Type of Shares

Total Number of Shares
Purchased

Previous
Purchase

Jun. 1, 2018 – Jun. 7, 2018

Common Stock

400,000 shares

531 million yen(Plan) Current
Purchase

Mar. 1, 2019 – Feb. 29, 2020

Common Stock

500,000 shares

600 million yen(maximum)

Total Value of Sharespurchased(maximum)18

Shareholder Benefit Program The following shareholder benefits are provided to investors with 500 or more sharesof AOI TYO Holdings, who are listed on the share register as of June 30, 2019.

Shareholder Gifts
500 shares or more

Original Quo Card

3,000 yen

1,000 shares or more

Original Quo Card

5,000 yen

2,000 shares or more

Original Catalog

value of 10,000 yen*Original catalog allows shareholders tochoose from original products, Quo Cards,or charitable donations

Animation Studio Tour
500 shares or more (randomly selected from those who enter the draw)
Studio tour of AOI TYO Group character development and stop-motion
animation division TYO/dwarf©NHK・TYO19

Status of Stock and Shareholders (as of Dec. 31, 2018)
Number of Shares and Shareholders

Status of Large Shareholders

Total number of shares issued

24,566,447

Total number of shareholders

11,011

9.0%
15.2%
1.7%
32.0%

39.7%

12

Shareholder Composition byType of Shareholder

2.4%

Shareholder Name
The Master Trust Bank of Japan, Ltd.
(Trust Account)
Japan Trustee Services Bank, Ltd.
(Trust Account)

Number ofShares Held

Shareholding
Ratio

1,956,500

8.16%

1,890,200

7.88%

3

Cosmo Channel

1,153,740

4.81%

4

IMAGICA GROUP Inc.

1,018,000

4.25%

Individuals, etc.

5

Japan Trustee Services Bank, Ltd.
(Trust Account 9)558,200

2.33%

Financial institutions

6Fields Corporation

479,660

2.00%

Financial instrumentsbusiness operator

7475,300

1.98%

Other corporations

8418,900

1.75%

Foreign corporations,etc.

9418,000

1.74%

Treasury shares

10 Hitoshi Hara

400,000

1.67%

The Nomura Trust and Banking Co., Ltd.
(Investment Trust Account)
Trust & Custody Services Bank, Ltd.
(Trust Account E)
Japan Trustee Services Bank, Ltd.
(Trust Account 5)* The shareholding ratios are calculated by subtracting treasury shares (594,257).

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Disclaimer
This document includes future forecasts that reflect the plans and outlook of AOITYO Holdings.
The future forecasts and related descriptions are based on information available tothe company at the time of the preparation of this document, and the forecasts areaffected by the economic environment of the company’s businesses, competition, theresults of new services provided, and other factors that involve uncertainties. Pleaseacknowledge, therefore, that the actual business results may deviate significantly
from the forecasts and related information provided in this document.
In addition, the company does not have any obligation to update and publish theinformation concerning future forecasts in this document after its publication.
Please contact the following for any questions:
Financial Planning & IR Department (+81 3-3779-8415)
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