Presentation Material:
Announcement of FY2007
Interim Results
November 21, 2007

Cleanup Corporation
Tokyo Stock Exchange, 1st Section, Code 7955
0

I. Interim Results Outline

1

Ⅰ． Interim Results Outline

1. Outline of Consolidated Results for Interim Period Ended September 2007
(Unit: millions of yen)

2007/92007/9(Initial Plan)(Revised Plan)△6.4％

59,50056,600

△3.3％

1,833

－- ％

1,000

△900

－ ％

△352

1,737

△0.0％
－ ％

900

△1,000

－ ％

△740

881

＋0.0％
－ ％

260

△1,400－ ％Interim Net Income△15.15 yen
Per Share

18.03 yen－ ％5.32yen△28.64 yen－ ％2007/92006/9(Actual Results)(Actual Results)

Net Sales

54,75958,474

Operating Income△306

Ordinary Profit

Interim
Net Income

Change From
Prev. Period＊Initial Plan: Announced May 8, 2007
＊Revised Plan: Announced July 26, 2007

Compared
To Revised Plan

2

Ⅰ． Interim Results Outline

2. Consolidated Profits ① Net Sales, Gross Profit(Billions of yen)

【Increased/Decreased Values (Rates)】【Main Increase/Decrease Factors】

Net Sales● System Kitchens△3,530 million yen
SS △1,790 million yen
CLEANLADY △850 million yen● System Bathrooms＋140 million yen
Aqulia＋620 million yen L-Bath △480 million yen

58.47
54.75

△3.71 billion yen
37.74

35.80

（64.6）（65.4）

Cost of Sales△1.94 billion yen
Cost of Sales Ratio

＋0.8％
20.72

18.95

（35.4）（34.6）

Gross Profit△1.77 billion yen●Reduction Due to Reduced Earnings△2,390 million yen●Increase Due to Increased Cost of Sales Ratio＋450 million yen● Worsening Kitchen Section Product Mix(Large SS reductions)＋0.3 points●ﾟIncrease in Aqulia Cost of Sales Ratio ＋0.5 points●Decrease in Kitchen Section Distribution Ratio＋0.2 points●Cost Decrease△0.3 points
Increases in cost of raw materials absorbed byproduct price increases●Reduction Due to Reduced Earnings△1,320 million yen●Decrease in Gross Profit Ratio△450 million yen

3Ⅰ． Interim Results Outline

2. Consolidated Profits ② SGA Expenses, Operating Income(Billions of yen)
【Increased/Decreased Values (Rates)】

20.72
18.95

Gross Profit△1.77 billion yen【 Main Increase/Decrease Factors 】● Sales Expenses (New product promotion)＋380 million yen● Distribution Expenses

SGA Expenses
18.89

19.25

（32.3）（35.2）+0.36 billion yen△280 million yen●Renovation Expenses (Showrooms)＋140 million yen●Depreciation Expenses＋60 million yen

SGA Ratio● Sales Expenses＋0.9 points＋2.9％● Personnel Expenses＋0.9 points●Renovation・Depreciation Expenses ＋0.5 points

1.83

△0.30

（3.1）

（△0.6）

Operating Income●Change in Gross Profit△1,770 million yen●Change in SGA Expenses△360 million yen△2.13 billion yen
4Ⅰ．中間決算の概要

3. Sales Composition ① By Segment (Consolidated)
122,781(Millions of yen)

4,394

120,000

3.6％

Other

4,591
4,485

Bathtubs & Washstands
Kitchin Equipment

100,000

114,200

20,28816.5％【2007/9】

118,200
3.9％

3.9％

20,70920,267

17.5％

17.8％

Other

4.1％

Bathtubs &19.9％
Washstands
Kitchen Equipment

80,00076.0％～
58,4742,071

60,00010,74854,7592,260
10,88198,09879.9％

89,44878.3％

40,00045,654

92,90078.6％【2006/9】
Other 3.5％
Bathtubs &18.4％
Washstands

41,61820,000Kitchen Equipment
0

78.1％

2006/9 2007/9 2007/3 2008/3 2008/3(Current Interim Period)（Term-End Forecast）＊Forecasts for the current period represent a range of values and should be considered only as a general guide.

5

Ⅰ． Interim Results Outline

3. Sales Composition ② By Sales Route (Non-Consolidated)
Direct-Sales(Condominium owners)【Full-Term Base】

Housing Constructors

9.0％
General Routes(Construction Contractors Home Renovation)

16.2％

10.2％

11.6％

11.3％
16.9％

18.1％

17.7％

～

【First-Half Base】
4.9％
15.9％

6.3％
17.5％

6.4％
18.1％

79.2％

76.2％

75.5％

74.8％

72.9％

71.0％

70.3％

0

0

2005/92006/92007/9(Current Interim Period)

2006/3

2007/3

2008/3

2008/3（Term-End Forecast）＊Forecasts for the current period represent a range of values andshould be considered only as a general guide.

6

Ⅰ． Interim Results Outline

4. Consolidated Balance Sheet Summary – 1/2(Billions of yen)

【Increased/Decreased Values】【 Main Increase/Decrease Factors 】【Assets】
88.51

86.95

84.27

Total Assets● Current Assets△3,250 million yen● Fixed Assets＋570 million yen△2.67 billion yen
Current Assets● Cash and Deposits
Cash and Deposits Notes
and Accounts Receivable△1,010 million yen● Notes and Accounts Receivable△4,630 million yen△5.64 billion yen● Increase in Direct-Sales Inventory(For Apartments)

Inventory＋1.65 billion yen
Other Current Assets● Securities (Increase in CP)＋790 million yen＋0.73 billion yen
Fixed Assets+0.57 billion yen●Tangible Fixed Assets (New Product
Equipment)＋700 million yen●Intangible Fixed Assets (Software)△180 million yen

7Ⅰ． Interim Results Outline

4. Consolidated Balance Sheet Summary – 2/2(Billions of yen)

【 Increased/Decreased Values 】【Liabilities･Minority Interests・Assets】

88.51

86.95

【 Main Increase/Decrease Factors 】● Accounts Payable

84.27● Short-Term Debt
Current Liabilities△330 million yen△1,500 million yen● Income Taxes Payable△690 million yen● Advance Receipts＋670 million yen△1.87billion yen
Long-Term Liabilities
Minority
Interests+0.72billion yen● Long-Term Debt

＋1,060 million yen● Long-Term Unpaid Obligations △400 million yen

Total Assets△1.52billion yen● Retained Earnings△1,220 million yen● Unrealized Gain on Securities △290 million yen

8Ⅰ． Interim Results Outline

5. Consolidated Cash Flow Statement Summary(Billions of yen)

16.63

Compared to Year-End Balance△0.21（2007/3）

＋0.07

△0.99

2006/9＋1.10
2007/99Ⅰ． Interim Results Outline

6．Capital Investments (Consolidated)(Billions of yen)

【FY2007 Major Capital Investment Details】

6.00

R&D Costs

First-Half Results

5.20

Capital Investment① Dies for New Products

Deprecation Costs② Equipment for New Products 430 million yen
4.00

4.00

0.00

Second-Half Plans

1.92

1.74

410 million yen

3.35

3.21

2.00

③ Showroom Renovations, etc. 210 million yen④ Information Investment

3.59

680 million yen

1.51

1.38

0.68

0.73

2006/92007/9(Current Interim Period)

2007/3

1.40①Production-Related

620 million yen②Operations-Related

730 million yen③Information-Related

490 million yen

2008/3（Term-End Forecast）

10

Ⅰ． Interim Results Outline

7. Outline of Non-Consolidated Results For Interim Period Ended September 2007
(Unit: millions of yen)

2007/92007/9(Initial Plan)(Revised Plan)△6.8％

57,70055,000

△3.4％

1,505

－ ％

780

△1,000

－ ％

△148

1,584

－ ％

1,000

△800

－ ％

△498

833

－ ％

450

△1,200－ ％Interim Net Income△10.19 yen
Per Share

17.05 yen－ ％9.21 yen△24.55 yen－ ％2007/92006/9(Actual Results)(Actual Results)

Net Sales

53,14957,017

Operating Income△479

Ordinary Profit

Interim
Net Income

Change From
Prev. Period＊Initial Plan: Announced May 8, 2007
＊Revised Plan: Announced July 26, 2007

Compared
To Revised Plan

11

Ⅰ． Interim Results Outline

8. Non-Consolidated Sales Composition By Segment(Millions of yen)

119,582

120,000

Other

9,292

Industrial Kitchen Equipment

1,834
5,093

Washstands
100,000

7.8％
1.5％
4.3％

15,197Bathrooms

12.7％

Kitchen Equipment

111,000

115,000

8.1％

9,003

1,810 1.6％
4,990 4.5％

9,321

8.1％

1,819
5,081

1.6％
4.4％

15,62815,277

13.6％

13.8％
80,000

3,421
2,418

8,330

827

3,354
2,419

Bathrooms

71.7％【2006/9】

8,463

88,16773.7％

79,92083,151
72.3％

Industrial
KitchenEquipment 1.5％
Washstands 4.2％

38,10914.6％
0KitchenEquipment

15.9％

805

72.0％

42,022

6.3％

53,14940,00020,000Washstands 4.6％

Other

～

57,01760,000【2007/9】

Industrial
KitchenEquipment 1.5％

Bathrooms

Other

6.0％
KitchenEquipment

73.7％

2006/9 2007/9 2007/3 2008/3 2008/3(Current Interim Period)（Term-End Forecast）＊Forecasts for the current period represent a range of values and should be considered only as a general guide.

12

Ⅰ． Interim Results Outline

9. Sales Results For Major Products and Cleanup Market Share - 1/4
Complete System Kitchen Sales Results(Billions ofyen)

Demand Trends and Market Share(Thousandsof sets)(Thousandsof sets)

（％）

35.3
◆

87

Current Interim Period(Planned)(Current Interim Period)13

Ⅰ． Interim Results Outline

9. Sales Results For Major Products and Cleanup Market Share - 2/4
Sectional System Kitchen Sales Results(Billions ofyen)(Thousandsof sets)

Demand Trends and Market Share(Thousandsof sets)

（％）

2.8
◆

33
Current Interim Period(Planned)(Current Interim Period)

14

Ⅰ． Interim Results Outline

9. Sales Results For Major Products and Cleanup Market Share - 3/4
Modular System Bathroom Sales Results(Billions ofyen)(Thousandsof sets)

Demand Trends and Market Share(Thousandsof sets)

（％）

8.2
◆

17

Current Interim Period(Planned)(Current Interim Period)

Note: Total number of companies increased from 11 to 15 in FY2005

15

Ⅰ． Interim Results Outline

9. Sales Results For Major Products and Cleanup Market Share - 4/4
Washstands/Vanities

Demand Trends and Market Share

(Billions ofyen)(Thousandsof sets)(Thousandsof sets)

（％）

2.4
◆

43

Current Interim Period(Planned)(Current Interim Period)16

Ⅰ． Interim Results Outline

10. Showrooms And Visitor Numbers(Locations)(Thousands of groups)

Prev. Interim Period
225 thousand groups
Current Interim Period
233 thousand groups(+3.5%)

Current Interim
Period109 locations(Planned)17

Ⅰ． Interim Results Outline

11. Forecast Consolidated Results For The Period Ending March 2008
(Unit: millions of yen)

2007/3

2008/3

2008/3(Actual Results)(Initial Plan)(Term-End Forecast)

Net Sales

122,781

126,500

Operating
Income4,139

Operating Margin

Change From
Prev. Period

Compared
To Plan

114,200～118,200

△7.0～
△3.7％

△9.7～
△6.6％

3,400

△800～380

－ ％

－ ％

3.4％

2.7％

△0.7～0.3％--

Ordinary
Profit

3,962

3,200

△900～300－ ％－ ％Ordinary Profit
Margin3.2％

2.5％△0.8～0.3％--

Current Period
Net Income

1,865

1,400

△1,800～△600

－ ％

－ ％

Current Period
Return on Revenues

1.5％

1.1％

△1.8～△0.5％-

18

Ⅰ． Interim Results Outline

12. Forecast Non-Consolidated Results For The Period Ending March 2008
(Unit: millions of yen)

2007/3

2008/3

2008/3(Actual Results)(Initial Plan)(Term-End Forecast)

Net Sales

119,582

123,000

Operating
Income3,211

Operating Margin

Change From
Prev. Period

Compared
To Plan

111,000～115,000

△7.2～
△3.8％

△9.8～
△6.5％

2,700

△1,050～80

－ ％

－ ％

2.7％

2.2％

△0.9～0.1％--

Ordinary
Profit

3,255

2,850

△800～330－ ％－ ％Ordinary Profit
Margin2.7％

2.3％△0.7～0.3％--

Current Period
Net Income

1, 4381,300△1,600～△370

－ ％

－ ％

Current Period
Return on Revenues

1.2％

1.1％

△1.4～△0.3％-

19

Ⅱ．Medium-Term Strategy Progress

20

Ⅱ．Medium-Term Strategy Progress

1. Basic Business Policy & Strategy
OperatingGoal

Growing from a simple home equipment manufacturer
to a “creator of home living space services”

Important
TargetIndices

Concentrating on sales of value-added products, increasing
our brand strength as an exclusive manufacturer andimproving our earning rate (ordinary profit margin)

Basic
Strategy

Construction of a life-cycle support system

Aiming for medium/long-term growth byconquering the renovation market
Cleanup’s medium/long-term strategy will continue to adhere
to this basic policy.
21

Ⅱ．Medium-Term Strategy Progress

2. Market Conditions
June 20, 2007
Revised Building Standards
Law Enforcement（Thousands of Homes）

2006【Revised Building Standards Law】
Stringent construction verification
to prevent reoccurrenceof falsified earthquake prevention
measures

（％）

2007

＊Source: MLIT

●Decreased number of applications and increasingly long review period(Large delays for 3-story houses/apartments buildings, in particular)●A construction verification application is necessary for renovations
greater than 10 ㎡, likely responsible for the reduced renovation demand●Time is needed before the market will recover from the current conditions

22

Ⅱ．Medium-Term Strategy Progress

3. Important Future Policies

Aiming to be the No. 1 kitchen company
in terms of both quality and scale.
【Keywords】
Product Strategy

Lifestyle Satisfaction Proposals
Developing strategic
marketing basedon this concept.

Showroom Strategy
Channel Strategy
Customer Service Strategy

Pursue marketing strategies that will reverberate withsegments seeking to improve their quality of life.
23

Ⅱ．Medium-Term Strategy Progress

4. Product Strategy-1/3

New Brand/Concept for Kitchen Creation

Happiness That Fosters Taste‘Creating Food’ ‘Eating Deliciously’ ‘Families Coming Together’
Reconsidering the past roles of the kitchen…

Complete Redesign of “S. S.” and “Clean Lady”(Both on sale September 3)
24

Ⅱ．Medium-Term Strategy Progress

4. Product Strategy-2/3

S. S.

Theme: ‘Happiness Creating Food’【Target User】●Very particular about food and even more particular about their interests.
●Baby boomers who have finished raising children, double income baby boomers, DINKS

Slow Enjoyment●Work table●Corner pantry●Separated slim storage

Time Together●S-style Work top●Counter table●Flat drawer storage

Work Cleanly●Self-cleaning range hood
●Meister work top●Adjustable storage wagon
25

Ⅱ．Medium-Term Strategy Progress

4. Product Strategy-3/3

CLEANLADY

Theme: ‘Smiling family faces, growing every day’

【Target User】●Places importance on the family, the value of life and family communication.
●Primarily parents in their 30s and their children

Enjoying conversation…
●Swan sink
●Relaxation plan
●Cheerful plan

‘Easily concealable’●Hanging guard bar &hanging system●Vertical sliding storage

Silent, Storage Space● “Be” Silent sink
●Floor container●Silent rails
26

Ⅱ．Medium-Term Strategy Progress

5. Showroom Strategy

Creating areas for users to experience new, grand concepts【Heretofore】‘Viewing products’ was the most important【Shinjuku Showroom】● ‘Ｓ. Ｓ.’ ‘CLEANLADY’ New product displays→New space through user segmentation● Creating a new ‘Party Space’→Users can actually test out the products●Sales of kitchens goods/organic wines→Promoting showroom visits to previous
and new customers●Expansion following the Shinjuku Showroom trial●Expanding the Kobe Showroom sales corner27

Ⅱ．Medium-Term Strategy Progress

6. Channel Strategy ① ‘Water Section Workshop’ Outline●Bringing in local, popular contractors through a “membershipregistration system”.
(Registrations begin Nov. 2006)●Business development of the “Water Section Workshop” brand.

Strength ①

Strength ②

Successfully bringing in local,
popular businesses capable ofcontracting

Efficient/effective customer
development through effective use of
Cleanup business resources●Holding renovation events using
Cleanup showrooms

Building a renovation channel deeplyrooted in local regions●Backing-up proposal activities
through “Plan-Kan”, training, etc.
28

Ⅱ．Medium-Term Strategy Progress

6. Channel Strategy ② ‘Water Section Workshop’ Progress
No. of Registered‘Water Section Workshop Member Stores’(As of August 2007)

Approx.

■Changes in the No. of Registered Companies(Companies)

Current term’s
Goal of 1,200
companies is achievable

1,100 Stores

No. of Stores Holding
Renovation Seminars

750 Stores

No. ofRenovation Fairs

800 Times

No. ofMobilized Customers

6,500

Registration
BeginsNov. 2006

2006(6 month period between Apr. 2007 and Sept. 2007)

2007

2008
Planned29

Ⅱ．Medium-Term Strategy Progress

6. Channel Strategy ③ ‘Cleanup-Design Co., Ltd.’(Established November 2006)（Cleanup Design Co., Ltd.）●Capable of accepting all renovation requests, including
kitchen/bathroom-related.
●Backing-up the activities of registered “Water Section
Workshop” businesses with accumulated know-how.

●Kitchen/Bathroom Renovations●“Sick House” Renovations●Elderly Renovation●Disaster/Earthquake Resistance●Security Renovations●Hobby Renovations, etc.

Primary interim achievements●Steadily creating information resources such as showrooms,
the Cleanup homepage and specialist magazines.
●Creating a support step for the “Water Section Workshop” based on
our accumulation of detailed response results.
●Renovating “sick houses” using the popular CS Kitchen.
30

Ⅱ．Medium-Term Strategy Progress

7. Customer Service Strategy ① “Smile 20”

20 Year Support Program

Starting “Smile 20”(From September 2007)
SocialBackground●July 1995, Product Liability Law Enacted●May 2007,、Revised Consumer Product Safety Law Enacted

The direction of societal changes toprotect consumers has become clear.

5 promises and 1 request

1
2

Continue ‘creating
solid products’.

3

Working to provide ‘helpful
information’ to improve user
lifestyles.

Pursuing a system capableof responding to ‘version
updates’, too.

4

5Working to promote ‘repairs
and replacements’, whenparts are lost, for example.

Aiming for ‘detailed support’according to the number ofyears in use.

+1

Please allow us to create a‘Customer Chart’.
→Cleanup Smile Membership

31

Ⅱ．Medium-Term Strategy Progress

7. Customer Service Strategy ② Cleanup Smile Membership

Creating “Cleanup Smile
Members”【Applicable Products】

Ｓ. Ｓ.
CLEANLADY
Aqulia Bathdelivered after Sept. 2007

Annual Fee 3,000 Yen (Inc. Tax)
＊A separate startup fee of 12,000 yen (inc. tax) is required for the CLEANLADY ・Aqulia Bath support programs.

Regular Inspection Service (Free)
5・10・15・20 Year Intervals

Spot Service
Cleaning・Version Updates・Renovations・Supply Replacements, etc. 10％ OFF

Extended Repair Warranty
A maximum of 5 years
following the start of use.

Information Provision Service
Information magazines,
notification of regular inspection
periods, service details, etc.
32

Ⅱ．Medium-Term Strategy Progress

8. Quality Management System
Cleanup subsidiary ‘Cleanup Tecno Service’,a specialist in residential equipment installation/service, acquired
ISO9001 certification in April 2007.

＋
All production facilities, including the main officeand the shipping subsidiary ‘Cleanup Logistics’
have already acquired certification.

Cleanup has realized a unified quality management system
ranging from development to production,
distribution, installation and service.
33

Ⅱ．Medium-Term Strategy Progress

9. “Creation of Home Living Space Services”
Creating lifestyle-satisfying products

Distribution【Cleanup】
DesignCreating Attractive
Products

Unified quality management system

Sales

customer
support centers.

Product
Development

Technical
Development

Showrooms are

Production

Providing lifestyle-satisfying information

Home
Renovation

Sales
Proposals【Customer Homes】
Providing Safe,
Reliable Services
Construction

RelationshipStrengthening

Maintenance

20 year support program34

Ⅱ．Medium-Term Strategy Progress

10. Second-Half Plans

１ Increasing product strength●System bathroom ‘Aqulia’●Washstand ‘Ｓ’

２ Strengthening showrooms●3 showrooms transferred to roadside locations

３

Collaboration between ‘Water Section Workshop’and influential sub-users.
●Holding renovation fairs/renovation consultation events
35

For any questions concerning investor relations,please contact:

Cleanup Corporation
Public Relations Section
Tel 03-3810-8241
Fax 03-3893-9577
URL http://www.cleanup.jp/english/index.html

36Disclaimer
This material is intended to provide information regarding FY2007
Interim Results (April 2007 ～September 2007) and does notconstitute a solicitation to invest in Cleanup Co., Ltd.-issued securities.
Furthermore, this material was created based upon data current as ofNovember 21, 2007. Opinions and forecasts contained within thismaterial were the subjective judgments of Cleanup Co., Ltd. at the timeof creation. No guarantee or promise is made as to the accuracy orcompleteness of this information. Additionally, this information is subject
to change without prior notice.

37