SMS CO., LTD.
(Securities Code: 2175 / TSE1 )Presentation Materials for Investor Relations
Financial Results Summary for the First Half of
the Fiscal Year Ending March 31, 2016 (the 13th Fiscal Year)

October 29, 2015

Table of Contents

1

Our Mission & Strategy

P3-P12

2

1H FY03/16 Consolidated Financial Results

P14-P213

Acquisition of MIMS Group

P23-P31

4

FAQ

P33-P61© Copyright SMS CO.,LTD.

1

1

Our Mission & Strategy

P3-P12

2

1H FY03/16 Consolidated Financial Results

P14-P213

Acquisition of MIMS Group

P23-P31

4

FAQ

P33-P61© Copyright SMS CO.,LTD.

2

1

Our Mission

We create values and contribute to society by providing an“information infrastructure for an aging society.”

SMS stands for “Senior Marketing System.”© Copyright SMS CO.,LTD.

3

1

Gaining Recognition as an Industry

 Ever since the establishment of SMS, we have believed that the “information infrastructure foran aging society” would develop into a major industry boosted by trends in the social
background.

Social Background

Emergence of a new industry

Macroeconomic trends
IT

Demographics
Social insurance system
People’s interest

Telecommunications

Education“Information
infrastructure
for anAutomobiles
aging society ”
Housing

Publishing

Information Asymmetry

Nursing care
Electronics

Medical care
Foods

etc.
© Copyright SMS CO.,LTD.

4

1

Future Image

 By providing a variety of information and services to end-users, professionals and service
operators associated to the aging society, and by organically linking those information andservices, we aim to create an ecosystem of an “information infrastructure for an aging
society.”

Current

FutureRelated-Business
Operators？
？
Travels？
Healthclubs

Welfarevehicles？

Service Operators？

Meal
deliveryEnd
Grand Users?
children

？

？

PT/OT

Facility
care

Real estates

Factoring？

Professionals？

Helpers？

Health
foods

？

？

？

？
？

Travels？

Housing

Funeral

？

？

Nursing
care

DiseaseDoctors

？

Home
care

Pharmaceutical
Dispensariescompanies

Meal
deliveryHospitals
Educationagencies？

Medicaldevices？

？

？

Real estates

？

Grand
children？

Helpers

PT/OT

Facility
care？

？
Nutritionists?

HealthcarePharmacists

Nursing
Diseasecare

Caremanagers？

Health
foods

？

？

？

？

？

？
？

Housing
WelfarevehiclesClinics

Home-visit
nursing

Healthclubs

Commodities？

NursesStudents

Communication
carriers Rehabilitation
Nursing care
goods
goods

© Copyright SMS CO.,LTD.

？

HealthcarePharmacists

Caremanagers？

Warehouses

Nutritionists？

？

Doctors

Warehouses？

？

？

Pharmaceutical
Dispensariescompanies

NursesStudents

Commodities

Clinics？

Hospitals
MedicalHome-visit
devicesnursing
Communication
Education
carriers
agencies
Rehabilitation
Nursing care ？
goods
goods

Factoring

Home
care

5

1

Market Segments

 We reclassified our market segments as nursing care, medical care, career, healthcare,senior life, and global.

Senior Life*2
Healthcare*1

Globaletc.

CareerNursing Care

Medical Care

*1 : Healthcare-related businesses which are not covered by long-term care and medical care insurances© Copyright SMS CO.,LTD. *2 : Businesses related to daily life in the aging society

6

1

SMS Basic Strategy

 Identify strategically important customers.
 Expand target customer base and build strong connections with those customers
through frequently used, “Daily-use” services.
 Develop a variety of services based on such connections, and create an ecosystem.

 Customer Base Strong Connections
Recruiting Agent

Professionals

Recruiting Ads

Certification
Course Information© Copyright SMS CO.,LTD.

Management information systems
Online communities
Information portals
Service
Operators

Information portal on
housing for seniors

New Service

End Users
New Service

7

1

Growth Scenario

 Career-related businesses will continue to grow steadily.
 Kaipoke will grow as the second pillar.
 New businesses will be developed and expanded continuously in each market segment.

③Growth of new businesses
Nursing Care, medical care, healthcare, senior life, and global②Growth of Kaipoke①Growth of career-related businessesNow© Copyright SMS CO.,LTD.

Future8

1① Growth of Career-related Businesses Aim to realize long-term and continuous growth in the career-related businesses bydeveloping an optimal organization and expanding the scope of each service.
Needs ofService Operators

Providing exhaustive
services to meet theneeds of service
operators

Enhancing competitive
advantages throughcontinuous growth centeredon recruiting agent services

Expanding scopeof services

RAG*1 forPT/OT*3

RAG*1 fornurses・Improving ES and CS
・Developing organization, humancapital management, and culture
RAD*2 fornursesRAD*2 fornursing care
professionals

Others*1 : RAG stands for Recruiting Agent

Extendingscope ofservices*2 : RAD strands for Recruiting Ads© Copyright SMS CO.,LTD. *3 : PT/OT/ stands for Physical Therapist, Occupational Therapist, respectively

Covering all medical andnursing care professionals

Needs ofProcessionals

91② Growth of Kaipoke

 Aim for a membership share of 30% and net sales of ¥10 billion*1 in FY03/21.
 Accelerate growth by enhancing communication, expanding peripheral services, and covering
new service types.

Covering new service types
Roll out management support services to
new service types such as home-visit
nursing

Expanding peripheral services

FY03/21

Expand peripheral services such as
factoring, purchasing, and consulting

Enhancing communication
Acquire new clients and promote service
use through door-to-door sales, web
advertising and call center promotions

The No.1
management support service
Membership share: 30%
Net sales: ¥10 billion*1

FY03/15
Past
Insurance claim
software© Copyright SMS CO.,LTD.

Renewal to “management
support services”
Membership share: 12%
Net sales: ¥1.5 billion*2*1: Net sales in FY03/21 are expected to be ¥10 billion, considering the
growth of existing (and projected) service types and peripheral services*2: Price was revised on October 2014 accompanying the service renewal.
The revised price was applied from the 2H of FY03/15.

101③ Growth of New Businesses - Platform - Accelerate the development, expansion and management of businesses, as well as thegeneration of synergetic effects between the businesses by making strong connections withmany service operators/professionals in the nursing and medical care fields.
42%

Nursing
Care

28%

67%

Care managers

Nurses(Com membership)
54K/130K(Com membership)
420K/1,500K(RAG registration)
100K/150K

3%/500K per monthNursing care
professionals

MedicalCare

11%Student nurses(RAD membership)
8K/70K(Com membership)
44K/1,450K(RAD site visitor)
500K/1,500K per month

10%

6%

PT/OT/ST

Pharmacists(RAG registration)
14K/140K(Com membership)
17K/280K

60%

55%
Large-sized
nursing care operators(Clients of RAD)© Copyright SMS CO.,LTD.

Hospitals
12%40%

Small and Medium-sized
home-visit nursing
care operators

Registerednutritionists(Membership)
14K/114K(Com members)
32K/80K

7%(Client hospitals of
RAG for nurses)
5.4K/8.6K

Clinics(Client clinics of
RAG for nurses)
7.1K/100K

111③ Growth of New Businesses - Nursing Care - Create and expand businesses targeting service operators through the Kaipoke platform, and

professionals through online community platforms.
Promote the development of new businesses while also expanding existing services targeting
newly excavated end user segments.

【Professionals】

Example in Nursing Care

• Create service centeredaround care managers• Promote the building of strong
connections with nursing caremanagers

Com forCare managers

Collaborate【Service Operators】• Create services forfacilities or homevisit nursing
centered around
Kaipoke© Copyright SMS CO.,LTD.

Mngt Support forsmall andmedium-sized
operators（Kaipoke）

Collaborate

Housing Infofor seniors

Home-delivered
Meal
SearchCom forFamilyCollaborate【End Users】• Develop services
related to food,clothing, andshelter, etc.

12

1

Our Mission & Strategy

P3-P12

2

1H FY03/16 Consolidated Financial Results

P14-P213

Acquisition of MIMS Group

P23-P31

4

FAQ

P33-P61© Copyright SMS CO.,LTD.

13

2Historical Financial Results and FY03/16 Forecasts

 We expect to achieve growth in both net sales and ordinary income for the 12th consecutive
year*1 since our establishment.

Trends in Net Sales (LHS) and Ordinary Income (RHS)*2(Net Sales, ¥100 million)
200(Ordinary Income, ¥100 million)
80
188.8

180

72

160

64

150.5

140

56

120.4

120

101.8

100

86.9

80

0
-20

26.9
23.4

51.7

40

27.1
3.8
0.5
0.4
(0.05)

8.3
1.0

15.4
2.6

12.3

34.0

76.1

71.7

60

20

48

12.6

15.3

17.3

19.9

40
32
24
16
8

4.1

0

第1期 FY03/05
第2期 FY03/06
第3期 FY03/07
第4期 FY03/08
第5期 FY03/09
第6期 FY03/10
第7期 FY03/11
第8期 FY03/12
第9期 FY03/13
第10期 FY03/14
第11期 FY03/15
第12期 FY03/16
第13期
FY03/04：Net Sales (in black font)*1 ：Excludes the first fiscal year

：Ordinary Income (in blue font)© Copyright SMS CO.,LTD. *2 ：Figures up to FY03/10 are on a non-consolidated basis while figures from FY03/11 are on a consolidated basis

-8

14

2

FY03/16 1H Consolidated Financial Results Both net sales and incomes significantly increased YoY.
 Both net sales and incomes were in line with forecasts.

1H FY03/16 P/L Statement (¥ million)
1H FY03/15 1H FY03/16 1H FY03/16
ActualActualForecasts

YoY
Changes

vs.
Forecasts

FY03/16
Forecasts

Net Sales

7,492

9,850

9,325

+25％

-5％

18,881

Operating
Income

1,299

1,834

1,899

+46％

+4％

2,702

Ordinary
Income

1,657

2,245

2,391

+44％

+7％

3,403

Net Income

1,295

1,537

1,602

+24％*1+4％

2,306© Copyright SMS CO.,LTD. *1: +44% YoY growth if extraordinary income from acquisition of eChannelling in Q1 FY03/15 is excluded.

15

2

Analysis of Year-on-Year Differences Kaipoke significantly contributed to an increase in net sales and incomes.

Year-on-Year Differences and Analysis(¥ million)
1H
1H
FY03/16
ActualFY03/15
ActualDifferences

Net Sales

9,325

7,492

+1,832

Operating
Income

1,899

1,299

+600

Ordinary
Income

2,391

1,657

+734

Net
Income© Copyright SMS CO.,LTD.

1,602

1,295

+306

Analysis•

Almost all services, including Kaipoke andcareer-related services, increased YoY•

Kaipoke became profitable and increased
significantly YoY•

Gains from M3 Career, an affiliated company,
increased YoY•

Increased 44% YoY if extraordinary income(185M) form acquisition of eChannelling in
1H FY03/15 is excluded16

2

Analysis of Differences between Actual Results and Forecasts

 Net sales were below forecasts, but incomes were above forecasts.

Differences between Actual Results and Forecasts (¥ million)
1H
FY03/16
Actual1H
FY03/16
Forecasts

Differences

Analysis•

Net Sales

9,325

9,850

-524

Operating
Income

1,899

1,834

+64

Ordinary
Income

2,391

2,245

+146

Net
Income

1,602

1,537

+65

© Copyright SMS CO.,LTD. *1: Consultants for recruiting agent services were recruited as planned.

•

Net sales for recruiting agent services were
below forecasts
Other services including Kaipoke increased
steadily•

Costs were below forecasts due to:- cost-cutting from reviewing measures- delays in recruiting*1•

Gains from M3 Career, an affiliated company,
were above forecasts

ー
17

2

Career Segment (1H)

 Net sales up 12% YoY
 Almost all services increased steadily.
Year-on-Year Comparison of Net Sales(¥ million)_

Nursing
Care

MedicalCare

1H FY03/15

1H FY03/16

YoY Change

Recruiting Agent

624

785

+26％

Media

705

865

+23％

Recruiting Agent

4,416

4,790

+9％

Media

480

547

+14％

6,227

6,989

+12％

Total

Highlights• In existing recruiting agent services, new consultants contributed to an increase in net sales Recruiting agent for nurses：# of consultants on average: 265 in 1H FY03/15 to 290 in 1H FY03/16• Recruiting agent for paramedics, excluding nurses, increased steadily• Recruiting ads for both nursing care professionals and nurses increased steadily© Copyright SMS CO.,LTD.

18

2

Nursing Care Segment (1H)

 Net sales up 170% YoY change Kaipoke increased significantly in line with the scenario established for changing the service
concept.

Year-on-Year Comparison of Net Sales(¥ million)_

1H FY03/15

1H FY03/16

YoY Change

Mngt Support
forService
Operators

359

1,211

+237%

New
Businesses

154

175

+14%

Total

514

1,387

+170%

Highlights• Management Support for Service Operators increased significantly owing to Kaipoke’s price revision associated withrenewal of management support services (applied from the 2H of FY03/15)• In new businesses, the information portal of housing for seniors and the home-delivered meal search site increased
steadily© Copyright SMS CO.,LTD.

19

2

Kaipoke The number of memberships increased steadily in line with FY03/16 targets.
 The upward trend in memberships is solid and net increase of memberships is also expanding.

Membership

Actions to Achieve the Target• The number of memberships has been increasing since
March, when the trend turned into a net increase, reaching
10,850 as of October 1• Reinforcing door-to-door sales team
 Increased offices and sales staff in Q1 andsteadily reinforced sales activities【Trend of Membership】• Covering new service types
 Launched management support services for“home-vising nursing” in June Scheduled to launch services for “outpatient
rehabilitation” and “residence for elderly people
with services” in November

12,000(as of March 1, 2016）

10,850(as of Oct. 1, 2015）

11,20010,600(as of July 1, 2015）

10,50010,400(as of April 1, 2015）

2014
Oct.

2015
Jan.

© Copyright SMS CO.,LTD.

2015
Apr.

2015
July

2015
Oct.

・・・ 2016
Mar.

• Strengthened sales to nursing care operators who own
offices in multiple locations
 Especially approaching medium-sized nursing
care operators and franchisers Added management function to manage offices in
multiple locations- Currently negotiating with several franchisers,
each owning offices in dozens of locations, andexpecting to win contracts20

2

Medical Care, Healthcare and Global Segments (1H)

 Developed a variety of new services in Medical Care, Healthcare, and Global segments.

Year-on-Year Comparison of Net Sales(¥ million)

1H FY03/15

1H FY03/16

YoY Change

Medical Care

422

365

-14％

Healthcare

12

50

+314％

Global

316

533

+69％

GlobalHealthcare

MedicalCare

Highlights• Net sales of “Mail order/online sales of nursing goods” decreased YoY, but profitability improved by discontinuing
catalog sales and focusing on online sales• The number of memberships of information portals for hospital office managers increased, and Aikon, a support
service for purchasing was launched• Developing services based on specific segments/themes, such as dementia• Net sales increased YoY mainly in Taiwan and Australia© Copyright SMS CO.,LTD.

21

1

Our Mission & Strategy

P3-P12

2

1H FY03/16 Consolidated Financial Results

P14-P213

Acquisition of MIMS Group

P23-P31

4

FAQ

P33-P61© Copyright SMS CO.,LTD.

22

3MIMS Group Profile

MIMS Group
Global Coverage

MIMS Group

Founded1963

Net Sales

US$47.4 million in FY12/2014

Employees

468（as of December 2014）

Business
Description

Providing drug information

Singapore, China, Hong Kong,
South Korea, India, Indonesia,
Global Coverage Philippines, Thailand, Malaysia,
Vietnam, Myanmar, Australia and
New Zealand
Number ofmemberships© Copyright SMS CO.,LTD.

Approx. 1.7 million memberships(including 0.4 million doctors)

23

3

Overview of the Acquisition

Overview

Investment Structure

SMS
60%

MIMSGroup

MIMS Pte.
Ltd.
（Singapore）

Mitsui & Co.,Ltd.

© Copyright SMS CO.,LTD.

US$250 million

Investment
Ratio

SMS 60％, Mitsui & Co., Ltd. 40％

40%

Medica Asia (Holdco)
Limited（U.K）

MIMS(Hong Kong)
Limited（Hong Kong）

Acquisition
Price

MIMS
Medica Sdn
Bhd(Malaysia)

The Date of theOctober 7, 2015
Share Transfer

・・・

Company fromwhich Shareswere Acquired

AXIO Data Hedgeco Limited(subsidiary of Electra Private Equity PLC
headquartered in the U.K. )24

3

MIMS Group Business ① Pharma Marketing The Pharma Marketing Business provides healthcare professionals with a drug databasewhich sort and summarize drug information provided by pharmaceutical companies. andwhich can be accessed through various media. The database is a de facto standard in
the industry.
 It also provides marketing support to healthcare professionals at pharmaceuticalcompanies by delivering medical news and educational contents, and managing events.
Business ModelMedia for Accessing Database
Pharmaceutical
Companies

Healthcare Professionals(e.g., doctors, nurses,
pharmacists）

1.7 million

・Post drug information on
database

Pay postingfee

・Provides access to drug
database
・Provides medical news andeducational contents
Healthcare Professionals(e.g., doctors, nurses,
pharmacists)

Service Provision Area
Singapore, China, Hong Kong, South Korea, India,
Indonesia, Malaysia, Philippines, Thailand, Myanmar
and Vietnam© Copyright SMS CO.,LTD.

OnlinePrinted publications
Mobile applications
Mail magazines
Social media etc.
Pharmaceutical
Companies

・Post drug information
on database25

3MIMS Group Business ② Healthcare Data

 The Heathcare Data Business provides a drug database to healthcare institutions andcovers over 50% of all hospitals, clinics and pharmacies in Australia and New Zealand.
 In addition to being offered as a stand-alone system, the database can also be
integrated into core systems such as hospital information systems, clinic prescription
systems and pharmacy dispensing systems.
Business ModelMedia for Accessing Database＜Drug Database＞

Pay usage
fee

・Provides access to drug
database・Database can be
integrated into coresystems of healthcare
institutions
Healthcare Institutions(e.g., hospitals, clinics,
pharmacies)＜Integrating into Core System＞

Service Provision Area
Australia, New Zealand, South Korea and Singapore© Copyright SMS CO.,LTD.

Core systems of hospitals and pharmacies 26

3Strengths of MIMS Group Strengths of MIMS Group include its overwhelming brand value in the region, its strong
membership base of healthcare professionals, and its business relationships withpharmaceutical companies.

1. Overwhelming Brand Value

 50 years of history
 Utilized by healthcare institutions/professionals to get drug information
on a daily basis

Healthcare
Professionals
1.7million

Pharmaceutical
Companies

2. Strong Membership Baseof Healthcare Professionals

3. Business Relationships
with Pharmaceutical Companies

 Healthcare professional memberships approx. 1.7 million- Including approx. 0.4 million doctors
 More than 80% of all doctors are registered in Singaporeand Hong Kong, etc.
© Copyright SMS CO.,LTD.

 Almost all patented drug makers in the region post
information of their drugs on MIMS’s database27

3MIMS Group’s Role in SMS’s Strategy

 MIMS Group plays an important role in our company-wide strategy.
 MIMS Group will be the pivotal player of our strategy in Asia.

MIMS Group’s Role in SMS’s Strategy
In Japan, we are developing and expanding various
businesses based on daily-use platforms such ascommunity sites.
Through this acquisition, we obtained a solid platform
for accelerating business in Asia as well.

Countries where SMS and MIMS Group Operate
The two companies operate mostly in the same countries.
MIMS Group’s platform can be utilized to expand ourbusinesses.

Business

Business：SMS and MIMS
：SMS
：MIMS

PlatformBusiness© Copyright SMS CO.,LTD.

Business28

3Strengths of SMS and Mitsui Both SMS’s expertise in developing and operating various information services and
Mitsui’s network will serve to reinforce MIMS’s strength, enabling MIMS Group to
expand its existing businesses and develop new ones.
Management Support Services

Career-related Services

Overwhelming
Brand Value

Online Communities© Copyright SMS CO.,LTD.

Business
Relationships
with Pharmaceutical
Companies

StrongMembership Baseof Healthcare
Professionals

Mitsui
Medical/Healthcare Network29

3MIMS Growth Strategy

Pharmaceutical Field

Clinic Field

Marketing Support for
Pharmaceutical Companies

Management Support for
ClinicsMR
educationcompanies

SFA
vendors

Marketresearch

Medicaldevicevendors

Sales
promotion
supportcompanies

Purchasing
Attracting
new patients

Phase 4
PharmaDB

R&D

Medicalprescription
Medicalrecords

CRO
CSO

Medicine
wholesalers

Privatepractice
supportCMS(Clinic
Management
System)PharmaHealthcare
ceuticalProfessionals
companiesMR
digitization

SMO

Sales &
Marketing

Patient
management

e-detailing

Pharmaresearchcompanies

Document
management

Clinical trial
recruitment
Multinational
clinical trial

Education

MIMS businessBusiness of associated organization/partner© Copyright SMS CO.,LTD.

Consulting
firms

Medication
managementcompanies

Education
supportcompanies

Financing

CareersupportFinancial
institutions

CIS(Clinic
Information
System)Recruiting
agencies30

3Market Potential in Asia

 Total medical expenses in countries where MIMS Group operates are currently 2.3
times that of Japan.
 Owing to improvements in insurance systems and economic growth, the amount of
medical expenses are increasing faster than Japan. Hence, Asia is a promising market
for medical/healthcare information infrastructure.
Medical Expenses in Japan and Other Asian Countries (2013)*1
Other Asian Countries where MIMS Group Operates*2

Japan

Total:¥48 trillion
2013

Other Asian Countries:
x2.3 of Japan2013¥9 trillionMedical expenses:¥39 trillion

2013
Medical expenses:¥112 trillion

Nursing care expenses

approx. +15％
2008
2008
Medical expenses:¥7 trillion¥35 trillion

2008
Medical expenses:¥58 trillion© Copyright SMS CO.,LTD. *1：Source: Japan: Ministry of Health, Labor and Welfare(MHLW) / Asia: WHOapprox. x2

31*2: including Australia and New Zealand1

Our Mission & Strategy

P3-P12

2

1H FY03/16 Consolidated Financial Results

P14-P213

Acquisition of MIMS Group

P23-P31

4

FAQ

P33-P61© Copyright SMS CO.,LTD.

32

4-1

Corporate Overview*1

CompanyName

SMS CO., LTD.

FoundedApril 4, 2003 (Currently the 13th Fiscal Year ending March 31, 2016)

Location

5 offices in Japan (SMS Career CO., LTD. : 15 offices in Japan)

Board ofDirectors

CEO: Natsuki Goto *2
Directors: Hajime Kawaguchi, Tsutomu Nobunaga and Tadaharu Goto (Outside)
Audit & Supervisory Board Members: Yukio Hosono (Outside), Tomoki Matsubayashi and Takaya Yano
(Outside)

Stock
MarketFirst Section of the Tokyo Stock Exchange (Securities Code: 2175)(SMS stands for Senior Marketing System)■Domestic Subsidiaries
・SMS Career CO., LTD.
・Pure Nurse Co., Ltd.
・SMS Support Service Co., Ltd.
・SMS Financial Service Co., Ltd.
・SMS Medicare Service Co., Ltd.
・EIR Co., Ltd.

AssociatedCompanies*3(24 companies)■Affiliated Companies
・M3 Career, Inc. [Japan]
・QLife [Japan]
・Luvina Software Joint Stock Company[Vietnam]■Overseas Subsidiaries
・SENIOR MARKETING SYSTEM ASIA PTE. LTD.
[Singapore]
・SMS Beijing CO., LTD.
・SMS Shanghai CO., LTD.
・Senior Marketing System Korea Co,.Ltd.
（renamed from NURSCAPE CO., LTD）
・SMS Taiwan CO., LTD・iHealth [Taiwan]
・SMS VIETNAM CO., LTD.
・SENIOR MARKETING SYSTEM (THAILAND) CO., LTD.
・SENIOR MARKETING SYSTEM SDN.BHD.[Malaysia]
・Centium Software Sdn Bhd[Malaysia]
・SMS PHILIPPINES HEALTHCARE SOLUTIONS INC.
・PT. SENIOR MARKETING SYSTEM INDONESIA・EHEALTHWISE SERVICES PTY LTD [Australia]
・eChannelling PLC [Sri Lanka]
・Wadoc Pte. Ltd. [Singapore]© Copyright SMS CO.,LTD. *1: As of end of Sep. 2015 *2: Natsuki Goto was inaugurated on April 1, 2014 (predecessor was Shuhei Morofuji) *3: Consolidated companies only

33

4-1

Historical Financial Results*1(¥ million)
FY03/04

FY03/05

FY03/06

FY03/07

FY03/08

FY03/09

FY03/10

FY03/11

FY03/12

FY03/13

FY03/14

FY03/15Net Sales

58

383

835

1,545

2,715

5,177

7,172

7,618

8,692

10,181

12,046

15,056

Cost of Sales

0

5

20

38

77

149

375

319

431

700

952

1,332

SG&A Expenses

63

326

705

1,237

2,211

3,796

5,534

5,818

6,740

7,910

9,363

11,644

Operating Income

(5)

52

109

269

426

1,230

1,261

1,480

1,519

1,570

1,730

2,079

Ordinary Income

(5)

49

108

269

415

1,238

1,266

1,530

1,734

1,990

2,340

2,693

Net Income

(5)

31

63

157

244

719

717

876

1,004

1,226

1,380

1,824

Total Assets

59

357

566

1,016

1,806

3,118

3,645

4,672

5,716

6,948

8,406

11,421

Liabilities

55

166

196

489

822

1,410

1,266

1,430

1,579

1,794

2,331

4,497

Net Assets

4

190

369

527

983

1,708

2,379

3,242

4,136

5,153

6,074

6,923

7.5

53.3

65.3

51.9

54.4

54.8

65.2

69.2

72.3

74.1

71.5

59.7

ROE (%)-124.9

31.8

22.8

35.1

32.3

53.4

35.1

31.2

27.3

26.4

24.7

28.4

DPS (¥) *2

-

-

-

-

-

1.25

1.25

2.5

3

4

5

７

Dividend Payout
Ratio(%)

-

-

-

-

-

6.8

6.8

11.6

12.3

13.6

14.8

15.6

Equity Ratio (%)© Copyright SMS CO.,LTD. *1: As of March 31, 2015

*2: Conducted a 2-for-1 stock spilt on January 1, 2015. DPS is recalculated accordingly.

35

4-1

Historical Financial Results (Expenses Breakdown)(¥ million)

FY03/14
ActualFY03/15
ActualFY03/16
Forecasts

952

1,332

1,609

Personnel
Expenses

3,715

4,858

6,193

Advertising
Expenses

2,410

2,518

3,111

Other
Expenses

3,236

4,267

5,264

Cost of Sales

7.9

8.9

8.5

Personnel
Expenses

30.8

32.3

32.8

Advertising
Expenses

20.0

16.7

16.5

Other
Expenses

26.9

28.3

27.9

Cost of Sales

Amount(¥ million)

Net
Sales
Ratio
(%)

© Copyright SMS CO.,LTD.

36

4-1

Seasonal Volatility Net sales and operating income increase in Q1 and Q4.

Seasonal Volatility of Net Sales and Operating Income
Quarterly Net Sales and Operating Income (FY03/15)（¥ million）
Net Sales

5,000

Operating Income

4,000

Businesses whose net sales and operating
income increase in Q1□Recruiting Agent Service
 Net sales are booked when a job seeker joins a company;
therefore, net sales and operating income increase in April(Q1) when personnel changes often happen
Businesses whose net sales and operating
income increase in Q4

3,000□Recruiting Ads Service

2,000 Net sales are booked when a job seeker applies for a
recruiting ad; therefore, net sales and operating income
increase in Q4 when companies publish recruiting ads
targeting the beginning of a fiscal year when job seekers arelikely to be motivated to change jobs

1,000

0

Businesses with Seasonal Volatility and Reasons

Q1

1Q

Q2

2Q

Q3

3Q

Q4

4Q

Both net sales and operating income increasesignificantly in Q1 and Q4© Copyright SMS CO.,LTD.

□Recruiting Magazine
 Net sales are booked when recruiting magazines areshipped; therefore, net sales and operating income increasein March (Q4) when the spring issue of recruiting magazines
for student nurses are published

36

4-1

Sales Composition

 The Career Segment accounts for 77% and the Nursing Care Segment accounts for 13% oftotal net sales.
RAG*2 for nurses accounts for more than 50% of total net sales.

Sales Composition by Segment (FY03/15)
Segment

Net Sales(¥ billion)

Composition Ratio

Nursing Care

1.88

12.5%

Kaipoke (80%)

Medical Care

0.78

5.2%

Mail order/online sales ofnursing goods (80%)

Career

11.6

77.1%

RAG for nurses (60%)

Healthcare

0.04

0.3%

Global0.74

4.9%© Copyright SMS CO.,LTD. *1: Numbers in () stands for composition ratio within the segment

Principal Service

iHealth (50%)*2: RAG stands for Recruiting Agent

37

4-2

List of Services Provided*1

Segment

Subsegment
Mngt Support
for Service
Operators

Nursing
Care

New
Businesses

Service Name
Information portal of housing for seniors

Management support service fornursing care operators
Com forcare
managers

Com fornursing care
professionals

Com forCom for managers offamilies withnursing care operators
those requiring
nursing care

User review site regarding
nursing care operators

Com for nurses Mail order/online Nursing /medical care Information portal forand student
sales of nursing seminar information
hospital management
nursesgoods

MedicalCare−

Nursing Care
RAG
Nursing Care
RAD

CareerMedical Care
RAG
Medical CareRAD

Healthcare

GlobalAssociatedCompanies−−−

Publishing fornursesLivelihood support search site

Drug and medicine Home-visit pharmacy DB
DB for pharmacists

Com forpharmacists

Regional partnershipsupport system

IT service for pharmacies

RAG for PT/OT/ST

Certification
courseinformation

RAD for newlygraduated nursing
care professionals

RAD for nursing
care professionals
RAG for medical
technologists

RAD for nurses

RAG for radiological
technologists

RAD for newlygraduated nurses

RAG medical engineers

Solution service forhospitals

Com for nutritionists

Q&A site on
healthCom for nurses(South Korea)

Chronic disease medicinedelivery (Taiwan)

Hospital
search site

Support service to resolve
social issues faced by public
sectors

Information portal for
Purchase support for
Regional partnership support in
hospital office managers hospital office managers the nursing/medical segment

RAG for caremanagers

RAG for nurses

Home-delivered meal search site

Information portal ofdementia

RAG for childcare RAG for nutritionists
workers

Scholarship information
portalNews column for active
seniors

Medical bill e-claiming
solution for hospitals(Australia)

Information ofgenetic test

News column
regarding pregnancy,
childbirth and childraising

Information portal of
end-of-life preparations

Doctor's appointment service Development/sales of system forfor patients (Sri Lanka)
clinic information (Malaysia)

RAG and RAD for RAG
for pharmacists
doctors andpharmacists© Copyright SMS CO.,LTD. *1: As of Sep. 30, 2015

Note: RAG stands for Recruiting Agent; RAD stands for Recruiting Ads; Com stands for online community

38

4-2

Launch of Services 1/4
03/04

03/05

03/06

03/07

03/08

03/09

03/10

03/11

03/12

03/13

03/14

03/15

03/16

Com for nursing care professionals: Care Tomo Oct. 2005
Information portal of housing for seniors: Kaigo DB July 2006）
Management support service for nursing care operators: Kaipoke July 2006

Nursing Care

Com for care managers: Care Mane.com Sep. 2006
Com for families with those requiring nursing care: Anshin Kaigo June 2009
Home-delivered meal search site: Lifood Nov. 2013
User review site regarding nursing care operators: Tonari no Kaigo Apr. 2014

Support service to resolve social issues faced by public sectors: Kokyo Keiei Shien Apr. 2014
Com for managers of nursing care operators: Kaigo Must Feb. 2015

© Copyright SMS CO.,LTD.

39

4-2

Launch of Services 2/4
03/04

03/05

03/06

03/07

03/08

03/09

03/10

03/11

03/12

03/13

03/14

03/15

03/16

Com for nurses and student nurses: Nurse-senka Community Aug. 2006
Com for pharmacists: Cocoyaku May 2009
Publishing for nurses: Nurse-senka Books Aug. 2009
Mail order/online sales of nursing goods: PURE NURSE Sep. 2011

Medical Care

Nursing/medical care seminar information: Meducation Apr. 2012
Information portal for hospital management: GALENUS May 2013
Drug and medicine DB for pharmacists: Cocoyaku DI-pedia May 2014
Information portal for hospital office managers: Jimcom Sep. 2014
Regional partnership support in the nursing/medical segment: Chiiki Renkei ONE Nov. 2014
Home-visit pharmacy DB: Homon Yakkyoku Navi Dec. 2014
IT service for pharmacies: Okusute Net Apr. 2015
Regional partnership support system: EIR Apr. 2015
Purchasing support for hospital office managers and purchasing managers: Aikon Sep. 2015

© Copyright SMS CO.,LTD.

40

4-2

Launch of Services 3/4
03/04

03/05

03/06

03/07

03/08

03/09

03/10

03/11

03/12

03/13

03/14

03/15

03/16

RAG for care managers: Care Jinzai-bank May 2003
RAD for newly graduated nursing care professionals: Kaigo Job Gakusei-ban July 2003
Certification course information: Sikatoru Nov. 2003
RAD for nursing care professionals: Kaigo Job Mar. 2004
RAG for nurses: Nurse Jinzai-bank Sep. 2005
RAD for nurses: Nurse-senka Kyujin-navi July 2006
RAG and RAD for doctors and pharmacists: M3 Career Agent Aug. 2006

Career

RAG for pharmacists: Yaku Kyari Agent Apr. 2007

Company split andsucceeded to M3 career atthe end of Dec. 2012

RAG for PT/OT/ST : PT/OT Jinzai-bank Sep. 2008
RAD for newly-graduated nurses: Nurse-senka Shusyoku-navi Aug. 2009
Solution service for hospitals Apr. 2011
RAG for nutritionists: Nutritionist Jinzai-bank May 2012
Scholarship information portal: Kango Shogakukin-navi Oct. 2012
RAG for medical technologists: MT Jinzai-bank Sep. 2013
RAG for radiological technologists: RT Jinzai-bank June 2014
RAG for medical engineers: ME Jinzai-bank July 2014
RAG for childcare workers: CW Jinzai-bank Sep. 2014

© Copyright SMS CO.,LTD.

41

4-2

Launch of Services 4/4
03/04

03/05

03/06

03/07

03/08

03/09

03/10

03/11

03/12

03/13

03/14

03/15

03/16

Com for nutritionists: Eichie June 2011

Healthcare

Information portal of dementia: Ninchisho Net Aug. 2011
Q&A site on health: Narukara Dec. 2013
News column regarding pregnancy, childbirth and child-raising: Ixil July 2014
News column for active seniors: Lvly Sep. 2014
Information portal of end-of-life preparations: mirasona Dec. 2014
Information of genetic test: Navigene Mar. 2015

Information of genetic test: Navigene Mar. 2015

Global(Taiwan) Chronic disease medicine delivery service: iHealth May 2013
(Australia) Medical bill e-claiming solution for hospitals: EHEALTHWISE Jan. 2014
(Sri Lanka) Doctor’s appointment service for patients: eChannelling June 2014
(Malaysia) Development/sales of system for clinic information: Centium Dec. 2014

© Copyright SMS CO.,LTD.

42

4-2

Recruiting Agent Service: Business Model When a job seeker successfully changes jobs through SMS’s service, SMS receives apercentage of the job seeker’s estimated annual income from the service operator (e.g.,
hospitals and nurse care operators) as a commission.

【Example: Recruiting agent service for nurses, Nurse Jinzai-bank 】

Register on
the website

SMS Group website
Introduce
job seekers

Postrecruiting
ads

Providesinfo. onregisteredmembers

Requestrecruiting

Hospital (Service operators)

SMS consultants

Provide job
opportunity
information

Seek
consultation

Nurses (Job seekers)

Pay commission for job placement service(calculated as a percentage of the job seeker’s
estimated annual income)© Copyright SMS CO.,LTD.

43

4-2

Sales Formula for Recruiting Agent Services

 Accumulation of past Received Order Sales(ROS) constitutes net sales.
 ROS is the result of sales activities during a certain period, and regarded as the leading
indicator of net sales.

Sales Formula

ROS Formula

Sales＝ROS × DF - Cancellation - Refund

ROS＝NofC × Productivity × Unit priceAny cancellations

Any refunds

・Number of Consultants (NofC):
Agreement b/w
job seeker and company（ROS Booking）

Job seeker
joins company（Sales Booking）

6months or
12months

Number of sales staff engaging in recruiting agent service
・Productivity:
Number of completed agreements between a job
seeker and a company per sales staff per month・Unit price: The mean of commissions for job placement
service・Net sales：Booked when a job seeker joins a company
・ROS：Recorded when a job seeker and a company reach an
agreement* Primary factors for productivity
Not booked in financial accounting
・Number of recruitment orders from companies
・Distribution factor(DF)：・Effectiveness in the process leading to placement% of ROS distributed to each future month- Interviews with job seekers
・Cancellation:- Setting interviews between job seekers and companies
Cancellation of the agreement between a job seeker and- Reaching agreements after interviews
a company after recording ROS
Cancellation will be deducted from net sales
・Refund:
When a job seeker quits within a certain period of time, SMS
will refund part of the commissions to the company
ROS and productivity are
Accumulation of past ROS constitutes net sales
the result of monthly sales activities© Copyright SMS CO.,LTD. Among the factors above, net sales, number of consultants, and productivity are disclosed (up till FY03/15)

44

4-2

Recruiting Ads: Business Model SMS receives from service operators (e.g., hospitals, nurse care operators, dispatching firms
and recruiting agents) advertisement posting fees proportional to the number of job seekers’
applications.

【Example: Recruiting ads service for nurses, Nurse-senka Kyujin-navi】
Apply to job
opportunities
postedProvidesinformation of
applicants

SMS Group website
Post
recruiting ads
Request postingof recruiting ads

Hospital (Service operators)

SMS sales staff

Provides job
opportunity
information

Nurses (Job seekers)

Pay advertisement posting fee calculated in prorata of the number of applicants（measured rate）© Copyright SMS CO.,LTD.

45

4-2

Kaipoke Renewed from insurance claim service to management support services in February 2014.
 Already started approximately 40 new services, supporting operational efficiency and financial
improvement.

Starting in February 2014*2
Service Improvement

Prior toFebruary 2014
Insurance
claim
systemInsurance
claim service

Human Resource

・Tablet・Marketing
・Bank transfer
・Document Sharing
etc.

・Recruitment
・Insurance claim system
・Attendance・Accounting software
・Welfare・Factoring
Management
・Payroll calculation/
・Business management
support service etc.
deposit(Improve operation efficiency
etc.
and reduce costs)

General Affairs/
Purchasing

・Purchasing
・Insurance
・Document storageetc.

© Copyright SMS CO.,LTD.

Accounting/Financing

Establishment
・Market analysis
・Task management
・Funding consulting
・Reform support
etc.

*1: There are around 100,000 nursing care service operators and 80% are small or medium-sized. It is crucial to make strong connections withthem, since they will continue to serve an important role in the industry based on such industrial structure.
*2: Only representative services are shown.

46

4-2

Kaipoke: Business Model Receive service fee from nursing care operators for providing not only insurance claim services
but also management support services, which include support in sales, recruiting, andoperational efficiency improvement.

Service
Improvement

Provide services(improving financials andoperation and others)

Pay service fee（fixed rate or measured
rate）

Service fee

Nursing Care
Operators© Copyright SMS CO.,LTD.

• Fixed monthly rate for
packaged service• Measured rate for optional
services such as factoringand purchasing

Human Resource
・Recruitment
・Attendance
・Welfare・Payroll calculation/
depositetc.

・Tablet・Marketing
・Bank transfer
・Document
Sharingetc.

Accounting/
Financing・Insurance claim system
・Accounting software・Factoring
・Business management
etc.

General Affairs/
Purchasing

Establishment

・Purchasing
・Insurance
・Document
storageetc.

・Market analysis
・Task management
・Funding consulting
・Reform support
etc.

47

4-3

External Environment: Nursing Care Expenditure of long-term care insurance has doubled during each decade.
 Markets that are not covered by long-term care insurance are also growing.
Trend in Expenditure of Long-Term Care Insurance*1

Size of Nursing Care and Related Markets (in 2010 or 2011）*2(¥ trillion)(¥ trillion)

16.1
×2

×2

Food
for seniors
1.0

7.8

2010

Grant forlong-termcare payment
7.8

Expendables
for nursing care
0.3

3.6

2000

Welfareequipment
1.1
Housingfor seniors
3.0

Safetymanagement
0.3

2020

*1: Ministry of Health, Labour and Welfare (MHLW) (Includes copayment; the most recently value disclosed was ¥10.0 trillion in 2014)© Copyright SMS CO.,LTD. *2: Welfare equipment: Japan Assistive Products Association (JASPA) / Others: Fuji-Keizai; figures are based on either 2010 or 2011 statistics

48

4-3

External Environment: Medical Care Medical expenses have increased.
 Suffering from shortage of nurses although the number of nurses has increased.
Number of Working Nurses andEffective Ratio of Job Offers to Applicants*2

Trend in Medical Expenses*1(¥ trillion)(Effective ratio of job
offers to applicants, times)(Number of nurses, million)

160
1,600
1.6

50

47

45

1.2
1,200
120

+10

40

1.16
million

4.00

3.13

3.00

37

35
30

1.54
million

800
80
0.8

+8

2.00

29

25

0.4
400
40

1.05

1.00

20
15

00
2000
2000年

2010
2010年

2020
2020年

0.00
2000
'00年

2003
'03年

2006
'06年

2009
'09年

2012
'12年

*1: 2000 and 2010: MHLW
2020: MHLW; Reform of medical care system for the elderly conference materials; the most recently disclosed value was ¥40.0 trillion in 2014
*2: Effective ratio of job offers to applicants: MHLW
Number of working nurses: Japanese Nursing Association© Copyright SMS CO.,LTD. The most recently disclosed value was ¥1.57million in 2013

49

4-3

External Environment:
Effective Ratio of Job Offers to Applicants by Occupational Categories

 Continuous labor shortage in both nursing care professions and nursing professions

Nursing Care Segment

Medical Care Segment

Transition of effective ratio of job offers to applicantsfor Nursing Care Professions *1

Transition of effective ratio of job offers to applicants for
Nursing Professions *1

2.40

4.00

Nursing Care
Professions

2.00

Nursing
Professions

3.00
1.60
1.20

2.00

Industry Total
0.80

Industry Total
1.00

0.40
0.00

0.00
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

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

FY03/11'11年3月期

FY03/11'11年3月期

FY03/12'12年3月期

FY03/13'13年3月期

FY03/14'14年3月期

FY03/15 '16年3'15年3月期
月期
FY03/16© Copyright SMS CO.,LTD.

FY03/12'12年3月期

FY03/13'13年3月期

FY03/14'14年3月期

FY03/15 '16年3'15年3月期
月期
ʻ16年3月期
FY03/16*1: MHLW, General employment placement situation
Figures represent the means of values for the 3 months in each quarter. The figure for Q2 FY03/16 is the mean of values for July and August

50

4-3

External Environment: Global

 The global market is extremely attractive as it is larger than the Japanese market and theaging population is expected to expand further.
Population and the Rate of Aging*1 (100 million)
13.4

8％

China

12.2

5％

India
ASEAN
Japan
South Korea

Taiwan

India

13.9

6％
6％

5.9

7％

6.5

5,951

China

13.9

12％

GDP*2 (US$ billion)

ASEAN

12,630
1,678
2,848
1,886
3,751

23％

1.3
1.2

29％

0.5
0.5

11％

0.2
0.2

11％

16％

16％

5,511

Japan
South Korea

Taiwan

5,224
1,015
1,508
428
715

2010
2020

© Copyright SMS CO.,LTD.

*1: Statistic Bureau of Ministry of Internal Affairs and Communications and the United Nations; “seniors”=age 65 and above*2: ASEAN, Taiwan: IMF (Figures for 2020 are substituted by those of 2018)
Other countries: The United Nations and Goldman Sachs

51

4-3

Nursing Care Segment: Career-related Services

 Provide recruiting agent service to care managers and PT/OT/ST, and recruiting ads service
to all professionals
 Provide services to large-sized service operators through recruiting ads and to small andmedium-sized operators through Kaipoke

Services by Professional Type

Services by Size of Service Providers

Our services in relation to nursing care professionals*1

Our services in relation to the nursing care operators structure*3

Nursing care
professionals(Care workers,
care helpers etc.)
1.52 million

Care
PT/OT/
managers
ST*2
150,000 130,000

Provide recruiting agent service
to care managers, PT/OP/ST

Providerecruiting ads
service to all
professionals

Provide services
through
Kaigo Job
（Recruiting ads）

Large-sized
nursing care
operators(20%, 29,000)

Provide services
through
Kaipoke(Recruiting ads
as part of the
management
support service)

Small and medium-sized
nursing care
operators(80%, 118,000)

Provide recruiting agent service
to all nursing care operators(Service used in urgent need)*1: Figures represent the number of employees
Source: MHLW (2013), Figures for PT/OT/ST include PT/OT/ST in both the nursing care and medical fields*2: PT stands for Physical Therapist, OT stands for Occupational Therapist, and ST stands for Speech Therapist*3: Figures represent the number of service operators© Copyright SMS CO.,LTD. Source: SMS estimates based on MHLW, Care payment costs fact-finding monthly report (Apr. 2014)

52

4-3

Medical Care Segment (Nurses): Career-related Services

 Provide recruiting agent and recruiting ads services to mid-career nurses, and recruiting ads
service to newly-graduated nurses
 Provide matching services meeting the needs of nurses and service operators, and services
promoting employee retention
Our Services in Relation to Nurses’ Employment*1(Number of
employed nurses,
etc.)

Students
approx. 70,000/year

Employed nurses
approx. 1.5 million(increasing by
20,000-30,000/year)

Nurses leaving work
150,000-160,000/year*2(Our services)

For newly-graduating
nurses・Recruiting information
services

Unemployednursesapprox. 550,000650,000

For mid-career nurses
For unemployed nurses
・Recruiting agent services ・To be provided
・Recruiting ads services
・Employee retention support(provided through solution service for hospitals)*1: [Number of students] MHLW; [Number of employed nurses] Japanese Nursing Association;[Number of nurses leaving work] SMS estimates based on Japanese Nursing Association, ratio of nurses leaving work; [Unemployed nurses] Japanese Nursing Association
Students include prospective registered nurses and prospective associate nurses. Employed nurses include registered nurses, associate nurses, public health nurses and midwives.
*2: Number of nurses leaving work Includes those who transferred to another nursing position as well as those who transferred to different professions.

© Copyright SMS CO.,LTD.

53

4-3

Nurse Recruiting Agent Service: Market Trends and Competitive Landscape Room for further expansion of SMS’s nurse recruiting agent service.
• Despite the increasing number of nurses, shortage of nurses is intensifying over the years.
• SMS is a market leader in recruiting agent services, but its share among all job seekers is
7%. Therefore, SMS is expected to grow further.
Number of Working Nurses and Effective Ratio of Job Offers
to Applicants*1(Effective ratio of job
offers to applicants, times)（Number of nurses, thousand）

1600
1,600

1200
1,200

Market Size of Nurse Recruiting Agent Service and
SMS’s Market Share*2

1,540

Total number of nurse job seekers:
150-160K nurses/year

4.00

3.13

1,160

3.00

SMS
7%

SMS
25-30%

800
800

400
400

（Main
player）

2.00
Increase in effective
ratio of job offers toapplicants＝ escalation of labor
shortage

1.05

00

Furthergrowth

2003

2006

2009

Furthergrowth

1.00

0.00
2000

Expanding2012*1: Effective ratio of job offers to applicants: MHLW
Number of job seekers: Japanese Nurse Association© Copyright SMS CO.,LTD. *2: SMS estimates as of the end of March 2012

Total number of job
seekers via nurse
recruiting agent
services
40 K nurses/year

Number of nurse job
seekers via SMS’ nurse
recruiting agent service
10 K nurses/year

54

4-3

Target Service Offices of Kaipoke

 Among services received at home, 118,000 small and medium-sized service offices are targets
of Kaipoke.
SMS holds approximately 12% share and intends to increase its market share by gaining
memberships in line with the increase in number of service offices.

Total
223,000*1 Services at facility
13,00020,000Communitybased
services*2

no target 43,000

190,000

Out of scope 29,000

In-homeservices

Target service
offices for
insurance
claim services

Total
service offices

・Short stay*3
・Specified facility*3・Management of inhome medical longterm care *3

147,000
Small andmediumsized :80%

Potential member
service offices:103,800

Large-sized :20%

103,800

118,000
12%

Member service offices asof Oct. 2015: 14,200(SMS market share: 12％,
Locations: 10,850）

Target service offices Small and medium-sized Member of Kaipoke
for insurance claim
target service offices
and Potential
servicesfor insurance claim services
members（= Target of Kaipoke）*1: SMS estimates based on MHLW, Monthly report of Survey of Long-term Care Benefit Expenditures (May 2015)*2: Among community-based services, nighttime home-visit nursing care services and daycare services for dementia patients are our targets*3: Kaipoke does not cover short-stay services or specified facilities© Copyright SMS CO.,LTD.
Management of in-home medical long-term care is also not covered since the need for insurance claim services is significantly lower

55

4-3

Expansion of Kaipoke’s Target

 We aim to expand Kaipokeʻs target significantly by including nursing care operators that own
offices in multiple locations and new service types such as home-visit nursing operators andoutpatient rehabilitation operators.

Breakdown by Number of Locations*1

Covering New Service Types

・48% of Kaipoke’s targets are nursing care operators that own
offices in more than three locations.
・Kaipoke’s target will expand significantly by including suchoperators.

Breakdown by Number of Locations
48% own more than
three locations

The number of offices targeted by Kaipoke increased by 13,000(+14%) by covering new services types such as home-visit
nursing and outpatient rehabilitation.

Number of Service Offices Targeted by Kaipoke
Others 14,000

Outpatient rehabilitation
6,000

Home-visit
nursing care
26,000Home-visit nursing
7,000Over 50
locations

11-50

6％

locations11％
1-2 locations
52％
3-10 locations
31％

Total
104,000
Total
Daycareservice
offices
91,00034,000
offices(+14%)
Home-care
support31,000*Residence for elderly people with services is included in homecare support, daycare service, and home-visit nursing care.

*1: Source: SMS estimates based on WAMNET© Copyright SMS CO.,LTD. *2: Source: SMS estimates based on MHLW, Monthly report of Survey of Long-term Care Benefit Expenditures (May 2015)

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Global 1/2 *1

Company Name

EstablishedCountry

Description of Business

SMS VIETNAM
CO.,LTD.

Apr. 2009*2

Vietnam

SMS’s portion of ownership: 100%, consolidated subsidiary
System development of SMS’s services and maintenance of part of them

SMS Beijing CO.,LTD.

Sep. 2009

China

SMS’s portion of ownership: 100%, consolidated subsidiaryBusiness development in nursing and medical care

Senior Marketing
System Korea
Co,.Ltd.
（old: NURSCAPE）

Sep. 2011*2

South
Korea

SMS’s portion of ownership: 80%, consolidated subsidiary
Operating well-known online community（243,000 nurses among 300,000 use the site),
recruiting ads services, and e-leaning for nurses in South Korea

SMS Taiwan CO.,LTD.

Jan. 2012

TaiwanSMS’s portion of ownership: 90%, consolidated subsidiaryBusiness development in nursing and medical care
Refers experienced locals in nursing and medical care fields as management

SENIOR MARKETING SYSTEM
SDN. BHD.

Jan. 2013

Malaysia

SMS’s portion of ownership: 100%, consolidated subsidiaryBusiness development in nursing and medical careiHealth

May 2013*2

TaiwanSMS’s portion of ownership: 47.2%, consolidated subsidiary
Delivering chronic disease prescription drugs to nursing care facilities and patients

SENIOR MARKETING SYSTEMASIA PTE. LTD.

July 2013

Singapore

SMS’s portion of ownership: 100%, consolidated subsidiary
Responsible for overseas businesses, investment into overseas companies, and businessdevelopment in Singapore

SMS PHILIPPINESHEALTHCARESOLUTIONS INC.

Nov. 2013

Philippines

SMS’s portion of ownership: 99.995%, consolidated subsidiaryBusiness development in nursing and medical care

PT. SENIOR
MARKETINGSYSTEM
INDONESIA

Dec. 2013

Indonesia

SMS’s portion of ownership: 100%, consolidated subsidiaryBusiness development in nursing and medical care

© Copyright SMS CO.,LTD. *1: As of end of Sep. 2015 *2: Investment only (not established by SMS)

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4-4

Global 2/2 *1

Company Name

Established

SMS Shanghai CO.,LTD.

Dec. 2013

Country

Description of Business

China

SMS’s portion of ownership: 100%, consolidated subsidiaryBusiness development in nursing and medical care

EHEALTHWISESERVICES PTY LTD

Jan. 2014*2

Australia

SMS’s portion of ownership: 100%, consolidated subsidiary
Medical bill e-claiming solution for hospitals

SENIOR MARKETING SYSTEM(THAILAND) CO.,LTD.

Apr. 2013

Thailand

SMS’s portion of ownership: 49%, consolidated subsidiary since Apr. 2014
Business development in nursing and medical careeChannelling PLC

Oct. 2013*2

Sri Lanka

SMS’s portion of ownership: 87.6%, consolidated subsidiary since June 2014
Doctor’s appointment service. Listed on CSE.

Centium Software
Sdn Bhd*2

Jan. 2015

Malaysia

SMS’s portion of ownership: 51%, consolidated subsidiary
Development/sales of hospital information system

Luvina Software Joint
Stock Company

July 2012*2

Vietnam

SMS’s portion of ownership: 21.5%, Equity Method Affiliated Company
System/software development. Securing development resources and collaboration withSMS VIETNAM are the purpose of takeover.

PT.MEETDOCTOR

July 2013*2

Indonesia

SMS’s portion of ownership: 60.8%, unconsolidated subsidiary
Online communication platform where end users consult doctors on healthcare

Time Creation
Limited（FindDoc）

Aug. 2014*2

Hong Kong

SMS’s portion of ownership: 60.9%, unconsolidated subsidiary
Operating FindDoc where end users search doctors

HelpingDoc Private
Limited

Sep. 2014*2

India

SMS’s portion of ownership: 33.4%, unconsolidated subsidiary
Doctor’s appointment service

This Source (Pvt) Ltd

Jan. 2015*2

Sri Lanka

SMS’s portion of ownership: 86.7%, unconsolidated subsidiary
Publishing magazine for health care providers

Wadoc Pte. Ltd.

Aug. 2015

Singapore

SMS’s portion of ownership: 100%, consolidated subsidiary
Overseeing management support services for clinics© Copyright SMS CO.,LTD. *1: As of end of Sep. 2015 *2: Investment only (not established by SMS)

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4-5

Other
Number of Employees
 Number of employees and its breakdown as of September 30, 2015
Employees (consolidated)

1,136

SMS CO., LTD.

234

SMS Career CO., LTD.

498

Subsidiaries and Sub-subsidiaries

404

Japan

217

Global187

Shareholder Composition*1[as of September 30, 2015]
Number of stock
holders
3,483

11%
7%

Founder
Director, Employees and Shareholding association
Treasury Shares
Domestic Institutional Investors

30%

3%

32%
14%

3%

Foreign Institutional Investors
Individual Investors
Other© Copyright SMS CO.,LTD. *1：This Graph shows ratio of number of stocks

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Reclassification of Disclosed Segments

 Redefined disclosed segments accompanying the reclassification of market segments.
Former Disclosed Segments

Nursing Care

New Disclosed Segments

Nursing Care

Recruiting Businesses
OthersMedical Care

Recruiting Businesses

CareerMedical Care
OthersActive SeniorHealthcare
Senior Life

Overseas© Copyright SMS CO.,LTD.

Global60

4-6

New and Former Disclosed Segments

Former Segments
Segment

Nursing Care

New Segments

Sub-segment

New Businesses

Daily Use

Segment

Sub-segment

Nursing Care

Mngt Support for
Service
Operators*1
New Businesses

Medical Care

Nursing Care

Medical Care

New Businesses

Daily Use

Medical Care

Recruiting Agent
Services

Occasional Use

RAG*2 for Nursing
Care

Recruiting Ads

Occasional Use

RAD*3 for Nursing
Care

Career-Recruiting Agent
Services

Occasional Use

RAG*2 for Medical
Care

Recruiting Ads

Occasional Use

RAD*3 for Medical
Care

Active Senior-Healthcare-

Overseas-

Global-© Copyright SMS CO.,LTD. *1: Renamed. Expressed as “Kaipoke” in presentation materials for FY03/15. *2 : RAG stands for Recruiting Agent*3 : RAD stands for Recruiting Ads

61

Caution on Forward-Looking Statements

These materials contain forward-looking statements, including estimates, projections, and statements related to business
operations of SMS CO., LTD. (hereinafter referred to as the “Company”).
The forward-looking statements are based on current expectations and assumptions in light of the information available to
the Company as of September 30, 2015 and are subject to significant risks and uncertainties. The results or events
predicted in these forward-looking statements may differ materially from actual results or events.
As a result, we cannot guarantee that any forward-looking statements will materialize nor do we undertake any obligation to
update or revise publicly any of these forward-looking statements.

For any inquiries on the materials, please contact below:
Corporate Planning Department
E-mail: irinfo@bm-sms.co.jp
Phone: +81-3-6721-2403© Copyright SMS CO.,LTD.

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