Annual Results for the Fiscal Year
Ended March 31, 2019 (FY 2018)
May 16, 2019

Building a better,brighter future together
Total ICT Solutions:Contributing to the Realization of a Brighter
Future by Bringing People Together andForming Connections with Society

URL: http://www.exeo.co.jp/overseas/index.html

Contents
1. Overview of FY18 Results(1) Performance Figures(2) Orders Received

3. Plans for FY19
・・・
・・・

2
3

(1) Performance Figures(3) Net Sales・・・

4(3) Net Sales(4) Operating Income・・・5(4) Operating Income(5) Cash Flow・・・

7(5) NTT Group (Access/Network)(2) Orders Received(6) NTT Group (Mobile)

2. Review of Medium-term management plan（FY19-20）(7) NCCs

8(8) Urban Infrastructure(2) Basic Policies

・・・
・・・

8

(9) System-Solutions(3) Performance Target for FY20・・・

8(4) Objective and Growth Picture・・・

9(5) Net sales and Operating Income Plans

・・・ 10(1) Development Direction by Business
Segment(6) Create synergy with three companies in・・・ 11

5. Raising Shareholders’ Value(1) Medium-term vision

western Japan・・・ 12・・・ 13・・・ 14・・・ 16・・・ 17・・・ 18・・・ 19・・・ 21・・・ 22

4. Our M&A Strategy(1) Shareholder Return Policy(2) Plan for shareholder returns for FY19, etc.

・・・ 27・・・ 28・・・ 29

6. Topics(1) Singapore-based DeClout was made intoa group company－1－

・・・ 301. Overview of FY18 Results(1) Performance Figures◆ In addition to the organic growth of performance, the integration of the three companies inwestern Japan increased sales and profit substantially.
◆ Negative goodwill (18.3 billion yen) from the integration was posted as an extraordinary loss.

■ Overview of FY18 results (consolidated)(¥bn)

FY 2018
FY 2017
ActualCorrective plan
(Announced on
Nov. 6, 2018)

ActualYOY

Plan
accuracy

A

B

C

C/A

C/B

Orders received

325.0

415.0

424.3

131%

102%

Net sales

312.6

420.0

423.7

136%

101%

135%

104%

150%

109%

124%

101%

126%

103%

224%

96%

(13.9%)

Gross profit

43.3(5.7%)

SG&A expenses

17.7(8.2%)

Operating income

25.6(8.5%)

Ordinary income
Net income
attributable to ownersof parent

26.4(5.8%)

17.9(13.3%)

56.0(5.8%)

24.5(7.5%)

31.5(7.7%)

32.5(10.0%)

42.0(13.8%)

58.3(6.3%)

26.6(7.5%)

31.7(7.9%)

33.4(9.5%)

40.2

Notes: All amounts less than ¥100m are disregarded. Figures in parentheses are ratio to net sales.

－2－1. Overview of FY18 Results(2) Orders Received◆ Orders received increased substantially due to the favorable results of Urban Infrastructure
year on year, and the three integrated companies in western Japan successfully won orders.
(¥bn)○ Telecommunications
facilities○ Electricity supply○ Urban Civil
engineering○ Environmental
engineering

Seibu
Electric
Industry+25.1○ KDDI－ SB

Urban
Infrastructure
+22.8
NCCs
+1.2
SystemSolutions
NTT Group
+5.7
-6.5

NipponDentsu+17.2
C-Cube
+34.3

○ SI
○ NI

Existing Exeo G（＋23.2）325.0○ Access○ Network▲ Mobile（Consolidated
adjustment）
-0.5

＋99.3

FY17

Three companies
in western Japan（＋76.6）424.3（348.2）← Existing Exeo G
Actual

FY18
Note: All amounts less than ¥100m are disregarded.

－3－1. Overview of FY18 Results(3) Net Sales◆ Urban Infrastructure, which increased the number of orders received substantially,
also increased net sales significantly.
◆ The net sales of the three integrated companies in western Japan were mostly as planned.

○ KDDI○ SB(¥bn)○ Telecommunications
facilities○ Electricity supply○ Urban Civil
engineering○ Environmental
engineering

Urban
Infrastructure
NCCs
+17.0
+3.3
SystemSolutions
NTT Group
+4.4
+0.8

Seibu
Electric
Industry+33.1

NipponDentsu+18.5
C-Cube
+35.2

○ SI
○ NI

Existing Exeo G（＋25.5）312.6○ Access▲ Network▲ Mobile（Consolidated
adjustment）-1.2＋111.1

FY17

Three companies
in western Japan（＋86.8）423.7（338.1）← Existing Exeo G
Actual

FY18
Note: All amounts less than ¥100m are disregarded.

－4－1. Overview of FY18 Results(4) Operating Income◆ SG&A expenses increased in line with the increased sales and M&A, but the improvement of thesales mix resulted in record-high income.
(¥bn)

Sales mix
+1.2

Up due toincrease in sales
+3.5

25.6

Seibu
Electric
Industry+1.2

Personnel
expenses,etc.
-1.7

Amortization of
goodwill,etc.
-1.2

C-Cube+2.6（Consolidated
adjustment）±0
NipponDentsu+0.5

Three companies
in western Japan（＋4.3）

Existing Exeo G（＋1.8）

31.7（27.4）

＋6.1

FY17

FY18
Note: All amounts less than ¥100m are disregarded.

－5－1. Overview of FY18 Results
Reference: Trends in Group company profitability◆ The results of the group companies were favorable, and the ratio ofconsolidated to non-consolidated profits remained high.
■ Trends in operating profits over the past five years (consolidated/non-consolidated)(Ratio of consolidated to
non-consolidated profits)

（1.8）

（1.8）

（1.9）

（1.7）

(¥bn)

（1.8）
31.7

25.6
13.6

Group companies
グループ会社
エクシオ単体Exeo alone

18.3
8.3

20.8
18.4

8.4

10.5

9.6

10.0

10.0

11.2

FY14

FY15

FY16

15.1

FY17

18.1

FY18

Notes: Ratio of consolidated to non-consolidated profits = operating profits from consolidated projects ÷operating profits from non-consolidated projects. All amounts less than ¥100m are disregarded.

－6－1. Overview of FY18 Results(5) Cash Flow
◆ Cash flow is stable and cash on hand is ample.
■ Cash flow (consolidated)

(¥bn)

FY15

FY16

FY17

FY18

Cash at beginning of
FY

24.2

16.0

15.2

30.3

Operating activities

5.3

15.5

24.8

12.7

Investing activities

-13.9

-6.0

-4.5

-17.6

Financial activities

0.3

-10.2

-5.1

-4.9

Increase/decrease of cash
due to share exchange

Cash at end of period

21.0
16.0

15.2

30.3

41.4

Note: All amounts less than ¥100m are disregarded.

－7－

２. Review of Medium-term management plan（FY19-20）(1) Medium-term vision（No Change）
Focus Group strengths to take total solutions to a new growth stage(2) Basic Policies（Slightly Changed）
１．Creation of group synergy with the three integrated companies
２．Acceleration of solution business and expansion of stock business
３. Building of construction formation for the full-scale launch of 5G
４. Development of overseas business with EXEO GLOBAL as a starting point
５．Improvement of productivity through the digitalization of operations and the fostering of highlyskilled IT human resources６．Increase in shareholder value due to the improvement of capital efficiency(3) Performance Target for FY20 （Changed）■ Net sales¥500.0bn■ Operating income ¥33.0bn （Operating income margin 7.5%）
■ ROE
8.5％
■ EPS
¥210
－8－

２. Review of Medium-term management plan（FY19-20）(4) Objective and Growth Picture(¥bn)

Aiming for 500 billion yen in sales and further growth

500
5,000
450

4,500
400

4,000
350

3,500

Actively conduct M&A in addition
to organic growth

Growth segment

Solution fields including SI and NI

300
3,000

Facility fields including power and air conditioning

250
2,500
200
2,000
150

1,500
100
1,000
50
500

0

FY15

FY16

FY17

FY18

－9－

FY19 Plan

FY20 Plan

２. Review of Medium-term management plan（FY19-20）(5) Net sales and Operating Income Plans
Net sales

6,000

Operating income

Operating income margin

5,000

423.7

7.0%

7.5%

4,000

3,000

298.8

9.0%

8.0%

500.0

495.0

8.2%

(¥bn)

7.0%

6.5%

6.6%
6.0%

312.6

5.0%

4.0%

2,000

3.0%

2.0%
1,000

20.8

25.6

31.7

32.0

33.0

0

1.0%

0.0%

FY16

FY17

FY18
－10－

FY19 Plan

FY20 Plan

２. Review of Medium-term management plan（FY19-20）(6) Create synergy with three companies in western Japan◆ From the cooperation with the three integrated companies in western Japan, synergy from the integration iscreated throughout the EXEO Group.

■ While securing the profit level, concentrating operations in the same area as one operation
for better construction efficiency.
(Launch of NTT service comprehensive construction in the Kyoto-Osaka region, and others)■ Improvement of profitability through rebuilding of construction formation(reduction of outsourcing costs outside the group by mutually utilizing subsidiaries)■ Integration of internal system/business flow
(improvement of costs through shared use of access/user systems)

Synergy from
integration＋500 million

Generate synergy from the integrationof about 500 million per year on the

Synergy from
integration＋500 million(+α)

basis of consolidated operating profit

FY19

FY20
－11－

3. Plans for FY19(1) Performance Figures◆ Orders received and net sales are expected to increase substantially from the previous year, due inpart to the full-year contribution of the three integrated companies in western Japan.
◆ New record profit planned through improved productivity and synergy following the integration.

■ Plans for FY19 (consolidated)(¥bn)
FY 2019

FY 2018
Actual

Plan

YOY

A

B

B/A

Orders received

424.3

495.0

117%

Net sales

423.7

495.0

117%

(13.8%)

Gross profit

58.3(6.3%)

SG&A expenses

26.6(7.5%)

Operating income

31.7(7.9%)

Ordinary income

33.4(13.4%)

66.3

114%

(6.9%)

34.3

129%(6.5%)

32.0

101%(6.6%)

32.8

98%

Net income(9.5%)(4.4%)
attributable to owners
54%
40.2
21.8
of parent
Notes: All amounts less than ¥100m are disregarded. Figures in parentheses are ratio to net sales.

－12－3. Plans for FY19(2) Orders Received◆ While orders received are forecast to decline for the NTT Group, we aim to increase
those for system solutions substantially.
▲KDDI
▲ SB
○ Rakuten

NCCs
-4.1
NTT Group
-10.3

424.3

▲ Telecommunications
facilities○ Electricity supply○ Urban Civil
engineering▲ Environmental
engineering

Urban
Infrastructure-7.9▲ Access▲ Network○ Mobile

SystemSolutions+17.1

C-Cube+28.3（348.2）（Consolidated
adjustment）
+0.5

(¥bn)

NipponDentsu
+20.2

○ SI
○ NI

495.0
Three companies
in western Japan（＋75.4）

Existing Exeo G（-5.2）
Existing Exeo G →ActualSeibu
Electric
Industry
+26.9

＋70.7

FY18

（343.0）← Existing Exeo G
plan

FY19 Plan
Note: All amounts less than ¥100m are disregarded.

－13－

3. Plans for FY19(3) Net Sales◆ While working on the completion of a large amount of carried-over construction work,
aiming to increase sales by winning an increased number of orders.
▲KDDI
▲ SB
○ Rakuten▲ Telecommunications
facilities○ Electricity supply○ Urban Civil
engineering▲ Environmental
engineering

Urban
NCCs Infrastructure
-1.9
+3.5
NTT Group
System-8.7
Solutions+14.0▲ Access○ Network▲ Mobile

Seibu
Electric
Industry+19.4

C-Cube+26.3（Consolidated
adjustment）+1.2

NipponDentsu
+17.5

○ SI
－ NI

495.0

423.7
Existing Exeo G →Actual（338.1）Three companies
in western Japan（＋63.2）

Existing Exeo G（+6.9）(¥bn)（345.0）

＋71.3

FY18

← Existing Exeo G
plan

FY19 Plan
Note: All amounts less than ¥100m are disregarded.

－14－

3. Plans for FY19
Reference: Status of projects carried over
◆ Work carried over will continue to increase because of the increased number of orders
for large construction of Urban Infrastructure with longer construction periods.

■ Transition of amount of work carried over (consolidated)

(¥bn)

196.6

105.4

FY14

118.3

FY15

143.5

155.9
（169.9）← Existing Exeo G
Actual

FY16

FY17

FY18

Note: All amounts less than ¥100m are disregarded.

－15－

3. Plans for FY19(4) Operating Income◆ Despite the worsening of the mix and the increase in SG&A expenses, we will aim
to achieve a new record-high income, due in part to synergy following the integration.
(¥bn)

Sales mix
-1.2

Strategic system
investment-0.9

Existing Exeo G →Actual（Consolidated
adjustment）

+0.5

-0.3

＋0.5

Up due to
Improved
increase in sales
Productivity
+1.0
+0.6
Amortization of
goodwill,etc.
-0.5

31.7

Seibu ElectricIndustry

Synergy from
integration

C-Cube-0.1

Nippon Dentsu+0.7

Three companies
in western Japan（＋1.1）

Existing Exeo G（-0.5）（27.4）

32.0（26.9）＋0.3

FY18← Existing Exeo G
plan

FY19 Plan
Note: All amounts less than ¥100m are disregarded.

－16－

3. Plans for FY19(5) NTT Group (Access/Network)◆ Net sales from work to open an optical network are strong, and maintenance and construction for disastercountermeasures have gradually been increasing in recent years.
◆ In line with the increase in mobile traffic, NTT Building’s power-supply constructions are strong.

■ NTT Group’s disaster countermeasures■ Net sales of NTT Group(fixed-line network, consolidated)

1. Improvement of reliability ofcommunication networks（including multiple transmission routes）（Note）Including the consolidated adjustment of thethree integrated companies in western Japan(¥bn)
Existing Exeo G

communication infrastructure（concentration ofcommunication facilities, etc.）

Three companies
in western Japan

168.5
151.8

111.8

117.7

・ Further strengthening of

32.5

・ Proactive disaster response
3. Early
restoration

2. Securing of important
communication

・ Appropriate transmission of
information

57.0

115.8

(Source: Created by Kyowa Exeo based on NTT presentation material)■ Trend of number of subscribers to NTT Group's
fixed-line broadband
2,167
2,107
1,871

111.8

117.7

115.8

119.3

111.5

1,456

469

FY15

FY16

FY17

FY18

FY19 Plan

－17－

FY15

1,925

1,130

874

FY16

2,053
941

10,000s of
subscribers

838

778

1,111

1,269

1,389

FY17

FY18

FY19 Plan

FLET'S HIKARICOLLABO HIKARI

3. Plans for FY19(6) NTT Group (Mobile)◆ Expect an increase in the construction of 4G-enabled base stations for the new frequency (3.4GHz) from 2H.
◆ In preparation for the full-scale construction for 5G, a new construction system is established in whichaccess/mobile is integrated.

■ Net sales of NTT Group(mobile network, consolidated)(¥bn)■ Image of NTT DOCOMO Main Processes (our company's assumption)

2018年度（Note）Including the consolidated adjustment of thethree integrated companies in western Japan

Existing Exeo G

2019年度

2020年度

2021年度

2022年度

800MHz/1.5GHz/1.7GHz/2GHz

Three companies
in western Japan

3.5GHz/700MHz
48.7

48.7

50.6

50.6

51.5

51.5

51.7

52.5

2.8

4.5

48.9

3.4GHz■ NTT Docomo’s development of 5G service

48.0

September 2019
Preservice starts

Building of 5G infrastructure
Investment

Spring 2020
Commercial service starts

1 trillion yen（2019-2023 total）

・ 5G trial site: 75 trials will be conducted

・ Docomo 5G open partner program: Around 1,800 companies

FY15

FY16

FY17

FY18

FY19 Plan－18－

and organizations will participate(Source: Created by us based on NTT DoCoMo presentation material.)

3. Plans for FY19(7) NCCs◆ Strong sales are expected to continue because of the increase in orders received in recent years.
◆ We will respond to the construction of Rakuten’s wireless base stations, which will be commenced ona full-scale basis, jointly with the three integrated companies in western Japan.
■ Number of base stations for new frequency bands for 4G(1.7 GHz and 3.4 GHz) planned to be opened■ Net sales of NCCs (consolidated)(¥bn)（Note）Including the consolidated adjustment of thethree integrated companies in western Japan

Existing Exeo G

Three companies
in western Japan

38.0
28.1
23.2

6.6

39.5

23.2

23.3

FY15

FY16

FY17

31.4

FY18

Service to be launched at the end of
March 2019
Number of stations planned to be openedby the end of FY25

SoftBank
23,167

Service to be launched at the end of
March 2020
Number of stations planned to be openedby the end of FY22

Rakuten27,397

Service to be launched in October 2019
Number of stations planned to be openedby the end of FY25

(Source: Prepared by the Company based on the materials of the Telecommunication
Bureau, Ministry of Internal Affairs and Communications)■ Results of 5G frequency allotment

10.0

23.3

28.1

KDDI
28,66029.5（19.9）FY19 Plan－19－

3. Plans for FY19
Reference: Investment Trends of Major Telecom Carriers(Source: Figures released by the telecommunications carriers)■ NTT East/West
583.4■ NTT DoCoMo

Optical fiber

549.6

547.9

541.0

595.2

(¥bn)

LTE-related

597.1

577.9

593.7

FY16

FY17

FY18

FY19
Plan
PLAN

380.3

380.0

FY18

FY19
Plan
PLAN

520.0

570.0

365.4
177.0

156.0

154.0

161.0

150.0

FY15

FY16

FY17

FY18

FY19
PLAN
Plan

FY15

■ SoftBank■ KDDI
Mobile

531.4

519.3

560.8

601.7

610.0
412.8
320.5

338.0

325.0

FY15

FY16

FY17

FY18

FY15

FY19
Plan
PLAN

－20－

FY16

350.1

FY17

3. Plans for FY19(8) Urban Infrastructure◆ Construction for 700MHzBand TV reception measures is declining, but sales are expected
to remain strong.
◆ We will undertake construction in a new field, including the earth shuttle method forsubmarine cables.
■ 700 MHz Band TV reception measures■ Urban Infrastructure net sales (consolidated)(¥bn)（Note）Including the consolidated adjustment of thethree integrated companies in western Japan

Existing Exeo G

Three companies
in western Japan

Replacement
Installationof boosterOrof filter

128.0
Construction areas of theCompany

108.6

33.0

17.1

65.7

67.3

Install a filter to cancel the radio

Replace a booster with one that amplifies only thewaves from the 700MHz bandbands up to 710MHz (where the situation cannot

mobile phone base stations

be addressed with the installation of a filter)

Kanto andKoshinetsu(Source: Created by us based on the HP of Association of 700MHz Frequency Promotion)■ Undertake the earth shuttle method

74.5

Note: Appropriate method for the penetration of the sea, rivers, and mountainareas, etc.

Okinawa Construction for installation ofsubmarine cable unloading duct line, etc.
Substation

65.7

67.3

74.5

91.5

Wind farm on the sea

95.0

Filter plant
Cable duct line
海上風力発電施設
Fisheries facilities

Communicationbase station

Sea water intake pipe

Water line to an
isolated island

Coral reef

FY15

FY16

FY17

FY18

FY19 Plan－21－

Cable unloading duct line

3. Plans for FY19(9) System-Solutions◆ Continue to focus on the expansion of new solutions such as new energy and Geo Solutions.
◆ Through global M&A, strengthen the base with the aim of expanding business in the APAC region.

■ Solution Map (added value expansion plan)■ System-Solutions net sales(consolidated)（Note）Including the consolidated adjustment of thethree integrated companies in western Japan(¥bn)
Existing Exeo G

Three companies
in western Japan

106.5

73.4

45.5

26.5
37.8

39.7

42.5

37.8

39.7

42.5

46.9

FY15

FY16

FY17

FY18

61.0

FY19 Plan－22－

3. Plans for FY19
Reference: Results of orders received for new solutions and activities going forward
8¥7.5bn8

6

6

New energy field

42¥1.7bn・ Energy management service

0

FY18

・ Transportable lithium battery
・ Smart meter

FY19 Planin Singapore, and willcommence full scale

Global, otherdevelopment globally・ Global projects
・ Global project
investment, etc.

20
18
16
14
12
10
8
6
4
2
0

2

¥1.3bn0

FY18

FY19 Plan

Energy Viewer , Survival Power Supply,
Utility cloud for new electric power companies ,Orders Received

EXEO GLOBAL was founded¥3.0bn4

HEMS, etc.

¥15.0bn

Geo Solutions field・ Beacon（indoor positioning¥6.1bn

FY18

FY19 Plan

EXBeacon:(Next-generation beacon
equipped with mesh network

infrastructure/sensor

function)

network）⇒ Provision of indoor positioning

・ Guide application

infrastructure and formation of(tourism/disaster)

sensor network

86
4¥2.9bn¥3.5bnCloud/security

2

field

8

0

・ Thin client/virtual field

6・ Security infrastructure

4・ Educational apps

2

FY18

FY19 Plan・Cloud integration engineering in partnership with Microsoft

Computerized parking spacecertification system－Enrichment of lineup of solutions in corporate communication and
IoT fields, Capital and business tie-up with Phone Appli Inc.

－23－

¥0.2bn¥1.0bn0

FY18

FY19 Plan

3. Plans for FY19
Reference : Energy Viewer

Reference : Cloud Integration Engineering

Number of bases that introduced the service
Number of bases to which a proposal was madeTrend of numbers on comprehensive cloud engineering, including received orders
Transition of number of bases that introduced theservice/to which a proposal was made■ Number of bases that introduced the service
20 companies, 153 bases, reduced electricity for
air conditioning by 20% on average
 FY2018: Four companies made a full-scale introduction after understanding theeffect in a trial
 Partners (middle B）also strengthened sales to achieve a substantial increase in
the number of companies to which a proposal was made■ Inquiries for new partners
Discussing collaboration with seven companies■ Status of activities [FY2018]
 Efforts for comprehensive cloud engineering in collaboration with Microsoft Japanand other companies
・ Reform of communication through cooperation between Microsoft
Teams and existing telephones
・ Support of introduction/operation of Microsoft Azure IoT・ Renewal of network/security for the introduction of the cloud,support for the introduction of cloud PBX (PBX renewal, voice recognition)
 IoT
Collaboration with multiple carriers in Japan
Vision AI Developer Kit
in agricultural IoT/factory IoT solutions■ Obtained approval of Microsoft Japan 18.6 Commenced telephone system connection service construction support for
Microsoft Teams for the first time in Japan 18.7 Certified as a Microsoft Mixed Reality partner
 18.11 Trial of Microsoft Azure IoT Edge commenced

 The value of the solution is recognized, due in partto winning the Energy Conservation Award■ New business development

 Solution other than added value of electric power selling■ Provision of new solution in cooperation with Nextgen
 19.4 Opened a laboratory for the next-generation voice solution (voicerecognition/analysis, etc.), starting to consider next-generation voice base

 Analysis and utilization of accumulated big data－24－

3. Plans for FY19
Reference: Mesh-Type Beacon (new LAN exclusive for IoT)
（Case）

160
140

EXBeacon

120
100
80

11

6

60
40

152

Pending
POC
Under introduction/to be introducedordersreceived

420
0

As of July 2017

As of Dec. 2017

As of June 2018

As of Mar. 2019

FY2019 Goal

Trend of numbers on mesh-type beacon, including introduction results
DomainSales Policies

Partner

Plant 1. Direct sales/trade show/2. Joint sales with MES provider: Major automobile plant, major musical instrument company, MES provider

Photo of equipment introduced in Company A

Office 1. Direct sales/trade show/2. Sales by distributor: Major trading company, major furniture and fixtures company, NTT East/West, MS, etc.

Achieve integration of attendance management

Building management: Jointly provide part of a building management system jointly with a management company: NTT Facilities, NTT Data

using location detection of employees andOffice survey: Develop SoI solution jointly with a partner: Major real estate company, NTT Facilities.

production management using location
detection of products

Facility design Position IoT-LAN as a new item for designing building equipment: Nikken Sekkei, major general contractor, NTT Facilities(IoT-LAN)
Facilities/equipment installation: Development/sales of joint solution with air conditioner maker: Major air conditioner maker, Hitachi GLSEXTxAir（Beacon tag card-type）
Furniture and fixtures installation: Development/sales of joint solution with a furniture and fixtures maker: Major furniture and fixtures company

EXTx（Beacon tag）
Warehouse Development/sales of a solution with WMS provider: Own use, Denseisha, Hitachi
Solutions
自社利用

EXBeaconNursing care facilities/hospital 1. Transfer of PoC business in nursing facilities, 2. Business development of Juntendo University SOMPO, Nichii
Gakkan Soft Bank, Juntendo University

EXGateway
Construction site: Subscription system with a rental company as an agency: Major construction machinery rental company－25－

3. Plans for FY19
Reference: Global business initiatives
With EXEO GLOBAL as a starting point, expand business in the APAC region

Building business basesin Southeast Asia
Philippines , Thailand , Singapore

Philippines

Thailand・ Airport ICT・ Industrial complex ICT
・ Data center ICT
・ Expressway communication
・ Railway communication

On October 31, 2018, the company signed an agreement to acquire all shares of the LAE
Group, which engages in work for electrical and integrated facilities in Singapore.

N

SingaporeameLocation
Business
Activities
C a p i t a l
Number of
employees
D a t eo f
Establishment

Leng Aik Engineering Pte.Ltd.
Singapore
Work for electrical and integrated facilities
150 million SGD
Approx. 260 people
September 6, 1999

In November 2018,
EXEO GLOBAL Pte.Ltd. was established in Singapore to operate and manage
overseas subsidiaries. A takeover bid is currently underway for all the shares of
DeClout, a global operator of a system solution business.

External view of training center near Manila

Establishment of EXEO ASIA, a new joint
venture in Thailand in Jan. 2018
N

a

m

e

EXEO ASIA COMPANY LIMITED

L o c a t i o n

Bangkok, Thailand

B u s i n e s s
Activities

Planning, marketing, design, construction, development, sales andmaintenance services in relation to ICT solutions, communicationequipment and IP/Internet

C a p i t a l

6,000,000 THB

Ownership
R a t i o s

KYOWA EXEO 40%, Net Chart 9%, S.E.C.T. 16%,
KDTS 10%, Millennium Plus One 25%

D a t eo f
Establishment

January 3, 2018

N

a

m

e

Location
Business
Activities
C a p i t a l
Number of
employees
D a t eo f
Establishment

DeCLout Limited
Singapore
Sale and service of IT infrastructure and cloud service
114 million SGD
Approx. 630 people
August 21, 2010

MG Exeo (Philippines) has been engaged in construction forcommunication common carriers for a long time.
・Development of ICT technology educators in the Philippines→ Spread to other SE Asian countries
・Global human resources development in the Philippines (one-year stay ＆ short-term stay)Continue to send trainees (employees of our company) from Japan starting in 2015.

－26－

4. Our M&A Strategy(1) Development Direction by Business Segment
Engineering Solutions（Urban infrastructure）

Engineering Solutions（NTT Group, NCCs）
Implementation of system enforcement,
maintenance area expansion

Expanding areas of power/air conditioning and maintenance・M&A in the power/air conditioning field, where synergy can be generated
・M&A in the facility maintenance field・ Generation of synergy with each of the companies
merged and previously acquired
・ M&A aiming at enhancing implementation systemand expanding maintenance2018
C-Cube2018
ＫＯＨＫＥＮ2018
Seibu
Electric
Industry

2010
Ikeno
TsukenAnticorrosion
coating

Currently: Exeo Tech
2011
Wako
Engineering
2011
Daiwa
Densetsu

Competitors(mainly undertaking
NTT's communication
facility construction)

2011

2018

LAE
Electricity supply

Icom

2014

ＳＩ

AID

2015

ＳＩ

WHERE
ＮＩ(Beacon , etc.)

2019

Expansion of SI, NI, and global fields

ＮＩ・M&A in the IoT, AI, and Robotics fields
・M&A in the fields of facility construction,
SI, and NI in the ASEAN region

DeClout

2018
NipponDentsuSystem Solutions－27－

5. Raising Shareholders’ Value(1) Shareholder Return Policy◆ From the FY2018 dividend, DOE was raised to around 3.5% to strengthen shareholder returns◆ Plan to acquire own shares of 5 billion yen in 1H FY2019■ FY2019 planned annual dividend: 80 yen
FY16

FY17

FY18

FY19 Forecast

DOE 3％

DOE 3％

DOE 3.5%(integrated from 2H)

DOE 3.5％

Annual dividends
per share

¥46

¥50

¥70

¥80

Total annual dividends¥4.38 billion¥4.78 billion¥7.31 billion¥8.86billion

31.7％

26.4％

※32.9 ％

40.9％

Item

Payout ratio*Calculated by subtracting the extraordinary profit (negative goodwill) arising from the management integration.

■ Outline of repurchase of treasury stock （the first half of FY19）(1) Purposes of the acquisition: Flexible implementation of capital policy and improvement of capital efficiency(2) Total acquisition: ¥5.0 billion (upper limit)(3) Total number of shares of treasury stock to be acquired: 2.0 million shares (upper limit)(4) Acquisition period: May 15, 2019 to September 30, 2019－28－

5. Raising Shareholders’ Value(2) Plan for shareholder returns for FY19, etc.
■ Dividend history (per share)■ Total shareholder return¥80(Total dividends + total acquisition of treasury stock)70

46

Total acquisition of treasury stock50

Year-end
40

38

8.7
5.0

Interim
40
FY15

FY16

FY17

¥13.8bn

Total dividends

FY18

FY19
Plan

■ Acquisition of treasury stock
5.0

10.3
3.0

7.3
3.0

4.7

3.7

4.3

4.7

FY15

FY16

FY17

7.3

FY18

8.8

FY19
PPlan
LAN

■ EPS/ROE

Note)EPS and ROE are calculated by subtracting the special profit (negative goodwill)from the management integration.

EPS¥5.0bn

ROE
212

189
3.0

5.0

3.0

125

145

¥195

10.8%

8.9%

10.0%

8.2%
8.1%
FY15

FY16

FY17

FY18

FY15

FY19
Plan

－29－

FY16

FY17

FY18

FY19
Plan

6. Topics(1) Singapore-based DeClout made into a group company◆ As part of the efforts to achieve business expansion in the APAC region, EXEO GLOBAL wasfounded and DeClout, a global system solution provider, was made into a group company.

■ Overview of EXEO GLOBAL■ Business formation of DeClout

Name

EXEO GLOBAL Pte.Ltd

Location

Singapore 80 Robinson Road
#02-00 Singapore 068898

EXEO GLOBAL

Title and nameofrepresentative

Managing Director, President
Fumitoshi Imaizumi

DeClout

Business
activities

Management of KYOWA EXEOCORPORATION’s overseas
subsidiary

Capital

6.0 million SGD(about 5.0 million yen)

Date ofestablishment（Japan）

KYOWA EXEO

（Singapore）（an operating company under DeClout)

Beaqon Pte. Ltd.

NamevCargo Cloud

De Clout Investments

Pte . Ltd .

Pte. Ltd.

Business activities

DeClout

Sales/service of IT infrastructure that use next-generation
information communication technology

BeaqonICT solution, data center, and neutral hostingvCargo Cloud

Platform business for smooth digitalized trade

De Clout Investments

Start-up for growth of companies, venture/incubation, andinvestment

November 20, 2018－30－

Disclaimer Regarding Forward-Looking Statements
Management of the Company has made estimates and assumptions
relating to financial forecasts based on information available as of thereporting date. Actual results could differ from those estimates.

3-29-20 Shibuya, Shibuya-ku,
Tokyo 150-0002 JAPANhttp://www.exeo.co.jp/overseas/index.html
TEL: (81)3-5778-1073
FAX: (81)3-5778-1228

A variety of IR materials is available for
consultation on our company website.