Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

Contents1.

‥‥‥‥‥‥ 02

Summary2.

Overview of 2Q Business Results

3.

Results Forecasts

4.

‥‥‥‥‥‥ 07‥‥‥‥‥‥ 16

Topics‥‥‥‥‥‥ 21

Appendix Company Profile, Revenue Categories* Financial figures indicated in this material are based on consolidated accounting to which International Financial ReportingStandards (IFRS) are applied. The indicated figures are rounded off.
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

1

Contents
1. Summary
2.

Overview of 2Q Business Results

3.

Results Forecasts

4.

TopicsAppendix Company Profile, Revenue Categories

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

2

Impact of COVID-19

Summary

Negotiations were prolonged overall because many customers were unaccustomed to online negotiations. As
a result, about 0.9 billion yen slid into 2H. In addition, about 0.1 billion yen was generated from frozen deals due to thedeterioration of the business outlook. Therefore, the sales fell short of the target by about 1 billion yen in total.

Automotive
Market conditions

The business management environment is relatively stable thanks to demand for car inspection and legal
inspection, which are resistant to the effects of the economy.
The deadline for car inspection was delayed until July 1. Customers became busy since June, after the state of
emergency was lifted.

Non-automotive The severe business management environment continues in the travel industry and the tourist bus industry.
OTRS
Ordersreceived/Sales

Expenses/
Investment

Financial activities/
Credit limit

Manufacturing industry, the main purchaser of OTRS, continues to be passive in investments to cut costs.

The Company has shifted from face-to-face sales activities to online sales activities since late March. As a result, negotiations
tend to be protracted.
Consequently, about 0.9 billion yen slid into 2H. In addition, about 0.1 billion yen was generated from frozen deals, making sales
fall short of the target by about 1 billion yen in total.
Expenses were controlled due to a reduction in advertising expenses and restrictions on sales activities.
Although cloud software development is generally progressing as planned, the product launch timing was reviewed strategically.

Borrowed 1.7 billion yen in February as scheduled at the beginning of the period. Despite the seasonality, working capital was secured.
It is unlikely that a loss exceeding a provision for loss will be generated.

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

3

Chapter 1

Impact by Industry

Summary

About 0.9 billion yen slid into 2H, mainly deals in automotive industry, machine tools dealers, and mobile phone distributers.
About 0.1 billion yen were frozen, mainly deals in travel agencies, bus operators, and OTRS (manufacturing industry).
Similar trend is expected to continue in 2H.
Sales composition by industry*
Automotive 79%

Non-automotive 19%

OTRS 2%

Travel, Bus
3%
Mobile phone
9%
Auto maintenance,
Auto body,
Car dealers
50%

Machine tools
7%
Others**9%Auto parts,
Auto recycle20%* 1st Half Sales Forecast Composition (Software and Equipment)**Auto glass, Auto electrical equipment and radiator

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

Amount of impact（1.03 billion yen）and breakdown by industry
OTRS ▲20 million yen（Mainly frozen）（Reason）Freezing of deals wereremarkable after March（2nd Half）Similar situation is
expected to continue

Auto maintenance,
Auto body,▲520 million yen (Slide)Car dealers（Reason）Business negotiations
prolonged after March（2nd Half）Sales will stay at the same level
as the previous year due toprolongment of negotiations

Auto parts,
Auto recycle▲140 million yen（ Slide ）（Reason）Business negotiations
prolonged after March（2nd Half）Sales will stay at the same level
as the previous year due toprolongment of negotiations

Travel, Bus ▲120 million yen (Mainly frozen)（Reason）Freezing of deals wereremarkable after March（2nd Half）Similar situation is
expected to continue

Mobile phone ▲180 million yen (Slide)（Reason）Restricted sales activities at therequest of customers after March（2nd Half）Restriction of sales activities may
continue

Machine tools ▲30 million yen（Slide）（Reason）Restricted sales activities at therequest of customers after March（2nd Half）Restriction of sales activities may
continue

Others** ▲20 million yen（Slide）（Reason）Business negotiations prolonged after March（2nd Half）Sales will stay at the same level as the previous
year due to prolongment of negotiations

4

1H Results and Full-year Forecasts

Chapter 1

Summary

Under the unpredictable external environment, the forecasts of the 2H have been updated from the forecasts at the
beginning of the period due to delay in the starting of business negotiations and the prolonged time used to conclude thenegotiations.
Operating profit

Revenue
Full-year

2H

1H

Forecast
227.0

Forecast
115.0

Forecast
112.0[100 million yen][100 million yen]

Forecast
213.0

Full-year
Forecast
110.7

Result102.3

Updated▲4.3

Unachieved

▲9.7

2H

1H

Forecast
46.0
Forecast
26.0

Forecast
20.0

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

After update（Aug. 7）

Forecast
22.7

Result16.3

Updated▲3.3

Unachieved

▲3.7

▲7.0

▲14.0
Beginning of the period（Feb. 14）

Forecast
39.0

Beginning of the period（Feb. 14）After update（Aug. 7）

5

Chapter 1

Release Plan for Cloud Software and Service

Summary

The Company introduced software in advance to major customers (car inspection chains and car accessories shops) who
hold the key to the early popularization of the cloud software.
Simultaneously it will offer software to diverse industries in 2021, and the electronic transaction platform is scheduled for
operation sequentially.
2020

Software

1H
Major

Maintenance2021

SS/party that has not yet
installed the product *

2H

1H

2022
2H

Development/Prior installation

2H

Offer (all targets)

Offer (target limited)

Test installation

1H

Offer (all targets)

At least mid-sized
Bodywork
Car Sales

Development

Testinstallation

Offer (target limited)

Offer (all targets)

Offer (major)

Offer (all targets)

Parts dealers
Recycling

ServiceElectronictransaction
platform

New auto parts
Recycled auto parts

Development

ExtensionDevelopment* SS means gas station. A party who has not yet installed the product is an operator who has not yet installed business software.
Note: The schedule may change due to the external environment.

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

6

Contents
1.

Summary

2. Overview of 2Q Business Results
3.

Results Forecasts

4.

TopicsAppendix Company Profile, Revenue Categories

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

7

Chapter 2

Overview of Consolidated Business Results

Overview of 2Q Business Results

Revenue and profit decreased due to prolonged business negotiations under the influence of the spread of COVID-19（¥ million）

FY2020FY20191H

1H

YoY change

YoY ratio

Revenue

10,232

11,072

-840

-7.6%

Operating profit

1,628

2,080

-452

-21.7%

Profit before tax

1,614

2,075

-461

-22.2%

Profit attributable to ownersof parent

1,066

1,361

-296

-21.7%

Basic earnings per share¥12.18¥15.59--Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

8

Revenue by Category

Chapter 2

Overview of 2Q Business Results

Sales of platforms and applications both decreased due to drop in the number of sales of software led by prolonged businessnegotiations
FY2020（¥ million）
FY2019YoY change
YoY ratio
1H
1H
Platforms

4,872

4,948

-76

-1.5%

Basic

3,600

3,717

-117

-3.1%

EDI/Payment settlement

439

455

-15

-3.4%

Support

761

706

+55

+7.7%

Others

72

70

+1

+2.0%

Applications

5,360

6,123

-763

-12.5%

4,165

5,173

-1,008-19.5%

OTRS

132

208

-76

-36.6%

Others

1,064

743

+321

+43.2%

10,232

11,072

-840

-7.6%

By industry

Total

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

9

Breakdown of Platform Sales

Chapter 2

Overview of 2Q Business Results

While monthly sales steadily increased, basic lump-sum sales which is linked to the number of software sales decreased（¥ million）
Basic

FY2020FY20191H

1H

YoY change

YoY ratio

3,600

3,717

-117

-3.1%

2,490

2,682

-193

-7.2%

lump-sum

1,014

1,287

-273

-21.2%

monthly

1,475

1,395

+80

+5.7%

monthly

1,110

1,035

+76

+7.3%

EDI / Payment settlement

439

455

-15

-3.4%

PaaS/SaaS

IaaS
PSF *

monthly

269

299

-30

-10.0%

BLP/CPT *monthly

170

155

+14

+9.3%

761

706

+55

+7.7%

415

337

+78

+23.0%

346

369

-23

-6.3%

72

70

+1

+2.0%

4,872

4,948

-76

-1.5%

SupportSupport service monthly
Provision of
consumables
lump-sum
OthersTotal

ｰCopyright©2020 Broadleaf.Co.,Ltd. All rights reserved. *[PSF] settlement agency fee for automobile recycled parts transaction market [BLP] Usage fee for “BL Parts Order System” [CPT] Usage fee for ”CarpodTab”

10Chapter 2

Half-yearly Transition of Monthly Sales

Overview of 2Q Business Results

Sales of ancillary service (Basic/Support service) remained firm regardless of the environment due to increase in thenumber of software users.
Sales of EDI/Payment settlement struggled influenced by the environment of recycled auto parts market.
（¥ million）： Basic（Monthly）[flat-rate]*： Support service [flat-rate]： EDI/Payment settlement [flat-rate/measured-rate]

3,326

3,440

3,077

3,170

3,222

453

482

455

465

291

310

337

370

2,334

2,377

2,430

2,490

2,586

FY20181H

FY20182H

FY20191H

FY20192H

FY20201H

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

439
415

*sum of PaaS/SaaS（monthly）and IaaS of Platform Basic

11

Breakdown of Application Sales

Chapter 2

Overview of 2Q Business Results

Sales were largely influenced by decrease in software sales due to prolonged business negotiations.
In non-automotive sector and OTRS, the original pool of deals were small and some of the deals were cancelled.

（¥ million）
By industry

FY2020FY20191H

1H

YoY change

YoY ratio

4,165

5,173

-1,008-19.5%

3,606

4,387

-781

-17.8%

559

786

-227

-28.9%

OTRS

132

208

-76

-36.6%

Others

1,064

743

+321

+43.2%

5,360

6,123

-763

-12.5%

Automotive
Non-automotive

Total

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

12

Chapter 2

Breakdown of Operating Profit

Overview of 2Q Business Results

Decline in cost of sales was limited due to increase in sales of equipment and amortization expense.
Reduced costs including advertising expense and operating expense but failed to complement the impact.
（¥ million）+ shows the factor of increase inoperating profit from the year-ago level－shows the factor of decrease inoperating profit from the year-ago level

Operating
Profit2,080

Decrease incost of sales+59

Decrease inadvertisingexpenses+94

Decrease inpersonnel
expenses+34

Decrease inshare-related
expenses+54

Others+147

Operating
Profit1,628

Decreasein sales-840 Increase inpurchase cost
-23
Increase in amortizationof cloud software -39

FY20191H
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

FY20201H
13Chapter 2

Overview of the Balance Sheet

Overview of 2Q Business Results

No significant changes other than increase in intangible assets gained by cloud software development investment andborrowing from the bank.
（¥ million）

FY2020End of

End of 1H

FY2019YoY change

Main factors ofincrease/decrease

Current assets

7,934

7,987

-53

Decrease in cash and deposits -208
Increase in operating andother receivables +158

Non-current assets

24,157

23,702+455

Increase in intangible assets +728

32,091

31,689+402

Total assets

Current liabilities
Non-current liabilities
Total liabilities
Total shareholders' equity
Total liabilities andshareholders' equity
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

7,031

7,100

-69

Decrease in operating andother payables -466
Increase in short-term interestbearing debt +987
Decrease in long-term interestbearing debt

1,303

1,369

-66

8,334

8,469

-135

23,75723,220+537

32,091

31,689+402-66

Recognition of profit +1,066
Dividend payout
-568

14

Chapter 2

Overview of Cash Flow

Overview of 2Q Business Results

Cash deposit balance remained stable due to investment control and borrowing from the bank.
（¥ million）

FY2020FY20191H

1H

YoYchangeMain factors ofincrease/decrease

Cash flow from operating activities

1,100

898

+202

Cash flow from investing activities-1,284-2,039+755

Decrease in operating andother receivables +569
Decrease in operating andother payables -574
Decrease in income taxes paid +345
Decrease in acquisition of
intangible assets +419
Decrease in acquisition of
investment +1,048

Cash flow from financing activities-23-1,324+1,300

Increase in short-term debt +1,001

Free cash flow

-184

-1,140+956

Cash and cash equivalents

2,826

3,153

-327

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

15

Contents
1.

Summary2.

Overview of 2Q Business Results

3. Results Forecasts
4.

TopicsAppendix Company Profile, Revenue Categories

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

16

Chapter 3

Consolidated Results Forecasts

Results Forecasts

Under the unpredictable external environment, the forecasts of the 2H of FY2020 has been updated from the forecasts
at the beginning of the period due to delay in the starting of business negotiations and prolongment in time used toconclude the negotiations.
（¥ million）

FY2020Full-year
forecast

FY2019Full-year

YoYchangeYoY(ratio)FY20202H
forecast

FY2019YoYchange

2H

YoY
ratio

Revenue

21,30022,586-1,286-5.7%

11,068

11,514

-446

-3.9%

Operating profit

3,900

4,525

-625

-13.8%

2,272

2,445

-173

-7.1%

Profit before tax

3,900

4,486

-586

-13.1%

2,286

2,410

-125

-5.2%

Profit attributable toowners of parent

2,700

3,093

-393

-12.7%

1,634

1,732

-97

-5.6%

Basic earnings per share¥30.87¥35.40

-

-

-

-

-

-

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

17

Sales Forecasts by Revenue Categories

Chapter 3

Results Forecasts

Sales of Platforms will be influenced by drop in lump-sum sales which is linked to the number of software sales.
Sales of Applications is expected to decrease due to drop in software sales caused by prolonged business negotiations andfrozen negotiations.
（¥ million）

FY2020Full-year
forecast

FY20202H
forecast

FY2019Full-year

Platforms

10,10010,192

-92

-0.9%

5,228

5,244

-16

-0.3%

Basic

7,600

7,654

-54

-0.7%

4,000

3,937

+62

+1.6%

850

920

-70

-7.6%

411

465

-54

-11.7%

Support

1,500

1,478

+22

+1.5%

739

771

-32

-4.2%

Others

150

140

+10

+6.9%

78

70

+8 +11.9%

Applications

11,20012,394-1,194

-9.6%

5,840

6,270

-430

-6.9%

9,200

10,448-1,248-11.9%

5,035

5,275

-240

-4.5%

OTRS

200

338

-138

-40.8%

68

130

-62

-47.6%

Others

1,800

1,608

+192 +12.0%

736

865

-129

-14.9%

21,30022,586-1,286

11,068

11,514

-446

-3.9%

EDI/Payment settlement

By industry

Total

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

FY2019YoYchange

YoY
ratio

-5.7%

2H

YoY
change

YoY
ratio

18

Chapter 3

Breakdown of Operating Profit（Full-year）

Results Forecasts

While continuing R&D expenses on new service, optimize operating and personnel expenses by increasing telework ratio,
and promote reduction of general expenses. Still, complementation of the decrease in revenue is expected to be difficult.
（¥ million）+ shows the factor of increase inoperating profit from the year-ago level－shows the factor of decrease inoperating profit from the year-ago level

Operating
Profit4,525

Decrease in Decrease inpersonnel
advertising
Decrease in
expensescost of sales expenses
+117
+96
+294
Decreasein sales-1,286

Decrease inshare-related
expenses+55

Others+173

Operating
Profit3,900

Increase in
R&D expenses-74

Increase in amortizationof cloud software -160

FY2019Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

FY2020（forecast）
19

Chapter 3

Dividend per ShareResults Forecasts

The interim dividend of ¥6.60 will be paid as planned,
no change year-end dividend forecast of ¥6.60, planning to continue increasing annual dividend
Dividend policy

Annual dividend

Annual dividend（Payout ratio）

Year-end

Interim¥12.00（39.5%）¥6.50¥13.00（36.7%）¥13.20（42.8%）

¥6.50

¥6.60
forecast

¥5.50

¥6.50

¥6.60
fixed

FY2018FY2019FY2020

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

Considering to raise the target dividend
payout ratio regarding the past dividend
performance.
Reference）Current dividend policy：
Stable dividend is the basic policy, withpayout ratio of approximately 20%

20

Contents
1.

Summary2.

Overview of 2Q Business Results

3.

Results Forecasts

4.

TopicsAppendix Company Profile, Revenue Categories
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

21

Chapter 4

Anti-COVID-19 Measures

TopicsAssuming that society will continue to live with COVID-19, the Company will pursue initiatives to secure the safety ofcustomers, business partners, and employees.

Workstyle• Control the coming-to-work rate using a system of rotation (a weekly average of less than 50%) and use staggered
work hours.
• Prohibit employees from coming to work if they do not feel well or have symptoms such as a fever or a cough.

Office use/Meeting• Meetings are held on web. When employees must hold a meeting face-to-face, avoid crowding by using a spacious
meeting room, where seats are spaced out and employees take a seat from one side to the other and sit face-to-face.
• Ensure that masks are worn, hands are regularly washed, and social distancing is maintained.

Visitation/Sales activities• Raise the online response ratio by directing customer inquiries to the Company’s call center.
• Take basic preventive measures, such as wearing a mask, and observe the rules set by places that employees are
visiting.
• Install the COVID-19 Contact Confirming Application (COCOA) on the smartphones used by employees at work.
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

22

Chapter 4

Support Customers Affected by the Heavy Rainfall in July 2020

Topics

To pursue recovery and restoration efforts for damage caused by the downpour that continued across Kyushu as quickly as
possible, the Company supported customers in terms of funds, IT infrastructure, and activities.

Finance• Made a consolation payment depending on the level of damage.
• Temporarily suspended the billing of running expenses for business software.

IT infrastructure• Lent portable Wi-Fi for free when the Internet environment was needed.

Support• Confirmed the safety and damage situation through the Company’s call center and functioned as a consultation
contact.
• Upheld employees’ volunteer activities and activity support (bearing the cost of volunteer insurance, providing ameans of transportation)

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

23

Contents
1.

Summary2.

Overview of 2Q Business Results

3.

Results Forecasts

4.

TopicsAppendix Company Profile, Revenue Categories

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

24Appendix

Company Profile

Corporate Name

Broadleaf Co., Ltd.

Representative

Kenji Oyama, Representative Director, President and CEO

Listed on

Listed on the First Section of the Tokyo Stock Exchange on March 22, 2013 (3673)

SectorInformation and communication sector

Founded/Established

December 2005/September 2009

Capital StockJPY 7,148 million (consolidated)

Fiscal Year

From January 1st to December 31st

Business Outline

The Company offers a wide range of IT services, including its independently developed business software.

Appendix

In addition to provision of business software that serves as core business systems, mainly for business operators
belonging to the automotive aftermarket sector, the Company provides diverse, unique one-stop services, including
electronic trading network for auto parts and big data analysis.
In addition, looking ahead to the evolution of the mobility society going forward, it has been conducting surveys andresearch for the commercialization of advanced technologies.
Head Office Address

Floor 8, Glass Cube Shinagawa, 4-13-14 Higashi-Shinagawa, Shinagawa-ku, Tokyo

Sales Offices

29 offices in Japan

Development Centers

3 centers in Japan (Sapporo, Tokyo and Fukuoka)

Main Subsidiaries

Tajima Inc.

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

25

Appendix

Revenue Categories (1)Types of Service

Appendix

For a customer company, the Company provides multiple services, including business software, as a single package.
Provision of services

Customer company

Compensation for services

Broadleaf

Breakdown

Non-optional

Non-optional

Non-optional

Non-optional

Optional*2

Optional

Optional

Optional

Optional

Business software

Business software(Basic functions)

Database

Server functions

Customer support

Ink toner
Business forms

E-commerce site
for recycled
automotive parts

EDI forautomotive parts

Computers andother equipment

Type ofcompensation

Fee for purchasing
usage rights*1

Fee for purchasing
usage rights*1

Use feeUse feeUse feeFee for purchasing
products

Use feeUse feeFee for purchasing
products

Form ofpayment

Lump-sum

Lump-sumMonthlyMonthlyMonthly

Lump-sumMonthlyMonthly

Lump-sum

Service name

*1 Usage rights valid for a maximum of 6 years*2 Measures for improving the contract ratio were strengthened in the second half of 2019.

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

Note: The range of services to be provided differs according to the type ofbusiness of customer company.

26

Appendix

Revenue Categories (2)Correspondence Relationship with Revenue Categories

Appendix

The form of payment differs according to the type of service. The correspondence relationship between the type of service
and revenue categories is as indicated below.
Services

Form of payment

Revenue Categories

アプリケーション
Applications
Fee for rights to use business software (valid
for a maximum of 6 years)

Lump-sum

By industry/OTRS[Periodic]

Fee for computers and other equipment

Lump-sum

Others[Periodic/Pay-as-you-go]

Platforms
Basic

Fee for rights to use basic functions(valid for a maximum of 6 years)

Lump-sum

PaaS/SaaS (Lump-sum)[Periodic]

Fee for use of database

Monthly

PaaS/SaaS (Monthly)[Flat rate]

Fee for use of server functions

Monthly

IaaS (Monthly)[Flat rate]

SupportFee for use of customer support

Monthly

Support Service[Flat rate]

Fee for toner/business forms

Lump-sum

Provision of consumables[Pay-as-you-go]

EDI / Payment settlement
Fee for use of e-commerce site

Monthly

PSF[Pay-per-use]

Fee for use of EDI

Monthly

BLP/CPT[Flat rate & Pay-per-use]

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

27

Appendix

Revenue Categories (3)Contract Renewal Timing

Most customer companies choose a lease contract.
There are cases where the Company takes over the remaining lease payments as a “trade-in” before the expiration of thesoftware lease period.
In the case of a 6-year contract

Trade-inAmount recorded as revenue

Broadleaf

Lump-sum payment (Payment
for the initial contract)

Lump-sum payment (Payment for the new contract - Remaining
lease payments taken over by the Company as a “trade-in”)

Finance lease
Leasing company

Monthly payments (Payments
for the initial contract)

Monthly payments (Payments for the new contract - Remaining
lease payments taken over by the Company as a “trade-in”)“Trade-in” (remaining lease payments)
Initial contract

Contract renewed before
6 years have elapsed(Average of 5 years)

Expiration of theinitial contract

Customer company
New contract
Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

Expiration of the
new contract28

Disclaimer
Results forecasts and future predictions provided in thisdocument are the Company’s judgment based on the information
available as of the time of preparation of the document andcontain potential risks and uncertainties.
Accordingly, please understand that the actual results may differ

from the results forecasts provided here.
【Contact Information】
Broadleaf Co., Ltd.
Investor Relations Department
E-Mail：bl-ir@broadleaf.co.jp

Copyright©2020 Broadleaf.Co.,Ltd. All rights reserved.

29