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

・I am Oyama, President and CEO of Broadleaf.
・Thank you for participating in the third quarter business results teleconference for the fiscal year
ending December 2020.

Contents
1.

Overview of 3Q Business Results

2.

Results Forecasts

3.

Topics‥‥‥‥‥‥ 02‥‥‥‥‥‥ 11‥‥‥‥‥‥ 16

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

・I would now like to proceed according to the table of contents shown on page 1.
・I would like to start with an overview of third quarter business results, on page 3.

1

Contents
1. Overview of 3Q Business Results
2.

Results Forecasts

3.

TopicsAppendix Company Profile, Revenue Categories

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

2

Chapter 1

Summary

Overview of 3Q Business Results

Progress of the business results was favorable for the cumulative third quarter, and the Company promoted digitaltransformation (DX) of customers through webinars, etc.
Revenue and profit decreased compared to previous financial year, but the progress toward full-year target isfavorable.

Businessresults

Revenue
Platform
Application

Operating profit

15,544 million yen（down 7.7% year on year）
including monthly sales of 5,331 million yen（up 6.9% year on year）
7,440 million yen（down 1.8% year on year）
8,104 million yen（down 12.5% year on year）

2,864 million yen（down 19.5% year on year）

Activities

Promoted penetration measures for DX of customers through webinars, etc.
Conducted sales activities using both online and face-to-face style. The situation of prolonged businessnegotiation continued.

Expense/Investment

Controlled cost by reducing mainly advertising expenses and operating expenses.
The development of cloud software generally progressed as planned. Strengthened the investment in order tosecure the continuity of the service.

Credit risk

Since the Company managed credit risk thoroughly, the impact of the materialization of credit risk is extremely
small.

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

3・First, regarding results for the first three quarters of the fiscal year under review.
・Revenue and profit declined YoY, but progress toward the full-year forecast was in line withexpectations, and we believe that results are steady.
・In terms of activities, due to the impact of the COVID-19, the business negotiation period
continues to be prolonged. In the third quarter too, we are not able to say that the length ofnegotiation period has returned to what it used to be.
・We continue to strengthen our online sales activities and engage in remote business negotiations.
In addition, we continue to promote penetration measures for DX of customers by webinars.
・We are also promoting both online and face-to-face business negotiations with customers,
and we believe that the negotiation period will gradually return to the level it used to be.
・Costs were restrained mainly by advertising expenses and operating expenses.
・The development of cloud software generally progressed as planned, and we also strengthened
the investment in order to secure the continuity of the service.
・We have also thoroughly managed the credit risk of our customers, and it can be said thatthe impact of the materialization of the risk on our business results is minimal.
・Next, I would like to give you an overview of third quarter consolidated business results, on page 4.

Chapter 1

Overview of Consolidated Business Results

Overview of 3Q Business Results

The impact of COVID-19 remained, and the trend of prolonged business negotiations continued in the third quarter (fromJuly to September)（¥ million）

Revenue

FY2020FY2019Cumulative 3Q

Cumulative 3Q

YoY change

YoY ratio

15,544

16,840-1,297-7.7%

Platform

7,440

7,579

-139

-1.8%

Application

8,104

9,261

-1,157-12.5%

Operating profit

2,864

3,558

-693

-19.5%

Profit before tax

2,815

3,523

-709

-20.1%

Profit attributable to owners of parent

1,867

2,320

-453

-19.5%

Basic earnings per share¥21.33¥26.55--

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

4・As explained in the summary, the impact of COVID-19 remained slightly from July to September,and the trend of prolonged business negotiations continued.
・As a result, revenue decreased by JPY1.297 billion to JPY15.544 billion, operating income
decreased by JPY693 million to JPY2.864 billion, and quarterly profit attributable to owners of theparent company decreased by JPY453 million to JPY1.867 billion.
・Next, I would like to discuss revenue by the category of platform, on page 5.

Breakdown of Platform Sales

Chapter 1

Overview of 3Q Business Results

Monthly sales continued to increase as a whole, but Basic lump-sum sales decreased because it is linked to the number ofsoftware sales.
（¥ million）

Basic

FY2019Cumulative 3Q

YoY change

YoY ratio

5,497

5,684

-187

-3.3%

3,823

4,116

-293

-7.1%

lump-sum

1,584

2,012

-428

-21.3%

Monthly

2,239

2,104

+135

+6.4%

Monthly

1,674

1,568

+106

+6.8%

PaaS/SaaS

IaaS

FY2020
Cumulative 3Q

EDI / Payment settlement

665

689

-23

-3.4%

PSF *

monthly

407

454

-47

-10.3%

BLP/CPT *monthly

258

235

+23

+9.9%

SupportSupport service
Provision of
consumables

Others

1,163

1,099

+65

+5.9%

monthly

639

517

+121

+23.5%

lump-sum

525

582

-57

-9.8%

ｰ

113

107

+6

+5.8%

7,440

7,579

-139

-1.8%

Total
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”

5・For the Basics, lump-sum of PaaS/SaaS is linked to the number of software sold, resulting in adecrease in revenue.
・On the other hand, monthly sales continued to increase as a whole, mainly due to recurring
revenue.
・For EDI and Settlement, PSF consist of a payment settlement fee for transactions of recycled autoparts, which struggled due to the sluggish distribution market for recycled parts.
・Sales of BLP/CPT are steadily increasing due to the increasing number of corporate users.
・For Support, support service sales continued to increase in line with an increase in the contract
rate.
・Supplies are sales of products associated with our services, such as printing forms, and the sales
decreased due to the external environment which affected purchasing behavior.
・For Others, sales increased mainly due to an increase in subscribers to the new service named“Broadleaf Homepage Premium.”・Next, I would like to discuss the quarterly transition of monthly sales, on page 6.

Chapter 1

Transition of Monthly Sales (Three Months)

Overview of 3Q Business Results

In addition to increase in the number of software users and support service contract ratio, deals of services related to DX also
increased（¥ million）： Basic（Monthly）[flat-rate]*：Support service and others[flat-rate]：EDI/Payment settlement[flat-rate/measured-rate]

1,819

1,636

1,656

1,693

1,702

1,745

1,767

1,609

228
195

226
213

234

231

222

217

226

244
172

217

224

241

245

265

1,193

1,213

1,217

1,242

1,248

1,281

1,305

1,327

4Q

1Q

2Q

3Q

4Q

1Q

2Q

3Q

FY2018

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

FY2019FY2020*The sum of PaaS/SaaS（monthly）and IaaS of Platform Basic

6

・Quarterly trends in monthly sales are shown in the graph.
・The number of customers of business software continued to grow, and service sales, such as
database use fees, remained steady regardless of the external environment.
・These are the basic sales of platforms, and recurring revenue is increasing as the number ofcustomers increases.
・Sales of support service have been on an uptrend against the backdrop of an increase in thecontract rate.
・In addition, new service of monthly sales named “Broadleaf Homepage Premium” are added to themonthly sales.
・Meanwhile, payment settlement fees from the purchase and sale of recycled auto parts havestruggled, partly due to the impact of market conditions.
・Next, I would like to discuss details on breakdown of application sales, on page 7.

Breakdown of Application Sales

Chapter 1

Overview of 3Q Business Results

Sales in By industry and OTRS decreased because trend of prolonged business negotiations continued.
Sales in Others increased because there were big deals on equipment sales.
（¥ million）

By industry

FY2020FY2019Cumulative 3Q

Cumulative 3Q

YoY ratio

YoY change

6,489

7,788

-1,299-16.7%

5,548

6,598

-1,050-15.9%

941

1,189

-249

-20.9%

OTRS

173

282

-109

-38.6%

Others

1,442

1,192

+250

+21.0%

8,104

9,261

-1,157-12.5%

Automotive
Non-automotive

Total

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

7

・Sales of applications decreased due to a decrease in the number of software sold.
・For By industry, sales of automotive category decreased mainly due to continuation of prolonged
business negotiations.
・Regarding replacements of existing customers, early replacement is decreasing due to prolonged
business negotiations. This is because customers are able to adjust the replacement period aslong as the date is within the contract period of 60 months (in the case of five years contract).
・In the non-automotive category, in addition to prolonged business negotiations, there wereoriginally fewer deals of replacement for existing customers, and some deals were frozen mainly
in travel agencies, which influenced the sales.
・OTRS, which is a work analysis software, was influenced by customers who became cautious on
investments.
・Sales in Others largely increased because there were big deals on equipment sales.
・Next, I will discuss the breakdown of operating profit, on page 8.

Chapter 1

Breakdown of Operating Profit

Overview of 3Q Business Results

Decline in cost of sales was limited, and even though the Company reduced SGA expenses, it was not sufficient tocompensate the decrease in revenue.
（¥million）

Operating
Profit3,558+ shows the factor of increase in profit year on year
- shows the factor of decrease in profit year on year

Decrease incost of sales+108
Decreasein sales-1,297

Decrease inadvertisingexpenses+112

Decrease inpersonnel
expenses+49

Decrease inshare-related
expenses+55

Others+279

Operating
Profit2,864

Increase inpurchase cost
- 33
Increase in amortizationof cloud software - 63

FY2019Cumulative
3Q
Copyright©2020 Broadleaf Co.,Ltd. All rights reserved.

FY2020
Cumulative
3Q
8・The decrease in cost of sales was limited due to increase in purchase cost caused by the growthin equipment sales and increase in amortization of cloud software.
・On the other hand, advertising expenses declined due to the cancellation of large-scale exhibitions
in response to the spread of COVID-19.
・In addition, SG&A expenses as a whole decreased by JPY498 million due to a reduction in various
expenses, such as shareholder-related expenses and operating expenses.
・As a result, operating profit decreased by JPY693 million to JPY2.864 billion.
・Next, I would like to discuss the balance sheet, on page 9.

Chapter 1

Overview of Balance Sheet

Overview of 3Q Business Results

No significant changes other than increase in intangible assets gained by cloud software development investment andincrease in short-term interest-bearing debt .
（¥ million）

FY2020End of 3Q

End of
FY2019YoY change

Main factors of increase/decrease

Current assets

7,989

7,987

+2

Decrease in cash and deposits -265
Increase in operating and other receivables +341

Non-current assets

24,33523,702+634

Increase in intangible assets +1,034

32,324

31,689+635

Current liabilities

7,072

7,100

-28 Increase in short-term interest-bearing debt +1,357

Non-current liabilities

1,229

1,369

-140

Total liabilities

8,301

8,469

-168

Total shareholders' equity

24,02323,220+803

32,324

31,689+635

Total assets

Total liabilities andshareholders' equity

Decrease in operating and other payables-355

Decrease in long-term interest-bearing debt -135

Recognition of profit +1,867
Dividend payout -1,146

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

9・In assets, cash and deposits decreased due to dividend payments and tax payments, whileborrowing money from the bank.
・Intangible assets increased due to investments in cloud software development.
・In liabilities, short-term interest-bearing debt increased due to bank loans, while long-term interestbearing debt decreased.
・Total shareholders' equity increased due to the recognition of profit.
・Next, I would like to give you an overview of cash flow, on page 10.

Chapter 1

Overview of Cash Flow

Overview of 3Q Business Results

In addition to increase in free cash flow due to control of investment, cash and deposit balance increased due to short-termborrowing from the banks.
（¥ million）

FY2020FY2019Cumulative 3Q

Cumulative 3Q

Cash flow from operating activities

2,114

1,376

+739

Decrease in operating and other receivables +62
Decrease in operating and other payables -86
Decrease in income taxes paid +507

Cash flow from investing activities-1,938-2,961+1,023

Decrease in acquisition of intangible assets +421
Decrease in acquisition of investment +985

Cash flow from financing activities-441-2,112+1,672

Increase in short-term debt +1,400

Free cash flow

176

-1,586+1,762

2,769

1,928

+841

Cash and cash equivalents

YoY change

Main factors ofincrease/decrease

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

10・Operating cash flow increased YoY due to a decrease in income taxes paid and other factors.
・For investing cash flow, expenses decreased due to a reduction in other investments despite
progress in cloud software development.
・As a result, free cash flow increased by JPY1.762 billion.
・For financing cash flow, expenses decreased mainly due to bank loans.
・Cash and deposits increased by JPY841 million.
・Next, I would like to discuss the results forecasts for the fiscal year 2020, on page 12.

Contents
1.

Overview of 3Q Business Results

2. Results Forecasts
3.

TopicsAppendix Company Profile, Revenue Categories

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

11

Chapter 2

Consolidated Result Forecasts

Results Forecasts

No change to results forecasts announced on August 7, 2020（¥ million）

FY2020FY2019YoYchangeYoY
ratio

FY2020FY2019Necessaryamountfor 4Q*

4Q
resultYoYchangeYoY
ratio

Full-year
forecast

Full-year
resultRevenue

21,30022,586-1,286

-5.7%

5,756

5,746

+11

+0.2%

Operating profit

3,900

4,525

-625

-13.8%

1,036

967

+68

+7.1%

Profit before tax

3,900

4,486

-586

-13.1%

1,085

962

+123

+12.8%

Profit attributable toowners of parent

2,700

3,093

-393

-12.7%

833

774

+60

+7.7%

Basic earnings per share¥30.87¥35.40

-

-

-

-

-

-

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

* Calculated by subtracting the amount of cumulative 3Q from full-year result forecast

12・There is no change in the consolidated results forecasts from the figures announced on August 7.
・In order to finalize the forecast, we will need to increase revenue and profit in the fourth quarter as
well, but sales levels have been lower in the fourth quarter of 2019 than before.
・The reason for this is that several deals were slid in 2020 in order to promote sales smoothing in
the quarter.
・Accordingly, we believe that the increase in revenue and profit in the fourth quarter is well withinreach, although it is by no means easy given the external environment.
・Next, I would like to discuss results forecasts by revenue categories, on page 13.

Results Forecasts by Revenue Categories

Chapter 2

Results Forecasts

No change to results forecasts announced on August 7, 2020（¥ million）

FY2020FY2019YoYchangeYoY
ratio

FY2020FY2019Necessaryamountfor 4Q*

4Q
resultYoYchangeYoY
ratio

Full-year
forecast

Full-year
resultPlatforms

10,10010,192

-92

-0.9%

2,660

2,613

+47

Basic

7,600

7,654

-54

-0.7%

2,103

1,970

+132

+6.7%

850

920

-70

-7.6%

185

231

-46

-20.1%

1,500

1,478

+22

+1.5%

337

379

-42

-11.1%EDI/Payment settlement
Support+1.8%

Others

150

140

+10

+6.9%

37

33

+4

+10.6%

Applications

11,20012,394-1,194

-9.6%

3,096

3,132

-36

-1.2%

9,200

10,448-1,248-11.9%

2,711

2,660

+51

+1.9%

OTRS

200

338

-138

-40.8%

27

56

-29

-51.7%

Others

1,800

1,608

+192

+12.0%

358

416

-58

-13.9%

21,30022,586-1,286

-5.7%

5,756

5,746

+11

+0.2%

By industry

Total

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

* Calculated by subtracting the amount of cumulative 3Q from full-year result forecast

13

・There is no change in the results forecasts by revenue categories from the figures announced on
August 7.
・For the full fiscal year, not only applications but also platforms are expected to decline.
This is due to a decrease in lump-sum sales linked to the number of sales of business software.
・On the other hand, monthly sales, which are recurring revenue, will increase.
・In the fourth quarter, platforms are expected to exceed the previous year's level.
・As for applications, although there has been a recovery by industry, mainly in automotive
industry, the overall figure is expected to be at the same level as the previous year.
・Next, I would like to discuss the breakdown of operating profit, on page 14.

Chapter 2

Breakdown of Operating Profit（Full-year）

Results Forecasts

While the reduction of operating expenses and general expenses would be promoted, amortization expenses of cloud softwareand R&D expenses would increase, so it would be difficult to compensate the decrease in revenue.
（¥ million）+ shows the factor of increase in profit year on year
- shows the factor of decrease in profit year on year

Operating
Profit4,525

Decrease in Decrease inpersonnel
Decrease in advertisingexpensescost of sales expenses
+51
+120
+346
Decreasein sales-1,286

Increase in amortizationof cloud software -160

Decrease inshare-related
expenses+55

Others+184

Operating
Profit3,900

Increase in
R&D expenses-95

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

FY2020（forecast）
14・Due to the gradual release of cloud services, amortization expenses included in cost of sales are
expected to increase.
・As for SG&A expenses, we plan to continue to reduce operating expenses and general expenses.
・However, as these cost reductions do not cover all of the decline in sales, we expect operating
profit to decrease by JPY625 million to JPY3.9 billion.
・Next, I would like to discuss the topic of dividends, on page 15.

Chapter 2

Dividend per ShareResults Forecasts

Year-end dividend is expected to be ¥6.60, and annual dividend is expected to be ¥13.20（¥0.20 increase year on year）

Dividend policy

Annual dividend

Annual dividend（Payout ratio）

Year-end

Interim¥12.00（39.5%）¥6.50¥13.00（36.7%）¥6.50¥13.20（42.8%）¥6.60
forecast

¥5.50

¥6.50

¥6.60

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%

15・Regarding the year-end dividend, there is no change from the announced value, and it is planned
to be JPY6.6.
・With this in mind, we forecast an annual dividend of JPY13.2 per share, an increase of JPY0.2
YoY.
・In addition, while the current dividend policy was prepared when the Company was listed on Tokyo
Stock Exchange in 2013, we are currently considering to raise the criteria of the dividend payout
ratio.
・Next, I would like to explain the content of the press release announced today as a topic, on
page 17.

Contents
1.

Overview of 3Q Business Results

2.

Results Forecasts

3. Topics
Appendix Company Profile, Revenue Categories

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

16

Chapter 3

Press Releases in 2020 (1)TopicsStart of Provision of Broadleaf Cloud Platform, a Business Platform for Third Parties, to Shelf AP, which Operates Used Car
Marketplaces Using Blockchain Technology (November 4)
On November 4, 2020, Broadleaf Cloud Platform, a business digital platform developed and provided by the Company, and Shelf
AP.jp, used car marketplaces operated by Shelf AP Co., Ltd. using blockchain technology, completed system construction anddata linkage and started to provide service.
Shelf AP.jp
In the used car market, which continues to see global growth, Shelf AP.jp has introduced a distributed data structure and management method,which are features of the blockchain. Shelf AP.jp thereby increases the credibility and safety of data exchanged on the Internet and enables
cross-border transactions in real time.
Broadleaf Cloud Platform
The features of the Broadleaf Cloud Platform are the collection, high-speed search and analysis of mass data, service implementation in the
short term through a combination of business API services, and high scalability of usage.

Shelf AP Co., Ltd.
Planning, designing, development, operation and management of software, applications and platforms, etc. that use the blockchain, AI and other advanced technologies
Head office: Shinagawa Grand Central Tower 8F, 2-16-4 Konan, Minato-ku, Tokyo
CEO: Izuru Anzai
URL: https://shelfap.com/en/

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

17

・Recently, Shelf AP, which operates a used car trading marketplace, has decided to adopt our cloud
platform service.
・Firstly, they will start by using the operational platform and the interface platform for other systems,
from among our cloud platform services.
・Shelf AP's marketplace is characterized by managing report information using blockchain, which
distinguishes them from other similar services in terms of reliability and traceability of information.
・Next, I would like to explain further about Shelf AP and Shelf.Network, on page 18.

Chapter 3(For Reference) Shelf.Network

TopicsShelf AP
Shelf AP is a business base in Asia of Shelf.Network Inc., which was established in April 2019.
As one of the global partners of Shelf.Network, Shelf AP is provided with licenses for systems and operates in Asia and Oceania.

Shelf.Network
Shelf.Network, headquartered in Ukraine, was established in 2017. The head office is registered in New York.
It operates a used car distribution platform using blockchain technology. Used car sales companies, auction companies and logistics companies in North America andEurope use the platform.
Awards received
Best European Blockchain startup, GrandFrontier Innovation Award (2018), Winner of Blockshow Europe (2018),
Best real world application of Blockchain technology (2018), Top automotive re-marketing solution (2019), and many other awards
CEO Lasha Antadze
Lasha Antadze is the founder of Shelf.Network. He completed a program at Y-combinator, one of the world’s leading seed accelerators.
In 2015, at the request of the Ukraine government, he developed a platform for privatizing state assets using blockchain distributed auction technology.
Pavel Kravchenko
Pavel Kravchenko is co-founder of Shelf.Network. He earned a PhD at Kharkiv National University of Radioelectronics.
He is co-founder of Distributed Lab, a venture company that researches and develops cryptocurrency and blockchain technology in cooperation with industry,
government and academia.

Features

Shelf.Network’s distribute electronic auction system connects multiple auction systems and enables multiple marketplaces to share used car inventory information.
As a result, cross-boarder used car distribution is promoted.
Current

Shelf.Network’s
blockchain technology

SinglemarketplaceAPIplug-in

Payment
gateway

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

After

API
plug-inMarketplaceA

Marketplace
B

Marketplace
C

Inventory
management
Payment
gateway

Inventory
management

18

・Shelf AP, which uses our cloud platform services, is licensed for its systems as a member ofShelf.Network's global partners and is expanding its business in Japan, Southeast Asia andOceania.
・Shelf.Network utilizes blockchain technology to operate used car distribution platforms in North
America and Europe.
・Their business model using a distributed electronic auction system using blockchain has beenhighly evaluated in terms of both technology side and business side.
・In addition, they are highly expected company, for they have won a variety of awards atpresentations in various locations, and became a winner at a presentation event that attracted
investors.
・We believe that there is enormous potential for Broadleaf Cloud Platform to collaborate with suchcompany.
・Next, I would like to discuss the overview of our cloud platform service and deployment method in
the future, on page 19.

Chapter 3(Reference) Broadleaf Cloud Platform

Consumer

User company

TopicsMobility service users/car owners

Used car dealer(Car Seven etc.)

Shelf AP

Transportation

Zenmov inc.

Deliverycompany

Travel agency/
entertainment
company

Car sharing
company

Auto maintenancecompany

Company Company Company
XYZ.c series• • •Application
Used car marketplace

Blockchain

Operation management
platform

Traceability

EC/EDI

Third party

AI safety

Retailer/wholesaler

Payment

Broadleaf applications

AI data analysis

Interface

Infrastructure middleware
NetworkDevelopment
platform

Operational platform

Broadleaf Cloud Platform services
Copyright©2020 Broadleaf Co.,Ltd. All rights reserved.

19

・Our cloud platform service provides sections corresponding to infrastructure and middleware tothird parties as service menu.
・In addition to Shelf AP, Zenmov, which operates an operation management platform, currently
operates their application on our platform services and provide it to service providers.
・Service providers which utilizes applications will provide various mobility services to consumers.
・In addition, business software we provide, including Maintenance.c series which are for auto
maintenance shops and auto body shops, will be connected to and operated on our platform asapplications.
・As third parties, companies with specialized applications such as Shelf AP and Zenmov, vendorsof accounting and ERP software, and system integrators that develop applications fall within thescope, and the model is designed so that services are eventually provided to consumers.
・Not only do we have all sorts of information on automobiles, auto parts, support service, andinformation for guaranteeing the safety, but also related know-hows, and we are also realizing
traceability using blockchain technology.
・Going forward, we intend to expand the platform business while deepening cooperation with suchthird parties.
・Next, I would like explain the content of shareholders benefits announced today, on page 20.

Chapter 3

Press Releases in 2020 (2)TopicsDetermination of Details of Shareholder Benefits Reciprocal Agency Agreement with Genetec(November 4)
Corporation (October 6)
The shareholder benefits for the fiscal year ending Dec. 31, 2020
were determined as follows.
Number of shares held

Visa gift cards

500 to 999 shares

5,000 yen

1,000 to 1,999 shares

10,000 yen

2,000 shares or more

20,000 yen

Broadleaf and Genetec Corporation concluded a reciprocal agency
agreement for OTRS and FlexSim.
Under the agreement, the effects of improvement activities resulting
from OTRS can be simulated using FlexSim, a product of Genetec,
which can show future improvements and their purposes.

Reasons for continuously using Visa gift cards as shareholder benefits

OTRS, work analysis software

Compared to QUO cards which we previously used as the shareholder
benefits, Visa gift cards can be used in greater numbers of industries andbusiness categories. In addition, from the perspective that they can be used
in internet shopping, which are more frequently used under the influence of
COVID-19, we continued using Visa gifts cards as the shareholder benefits.

OTRS is used at many production sites as a tool for
accurate video analysis and time analysis of movementsof people, goods and machines using the IE (Industrial
Engineering) method.

Eligible shareholders

FlexSim, 3D IoT simulation software

Those shareholders whose names are recorded in the Company’s
shareholder registry as of December 31, 2020 and who hold five trading units(500 shares) or more of the Company’s shares.

FlexSim calculates flows of goods and people, using
3D graphics. FlexSim is sold worldwide, particularly
in Europe, the United States and China, throughsales channels in 77 countries or more (a total ofover 51,500 licenses).

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

20

・Today, we announced the content of shareholders benefits. We have decided to continue thesame type of program that was established last year.
・Eligible shareholders are those whose names are recorded in the Company’s shareholder registry
as of December 31, 2020 and who hold five trading units (500 shares) or more of the Company’s
shares.
・In addition, we have entered into a mutual agency agreement with Genetec Corporation in October.
・Regarding sales of OTRS, customer segments or fields of both companies are very close, and so
we have concluded agency contracts and aim to provide services with more added values.
・In addition, there is a past press release that you can refer to.
・That is all for my explanation. Thank you very much.

Chapter 3

Press Releases in 2020 (3)TopicsAn MOU Concluded with BEMAC Philippines(July 20)

BL.Homepage Premium Launched (March 2)

Broadleaf and its subsidiary BLITS concluded an MOU (memorandumof understanding) with BEMAC Philippines for building acomprehensive platform for after-sales service related to mobility inPhilippines.

Broadleaf released BL.Homepage Premium, a website building andoperation solution.

Broadleaf aims to build an infrastructure that will provide a one-stop
solution for the production, sale, inspection and maintenance of electricvehicles and the distribution of service parts for electric vehicles.

BL.Homepage Premium is a solution that enables the user to easily
open a website, a tool necessary for attracting customers andexpanding sales.

BEMAC Electric Transportation Philippines Inc.
BEMAC Electric Transportation Philippines Inc. is a subsidiary in the Philippines of
BEMAC Corporation, a marine equipment manufacturer that designs,
manufactures, installs and maintains a range of electrical equipment for large
vessels.
BEMAC Electric Transportation Philippines has developed and sells E-Trike, anelectric tricycle (tricycles are major vehicles in the Philippines). The company hasdelivered 3,000 tricycles to the government of the Philippines as of September
2019.

Prices
Initial cost
Monthly charge

100,000 yen (exclusive of tax)
19,800 yen (exclusive of tax)

URL: http://www.bemac-philippines.com/
Copyright©2020 Broadleaf Co.,Ltd. All rights reserved.

21

Contents
1.

Overview of 3Q Business Results

2.

Results Forecasts

3.

TopicsAppendix Company Profile, Revenue Categories

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

22

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)

Industry

Information and communication industry

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.

23

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.

24

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]

Fee for use of customer support

Monthly

Support Service[Flat rate]

Fee for toner/business forms

Lump-sum

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

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]

Support

EDI / Payment settlement

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

25

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 contract26

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.

27