CHAPTER 3

Medium-term Management Plan (2022-2028)

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

CHAPTER３ Medium-term Management Plan (2022-2028)

Background of Formulation of the Plan
Updated the medium-term management policy announced in 2021 and formulated a performanceplan up to 2028 in accordance with the launch of “.c Series,” cloud-based software.
February 2021 Announced the mid-term management policy
Establishment of growth strategies and priority measures under the theme of “2 DX"
DX (1) Promote clients' digital transformation
DX (2) Add values to its service infrastructure as the Data Exchanger

October 2021

Released “.c Series,” cloud-based software

Started offering from 2022. The transition from conventional software is expected to be completed in 2028.

February 2022 Announced medium-term management plan (2022-2028)
Updated the medium-term management policy announced in 2021 and formulated a performance plan up to 2028

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

19

CHAPTER１ Overview of FY12/2021 Business Results

Growth strategy

Growth strategy ①

Growth strategy ②

Cloud penetration

Expansion of services

Software services
Autoparts... dealer

Autobody

Software users

Auto
Maintenance

Auto maintenance shops
and auto parts dealers, etc.

Platform Services...

Logistics
MaaS

Finance

Consumer

3rd party

Ordering

API/SDKDigital Transformation

Database

Finance companies,
system companies, etc.
(Service Provider)

Consumer

Data Exchanger
Transaction data

Broadleaf Cloud Platform
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

Master data20

CHAPTER３ Medium-term Management Plan (2022-2028)

Consolidated Performance Plan
Record-high performance in 2026 is a milestone, continuing to grow as transition to stock revenue
continues. The Company aims to achieve operating margin of 40% and profit of 8 billion yen in 2028.
FY2022

FY2023

FY2024FY2025

FY2026FY2027

FY2028

Revenue

12.3

14.7

18.5

22.0

25.5

29.0

32.5

Operating profit (loss)

-4.8

-2.7

1.0

3.3

6.7

10.0

13.0

ーー

5%

15%

25%

34%

40%

Profit (loss) attributableto owners of the parent

-5.0

-2.9

0.6

2.0

4.2

6.3

8.0

Equity attributable toowners of the parent

20.0

17.5

18.0

Percentage of equity
attributable to ownersof the parent

60%

50%

52%(Billions of yen)

Operating marginCopyright©2022 Broadleaf Co.,Ltd. All rights reserved.

21

CHAPTER３ Medium-term Management Plan (2022-2028)

Revenue Plan by Business Categories(Billions of yen)

Cloud business

FY2022

FY2023

FY2024FY2025

FY2026FY2027

FY2028

2.6

5.9

10.4

15.2

20.0

25.0

29.1

Platform services

0.7

0.9

1.4

1.6

1.9

2.9

4.1

Software service

1.9

5.0

9.0

13.6

18.0

22.1

25.0

9.7

8.8

8.1

6.8

5.5

4.0

3.4

License sale

1.9

1.6

1.6

1.6

1.6

1.5

1.5

Ancillary services

6.5

6.0

5.2

3.82.71.5

1.2

Device sale, etc.

1.3

1.2

1.3

1.4

1.3

1.1

0.7

12.3

14.7

18.5

22.0

25.5

29.0

32.5

Conventional businessTotal RevenueNOTE)Please refer to page 39 for a comparison between the breakdown of FY2022 sales forecasts and sales forecasts by revenue category.
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

22

CHAPTER３ Medium-term Management Plan (2022-2028)

Revenue Trend in Cloud Business(Billions of yen)

Cloud business drives revenue growth
Revenue categories

New platform services

4.1※NOT included in theperformance planAuto finance, logistics MaaS, etc.

2.9

Platform services

EDI and settlement

Ordering platform

1.9

Software service

SaaS

Cloud-based software, DX solutions

DX

1.6
25.0
22.1
1.4

18.0

13.6
0.9
0.7
1.9

5.0

FY2022

FY2023Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

9.0

FY2024FY2025

FY2026FY2027

FY202823

CHAPTER３ Medium-term Management Plan (2022-2028)

Revenue Trend in Previous Business(Billions of yen)

As cloud business progresses, revenue of conventional business is expected to shrink.
Revenuecategories
By industry

License saleLicense fees for conventional software

Ancillary services
Network usage fees and support services fee
for conventional software

Device sales and OtherOTRS
PaaS/IaaS (basic)
Support Support services
Support Supply

Devices , forms, etc.

1.9Devices

1.6

1.6

1.6

6.5

6.0

5.2

3.8

1.3

1.2
FY2023

1.3

1.4

1.6
2.7
1.3

FY2024FY2025

FY2026FY2022
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

1.5
1.2
0.7

1.5
1.5
1.1
FY2027

FY202824CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ① Penetration of cloud-based products (1)Key to achieving the performance target is the penetration of “.c Series,” cloud-based software

Key Factors for Success
Progress

Cloud-based
software sales

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

= Cloud transition rate (Rate of transition to cloud-based software)= Number of licenses × Average monthly license fee × (1 - churn rate)
Total number of licenses
for cloud-based software

Monthly sales per license
for cloud-based software

Average churn rate peryear for cloud-basedsoftware25

CHAPTER１ Overview of FY12/2021 Business Results

Growth Strategy ① Penetration of cloud-based products (2)Cloud transition rate

40%

Users of conventional software will gradually transit to cloud-based
software over the next 6 years(End of 2024)

Client base
Number of users *Repeat rate **33,000 companies

95% or more

Product
Fully remodeled

Cloud-based software
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

* Auto maintenance shops, auto body shops, auto parts dealers, and recycle shops are covered.
** Repeat rate of conventional software26

CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ① Penetration of cloud-based products (3)Number of licenses

Average monthly license fee

24,000 × 23,000(End of 2024)

yen/month

In addition to expanding the market through high scalability,
license system is changed to an easy-to-introduce system(2024)

Market expansion
Number of Companies *More than

100,000 companies

Car dealers (16,000 companies) becomes the new market
due to easier customization of the software

Change in the license system
Number of personnel *More than

500,000 people

From industry-specific to job-specific license*Number of companies and personnel in auto maintenance shops, auto body shops, auto parts dealers, and recycle shops
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

27

CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ① Penetration of cloud-based products (4)Role license
based on each industry and job category

Terminal freesince the software is running on the Web

・Role licenses * subdivided by job categories is set
in addition to basic licenses for each industry

・Real-time integrated management of information andsystems of each base is available at the headquarter.
・Portability that enables usage in any location"NS Series," conventional software
Use industry license by turns“.c Series,” cloud-based software

Each person uses role license based on their job categories
BasicHead Office

Mechanic
Industry licenseManagerFront・・*Available functions are set based on each account ID
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

28

CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ① Penetration of cloud-based products (5)Churn rate
Less than1

Cloud-based software is essential for business operations%(Average per year)

API
Provided as atotal management system

Real-time linkage with other systems

Data Analysis
Achieve client success

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

Support knowledge management

29

CHAPTER１ Overview of FY12/2021 Business Results

Growth Strategy ① Penetration of cloud-based products (6)Single sign-on
・Login to other systems with the samecloud-based software account ID“.NS Series,” conventional software= Administrative processing system

Issuance of estimates and invoices,client management, etc.

Real-time linkage

Analysis and sharing

by using the APIof the knowledge

・Function linkage and data linkage

・Support knowledge management
based on the usage conditions, etc.

“.c Series,” cloud-based software= Total management system

Accounting & tax
API

Sales & inventory
control

CRM
APIAPIAPI

Human resources& labor
Knowledge sharing
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

APIGroupware30

CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ② Expansion of Services (1)API linkage with other systems

Customizable bydevelopment vendors

Constructed with a
combination of micromodules

Development vendor

Other systems

Broadleaf software

Broadleaf software

Broadleaf software

Software service

Dataconversion

Service development by 3rd party

ServiceProvider
ServiceProvider

Micromodules

Database

Platform Services

Broadleaf Cloud Platform
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

31

CHAPTER１ Overview of FY12/2021 Business Results

Growth Strategy ② Expansion of Services (2)Establish industry standards
with the Ordering platform

CAGR

Aims to penetrate the ordering platform by incorporating the ordering platform into
cloud-based software as a standard function (100% adopted)

30% or more
Compliance with theElectronic Book Storage
Act will be a tailwind

Auto repair partstransaction market
New parts

Recycled parts850 billion yen 200 billion yen Equipped as
Usage level of electronic traderemains lowstandard(100% adopted)

EDI adoption rate *28.4%

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

Introduced to vehicle
examination chainswith high transaction
volumes, etc.

Introduced toparts dealers andrecycle shops

Promote usage in small-tomedium-sized auto maintenanceshops and auto body shops*Rate of adoption of the ordering platform by the Company’s software users (auto maintenance shops)

Industry standard

32

CHAPTER３ Medium-term Management Plan (2022-2028)

Growth Strategy ② Expansion of Services (3)Development of Auto Finance Platform
Auto Finance Platform
Finance businesses

Software users

Consumer(Car Owners, etc.)

Auto loans
Company A
Auto insurance

Business operator B

Warranty・・

Business operator C
Propose multiple financing services
to consumers

Broadleaf Cloud Platform
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

33

CHAPTER３ Medium-term Management Plan (2022-2028)

Policy for Allocating Management Resources

Concentrate all management resources on growth strategies of “Penetration of cloud-based
products" and “Expansion of services"
Portfolio managementImplementation of portfolio management to realize optimal allocation of management resources
Economic value(ROIC, sales growth rate, etc.)+Market attractiveness andthe Company’s strengths and advantages(Market growth rate, market share, etc.)

Investment in human capital andintellectual property
Recognize human resources and intellectual property as the core assets for realizing the Company’s growthstrategy, and make active investments in maximizing human capital and IP resources

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

34

CHAPTER３ Medium-term Management Plan (2022-2028)

Environmental changes and their impact on the Company’s business～Automobility Industry ～Sophistication of maintenance・Increasing demand for IT systems that support maintenance of EV and sophisticated vehicle

EV shift・Increasing demand for accumulation and sharing of knowledge

・In the case of large-scale business there is increasing demand for DX investment in order toimprove management efficiency→Introduced cloud-based software in the market

Sophistication ofvehicle

Polarization of business operators
・The number of companies tends to decrease while the number of cars tends to increase・Demand for maintenance such as preventive inspection is increasing→Changed the market from the number of companies to the number of employees

DX inadministrations
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

Response to computerization due to changes in the legal system
・Increasing demand for electronic storage of documents

35

CHAPTER３ Medium-term Management Plan (2022-2028)

Sustainability Policy
The Company aims to "realize a sustainable society" and “enhance its corporate value" throughthe practice of the ideas embodied in the "Corporate Philosophy" and "Origin of Company
Name" of Broadleaf

Basic Policy

From a long-term perspective, the Company will strive to expand direct and indirect positive impacts (valuecreation) and reduce negative impacts (social responsibility) to various stakeholders by addressing priority issues,

materiality, within "sustainability."

Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

36

CHAPTER３ Medium-term Management Plan (2022-2028)

Relationship between the Company’s business and SDGs
Theme of resolution

Corporate activities that lead to the resolution of issues

Related SDGs

・Provision of IT system for proper vehicle inspections and maintenanceRealization of a safe,
secure, and comfortablemobility society

・Promote the popularization of EVs and sophistication of vehicle

・Provision of ordering platforms for recycled auto parts
Promotion of recycle-oriented
usage of resources

・Promotion of home and remote work (establishment of systems andinfrastructure)
Realization of a comfortableworking society
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.

・Selected as one of “Telework Pioneer 100 company in Japan”

37Disclaimer

The statements regarding results forecasts and future forecasts contained in this materials

are forecasts based on information available at the time of preparation of the materials, sothey include potential risks and uncertainties.
Therefore, please be aware that actual results may differ from these results forecasts due tovarious factors.

Contact Information

Broadleaf Co., Ltd
Corporate Communication Department
E-mail:bl-ir@broadleaf.co.jp
Copyright©2022 Broadleaf Co.,Ltd. All rights reserved.