2Q FY12/2016
Business Results Briefing

Broadleaf Co., Ltd.
TSE 1st Section: 3673

July 28, 2016

Chapter 1
Overview of 2Q Business Results

Contents

2Chapter 2
Results Forecasts

11Appendix
Overview of the Companyand Sales Segments

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

171

Chapter 1
Overview of 2Q Business Results

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

2

PL Summary
POINT

Net income increased due to the recognition of extraordinary
income.

(¥ million)

1H FY12/2016
Results

YoY Change

1H FY12/2015
YoY (Ratio)

Results8,196-128-1.5%

8,325

Operating income

920-87

-8.7%

1,008

Ordinary income

928-67

-6.8%

996

1,179

176

17.6%

1,002622

146

30.7%

476

¥25.74¥6.77-¥18.97

Net sales

Income before
income taxes
Net income

EPS

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3

Sales by Category
Sales in Network Service, as the key segment, maintained adouble-digit increase.

POINT(¥ million)

Results
Business Application
Software
System Support

1H FY12/2016
YoY Change

YoY (Ratio)

1H FY12/2015
Results

5,293-351-6.2%

5,644633
289-1-10-0.2%
-3.6%

634
300

343

92.8%

334

2,270
1,803

223
179

10.9%
11.0%

2,046
1,624

446

39

9.6%

407

PSF*1

322-6-2.0%

328

Order Placing andAcceptance*2

124

45

58.2%

78

20
8,196

5-128

38.4%
-1.5%

148,325

Maintenance
Provision ofConsumables
Network Service
Stock
Transaction

Others
Net sales*1: Payment agency service for recycled parts*2: BL Parts Order System and CarpodTab

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4

Breakdown of Sales in Business Application Software
POINT

Sales to new customers and other segments (e.g. equipmentsales) increased, despite a low number of user renewals.
1H FY12/2016(¥ million)

Results
Automotive

RenewedNew customers

Non-automotive
RenewedNew customers
TotalRenewed
New customers
OthersBusiness Application
Software Total sales

YoY Change

1H FY12/2015

YoY (Ratio)

Results

3,718-608-14.1%

4,326

3,255
463
797
510
287-6393120
109-16.4%
7.3%
2.6%
2.2%
3.3%

3,895
431
777
499
278

4,516-588-11.5%

5,104

3,765
750
776-62840237-14.3%
5.7%
43.9%

4,394709
539

5,293-351

-6.2%

5,644

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5Breakdown of Expenses
POINTAn increase in the cost of goods sold was offset by controlling
SGA expenses.

(¥ million)

1H FY12/2016
Results

Net Sales

8,196

1H FY12/2015

YoY Change-128

Main Factors Behind
the Changes

Results

8,325 Personnel shifts to the personnel
2,391 expense side
Increase in equipment purchases

Cost of sales

2,475

83

SG&A expenses

4,800-124

PersonnelExpenses

2,33453166-81

247 systems (partial capitalization)

2,300-96

2,396 Decrease in advertising expenses

Operating Income920-87

1,008 -Total personnel
expenses *2,678-69

2,747 Reduced number of employees

Subcontract Cost

713

-51

R&D Expenses
Other

4,925 Personnel shifts from the cost side

2,280 (cost of labor)

Development of next-generation

Optimization of ratio of in-house and765 outsourced construction* Sum of labor cost (cost of sales) and personnel expenses (SG&A expenses)
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6BS SummaryPOINT(¥ million)

None of assets, liabilities or net assets changed significantly.

End of 2Q FY12/2016
Results

Current
AssetsNon-current
AssetsTotal Assets

YoY Change

Major factors ofincrease/decrease

Results

Increase in cash and deposits

13,207

174

13,033 (+497)

12,265-267

12,532 Amortization of goodwill (-334)

25,473-92

25,565 -Current
Liabilities

4,669

331

Non-current
Liabilities

1,494-347

6,163-16

Total Liabilities

End ofFY12/2015

Increase in income taxes payable(+505)
4,338 Decrease in accounts payable-trade(-156)
Decrease in long-term loans payable
1,841 (–329)

6,179 -

Total Net Assets

19,309-76

Total Liabilities
and Net Assets

Recognition of net income (+622)
Payment of dividends payable (19,385 303)
Acquisition of treasury stock (-364)

25,473-92

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7

CF Summary
POINT

An amount of free cash flow appropriate for the profit level
was maintained through investments that took the amountof depreciation into consideration.

(¥ million)

1H FY12/2016
YoY
Results
Change1H FY12/2015
Results

CF from operatingactivities

1,928

2,606-677

CF from investing
activities-440

11-451

CF from financing
activities

-990

-697

FCF

1,488

2,617

Balance of cash andcash equivalents at
end of first half

8,882-366

Major components ofcash flow

-293

Recognition of income before income
taxes (+1,179)
Amortization of goodwill (+334)
Depreciation expenses (＋296)
Acquisition of intangible fixed assets(-326)
Acquisition of investment securities (99)
Acquisition of treasury stock (-364)
Repayment of long-term loans
payable (-329)
Payment of dividends (-303)

Cash flow from operating activities(+1,928)-1,129 Cash flow from investing activities (440)9,249 -

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8

(Reference) PL Summary < Comparison with Forecasts >(¥ million)

1H FY12/2016
Results

YoY Change

1H FY12/2016
YoY (Ratio)

Forecasts*

8,196

-203

-2.4%

8,400

Operating income

920

-129

-12.3%

1,050

Ordinary income

928-101

-9.8%

1,030

Net income

622

62

11.2%

560

¥25.74¥2.60-¥23.14

Net sales

EPS* Published on February 10, 2016

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9(Reference) Sales by Category < Comparison with Forecasts >(¥ million)（単位：百万円）
1H FY12/2016

1H FY12/2016
YoY Change

Results

Business Application
Software

YoY (Ratio)

Forecasts*

5,293-256

-4.6%

5,550

System Support633-16-2.5%

650

Maintenance
Provision ofConsumables

289-10-3.4%

300

343

-6-1.8%350

Network Service

2,270

70

3.2%

2,200

1,803

103

6.1%

1,700

446

-33

-7.0%

480

PSF

322

-7-2.4%330

Order Placing andAcceptance

124-25-17.0%

150

Others2000.3%

20Net sales

8,196

-203

-2.4%

8,400

StockTransaction* Published on February 10, 2016

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

10Chapter 2

Results Forecasts

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11

Results Forecasts
POINT

No change has been made to the results forecasts for the full year
since the last announcement of forecasts (February 10).

(¥ million)

FY12/2016
Forecasts

YoY Change

FY12/2015
YoY(Ratio)

Results

18,000

1,175

7.0%

16,824

Operating income

3,000

485

19.3%

2,514

Operating income
margin

16.7%

1.7%

-14.9%

Ordinary income

2,970

476

19.1%

2,493

Net income1,620368

29.4%

1,251

EPS¥67.44¥16.97-¥50.47

Net sales

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12

Sales Forecasts by Category
No change has been made to the sales forecasts by category
for the full year since the last announcement of forecasts (February 10).

POINT(¥ million)

FY12/2016
Forecasts

Business Application
Software

FY12/2015

YoY Change

YoY(Ratio)

Results

11,700383

3.4%

11,316

System Support

1,250-16-1.3%

1,266

Maintenance
Provision ofConsumables

600

20.4%

597

650

-18-2.8%

668

Network Service

5,05080719.0%

4,242

Stock

3,550

199

5.9%

3,350

Transaction

1,200

341

39.8%

858

PSF

700

274.0%

672

Order Placing andAcceptance

500

314

169.5%

185

Others300

267

813.6%

32Net sales

18,000

1,175

7.0%

16,824

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13

Key Indicators in Network Service Domain
POINT

Continued efforts for the industry standardization of theelectronic order service.
FY12/2016

End of 2Q
Results

FY12/2015

End of FY
Forecasts

End of 2Q
Results

End of FY
Results■Stock.ＮＳRatio *1＿

84.2% No Set figure*2

76.5%

80.5%1,929 3,000 or more

1,113

1,666

335 No Set figure*2249

312

1,679

2,322

■Transactions
BL Parts Order System
Number of connections withmaintenance shops
Number of parts dealers
participating in transactions

CarpodTab
Number of contracts

2,762

4,000*4*1 Proportion of total number of contracts accounted for by current business application software,“.NS Series.” The calculation method was changed from the figures for the period under review.
*2 Planned values based on the new calculation method have yet to be made.
*3 Since the target of 300 parts dealers has already been achieved, any further requests to participate will be dealt with as appropriate.
*4 Changed from 4,500 in the conventional plan.
14
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Returns to Shareholders
POINT

Interim dividends (common dividend of 12.5 yen andcommemorative dividend of 5.0 yen) were paid as planned.
No change has been made to the expected year-end dividend pershare for the year ending December 2016.

Annual dividend(Payout ratio)¥25（49.5%）¥20（23.8%）
Yearend¥12.5（Ordinary dividend）¥10

Interim ¥10FY12/2014
2014/12期¥30（44.5%）

Yearend¥ 12.5Interim ¥ 12.5

FY12/2015
2015/12期

Yearend¥5.0（Commemorative dividend）

Interim¥12.5（Ordinary dividend）

FY12/2016 (予想)2016/12期(Forecast)

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15

(Reference) Introduction of J-ESOPPOINT

The Company has decided to introduce J-ESOP to increase incentives for
its executives and employees to unite and strive to increase medium- tolong-term performance and corporate value.

■Overview of J-ESOP (for employees)(1) Beneficiaries: those who are entitled to receive asset benefits according to the stock
benefit rules.
(2) Start of program: August 10, 2016 (planned)■Acquisition of the Company's shares through J-ESOP(1) Initial amount of trust: 610,000,000 yen (planned)(2) Period of acquisition: from August 10 to September 30, 2016 (planned)(3) Method of acquisition: through the stock exchange market[Reference] Introduction of Board Benefit Trust (BBT) for directors and corporate officers■Overview of BBT (directors and corporate officers)(1) Beneficiaries: those who have retired from the position of director and meet the beneficiary requirements specified
in the stock benefit rules.
(2) Start of program: June 2, 2016
■Acquisition of the Company's shares through BBT (* Acquisition completed)(1) Number of shares acquired: 354,300(2) Period of stock acquisition: from June 2 to July 29, 2016(3) Method of stock acquisition: through the stock exchange market
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16

Appendix [Reference Material]

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

17

Appendix ①

Our Profile

Corporate Name:Broadleaf Co., Ltd.

President and CEO:Kenji Oyama

Stock Listing:

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

Founded/Established:

December 2005/September 2009

Capital Stock:¥7,147 million

Business Outline:

Provision of services on an IT network system that supports the business of the players in theautomotive aftermarket(E.g. development of business applications, platform for collaboration between different businesssectors, marketplace for recycled auto parts, and automotive content）

Head Office Location:

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

Business Offices:

33 offices in Japan

Development Centers:

3 centers in Japan (Sapporo, Tokyo and Fukuoka)

Number of Employees:

780(as of June 30, 2016)

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18

Appendix ②Sales Domain
We have a single business segment, which consists of IT services,
but sales are classified into the areas below.

Large
Classification

Category
MiddleClassification

Small
Classification

Type of Business- Development and sales of business application software for specific businesses.
- Development and sales of package software, such as information security.
- Purchase and sales of PCs and printers, etc., and others

Business Application Software
Maintenance- Provision of maintenance services for business application software andhardware to customers to which we sold business application software.

Provision of Consumables- Purchase and sales of special ledger sheets and OA supplies used in businessapplication software.

System Support

Database Provisioning
Service- Provision of automobile-related information and a database of parts-related
information updated daily.

Server Provisioning
Service- Receipt of consideration for server maintenance necessary for the use ofnetwork systems.

Payment Agency Servicefor Recycled Parts- Operation of “Parts Station NET,” a distribution network for recycled parts thatshares information on the inventories of recycled parts.
Providing payment agency services when selling and purchasing recycled partsand collecting commissions.

Electronic parts orderplacing and acceptancesystem, tablet-based
business support tools andothers- Provision of an electronic order placing and acceptance system for auto parts.
- Provision of tablet-based business terminals to maintenance shops, etc., andothers

Stock

Network ServiceTransaction

Copyright (c) Broadleaf Co., Ltd. All rights reserved.

19Disclaimer
Forward-looking statements contained in this material such as results forecasts
and future prospects are forecasts and estimates made by Broadleaf based on
information available at the time of the preparation of the material, and are
subject to potential risks and uncertainties. Please note that actual results may
differ from the statements contained in this material due to various factors.

For inquiries, please contact
Corporate Communications(IR/PR) Department
Broadleaf Co., Ltd.
E-mail: broadleaf-ir@broadleaf.co.jp
URL: http://www.broadleaf.co.jp/english/

Copyright (c) Broadleaf Co., Ltd. All rights reserved.