2Q FY12/2014
Business Results Briefing
Broadleaf Co., Ltd.
(Securities Code: 3673 / TSE 1st Section)

August 8, 2014

Contents

1. Financial Highlights for 2Q FY12/2014

2. Progress of Core Initiatives

3. Reference Materials

11. Financial Highlights for
2Q FY12/2014

Summary of 2Q Results
 2Q FY12/2014 (April to June 2014)
Projected results were met despite the rise in consumption tax and the end of support for Windows XP.
The six-year right to use the license for systems sales is posted as an asset for replacement.

 Both net sales and income in the 1H results surpassed initial forecasts, achieving an increase
in revenue, as well as a significant boost in income year on year.
(¥ million)
FY12/2014 Actual

FY12/2014 Initial Forecasts

1Q
2Q
1H
(%, YoY Change) (%, YoY Change) (%, YoY Change)

Net sales

5,295(41.4%)

Operating income

1,554(328.7%)

Ordinary income

1,537(392.3%)

Net income872(691.9%)

3,788

9,083(-19.8%)(7.3%)

296

1,850(-74.8%)(20.2%)

289

1,827(-74.8%)(24.9%)

70943(-88.5%)(29.6%)

1H

Above:YoY Chg(Amount)
Below:YoY Chg(Ratio)
+83
9,000
0.9%+300
1,550

19.4%
+297
1,530
19.4%
+193
750
25.8%
3

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

Forecasts for FY12/2014
 In the 2H, we plan to make the following
investments toward the achievement of the midterm business plan.
 Costs for promoting “Car-unselor in Your Town”


Costs for advertisement and contracting out clericalwork (training expenses, etc.) were posted in the 1H.
We plan to run regional commercials starting fromautumn in the 2H.

 Development of the New-Generation BL CloudAn investment was implemented to solidify a businesscollaboration with Groovenauts, Inc.
We plan to consider the cost-effectiveness ofdeveloping our New-Generation BL Cloud.

Operating Income(¥ million)

2,500

2,150

2,200
2,000

1,850

1,401

1,500

1,539

Initial forecast
1,550
1,000

712
500

No change to the forecasts for
FY12/2014
Net sales: ¥19,000 million
Operating income: ¥4,000 million

01H
上半期

2H
期末

1H
上半期

2H
期末

1H
上半期

2H
期末
(forecast)

FY12/20122012/12月期

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

FY12/20132013/12月期FY12/2014
2014/12月期
4

Sales Trends by Category
 Business Application Software, System Support: Responding to the demand for package licenses.
 Network Service:(Stock)
We forecast that the sales of stock-type services will expand amid an increase in theproportion of network systems licenses.
(Transaction) We project that net sales will increase year on year, but fall short of the initial forecast by anarrow margin due to factors related to sales resources.
(¥ million)

Net sales
Business Application Software
System SupportMaintenance
Provision of consumables
Network ServiceStockTransaction

FY12/2014

YoY Changes1H Actual(Previous term)

Above: Amount
Below: Ratio

9,083(8,468)

6,572(6,187)

667(644)311(306)355(338)

1,843(1,636)

1,452(1,280)

391(355)

+615
7.3%
+385
6.2%
+22
3.5%
51.7%
+175.1%
+207
12.7%
+172
13.4%
+35
10.0%

Compared toInitial Forecasts
Above: Amount
Below: Ratio

+83
0.9%
+72
1.1%
+172.6%+10.4%+154.7%-6-0.3+20.2%-8-2.2%

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

FY12/2014
1HFull-term

9,00019,000

6,500

13,700

650

1,300

310

630

340

670

1,850

4,000

1,450

3,000

400

1,000
5Increased Sales of Network Services (1 of 2) With an increased proportion of network systems that provide the base of network services, the salesof stock-type services are rising.
 With more customers participating in our “Industrial Platform,” going forward we expect the sales oftransaction-type services to increase.
Proportion of licenses of network systems in the sales of Business Application Software(%, ¥ million)

ストック売上高Salesof stock-type services

55.4%

ネットワークライセンス比率
Proportionof network licenses50.5%
44.2%
38.9%
32.0%

1,452

27.1%

1,360
1,280

20.0%

1,194

16.7%

1,102

13.0%

1,001
914

785851

1H
end
上半期

Term
end
期末

FY12/20102010/12月期

1H
end
上半期

Term
end
期末

FY12/20112011/12月期

1H
end
上半期

Term
end
期末

FY12/20122012/12月期

1H
end
上半期

Term
end
期末

FY12/20132013/12月期

1H
end
上半期

Termend
期末FY12/20142014/12月期* Sales of stock-type services (fees for database and server usage)
6
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Increased Sales of Network Services (2 of 2)
 The status of the Carpod Tab and the BL Parts Ordering System (“BLP”), new revenue bases oftransaction-type services, are as follows: We were not able to promote the sales of Carpod Tab or BLP sufficiently amid a greater-than-expectedsurge in demand for systems sales in the 1Q (January to March).
 In the 2Q (April to June), we focused efforts on sales of the Carpod Tab and BLP with the involvement ofmajor regional parts dealers. We project that such efforts will contribute to expansion in sales fortransaction-type services in the 3Q and thereafter.
The number of Carpod Tab licenses increased steadily.
The number of parts dealers that provide BLP and their participation in the transaction-type services of recycledparts increased steadily.

Number of companies (*parts dealers)participating in transaction-type services

Trend of Carpod Tab licenses
Number of the licenses

Number of companies

1,000
800879662

130

121735
120

600
400

111112End2013年末FY12/2013

1Q
2014年第1Q
FY12/2014

110

200
0100
4Q
2013年第4Q
FY12/2013

1Q
2014年第1Q
FY12/20142Q
2014年第2Q
FY12/20142Q
2014年第2Q
FY12/2014* Number of customers, or parts dealers, that provide theBL Parts Ordering System
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

7

Balance Sheet at the End of 2Q FY12/2014
 Achieving stronger balance sheet(¥ million)
2Q EndEnd

FY12/2014

FY12/2013

YoY
ChangesAmountCurrent assets
Cash and deposits
Non-current assets

13,789
10,16012,704

14,037
9,229
13,006

-248
930
-302

Property, plant andequipment

463

481

-17

Total assets

11,412
10,365827
26,493

11,791
10,699733
27,044-378-334
94-551

Current liabilities
Loans payableNon-current liabilities
Long-term loans payable
Total liabilities

5,879
1,500
340
167
6,219

6,133
1,500
948
750
7,082

- 254
0-608
-582
-863

Total net assets

20,27326,493

19,961
27,044312-551

Intangible assets
Goodwill
Investments and other assets

Total liabilities and net assets

Goodwil- Goodwill arising at the time of MBO
amortized steadily (Amortized over 20years since FY12/2010)

Investment securities- Capital investment made in
Groovenauts, Inc. in order to build astrong business relationship with thecompany.

Loans payable- Repaid steadily- Increased with the trust-type
employee shareholding incentive plan

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

82. Progress of Core Initiatives

Mid-Term Management Plan (2014-2016):
Outline of Management Policy, Strategies and Initiatives
Management Policy:
Evolving into a comprehensive service
provider by supporting fulfilled car life
Core Strategies
Expand network
services to boost
profitability
Solidify theCreate new services
management
for medium- to longfoundation
term growthCore Initiatives
Marketing Measures
Promote a new service brand of“Car-uncelor in Your Town”
New Technology Development

Develop a New-Generation
BL Cloud

Step up businessexpansion in Asia
10Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Core Initiative: Promote a new service brand of “Car-uncelor in Your Town”
Progress in training activities
Trend in the number of trainees and shops thatfinished the basic course
800639Iwate

600

24 shops

342

Chiba

Kanagawa

Gifu
Nara

Wakayama

基礎研修終了店舗数
Numberof shops that finished the basic course

Osaka

受講者数 of trainees
NumberHyogo

June
30
6月末

Tokushima

March
3月末31

Kochi

December
12月末 310Hiroshima

256

Fukuoka

229Shimane

200456

Ibaraki305

Toyama400

Fukushima(as of the end of July, 2014)

Places where the service
will soon be launched

Role-playing workshop
11Core Initiative: Promote a new service brand of “Car-uncelor in Your Town”
Strengthen support systems for authorized shops
 Initiative to promote the services of “Car-unselor in Your Town”
Promote the “Car-unselor in Your Town” in collaboration with major regional parts dealersEnhance the activities of “Car-unselor shops” in specified areas.

Deploy staff dedicated to supporting the authorized shops of “Car-unselor in Your Town” ineach area across the country

Support authorized shops in such activities as the administration of operations, maintenance andimprovement of service quality and management.

Regional parts dealers

Iwate“Car-unselor in Your Town” shops
Hyogo
Fukuoka

Fukushima

Hiroshima

Tokushima We will run regional TV Commercials
in, or after, October to attract
customers.
 We aim to increase the amount ofparts in pipelines through “Carunselor in Your Town” shops.

NaraWakayama

Kanagawa

Increased sales ofnetwork services
12Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Core Initiative: Develop a New-Generation BL Cloud Encourage car owners to become BL members and deliver useful information and coupons
to their smartphones based on information (big data) concerning their characteristics, cars
they own, and their purchase histories.
 Help invigorate “Car-unselor in Your Town” shops and produce revenues from new network
services.

Receiving/shipping

Car Owners(BL member)

Car-unselor ShopCoupons

Registered

Provide coupons and useful
information via push notification
ブロードリーフ

New-Generation
BL Cloud

Un-registered

We deliver information
as an agent.

・Members・Points・Coupons

BroadLeaf
Improvement in revenue
from network services

13Step Up Business Expansion in Asia
Updates on exhibitions held in China
On display in forums and exhibitions
 2014 International Forum on Collection, Reuse and Re-fabrication of Motor Vehicles
Date: May 15, 2014
Organized by:Society of Automotive Engineers in China, Federation of Industrial Technology
Innovation Strategy for Collection and Use of Motor Vehicle Products, Shanghai
Jiao Tong University, and others
With the participation of:
Nearly 200 personnel from Chinese domestic automotive manufacturers andrebuilders, domestic recycling plants, automotive research institutes and others
 Annual Forum and Exhibition of China Natural Resources Recycling Association
Date: May 19-21, 2014
Organized by:
China Natural Resources Recycling AssociationWith participation of:
200 domestic recycling plants affiliated with the Association, government officials
from the Ministry of Commerce and others, and specialists in the recycling industry

Improvement in name recognition

A target of introducing it to 50 major
Chinese recycling operators
by the end of FY12/2014
14

3. Reference Materials

Our Profile

Corporate Philosophy
Gratitude and Satisfaction: These are the underlying principles
that drive our creation of new corporate value
as we develop enterprise solutions for our partner-clients.
Corporate Name:
President and CEO:
Stock Listing:Founded/Established:
Capital Stock:
Business Outline:

Head Office Location:
Business Offices:
Development Centers:
Number of Employees:

Broadleaf Co., Ltd.
Kenji Oyama
The First Section of the Tokyo Stock Exchange
Securities Code: 3673 (Listed on March 22, 2013)
December 2005/September 2009
¥7,141 million
Provision of services on an IT platform that supports the business ofplayers in the automotive aftermarket (e.g. development of businessapplications and automotive content, platform for collaboration between
different business sectors, marketplace for recycled auto parts)
Floor 8, Glass Cube Shinagawa, 4-13-14, Higashi-Shinagawa,Shinagawa-ku, Tokyo
35 offices in Japan
3 centers in Japan (Sapporo, Tokyo and Fukuoka)
810(as of June 30, 2014)16
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Automotive Aftermarket of JAPANThe automotive aftermarket refers to a market of products and services to be used by car owners
after purchase of their vehicles, including gasoline, accessories, safety inspections,maintenance checks, replacement of parts, and sales and scrapping.

17
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

Distribution Structure of Auto Parts and Relations
to BroadLeaf
 Introduce a seamless system of order taking and the placing of auto parts by vertically and horizontally linking fragmented
stages of the huge used automotive market, achieving high market shares in all stages from upstream to downstream

Manufacturersof Auto Parts

Electric
WiringCompanies

Glass
Shops

Recycling
Companies

Radiator
Shops

Supply of Auto Parts

Recycled Parts Market
Trading Firms
Auto Parts
Dealers

Used AutoParts
DealersScrapping,etc.

Sale andPurchase ofAuto Parts

Supply of Auto Parts

Manage recycled parts
possessed by multiple
auto dismantling shops
as common inventories

Retailers
MaintenanceShops, etc.

Compulsory andOther Inspections

Bodywork
Shops, etc.
Repairing damages due
to auto accidents, slightdamages, dents, etc.

Used Car
Dealers

Sellingused cars

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

18

Domain of Our Sales
 We have a single business segment of IT services, but sales are classified according to the type of services that weprovide to customers.
LargeClassification

MiddleClassification

Small Classification

Type of Business
Provisioning of business application software for specific businesses.
We sell the rights to use systems mainly to leasing companies, and they lease such rights
to customers, usually for 6 years.

Business Application
Software

Maintenance

We provide maintenance services for business application software and hardware.

Provision ofConsumables

We sell consumables such as special ledger sheets used in business application software.

System Support

Database Provisioning
ServiceWe provide databases for automobile-related information as well as parts-related
information updated daily, and bill monthly fixed charges.

Server Provisioning
ServiceWe bill monthly fixed charges to network systems customers for the cost of server
maintenance.

Payment Agency Servicefor Recycled Parts

We operate “Parts Station NET,” a distribution network for recycled parts that sharesinformation on the inventories of recycled parts, providing payment agency service whenselling and purchasing recycled parts and collecting commissions at a fixed rate.

Stock

Network ServiceTransaction
Service that provides for seamless placing and receiving of orders for auto parts.
BL Parts Ordering System
Through this service we collect payment for monthly fixed charges or charges on measured
Carpod Tab, etcrates. We also provide tablet-based services to maintenance shops.

19
Copyright (c) Broadleaf Co., Ltd. All rights reserved.

CSR Activities
Basic Policy on CSR
We will contribute to the revitalization of the automotive aftermarket and growtogether with customers in accordance with our corporate philosophy focusing on
Gratitude and Satisfaction. As a company associated with the automobile industry,
we will seek to contribute to the sustainable development of society throughenvironmental conservation and other activities.

Environmental Conservation Activities
Grow Leaf Project
Tree Planting Activities (since 2008)
Under the theme of contributing to the global environment,
we engage in the Grow Leaf Project activities.
We have planted 30,000 trees on land in need of reforestation.
Sponsorship of Musical:
The Fall of Freddie the Leaf: A Story of Life for All Ages (since 2008)
We have been co-sponsoring and promoting this musical for children.
Through the musical, we are conveying the importance of life and theenvironment to future generations.

20
Copyright (c) Broadleaf Co., Ltd. All rights reserved.Cautionary Note

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
Planning Department (Investor Relations)
Broadleaf Co., Ltd.
E-mail: broadleaf-ir@broadleaf.co.jp
URL: http://www.broadleaf.co.jp/english/
21
Copyright (c) Broadleaf Co., Ltd. All rights reserved.