3Q FY12/2016
Business Results BriefingBroadleaf Co., Ltd.
TSE 1st Section: 3673

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

Oct. 28, 2016

Chapter 1
Overview of 3Q Business Results

Contents

2

Chapter 2
Results Forecasts

8Appendix
Overview of the Company
Sales Domain151Chapter 1

Overview of 3Q Business Results

2

PL Summary
POINT

Net income increased due to the recognition of extraordinary
income.

(¥ million)

3Q FY12/2016
Results

YoY Change

3Q FY12/2015
YoY (Ratio)

Results

11,983-133-1.1%

12,116

Operating income

1,085-184-14.5%

1,270

Ordinary income

1,084-165-13.3%

1,249

Income before income
taxes

1,333

937.5%

1,239

659

100

17.9%

559

¥27.47

¥5.09

22.7%

¥22.38Net sales

Net income

Earnings Per Share

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

3

Sales by Category
POINT

Network Service, the key segment, maintained growth in sales.

3Q FY12/2016(¥ million)

Results
Business Application
Software
System Support

YoY Change

YoY (Ratio)

3Q FY12/2015
Results

7,613-422-5.3%

8,035924-20-2.1%

944

431

-19-4.3%

450493-0-0.1%

494Network Service

3,444309

9.9%

3,135

Stock

2,734

253

10.2%

2,480679

47

7.5%

631

PSF*1487-14-3.0%502

Order Placing andAcceptance*2191

6248.5%12930734.2%

2211,983

-133

-1.1%

12,116

Maintenance
Provision ofConsumables

Transaction

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

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

4Breakdown of Sales in Business Application Software
POINT

Sales to new automotive-related customers increased as a resultof efforts to expand trade-ins, despite a low number of user
renewals.

(¥ million)

Automotive
RenewedNew customers
Non-automotive

RenewedNew customers
TotalRenewed
New customers
OthersBusiness Application
Software Total sales

3Q FY12/2016
Results
YoY Change
5,355
-827
4,586-934
768
107
1,097-8
747
38
349
-47
6,452
-835
5,333
-896
1,118
60
1,160
413
7,613

YoY (Ratio)-13.4%-16.9%
16.3%
-0.8%
5.4%
-11.9%-11.5%-14.4%
5.7%
55.3%

3Q FY12/2015
Results
6,182
5,521
661
1,105708
397
7,288
6,229
1,058
747-5.3%

8,035-422

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

5Breakdown of Expenses
POINT

Continued initiatives to control costs (reviews, streamlining, etc.)(¥ million)

Net Sales
Cost of sales

3Q FY12/2016
3Q FY12/2015
Results
YoY Change
Results
11,983-133
12,116 -

3,714

144

Main factors behindthe changes

Personnel shifts to the personnel

3,570 expense side

Increase in equipment purchases

7,183-92

7,275 -3,57086

shifts from the cost side (cost3,483 Personnelof labor)

226
3,385-93-86of next-generation systems
320 Development(partial capitalization)
3,471 Advertising expenses, etc.

Operating Income

1,085-184

1,270 -Total personnelexpenses *4,105-79

4,184 Reduced number of employees

Subcontract Cost

1,033

-176

SG&A expenses
PersonnelExpenses
R&D Expenses
Otherof ratio of in-house and1,210 Optimization
outsourced construction* Sum of labor cost (cost of sales) and personnel expenses (SG&A expenses)

Copyright (c) Broadleaf Co., Ltd. All rights reserved6BS Summary
POINT

Implementation of interim dividends payment and treasury
stock acquisition (August 10 to September 8) for J-ESOP in
the 3 rd quarter.

(¥ million)

End of 3Q FY12/2016
Results

Current Assets

11,610Change-1,422

End ofFY12/2015

Major factors ofincrease/decrease

Results

Decrease in cash and deposits (-472)

13,033 Decrease in accounts receivable – trade(-882)

Non-current
AssetsTotal Assets
Current
Liabilities

Non-current
Liabilities
Total Liabilities
Total Net Assets

12,156-376

23,767-1,79812,532 Amortization of goodwill (-501)
25,565 -4,080-257

Decrease in accounts payable-trade
4,338 (-182)
Decrease in accounts payable – other(-210)

1,310-531

in long-term loans payable
1,841 Decrease(-505)

5,390-789

6,179 -18,376-1,009

Recognition of net income (＋659)

19,385 Payment of dividends payable (-728)
Acquisition of treasury stock (-974)

Total Liabilities andNet Assets

23,767-1,79825,565 -Copyright (c) Broadleaf Co., Ltd. All rights reserved

7Chapter 2

Results Forecasts

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

8Results Forecasts
POINT

No change to the results forecasts since the last announcement(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 income

1,620

368

29.4%

1,251

Earnings Per Share¥67.98¥17.51

34.7%¥50.47

Net sales

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

9Sales Forecasts by Category
No change to the sales forecasts since the last announcement(February 10).

POINT(¥ million)

FY12/2016
Forecasts

Business ApplicationSoftware

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

5,050

807

19.0%

4,242

Stock

3,550

199

5.9%

3,350

Transaction

1,200

341

39.8%

858

PSF

700

27

4.0%

672

Order Placing andAcceptance

500

314

169.5%

185

Others300

267

813.6%

32

Net sales

18,000

1,175

7.0%

16,824

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

10Estimates and Assumptions for 4 th Quarter of Fiscal Year EndingDecember 2016 < Sales by Category >POINTContinue to expand trade-ins and prioritize the increase in new
system contracts. Stock, which is categorized under incidental
revenue, is expected to exceed the full-year forecast.
(¥ million)

FY12/2016

FY12/2015

Estimates for4Q(ii-i)

7,613

4,086

11,7003,280

System Support

924

325

1,250

321

Maintenance

431

168

600

146

Provision of Consumables

493

156

650

174

Business Application Software

Full yearForecasts(ii)(Assumptions）

Cumulative
3Q Results(i)

4Q Results

3,444

1,605

5,050

1,106

2,734

815

3,550

869679

520

1,200

226

PSF

487

212700170

Order Placing and Acceptance

191308500

56

Others

30

269

300

9Net sales

11,983

6,016

18,0004,707

Network Service
Stock
Transaction

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

 Business Application Software(Renewed)
Closing by the fiscal year end asplanned(New customers)
Continue with strategic trade-ins
targeting customers of othercompanies. Further increase thenumber of contracts.
 Stock
The steady growth of the numberof new contracts in Business
Application Software up to 3Q isexpected to continue in 4Q.
 Order Placing and Acceptance
Aim at improving the rate ofutilization through presentation ofadded value.

11

Key Indicators in Network Service Domain
POINT

Continuous efforts for the industry standardization of theelectronic order service.
FY12/2016
End of 3Q
Results

FY12/2015

End of FY
Forecasts

End of 3Q
Results

End of FY
Results

 Stock.NS Ratio*1

85.5%

No set figure

78.8%

80.5%

1,959

3,000 or more

1,491

1,666

336

No set figure*2288

312

2,953

4,000

1,959

2,322

 Transaction
BL Parts Order System

Number of connections withmaintenance shops
Number of parts dealersparticipating in transactions
CarpodTab
Number of contracts*1: Proportion of total number of contracts accounted for by current business application software, “.NS Series.”*2: Since the target of 300 parts dealers has already been achieved, any further requests to participate will be dealt with as appropriate.
Copyright (c) Broadleaf Co., Ltd. All rights reserved

12Returns to Shareholders
POINT

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

¥30(44.1%)

Annual dividend(Payout ratio)¥25(49.5%)¥20(23.8%)

Year-end(forecast)Year-end ¥12.5¥5.0 (Commemorative dividend

Year-end ¥10Interim¥10

FY12/20142014/12期

Interim¥12.5

FY12/2015
2015/12期¥12.5 (Ordinary dividend)Interim(actualresult)for the 10th anniversary of the Company’sfounding)¥12.5 (Ordinary dividend)(予想)
FY12/2016(forecast)
2016/12期

Copyright (c) Broadleaf Co., Ltd. All rights reserved13Acquisition of Treasury StockPOINT

The Company decided to acquire treasury stock for the
purpose of improving capital efficiency and returning profits toshareholders.

(1)Type of shares to be acquired: Shares of common stock(2)Number of shares to be acquired: Up to 1,350,000 shares(Ratio to total shares outstanding (excluding treasury stock): 5.79%)(3)Total amount of acquisition: Up to 1.5 billion yen(4)Period of acquisition: From November 1, 2016 to January 31, 2017
(Reference) Status of treasury stock held by the Company as of September 30, 2016
Total number of shares issued: 24,474,200 shares
Number of treasury stock:
1,176,184 shares

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

14Appendix [Reference Material]

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

15Appendix①

Overview of the Company

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)

Copyright (c) Broadleaf Co., Ltd. All rights reserved16

Appendix②

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

Large
Classification

Category
MiddleClassification

SmallClassification

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

StockNetwork ServiceTransaction

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

17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