Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSFY12/2017
Business Results Briefing
Broadleaf Co., Ltd.
TSE 1st Section: 3673

Copyright (c) Broadleaf Co., Ltd. All rights reservedFeb. 14, 2018

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Chapter 1

Overview of FY12/2017 Business Results

2

Chapter 2

Contents

Results Forecasts for FY12/2018

12

Chapter 3

Management Plan

18

Appendix [Reference]
Corporate Philosophy, Corporate Profile,
Broadleaf Group, Sales Fields

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Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Chapter 1

Overview of FY12/2017 Business Results

Copyright (c) Broadleaf Co., Ltd. All rights reserved2Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSPL Summary (Consolidated, IFRS)POINTBusiness results surpassed the results forecasts, with both sales andprofit exceeding year-ago levels.

(¥ million)

FY12/2016
Full-year

FY12/2017
Full-year (*)

YoY (Ratio)

Forecast (Aug. 4th)

Achievement

Revenue

16,76018,195+8.6%

17,800102.2%

Operating profit

2,953

3,011

+2.0%

2,100

143.4%

Profit

1,876

1,932

+3.0%

1,240

155.8%EPS¥39.47¥43.63+10.5%¥28.00155.8%* The consolidation of Tajima was completed in August 2017.

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3

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS[For Reference] Special Factor Regarding Operating Profit(¥ million)

FY12/2016
Full-year
Special factor: Compensation for damage received as aresult of winning a lawsuit (*)

FY12/2017
Full-year

YoY (Ratio)

251--

Operating profit

2,953

3,011

+2.0%

Operating profit (Not including special factor)

2,702

3,011+11.4%

Operating profit ratio

17.6%

16.5%

-1.1 pt

Operating profit ratio (Not including special factor)

16.1%

16.5%

+0.4 pt* The company recorded other operating income of 251 million yen in FY2016 after the Company was found to have won acopyright infringement lawsuit against Azesta Cooporation.

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4

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSSales by Category (Consolidated, IFRS)POINT

As a result of the consolidation of Tajima, sales increased across-the-board in the Business
Application Software, System Support and Network Service categories.
(¥ million)

FY12/2016
Full-year

FY12/2017
Full-year

YoY Change

YoY (Ratio)

Business Application Software

10,894

11,737+844+7.7%

System Support

1,243

1,264+20+1.6%

Maintenance570

556-14-2.5%

Provision of Consumables

673

708

+35+5.2%

Network Service

4,623

5,194+571+12.3%

Stock

3,663

4,177+515+14.0%

918

939+21+2.3%

PSF

657

642-15-2.2%

Order Placement and Acceptance

261

296

+36+13.7%

4378+35+82.6%

16,76018,195+1,435+8.6%Transaction

Others
Revenue

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5Sales by Category (Non-Consolidated) (Japanese Standard)

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSPOINTIn the Business Application Software category, sales began to increase, while the Network
Service category maintained sales growth.
(¥ million)

FY12/2016

FY12/2017
Full-year

Full-year

YoY Change

YoY (Ratio)

10,988
1,239

11,0691,230+80-9+0.7%-0.8%

Maintenance

570

550

-19-3.4%

Provision of Consumables

669

679

+9+1.5%

Network Service

4,623

4,919

+296

+6.4%

Stock
PSF

3,662917
657

3,904938
642+241+20-14+6.6%+2.3%-2.2%Order Placement and Acceptance260

296+35+13.7%

4276+34+80.0%

16,851

17,219+368+2.2%

Business Application Software
System SupportTransaction

Others
Revenue

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6Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSBreakdown of Sales in Business Application Software(Non-Consolidated) (Japanese Standard)
POINT

Recovery of user renewals in the automotive sector made up for a downturn inequipment sales.
(¥ million)

FY12/2016
Full-year

Automotive
RenewedNew customers
Non-automotive
RenewedNew customers
Total
RenewedNew customers
OthersBusiness Application Software
total revenue

FY12/2017
Full-year

YoY Change

YoY (Ratio)

7,922
6,861
1,061
1,592
1,090
501
9,515
7,952
1,563
1,473

8,194
7,215
979
1,848
1,255
593
10,042
8,470
1,572
1,026

+272+354-82+256+165+92+527+518+9-447

+3.4%
+5.2%
-7.7%
+16.1%+15.1%+18.4%
+5.5%
+6.5%
+0.6%
-30.3%

10,988

11,069+80+0.7%

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

7Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSKey Indicators in Network Service Domain
POINT

Widespread action for the industry standardization of the electronic order platform
for auto parts

End of FY12/2016

End of FY12/2017

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

2,041

2,194

335

345

3,054

3,259

CarpodTab
Number of contracts

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8Breakdown of Increase/Decrease in Operating Profit(Consolidated, IFRS)

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSPOINTOperating profit increased, with a rise in personnel expenses and other SG&A expenses
outweighed by a rise in sales and a fall in cost of sales.
A fall in costof sales
+802

2,953

A rise insales+368

251(*)* Compensation for damage
received (P4)2,702(¥ million)

A fall in
R&D
expenses+172
A rise inpersonnel
expenses
-516

3,011
A rise insharerelated
expenses-200

TajimaTajimaacquisition
operatingexpenses,
loss
etc.
-82
-235

Note: Positive signs show factors for an increase in project,and negative signs show factors for a decrease in profit.

Excluding Tajima

FY12/2016(Results)

TajimaFY12/2017(Results)
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9Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSBS Summary (Consolidated, IFRS)POINTCash and deposits decreased while goodwill increased with the acquisition of Tajima.

(¥ million)

End ofFY12/2016

End of FY12/2017
YoY Change

Main factors forincrease/decrease
Decrease in cash and deposits (-1,768)

Current Assets

12,304

11,400Non-current Assets

13,018

16,663+3,645 Increase in goodwill (+1,708)

25,322

28,063+2,741

Current Liabilities

4,980

7,478

+2,497 Increase in operating payables (+2,455)

Non-current Liabilities

1,183

848

Total Liabilities

6,163

8,326

Total Shareholders' Equity

19,15919,73725,322

28,063

Total Assets-904 Increase in operating receivables (+786)-335 Decrease in long-term loans payable (-611)+2,163
Recognition of profit (+1,932)

Total Liabilities andShareholders' Equity+578 Decrease by acquisition of own shares (-483)
Decrease by dividend of surplus (-1,049)+2,741

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Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

CF Summary (Consolidated, IFRS)POINT

FCF fell year on year due to an increase in investment mainly due to software development
and the acquisition of Tajima.
(¥ million)

End ofFY12/2016

End of FY12/2017
YoY Change

Main factors forincrease/decrease

CF from operating
activities

3,142

2,558

CF from investing
activities-684-2,072-1,388 Purchase of shares of subsidiaries resulting in

CF from financing
activities-3,324-2,251+1,073 Decrease in purchase of treasury shares (+1,416)

FCF2,458

486-1,972

Cash and cash
equivalents

7,738

5,970

-1,768-584 Income taxes paid (-630)
Purchase of intangible assets (-753)
change in scope of consolidation (-865)
Cash dividends paid (-329)

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11

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Chapter 2

Results Forecasts for FY12/2018

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

12

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Full-Year Results Forecasts (Consolidated, IFRS)POINTA large rise in sales partly due to the full contribution of the consolidation of Tajima(¥ million)

FY12/2017
Full-year

FY12/2018
Forecasts

YoY Change

YoY (Ratio)

1H Forecasts

18,195

20,400+2,205+12.1%

9,400

Operating profit

3,011

3,300

+289+9.6%

950

Operating profit margin

16.5%

16.2%

-0.3 pt-

10.1%

Profit1,932

2,100+168+8.7%

600

10.6%

10.3%

-0.3 pt-6.4%¥21.82¥24.02+¥2.20+10.1%¥6.85

Revenue

Profit margin

EPS (*)* A 2-for-1 stock split effective from April 1, 2018 (planned) is reflected.

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

13

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSSales Forecasts by Category (Consolidated, IFRS)POINT

Recovery of Business Application Software sales combined with continued expansion in the
Network Service category especially stock(¥ million)

FY12/2017
Full-year

FY12/2018
Forecasts

YoY Change

YoY (Ratio)

1H Forecasts

Business Application Software

11,737

13,130+1,393+11.9%

5,870

System Support

1,264

1,340

+76+6.0%660

Maintenance

556

580

+24+4.4%

280

Provision of Consumables

708

760

+52+7.3%

380

5,194

5,930+736+14.2%

2,870

4,177

4,820

+643

+15.4%

2,360

939

1,010

+71+7.6%

480

PSF

642

680

+38+5.8%330

Order Placement and Acceptance

296

330

+34+11.4%

150

Others78

100+22+28.1%

30

Net sales

18,195

20,400+2,205+12.1%

9,400

Network Service
Stock

Transaction

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14Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Factors for Changes in Operating Profit(Consolidated, IFRS)POINT

Operating profit will increase due to a rise in the non-consolidated sales of Broadleaf
in addition to a rise in the profit of Tajima, etc.
(¥ million)

A rise insales+680

3,011

A rise incost ofsales-250

A rise inpersonnelexpenses-28

Other+91

A rise inthe profitof Tajima
+182

3,300

A rise in
A rise insharerelated depreciation
andexpenses-200 amortization-186

Note: Positive signs show factors for an increase in project,and negative signs show factors for a decrease in profit.

Excluding Tajima

FY12/2017(Results)

TajimaFY12/2018(Forecasts)
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15

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Measures for Integration with Tajima
POINT

Full-scale implementation of integration measures from FY2018

Measures and Schedule

1Q

2Q

3Q

3Q

4Q

Establishment of common accounting standards / Establishment of monthly data sales and maintenance charges
Reduction of purchasing costs though Group procurement
From January 2018
- Measures to instill Group philosophy system
March 2018
- Head office integration- Call center integration
From March 2018
- Establishment of common
head office operations

From July 2018
- Integration of sales bases(in phases)

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Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSDividends
POINT

The annual dividend forecast is 11 yen, and the consolidated payout ratio is 45.8%.
Annual dividend(Payout ratio)¥11.00 *2(50.4%)¥10.625 *1, *2(53.8%)

Yearend

Interim¥6.25*2¥4.375*1*2

FY12/2016¥11.00 *2(45.8%)

Yearend¥5.50(Plan)*2*3

Yearend*2¥5.50(Forecast)Interim¥5.50*2Interim*2¥5.50(Forecast)

FY12/2017*1 Amount adjusted for the share split (1:2) with the effective date on December 17, 2016
*2 Amount adjusted for a 2-for-1 stock split with the effective date on April 1, 2018 (planned).
*3 The year-end dividend for the fiscal year ended December 31, 2017 will be determinedat the 9th Ordinary General Meeting of Shareholders to be held in March 2018.
Copyright (c) Broadleaf Co., Ltd. All rights reserved

FY12/2018(Forecast)17

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Chapter 3

Management Plan

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

18

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Now and Moving Forward
POINT

Aiming to Become a Business Platform Vendor
Now
Our strengths

Moving forward
Data-based business expansion

 Development of customer
network

Social and industrial digitization

 Overwhelming databasevolumeDigitization of relationships with customers

Utilization of API economy/
BigData

Automotive aftermarket
supply chain
Auto parts
manufacturer

Cloud-based next-generation
business systems

OthersMobile, Tourism, Bus, Manufacturing (Plant)

AI, RPA, VR/AR・BigData

Parts trading company

Maintenance/Sheet metal/
Vehicle sales

Reform utilizing digital transformation

Cloud migration of IT infrastructure (Replacement of existing IT infrastructure) Move existing IT infrastructure into the cloud to ensure that IT infrastructure is not an obstacle tochanges in the management environment and various types of innovation, and integrate infrastructure,applications and BigData infrastructure into a platform.

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19

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSDevelopment Schedule
POINT- Strengthening of Group sales through synergies between Broadleaf and Tajima- Gradual introduction of next-generation systems (cloud-based)

Customer market

FY2018FY2019FY2020Introduction of nextgeneration system(for large scale)Upgrade of existing NS2system

L* Hybrid type(lump-sum+ monthly)
Introduction of nextgeneration system(for medium scale)M

S- Establishment of monthly data sales
and maintenance charges* Shift to subscription-type
ariff contract on
switchover- Start of BLP sales+Introduction of nextgeneration system(for small scale)SS

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

20Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSBasic Policy
POINT

Medium-to-long-term target is ROE of 12%.
Basic Policy (FY2018-FY2019)
Existing domains
Expansion in number of Group system users

New domains
Creation of newservices/new
businesses

Full-scale overseas
expansion- Utilization of technologies(AI, VR/AR)- Utilization of data
- Promotion of M&A- Expansion of Asia tradearea- Development of autoparts distribution

Shift to subscription-type charging model- Evolution of existing NS series business systems- Strategic market introduction of next-generation
business systems- Strengthening of earnings of Tajima

Provision of platform services- Development of existing and new services based on cloud infrastructure (platform)- Further differentiation through enhancement of data

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Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Performance Targets
POINT- Target sales CAGR for FY2017-2019 is 10.3%.
- Target 1.2 pt increase in operating profit margin, offsetting increase in development andintegration expenses with effect of increased sales.

(Billion yen)
% in ( ) is operating income margin

Net sales

Operating income

3.90
22.00
20.40

3.01

18.19

(16.5%)
Increase in user renewals

FY12/2018
Forecast

FY12/2019
Target(16.2%)
Effect ofincreased sales
Increase in expenses
due to Tajimaintegration, etc.

Shift to subscription-type
tariff while curbing impact
on salesFY12/2017
Results(17.7%)

3.30

FY12/2017
Results

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

FY12/2018
Forecast

FY12/2019
Target22

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

VisionPOINT

Provide Value to Society Through Data and Technology.
Broadleaf 10-Year Vision

Consider, Connect, Communicate ～~ Become a comprehensive planner that creates a rich society and lifestyle ~Open innovation
Collaborative
creation

Application and Utilization

TechnologyReal World

Realization of sustainable society

Finance, Services, Tourism, Manufacturing

Environmental change and industrial activity

Automotive aftermarket

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23

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSAppendix [Reference]

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

24Appendix 1

Corporate Philosophy

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Gratitude and Happiness
Here at Broadleaf, our business revolves around prospering hand in hand with our customers, with anemphasis on the spirit of gratitude and happiness, as essential qualities that inextricably connecting
people and companies.
We contribute to our customers’ business through the products and services that we provide, and aim toensure that our customers are glad they chose Broadleaf.
We derive happiness meanwhile from the sense our business is growing every day.
The emotions that we inspire in our customers fill us with gratitude and happiness, and in turn inspire us
to provide even better products and services, and greater value for society as a whole.
Copyright (c) Broadleaf Co., Ltd. All rights reserved

25Appendix 2

Corporate Profile

Corporate Name

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSBroadleaf Co., Ltd.

Representative Director, President and CEO
Kenji Oyama

Listed on

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

Founded/Established

December 2005/September 2009

Capital StockJPY 7,147 million

Business Outline

IT network system to support automotive aftermarket operators andprovision of services on the platform(Business applications, platforms for cooperation with different industries,
recycled parts marketplace, development of car-related contents, etc.)

Head Office Address

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

Sales Offices

33 offices in Japan

Development Centers

3 centers in Japan (Sapporo, Tokyo and Fukuoka)

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26

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSAppendix 3Broadleaf GroupJapanBroadleaf Co., Ltd.

 Tajima Inc.

100%

 SpiralMind Co., Ltd.

100%

Overseas【海外】(The Philippines)(China) Broadleaf I.T.Solutions Inc.

100%

 博楽得信息科技 (合肥)有限100%

 BLISAM TRADING CORP

50%

 北京盛源博乐信息科技有限公司

100%

: Consolidated subsidiaries. : Equity-method affiliates%: Percentage of voting rights owned
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27

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONSAppendix 4

Sales Fields

Although the Company is in a single segment of IT services businesses,
we have adopted the following classifications by business area
Major
category

Classification
MediumSmallcategory
category- Development and sale of industry-specific business applications- Development and sale of operation analysis/optimization software- Purchase and sale of PC bodies, printers, etc.

Business Application Software

Maintenance- Business application maintenance service to the Company’s Business
Application Software customers and provision of hardware maintenanceservices

Provision of consumables- Purchase and sale of exclusive forms and OA supply goods to be used forthe business applications

Stock- Provision of database of car-related vehicle information and parts-related
information that is updated daily- Consideration for server maintenance required for the use of network-typesystems

System
Support

NetworkService

Detailed businesses

PSF
Transaction- Operation of recycled parts distribution network “Parts Station NET” thatshares inventory information on recycled parts
Collecting fees as transaction amount settlement agency for parts dealing- Provision of computerized ordering system for automotive parts
Order Placement- Provision of tablet-type operation terminals, CarpodTab, to maintenanceand Acceptancebusiness operators, etcOthers- Products and services other then the above

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28

Broadleaf Co., Ltd.
FY2017INVESTOR RELATIONS

Disclaimer
Results forecasts and future predictions provided in this document are theCompany’s judgment based on the information available as of the time of
preparation of the document and contain potential risks and uncertainties.
Accordingly, please understand that the actual results may differ from the results
forecasts provided here.

[Contact Information]
Broadleaf Co., Ltd.
Corporate Communications (IR/PR) Department
E-Mail: broadleaf-ir@broadleaf.co.jp

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