Results for the Six Months Ended
September 30, 2017
November 2017

Building a better,brighter future together
Total ICT Solutions:Contributing to the Realization of a Brighter
Future by Bringing People Together andForming Connections with Society

URL: http://www.exeo.co.jp/overseas/index.html

Results for the Six Months Ended September 30, 2017

Contents
1. Overview of FY17 Interim Results･･･ 2

3. Medium-Term Management Plan･･･ 25(1) Performance Figures･･･ 3(1) Outline･･･ 26(2) Orders Received･･･ 4(2) Image of growth in each segment･･･ 27(3) Net Sales･･･ 5(4) Operating Income･･･ 7(5) Cash Flow･･･ 9

2. Expectations for the Rest of FY17･･･ 10(1) Performance Figures･･･ 11(2) NTT Group (Access/Network)･･･ 12(3) NTT Group (Mobile)･･･ 13(4) NCCs･･･ 14(5) Urban Infrastructure･･･ 15(6) SYSTEM-SOLUTIONS･･･ 16(7) Measures for greater efficiency･･･ 22

4. Raising Shareholders’ Value･･･ 29(1) Payment of Dividends･･･ 30･･･ 31

5. Topics(1) The National Skills Competition･･･ 32(Skill sector: Information Network Cabling)(ImprovedProductivity)
Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(1) Performance Figures(2) Orders Received(3) Net Sales(4) Operating Income(5) Cash Flow

－2－

Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(1) Performance Figures Both orders received and net sales up YOY due to strong NTT Group orders◆ Due to the greater efficiency of construction and the like, all types of income increased YOY andcompared to the plan, and reached a new high

■ Overview of FY17 interim results (consolidated)(¥bn)

FY 2016
Interim

FY2017
InterimFull year

Full year

Plan

ActualYOY

Plan
accuracy

Progress
rate
D/E

Plan

YOY

E

E/B

A

B

C

D

D/A

D/C

Orders received

154.6

324.1

155.0

161.1

104%

104%

49%

330.0

102%

Net sales

116.2

298.8

128.0

124.9

108%

98%

39%

320.0

107%

(12.3%)

Gross profit

14.3(7.2%)

SG&A expenses

8.3(5.2%)

Operating income

5.9(5.0%)

Ordinary income
Net income attributableto owners of parent

5.7(2.1%)

2.4(12.9%)

38.4(5.9%)

17.6(7.0%)

20.8(7.2%)

21.4(4.6%)

13.7(12.3%)

15.7(7.0%)(13.8%)

17.2
8.3
8.9

42%

9.7

100%

93%

45%

6.3

107%

18.3

104%

(7.2%)

149%

131%

39%

23.0

110%

(7.4%)

168%

133%

41%

(5.1%)

4.7

41.3(5.7%)(7.8%)

7.3(3.7%)

110%(7.1%)

6.8(5.7%)

120%(6.6%)

8.9(5.3%)(12.9%)

23.6

110%

(4.9%)

263%

135%

41%

15.7

114%

Notes: All amounts less than ¥100m are disregarded. Figures in parentheses are ratio to net sales.

－3－

Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(2) Orders Received◆ Exceeded the previous year due to strong NCCs and Urban Infrastructure orders◆ Increased compared to the plan due to the strong orders received from the NTT Group■ YOY (consolidated)■ Compared to plan (consolidated)
○ SI
○ NI

○ KDDI○ SB

324.1(Actual)

NCCs
+4.9

NTT Group
-3.5

154.6

▲ Access○ Network▲ Mobile

SYSTEMSOLUTIONS
+2.1

330.0

330.0

(Plan)(Plan)

330.0

161.1

155.0

SYSTEMSOLUTIONS
-2.0

NCCs
-0.3

○ Access○ Network○ Mobile(Plan)

Urban
Infrastructure+0.6○Telecommunications
facilities○Electricity supply▲Civil engineering

161.1

＋6.1

＋6.5

FY16 Interim▲ New Solutions

NTT Group
+7.9

Urban
Infrastructure+2.9－Telecommunications
facilities○Electricity supply▲Civil engineering▲ KDDI○ SB(¥bn)

FY16 Interim Plan

FY17 Interim○ Reason for increase ▲ Reason for decrease － No increase/decrease－4－

FY17 Interim

Note: All amounts less than ¥100m are disregarded.
Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(3) Net Sales◆ Increased YOY by consuming a large number of carried-over projects in each segment◆ Fell slightly short compared to the plan due to the delayed sales of Mobile (NTT & NCC)
■ YOY (consolidated)■ Compared to plan (consolidated) (¥bn)

－ SI
○ NI

〇 KDDI○ SB

298.8

NTT Group
＋4.1

116.2

○ Access○ Network－ Mobile

320.0(Plan)(Plan)▲ KDDI
▲ SB

NCCs
-2.5

Urban
Infrastructure-0.3○Telecommunications
facilities▲Electricity supply○Civil engineering

128.0

124.9

320.0

SYSTEMSOLUTIONS+0.5

NTT Group
-0.6

Urban
Infrastructure-0.4○ Access－ Network▲ Mobile▲Telecommunications
facilities○Electricity supply▲Civil engineering

124.9

-3.0

＋8.7

FY16 Interim

○ SI
○ NI

(Plan)SYSTEMSOLUTIONS
+2.1

NCCs
+2.8

(Actual)

320.0

FY17 Interim

FY17 Interim Plan

○ Reason for increase ▲ Reason for decrease － No increase/decrease－5－

FY17 Interim

Note: All amounts less than ¥100m are disregarded.
Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results
Reference: Status of projects carried over
◆ Work carried over after 2Q at all-time high■ Work carried over at end of Previous FY and 2Q by year (consolidated)
179.7

(¥bn)

156.6
143.5
138.6
133.1
125.8
118.3

117.9
105.4

103.7

End of2Q

Previous FY

End

FY13

End ofPrevious FY

FY14

2Q
End

End ofPrevious FY

2Q
End

FY15

－6－

End ofPrevious FY

FY16

2Q

End of2Q

End

Previous FY

End

FY17

Note: All amounts less than ¥100m are disregarded.
Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(4) Operating Income Reached a record high due to the improved construction efficiency and the promotion ofmultiple measures for greater efficiency■ YOY (consolidated)■ Compared to plan (consolidated) (¥bn)

20.8(Actual)Up due toincrease in sales
+1.0

23.0

23.0

23.0

(Plan)(Plan)(Plan)

Improved
efficiency+0.5

Improved
construction
efficiency+0.5

Down due todecrease in sales-0.4
Others+0.9

8.9

Improved
construction
efficiency
＋1.9

6.8

5.9

8.9

+2.1

+2.9

FY16 Interim

Others+0.6

FY17 Interim Plan

FY17 Interim

FY17 Interim

Note: All amounts less than ¥100m are disregarded.

－7－

Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results
Reference: Trends in Group company profitability◆ Continued high level of profits in Group companies■ Trends in operating profits over the past five years (consolidated/non-consolidated)(Ratio of consolidated to
non-consolidated profits)

(1.7)

2.3

(1.6)

(2.1)

(2.1)

(¥bn)

(1.9)

4.2

2.9

Group companies
Exeo alone

3.1
2.6
4.3

FY13 Interim

4.6

FY14 Interim

4.6
2.2

2.8

FY15 Interim

FY16 Interim

FY17 Interim

Notes: Ratio of consolidated to non-consolidated profits = operating profits from consolidated projects ÷operating profits from non-consolidated projects. All amounts less than ¥100m are disregarded.

－8－

Results for the Six Months Ended September 30, 2017

1. Overview of FY17 Interim Results(5) Cash Flow
◆ Stable cash flow
■ Cash flow (consolidated)

(¥bn)

FY14

FY15

FY16
InterimFull

FY17InterimCash at beginning of FY

16.2

24.2

16.0

16.0

15.2

Operating activities

23.1

5.3

17.9

15.5

17.3

Investing activities

-2.8

-13.9

-2.0

-6.0

-1.4

Financing activities

-12.3

0.3

-12.5

-10.2

-2.3

Cash at end of FY

24.2

16.0

19.3

15.2

28.7

Note: All amounts less than ¥100m are disregarded.

－9－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(1) Performance Figures(2) NTT Group (Access/Network)(3) NTT Group (Mobile)(4) NCCs(5) Urban Infrastructure(6) SYSTEM-SOLUTIONS(7) Measures for greater efficiency( Improved Productivity)－10－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(1) Performance Figures Will remain firm in 2Q
 Aim to achieve annual plan on the back of record-high work carried over and strong orders■ Plans for FY17 (consolidated)(¥bn)

FY 2016
Interim

FY2017
InterimFull year
Plan

ActualYOY

Full yearPlan
accuracy
D/C

Progress
rate
D/E

Plan

YOY

E

E/B

A

B

C

D

D/A

Orders received

154.6

324.1

155.0

161.1

104%

104%

49%

330.0

102%

Net sales

116.2

298.8

128.0

124.9

108%

98%

39%

320.0

107%

(12.3%)

Gross profit

14.3(7.2%)

SG&A expenses

8.3(5.2%)

Operating income

5.9(5.0%)

Ordinary income
Net income attributableto owners of parent

5.7(2.1%)

2.4(12.9%)

38.4(5.9%)

17.6(7.0%)

20.8(7.2%)

21.4(4.6%)

13.7(12.3%)(13.8%)

15.7(7.0%)

17.2(12.9%)

120%

110%

42%

(6.6%)

8.9(5.3%)

8.3(5.7%)

8.9

100%

93%

45%

(3.7%)

9.7

149%

131%

39%

6.3

104%

23.0

110%

(7.4%)

168%

133%

41%

(5.1%)

4.7

18.3(7.2%)(7.8%)

7.3

107%(5.7%)(7.1%)

6.8

41.3

23.6

110%

(4.9%)

263%

135%

41%

15.7

114%

Notes: All amounts less than ¥100m are disregarded. Figures in parentheses are ratio to net sales.

－11－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(2) NTT Group (Access/Network)◆ Increase in the Hikari collaboration has resulted in continued demand for FTTH
◆ The Group as a whole is promoting measures for greater efficiency■ Trend of number of subscribers to fixed-line broadband■ Net sales of NTT Group(fixed-line network, consolidated)

4,000
3,000

2nd
quarter

（bn）

Full
year

1
601
542

1
623
447

1
643
375

1
685
251

1
673
320

10,000s of
subscribers

FWA
CATV

2,000
1,000

2,385

2,531

FY12

FY13

2,661

2,932

2,788

DSL
FTTH

0
127.2
113.1

111.8

117.6

114.0
（plan）

FY14

FY15

FY16

Note: FWA：Fixed Wireless Access( Source: Created by us based on WHITE PAPER Information and Communications in Japan 2017of the Telecommunications Bureau of the Ministry of Internal Affairs and Communications)■ Trend in Number of FTTH Subscribers(Total of NTT East and West)
54.1

50.7

44.9

45.6

49.3

1,805

1,872
27

1,926
469

2,005

2,076

10,000s of
subscribers

Collabo
Hikari
874

1,845

FY13

FY14

FY15

FY16

1,457

FY17

Flets
Hikari
1,131

FY13

FY14

FY15

FY16

FY17 Plan(Source: Created by Kyowa Exeo, based on NTT presentation material)－12－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(3) NTT Group (Mobile)◆ LTE-Advanced construction work volume remains high
◆ The construction work is behind schedule due to the extension of work, etc. However, we aim to catchup throughout the full year
■ Net sales of NTT Group(mobile network, consolidated)
2ndquarter■ NTT DoCoMo Network Development
2014

（bn）

Full
year

2015

2017

2016

2020

５Ｇ

Effective

Up to １Gbps

speed

Furthersophistication

788Mbps
256ＱＡＭ

682Mbps 4×4ＭＩＭＯ
46.3

49.6

48.7

50.6

54.0
（Plan）

300Mbps
225Mbps
PREMIUM 4G
Servicelaunch370Mbps
375Mbps 3.5GHz band
FDD

500Mbps
256ＱＡＭ

256ＱＡＭ
4×4ＭＩＭＯTDD＋FDD■ LTE Base Stations
22.5

24.4

19.7

21.1

21.5

Total no. of LTE
base stations:149,600

170,900

PREMIUM 4G
Japan’s fastest 788Mbpsservice

86,300
FY13

FY14

FY15

FY16

FY17

ＰＲＥＭＩＵＭ 4G-enabledbase stations:38,100

To be developed in
195 cities nationwide(Commenced provision in
September 2017)

FY16 Interim

FY17 Interim(Source: Created by us based on NTT DoCoMo presentation material.)－13－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(4) NCCs◆ Sales fell below the plan, but increased YOY◆ Construction jobs of new frequency bands for traffic in 4G are active■ Net sales of NCCs (consolidated)■ Planned number of specified base stations with 700MHz
50,000

2ndquarter

38,87940,000

Full
year

(¥bn)

29,86330,00020,000SBKDDI16,235

10,000
0

16/3
44.1

FY13

23.3

31.0

50,000（Plan）

40,000（Plan）

30,000

18.8
10.2

FY14

18/3

■ Planned number of specified base stations with 3.5GHz

36.6

23.2
17.1

17/3

FY15

8.6

FY16

11.4

40,004SB

20,00010,00015,471

KDDI

4,188

0

FY17

16/3

17/3

18/3

(Source: Created by us based on documents from the Telecommunications
Bureau of the Ministry of Internal Affairs and Communications)－14－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(5) Urban Infrastructure◆ Construction jobs for 700MHZ TV reception will be proceeding at full pace towards FY19
◆ Continue to aim to win orders for large-scale electrical construction projects related toTokyo metropolitan area redevelopment■ Urban Infrastructure net sales (consolidated)■ 700 MHz Band TV reception measures

Replacement

2ndquarter

Full
year

Installation(¥bn)

of boosterOrof filter

Construction areas of theCompany

Kanto and Koshinetsu
Install a filter to cancel the radio

Replace a booster with one that amplifies only thewaves from the 700MHz bandbands up to 710MHz (where the situation cannot

mobile phone base stations

be addressed with the installation of a filter)(Source: Created by us based on the HP of Association of 700MHz Frequency Promotion)

76.0
65.5

67.9

65.7

20.1

21.0

17.1

FY13

FY14

FY15

67.3

（Plan）

23.9

23.5

FY16

FY17

■ Topics of orders received in the first half ・・・
Order for mega solar power station in Kagoshima Prefecture: Approx. 5.5 billion

Note: The above photo is for illustrative purposes only: Another plant constructed by us.

－15－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(6) SYSTEM-SOLUTIONS◆ Fuse the BPM solution business with the peripheral domains to expand the added value◆ Gradually produce results in the new solution fields such as IoT and the cloud■ SYSTEM-SOLUTIONS net sales(consolidated)

2ndquarter

Full
year■ Expand the added value of the BPM solution business

(¥bn)

45.0
35.2

33.6

14.1

12.1

FY13

FY14

37.8

39.7
（Plan）

15.7

16.9

19.0

FY15

FY16

FY17

－16－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: Results of orders received for new solutions and activities going forward¥5.6bn

6
5
4
3
2
1
0

¥1.3bnNew energy field
・ Energy management service

FY16

・ Transportable lithium battery
・ Smart meter

FY17 Plan

6
5
4
3
2
1
0

¥3.0bn¥1.4bnFY16

FY17 Plan

Energy Viewer , Survival Power Supply,・Expand business in the

Utility cloud for new electric power companies ,Philippines

HEMS, etc.

・Participate in business in

16

Global, other 14

Vietnam・ Participate in businessin Thailand

12

・ Okinawa

10・ International, etc.

8

Received

Solutions field・ Beacon

EXBeacon:(Next-generation beacon
equipped with mesh network（indoor positioning¥5.1bnfunction)6

infrastructure/sensor⇒ Provision of indoor positioning4

network）

infrastructure and formation of2・ Guide application

sensor network

0(tourism/disaster)

EXTravel:

FY16
6
5
4
3
2
1
0

¥13.0bn

Orders

FY17 Plan(Guide application for tourism,etc.)¥2.6bn¥3.2bnCloud/security
6
5
4
3
2
1
0

field
・ Thin client/virtual field

FY16

FY17 Plan・Cloud integration engineering in partnership with Microsoft

・ Security infrastructure
・ Educational apps
Computerized parking spacecertification system－Enrichment of lineup of solutions in corporate communication and
IoT fields, Capital and business tie-up with Phone Appli Inc.

－17－

¥0.2bnFY16¥1.2bnFY17 Plan

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference:
Viewer◆ Deregulation ofEnergy
electric powerand energy saving trend provide an opportunity to enter into the market in the
new energy field◆ “Energy Viewer” is a B2B2X business model through collaboration with the local electric power companies◆ Developed as a tool to reduce power usage through the control of air conditioning and to acquire customers
and prevent withdrawal for the local electric power companies

Solutions for air conditioning units utilizing IoT
Currently, orders received
from approx. 60 sites

Accumulation andcloud

serverIndoor environment data

analysis of data

Control information(dedicated line)

Current value of air
conditioning units

Control device for

CT sensor

contact connection
Measurement device

Distribution

Indoor temperature

board

Contact connection
Wireless (920Mhz)

IndoorTemperature sensor

OutdoorMonitor the indoor environment 24 hours a day, 365 days a year by utilizing the IoT devices
Automated control of air conditioning units connected to the network from a remote location－18－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: Cloud Integration Engineering*
Development of the market for sound solutions for enterprises and the expansion of the IoT solutions lineup◆ Concept of business development of cloud integration engineering
Business development that we start small, but allow to grow big /From construction income to stock income

Mission-criticalsystemHigh
Hybrid cloud

BPM提供
BPM provision

Security/operation
monitoring

Shift the businesssystem to the cloudSales(1) State of activities [From April to the end of September 2017]
Efforts for sound solutions for enterprises in collaboration with Microsoft
Japan.
-Approx. 30 orders received, approx. 70 business deals inprogress.
-Actual results: Assessment and partial introduction, etc.
（leading transport companies, manufacturers and local core
medical institutions, etc.）
 IoT
Visualize and analyze field engineering in real time by enhancing
sensor networks including LPWA.

Full-scale
introduction

Security/operation(2) Gained approval from Microsoft Japan (only 6 companies in Japan) Mar. 2017 Approved as Skype Operations Framework Offers Partner(6 companies elected in Japan)

monitoring
Nationwide
development of
Cloud PBX
Trial introduction(3) Capital and business tie-up with Nextgen
 Feb. 2017 Entered into a capital and business tie-up for the purposeof improving the sound communications environment for enterprises.

Solution to issue
PoC introductionof Cloud PBXOperation
monitoring

Voiceassessment(4) Capital and business tie-up with Phone Appli Inc.

On-premises Oct. 2017 Established a capital and business tie-up with the aim ofenhancing the provision of office total solutions utilizing ICT

Security
monitoring

Low

Shift to cloudHigh(5) Train cloud engineers
 Train 2,000 Microsoft cloud engineers by 2018 (as of September 30,
approx. 1,950 engineers had acquired qualifications).

*Offer nationwide, unified, one-stop engineering, including cloud
implementation alongside existing network engineering－19－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: Mesh-Type Beacon

Currently, approximately 20 companies are introducing it on a small
scale. (POC)

Plant/warehouse , etc.

Construction site, etc.

Office , etc.

Management of storage place for packages

Management of workers’ whereabouts



Visualization of employees’ behavior

Management of gate entrance and exit/Control of room environmentCollection of sensor information of machines,<Visualization of situation>

lines


Authentication management

etc.

Management of building entrance andexit/Authentication of employees

Management of the location/taking out of
goods



Management system of operation reports, etc.

<Visualization of worksite>

Management of employees’ positions/traffic

Control of office space environment
Work style reforms<Visualization of work style>

Application
examplesPOC stands for Proof of Concept－20－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: Global business initiatives ■ MG Exeo sales trends（¥100m）

Vietnam

15

Philippines
10
5
0

FY12

FY13

FY14

FY15

FY16

FY17 Plan

MG Exeo (Philippines) as a base forIndonesiandevelopment in Asia including ASEAN

Concluded an agreement to acquire shares of a newcompany of the IBS (In-Building System) Business in・Development of ICT technology educators in the Philippines

Vietnam in April 2017.

→ Spread to other SE Asian countries
・Train global staff in the Philippines(One-year local stay)

Send trainees from Japan(First group sent in Oct. 2015 (completed); second group in Oct.
2016 (completed) ; Third group in Oct. 2017 (In process))

Trial implementation of Indonesian FTTH project
Targeting various projects using government ODA
・Airport ICT・ Expressway communication

・Industrial complex ICT ・ Railway communication
・Data center ICT－21－・ICT business investment

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17(7) Measures for greater efficiency (Improved Productivity)◆ Progress as planned by 2Q◆ Continued measures to improve profits

Improvement■ Enhanced profitability through cost reductionsＦＹ

FY2014

Aims
Results

FY2015FY2016¥1.5bn¥1.0bn¥1.0bn(cumulative ¥5.0bn)(cumulative ¥6.0bn)

FY2017¥1.0bn(cumulative ¥7.0bn)(cumulative ¥8.0bn)¥2.0bn¥1.0bn¥1.5bn2Q Actual ; ¥0.5bn(cumulative ¥7.0bn)(cumulative ¥8.0bn)(cumulative ¥9.5bn)(cumulative ¥10.0bn)

Note: Amount of improvement represents cost reductions relative to FY10.

■ Recent principal measures

Measures

Area◇Construct common bases for system◇Continue to improve business flow andsystems through BPR◇Review of access, network, and engineering construction systems
Functional◇Expansion of shared company work consignments

integration◇Group-wide unification of audits, MS tasks ◇Reorganization of Group access companies in Kanto area
◇Integrated cross-departmental systems ◇Improved business flow and systems through BPR

Reorganization◇Merger of subsidiary security companies ◇Merger of subsidiary access companies in Kansai/Chugoku regionsof Group◇Merger of subsidiary mobile companies ◇Merger of subsidiary access companies in Tohoku region

companies◇Merger of major subsidiaries (WAKO and Ikeno) ◇Merger of subsidiary network companies◇Sendai General Engineering Center (9 bases → 1) ◇Kagawa Technical Center (5 bases → 1)
Consolidation of ◇Ishioka General Technical Center (4 bases → 1)
bases

◇Kansai branches （11 bases → 1)

◇Koshin branches (5 bases → 1)*(planned for Feb. 2018)◇Hyogo General Technical Center (5 bases → 1)

◇Shonan Technical Center （2 bases → 1)*(planned for Nov. 2017)

Resource◇Resource shift to mobile/solutions area

sharing◇Group-wide cross-sectional projects (mobile, 700 MHz TV reception measures, Data Centers, etc.)－22－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: System for promoting business structural reform◆ Promote the horizontal development of the best practice measures across the fields
President

Steering committee
Administrative office

Suggestion from ＰＴ

for business structural reform

Business improvement promotion ＰＴ
Headquarters

Branch offices

Headquarters
Headquarters

Branch offices

Branch offices

Branch offices

Headquarters
Headquarters（Measures across the organizations）

Branch offices

Branch offices

Branch offices

Branch offices

Branch offices

Headquarters
Headquarters

Coordination of eachmeasure, consideration,suggestion, anddeployment of Action Plan

Fundamental solutions ofBusiness improvement
Promotion Adjustment acrossthe organizations

business issues at
Headquarters/branch offices

Development of
support tool System optimization

Formulation of work
Rules Promotion ofdiversification at workplace

IT Promotion Division

Human Resources DivisionCorporate Planning Division－23－

Results for the Six Months Ended September 30, 2017

2. Expectations for the Rest of FY17
Reference: Specific example of business improvement measures(construct common bases for in-house systems)
Goal

Automated mutual collaboration with system EX via construction management system from all kindsof business scenarios

Headquarters

System EX

CustomersystemConstruction

Sales

Desk
Attendance
Attendance
Costs, etc.

Costs
Information
on ordersreceived

Information

Construction

on

Salarymanagement

construction
progress

Cost of
Drawing fordesignInformation

Information

Information

on orders

on process

received

management

on value ofDocument
management

・・・

Completiondrawing

Construction management system：analysis ofmanagement

work

work done：
FinanceFinancialstatement：：

construction

construction

Materials forConstruct common bases－24－

Results for the Six Months Ended September 30, 2017

3. Medium-Term Management Plan
(FY16–FY20)(1) Outline(2) Image of growth in each segment－25－

Results for the Six Months Ended September 30, 2017

3. Medium-Term Management Plan(FY16–FY20)(1) Outline■ Medium-Term Vision■ Basic Policies
1. Reorganize business portfolio, fostering solutions into second core business
2. Expand engineering peripheral businesses by combining existing technologies and services
3. Expand business through M&A and alliances
4. Bolster profitability by increasing productivity through business improvement and implementing
thorough efficiency measures
5. Increase shareholder value by boosting capital efficiency■ Achievements and Targets
Net sales
Operating income¥400.0bn¥30.0bn （Operating income margin 7.5%）

ROE

10%

EPS

Over ¥200

ROE: return on equity

EPS: earnings per share－26－

Results for the Six Months Ended September 30, 2017

3. Medium-Term Management Plan(FY16–FY20)(2) Image of growth in each segment
(¥bn)
4,000
400

3,500
350
◇IoT solutions◇Geo solutions （Mesh Beacon）

300
3,000

New solutions
HEMS, Smart meters
Data Center Project

2,500
250

Public projects(NEXCO, disasterprevention wireless etc.)

2,000
200

1,500
150

SYSTEMSOLUTIONS

Overseas projects◇New energy (Energy Viewer) Vietnam projects◇ MS CloudODA projects in Southeast Asia
Philippines Project■Response to inbound (cameras, signage, etc.)■Reduction of above-street wiring■ Railway communication （New Haneda Line, etc.)■Tokyo redevelopment work

Urban
Infrastructure■Shift to CATV FTTH (8K-compatible)

Response to aging public infrastructure(Waste-treatment plants,
water and sewage, etc.)

700 MHz Band TV
reception measures

KDDI synchro (Hokkaido) ■SB FY16–17PJ
Indoor Project■3.5GHz,700 MHz

NCCs■5th generation■ＬＴＥ-Advanced

NTT Group(Mobile)100
1,000■ NTT maintenance expansion■ Maintenance of aging facilities accompanying measures for easing burden for ensuing years

500
50

NTT Group(Access/Network)■ Hikari collaboration

Start of Medium-Term Management Plan
0

FY14

FY15

FY16

FY17

－27－

FY18

FY19

FY20

Results for the Six Months Ended September 30, 2017

3. Medium-Term Management Plan(FY16–FY20)
Reference: Investment Trends of Major Telecom Carriers■ NTT DoCoMo■ NTT East/West
690.7

263.0

FY13

703.1
626.6

224.0
FY14

583.4

547.9

(¥bn)

661.8

510.0

177.0

156.0

153.0

FY15

FY16

FY17 Plan

Optical fiber■ KDDI

387.8

406.7

FY13

FY14

597.1

570.0

FY16

FY17 Plan

365.4

FY15

合計

LTE-related

Note: LTE-related from FY16 onward has not been published■ SoftBank
667.7

571.8

739.4

531.4

519.4

530.0

583.7

479.1
344.3

FY13

595.2

FY14

412.5

338.0

325.0

330.0

FY15

FY16

FY17 Plan

合計

FY13

FY14

FY15

320.5

TBA

FY16

FY17 Plan

MobileNotes: FY12 and FY13 figures are totals for mobile and fixed-line communications (Source: FY13 Results Data Sheet).
FY14 and FY15 figures are domestic communications business (Source: FY15 Results Data Sheet).
On Japanese standards in FY12, and IFRS standards in the years after FY13.

Note: Trends in FY14 or later include UQ mobile.
On Japanese standards in FY13, and on IFRS in the years after FY14.

(Source: Figures released by the telecommunications carriers)－28－

Results for the Six Months Ended September 30, 2017

4. Raising Shareholders’ Value(1) Payment of Dividends－29－

Results for the Six Months Ended September 30, 2017

4. Raising Shareholders’ Value(1) Payment of Dividends◆ Annual dividend up ¥4 YoY to ¥50◆ Targeting 3% DOE and continued stable mid- to long-term dividend rise
■ Total shareholder return■ Dividend history (per share)(Total dividends + total acquisition of treasury stock)

24

32

38

46

￥50

Total dividends
Total acquisition of treasury stock
8.7
5.4

FY13

FY14

FY15

FY16

FY17 Plan■ Acquisition of treasury stock

3.0

3.0
2.4

3.1

3.7

4.3

FY13

FY14

FY15

FY16

147
￥3.0bn

ROE

123

125

145

11.6％
8.7％
FY13

FY14

FY15

FY16

￥4.7bn4.7

FY17 Plan■ EPS/ROE

5.0
3.0

5.0

7.3

3.0

EPS

3.0

6.1

FY17 Plan

FY13

－30－

FY14

8.2％
FY15

8.9％

FY16

￥165

9.6％
FY17 Plan

Results for the Six Months Ended September 30, 2017

5. Topics(1) The National Skills Competition(Skill sector: Information Network Cabling)－31－

Results for the Six Months Ended September 30, 2017

5. Topics(1) The National Skills Competition (Skill sector: Information Network Cabling)◆ Mr. Yoshiaki Shimizu, one of our employees, won the gold medal in the National
Skills Competition held in Abu Dhabi, UAE in October 2017!!
■ Our employees participated in the same skill sector of the National Skills Competition as
representatives of Japan for the fifth time, and they have won the gold medal in all the competitions(including four consecutive victories).

Mr. Shimizu, during the competition

Mr. Shimizu after the commendation ceremony－32－

Results for the Six Months Ended September 30, 2017

Disclaimer Regarding Forward-Looking Statements
Management of the Company has made estimates and assumptions
relating to financial forecasts based on information available as of thereporting date. Actual results could differ from those estimates.

3-29-20 Shibuya, Shibuya-ku,
Tokyo 150-0002 JAPANhttp://www.exeo.co.jp/overseas/index.html
TEL: (81)3-5778-1073
FAX: (81)3-5778-1228

A variety of IR materials is available for
consultation on our company website.

－33－

Results for the Six Months Ended September 30, 2017