FINANCIAL RESULTS BRIEFING FOR FY2018
Infocom Corporation
26/04/2019

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

Contents
01

Financial Results for FY201802

Earnings Forecast for FY2019
03

Initiatives for FY2019
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

1

01

Financial Results for FY2018

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

2

FY18 Earnings Highlights (Consolidated)
Double-digit growth in net sales and operating profit,
driven by strong e-comic performance

Operating profit

Net sales＋13.0%(Billion yen)

＋18.2%(Billion yen)

608

6.8

51.7
50

645.7

5.8

Profit attributable toowners of the parent+3.1%(Billion yen)

86404430222000

FY17FY18

FY17FY18

4.6＊4.7

FY17FY18＊ Includes extraordinary gains from sale of data center

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

3

Management Performance (Consolidated)(Unit: Billion yen,%)

FY17

YoY

FY18

ChangeOperating profit

45.7
5.8

51.7
6.8

(Operating margin)（12.7）（13.3）EBITDA

6.9

Ordinary income
Profit attributable toowners of theparent

5.98.06.8

4.64.7*87.46
15.7

Net sales

Net income pershare (yen)ROE（％）

84.85
17.9%

+5.9+13.0+1.0+18.2+1.0+14.5+0.8+14.9+0.1+3.1+2.61+3.1(2.2)*Net income per share reflects stock split on March 1, 2019
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

4

Business Areas and Segment Structure
Business Solution Group

Digital Entertainment Group

Health IT

Business SoftwareEnterprise ServiceManagement

Digital Entertainment

Package services
for medical institutions

ERP・RPABusiness package
cloud services

System integration
for major companies

E-comic
E-commerce・Hospitals
・Pharmaceutical companies
・Nursing-care companies
・Health industry

Copyright © 2019

・Companies
・ERP GRANDIT®
・Government
offices
・緊急連絡/安否確認
・Localgovernments
・文書管理
・RPA

INFOCOM CORPORATION. All rights reserved.

・Textile manufacturers
・Trading companies
・Pharmaceutical wholesalers
・Mobile phone companies

・General consumers

5Business Solution Segment Earnings (Consolidated)(Unit: Billion yen, %)Net sales(Billion yen)
6

(Billion yen)
30

24.4

Operating profit
45%

24.2
4

2030%

2.4

2.4

2

1010.1010.3%

0

FY17FY180%

FY17 FY18

Health ITCopyright © 2019

vs. PYFY18

Change%24.4

24.2(0.2)(1.0)

Health IT

10.1

9.8(0.3)(3.1)

Operating profit

2.4

2.4+0.0+1.1(Operating margin)(10.0)(10.3)Net sales

Net sales
15%

10.0%

9.8

FY17

INFOCOM CORPORATION. All rights reserved.

Strong performance of services for hospitals,
despite lower sales of services forpharmaceutical companies

Operating profit
Level with prior year as sales of services to hospitals
compensates for unprofitable projects
6

Digital Entertainment Segment Earnings (Consolidated)(Consolidated)
FY17(Billion yen)(Billion yen)

30

27.4

645%

4.3

21.2
20430%

3.3
15.8%

26.6
20.2

16.0%

102

15%000%FY17FY18

FY17 FY18E-comics
Copyright © 2019

(Unit: Billion yen, %)Operating profit

Net sales

INFOCOM CORPORATION. All rights reserved.

vs. PYFY18

Change%21.2

27.4+6.2+29.2

E-comics

20.2

26.6+6.4+31.8

Operating Profit

3.3

4.3+1.0+30.7(Operating margin)(15.8)(16.0)Net sales

Net sales

Impact of data analysis and initial exclusive
distribution, as well as contribution of stepped-up
promotions in Q3, leads to record-high results

Operating profit
Higher profits due to increase in e-comic sales

7E-Comic Distribution Service Earnings (Net Sales by Quarter)(Billion yen)

864

2

1Q

2Q

3Q

FY15Copyright © 2019

4Q

1Q

2Q

3Q

FY16

INFOCOM CORPORATION. All rights reserved.

4Q

1Q

2Q

3Q

FY17

4Q

1Q

2Q

3Q

4Q

FY188

Investments(Billion yen)(Billion yen)

R&D

CapitalEquityBus. Development

3.9

4

0.4
3

Category

Main Details

BusinessDevelopment

New business planning, research, demonstration tests, etc.

0.3

E-comics, Health IT, overseas startups, etc.

0.4

EquityInvestment＊2.2
2E-comic distribution service

1.8
0.3
0.4

11.00

AmountCapitalInvestment

0.1

FY17FY180.7

GRANDIT
Other

0.70.2

Health IT
Hospitals, community-based comprehensive care, drug
companies, etc.

R&D
Investment

AI, community-based comprehensive care, new technology
research, etc.

0.1

Other

* Papyless Co., Ltd.
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

9Balance Sheets (Consolidated)(Unit: Billion yen,%)

FY17AmountFY18Composition
Ratio

AmountComposition
RatioMajor Change Factors
YoY

Current assets

27.6

72.3

32.4

74.3

Fixed assets

10.6

27.7

11.2

25.7

・Cash and deposits +3.5+4.8 ・Notes and accounts receivable +0.8
・PPE(0.1)+0.6 ・Investment securities ＋0.8

38.2

100.0

43.6

100.0+5.4

24.4
0.7

・Accounts payable-trade +0.7
+0.9 ・Accounts payable-other, accrued income
taxes (0.1)
・Accruedconsumption tax +0.1
+0.0

Total assets
Current liabilities
Non-current liabilities

9.6
0.2

0.5

10.6
0.2

25.3

Total liabilities9.8

25.8

10.9

25.1

+1.0

Total net assets

28.3

74.2

32.7

74.9

+4.3

Total liabilities and net assets

38.2

100.0

43.6

100.0

+5.4

Shareholders’ equity ratio

73.8%

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

・Retained earnings +3.7

74.6%
10

Cash Flows (Consolidated)(Unit: Billion yen)・Purchase of intangible fixed assets
・Purchase of PPE・Purchase of investment securities

・ Profit before income taxes
・ Depreciation
・ Income taxes
・Accounts receivable-trade(Billion yen)

25FY17

5.6

5.6(0.0)

Investing CF

(0.6)

(1.0)

(0.3)

Free CF

4.9

4.6

(0.3)

Financing CF

(0.7)

(1.1)

(0.3)

(0.0)

0.0

+0.0

4.2

3.5

(0.6)

beginning of period

12.4

16.6

+4.2

Cash and cash equivalents,
end of quarter

16.6

20.1

+3.5

(1.1)

20+5.620.1

15Effects of exchange ratechanges on cash and cash
equivalents

16.6

Change in cash and cash
equivalents
Cash and cash equivalents,

10

Operating
営業…
CF
Cash and Equivalents
FY17
FY17

Copyright © 2019

Investing
投資…
CF

Financing
FY18
財務…
CF
Cash and EquivalentsINFOCOM CORPORATION. All rights reserved.

ChangeOperating CF・Dividends(1.0)

FY1811

02

Earnings Forecast for FY2019

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

12

Earnings Forecast for FY2019 (Consolidated)(Unit: Billion yen,%)

FY19

FY18 Actual

Forecast

vs. PY
Change%

H1

H2

FY

H1

H2

FY

Net sales

23.1

28.5

51.7

26.0

31.0

57.0

+5.2

+10.2

Operating profit

2.5

4.2

6.8

2.9

4.9

7.8

+0.9

+13.2

（Operating margin）(11.2)(15.0)(13.3)(11.2)(15.8)(13.7)EBITDA

3.14.8

8.0

3.5

5.5

9.0+0.9+12.4

Ordinary income

2.6

4.2

6.8

2.9

4.9

7.8+0.9+13.5

Profit attributable toowners of the parent

1.8

2.9

4.7

1.9

3.2

5.2+0.4

+8.7

95.07
15.1+7.61+8.7*Net income per share (yen)ROE（％）

87.46
15.7(0.6)*Net income per share reflects stock split on March 1, 2019
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

13

Business Solution Group Earnings Forecast (Consolidated)(Unit: Billion yen, %)(Billion yen)

FY18Actual

Operating profit

Net sales(Billion yen)

40630

24.2

25.045%42030%

2.429.80

FY19(Forecast)

Change%24.2

25.0+0.7+3.2

Health IT

9.8

10.6+0.8+8.7

Operating Profit

2.4

2.7+0.2+8.6(operating margin)(10.3)(10.8)Net sales

Net sales
Higher sales due to strong Health IT sales to hospitals

0FY1815%

10.3%

10.6

vs. PY

2.7
10.8%

10FY19Forecast

0%

FY18 FY19(Forecast)

Operating profit
Higher profits due to increased Health IT sales

Health IT
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

14Digital Entertainment Segment Earnings Forecast (Consolidated)(Unit: Billion yen, %)Net sales(Billion yen)(Billion yen)40645%

5.1

32.030FY18Actual

Operating profit

42030%

26.6

15.9%

215%

00%

100

FY18

FY19(Forecast)

Copyright © 2019

Change%3.2+4.5+16.4

26.6

31.8+5.2+19.5

Operating Profit

4.3

5.1+0.7+16.1（Operating margin）(16.0)(15.9)Net sales

31.8
16.0%

vs. PY

27.4

Net sales
E-comics

4.3

27.4

FY19Forecast

FY18 FY19(Forecast)

INFOCOM CORPORATION. All rights reserved.

Higher sales due to strong e-comic performance

Operating profit
Higher profit as increased sales of e-comics
compensates for cost increases incurred for up-front
investments in AI and overseas growth15

E-Comic Distribution Service Growth
31.8

Sales and Growth

300

50.0%

26.6
Sales

40.0%

Growth rate
200

20.2
30.0%

18.0

◆ Sales growth around 20%

15.0
12.3

20.0%

100
10.0%

00.0%

FY14

FY15

FY16

FY17

FY18

FY19(Forecast)

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

16

Investments(Billion yen)

2.5

R&D

CapitalBus. Development(Billion yen)
Main Details

Category

2.0

1.8
0.4

1.5

1.3
1.00.5Business
Development

0.3

New business planning, research,demonstration tests, etc.

Amount0.4

E-comics, overseas startups, etc.
CapitalInvestment

1.1

E-comic distribution service

1.1
GRANDIT
Other

0.7

AI, community-based comprehensive care,

0.00.1
FY180.2
FY19

R&D
Investment

new technology research, etc.

0.2

Other(Forecast)
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

17

Shareholder Returns(Yen)

Annual dividends per share40◆Dividends
29.03022.0＊
19.0

20
11.0

12.5
7.5(YearEnd)

1019.017.0(YearEnd)

14.0(YearEnd)(Year-End)

10.0

5.0(Interim)

5.0(Interim)

5.0(Interim)(Interim)

FY16

FY17FY18

FY19
FY190
FY15(Forecast)
Net income
per share(yen)

13.32

59.64

84.85

87.46

Forecast FYE March 2020 interim dividendof 10 yen, year-end dividend of 19 yen forannual dividend of 29 yen per share(30.5% payout ratio)◆Shareholder Benefits
Planning to offer benefits toshareholders owning at least one
trading unit who are listed on theshareholders' register as of
September 30, 201995.07

*22 yen (regular dividend: 20 yen; dividend to commemorate change in listed market: 2 yen)
*Dividends per share and net income per share reflect stock split performed on March 1, 2019
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

18

03

Initiatives for FY2019
E-Comics
Health IT

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

19E-comic

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

20

Responding to Changes in the Market Environment

Publishers
Accelerating shift to digitalMarketChanges

E-Bookstores

Users

Clear Bookstore Classifications
・Digital versions of print manga・Manga as content

Initiatives>Customer analysis>Forecast popular sellers

Original Content

Expand into overseas markets

Stronger Marketing

Sophisticated Data Analysis
Raise sophistication of analysis
using the latest US-based tools

Broaden customer segments

Net Sales

31.8¥

Bn26.6¥>Increase sales of in-house titles

Bn>Large-scale TV-integrated
promotions>Targeted ads>Recommendations

Overseas Expansion>Launch Korean distribution business>Major hit in [title] RISKY~Fukushu wa Tsumi no Aji~Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

21

Overseas Expansion
Enter the Korean e-comic distribution service market
E-comic market in Korea

China・Main format is the webtoon (vertical scroll)・20% growth in 2019 (in-house estimate)・Closing more pirate sites through stronger enforcement

NorthAmericaKorea
Market Size

¥50.0Bn*Initiatives
2016 ・Entered agency business: Offered original content

Japan
Market Size2018 ・Test marketing: Prove return on ad investment
2019 ・Convert Peanutoon to a subsidiary
Optimum online advertising using Meccha Comics expertise
Introduce Japanese titles (initial exclusives)¥200.0Bn*

Taiwan＊SE Asia*In-house research
Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

22

Health IT

Services for Hospitals

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

IT! For Nursing Care

23

Expansion Into the Nursing Care Field
2018

2019

IT!For Nursing Care
IoT-Based Monitoring Service

mima-more™

Nursing Care Digital Recording
SystemDaily

Career Change Support for Care
Workers
Carestyle

Rebuild data infrastructure
Expand sensor lineup

Adjacent services leveragingsensor data

More features (nursing care recordsupport)Improve usabilitySales(identify sales agents, etc.)⚫ Expand applications from ambulation
monitoring to pulse monitoring (forhome-care patients)

Launch business⚫ Reduce burden/generate efficiencies
in nursing care via sleep analysis,excretion prediction

Growth through M&A(care worker agencybusinesses)
Employee retention service⚫ Use AI to project risk of care worker
turnover and improve retention

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

24

Expand Services for Hospitals
New Tech
New Functions

Intraoperative Imaging Off-Site Storage ServiceStronger CWS
FunctionsOperation/Imaging
Dashboard Function⚫ Effective notification
features, work process
support features, etc.
for work-style reform⚫ Share info with ER,
surgery depts.
⚫ Link with crisis
management services

Services for Hospitals⚫ Radiology systems⚫ Medical info systems⚫ Employment management (CWS)⚫ Operation/medical imaging⚫ Drug information (PICS)⚫ …moreCopyright © 2019

INFOCOM CORPORATION. All rights reserved.

Cloud Compatibility⚫ CWS cloud⚫ PICS cloudRoll out to smalland medium-sizedhospitals

Add Sales Agents⚫ Develop regional agents⚫ Promote sales of medical infooptions

MarketArea25

Contact

Infocom Corporation
Corporate Communications Office
TEL: +81-3-6866-3160 Email: pr＠infocom.co.jp

This document is provided for the purpose of providing information about the Company and its performance, not for the solicitation of investments insecurities issued by the Company. In addition, because yen figures in this document are stated in billions of yen and rounded off after the first decimal
place, management indicators, year-on-year changes, and percentage changes are approximate. With certain exceptions, this document is based on data asof March 31, 2019.
The names of the companies, services, and products stated in this document are trademarks or registered trademarks of their respective companies.
The opinions and forecasts included in this document are judgments of the Company as of the date this document was prepared. The Company does notguarantee the accuracy or completeness of information contained herein, which might change as new data becomes available.

Copyright © 2019

INFOCOM CORPORATION. All rights reserved.

26