Slide 1: Results of Operations for the First Quarter of the Fiscal Year Ending April 30, 2021
Results of Operations for the First Quarter of the Fiscal Year Ending April 30, 2021 (16th Period) May 1 – July 31, 2020 Smaregi, Inc. Securities code: 4431
Slide 2: Contents
Contents 2 P3 About Smaregi P7 1Q FY4/21 Financial Summary P19 Business Summary P34 Business Plan for FY4/21 P42 Medium-term Plan
Slide 3: About Smaregi
3 About Smaregi
Slide 4: Business Profile
Business Profile About Smaregi 4 High-performance cloud-based POS systems Smaregi is a supplier of innovative cloud-based POS systems with capabilities that go far beyond those of conventional POS systems. Smaregi products analyze sales, perform sophisticated inventory management tasks and have many
Slide 5: The Smaregi Marketing Strategy
The Smaregi Marketing Strategy About Smaregi 5 Our goal is a 30% to 40% share of the targeted 770,000 stores Big businesses The POS system market will remain competitive rather than dominated (at least 40 stores) by a single company because a company that monopolizes this market 100,000 stores would
Slide 6: Smaregi Services and Support
Smaregi Services and Support About Smaregi 6 Smaregi provides a complete lineup of services and support for companies in the retail, restaurant and service sectors. Our goal is to help create more pleasant and productive workplaces by using the capabilities of Smaregi to make a broad range of busine
Slide 7: 1Q FY4/21 Financial Summary
7 1Q FY4/21 Financial Summary May 1, 2020 – July 31, 2020
Slide 8: 1Q FY4/21 Financial Highlights
1Q FY4/21 Financial Highlights 1Q FY4/21 Financial Summary 8 • Sales decreased only 7.4% to ¥715 million despite the impact of COVID-19 and the high level of sales one year earlier because of a temporary increase in demand associated with the start of tax reduction measures. • Demand is recovering s
Slide 9: Financial Highlights
Financial Highlights 1Q FY4/21 Financial Summary 9 First quarter sales were down only slightly from one year earlier, when one-time demand due to tax reduction measures boosted demand. SG&A expenses were higher than one year earlier because expenditures associated with Smaregi 4, including hiring mo
Slide 10: Balance Sheet
Balance Sheet 1Q FY4/21 Financial Summary 10 Non-current assets increased because of the Tokyo office relocation and other reasons. Inventories and payables decreased from one year earlier, when demand due to tax reduction measures temporarily raised these figures. The equity ratio remains high at 8
Slide 11: Statement of Income
Statement of Income 1Q FY4/21 Financial Summary 11 The gross profit margin increased because consistent sales (monthly fees for cloud services) are higher than the initial cost (sales of cloud service products). However, there was no impact on earnings. 1Q FY4/21 1Q FY4/20 YoY (Millions of yen) (May
Slide 12: Changes in Net Sales, Operating Profit and Operating Margin
Changes in Net Sales, Operating Profit 1Q FY4/21 Financial Summary and Operating Margin 12 Despite the negative effects of COVID-19, consistent sales increased and total sales were consistent with fiscal year plan. The gross profit margin was 62.5% and the operating margin was 19.4% even though SG&A
Slide 13: Quarterly Statement of Income
Quarterly Statement of Income 1Q FY4/21 Financial Summary 13 First quarter performance was in line with the fiscal year plan, including a recovery in operating profit from the fourth quarter of FY4/20, when business investments held down earnings. FY4/20 FY4/21 (Millions of yen) (May 2019 - Apr. 202
Slide 14: Quarterly Changes in Net Sales, Operating Profit and Operating Margin
Quarterly Changes in Net Sales, 1Q FY4/21 Financial Summary Operating Profit and Operating Margin 14 The operating margin recovered to 19.4% in the first quarter after temporarily falling to 5.8% in the fourth quarter of FY4/20 because of business investments. (Millions of yen) Operating margin Net
Slide 15: Changes in Sales Composition
Changes in Sales Composition 1Q FY4/21 Financial Summary 15 Monthly fees for cloud services, a source of consistent sales, recovered to the same level as prior to the start of the COVID-19 outbreak despite the ongoing negative effects of this crisis. (Millions of yen) Monthly fees for cloud services
Slide 16: Analysis of Changes in Operating Profit (YoY)
Analysis of Changes in Operating Profit (YoY) 1Q FY4/21 Financial Summary 16 (32) Small sales decrease from one year earlier (Millions of yen) Personnel • Increase in fee-based contracts because of POS system expenses 1 (2) replacement demand (27) Logistics Advertising cost • Growth of consistent sa
Slide 17: Quarterly Changes in SG&A Expenses
Quarterly Changes in SG&A Expenses 1Q FY4/21 Financial Summary 17 SG&A expenses returned to the usual level in the first quarter after the FY4/20 fourth quarter upturn due to expenditures for Smaregi 4, TV commercials and the Tokyo office relocation. Leasing and personnel expenses remain higher afte
Slide 18: Growth in Number of Employees
Growth in Number of Employees 1Q FY4/21 Financial Summary 18 The workforce is higher than one year earlier but unchanged from the previous quarter because of the suspension of most recruiting activities due to COVID-19. Recruiting activities are continuing with caution while monitoring the effects o
Slide 19: Business Summary
19 Business Summary
Slide 20: 1Q FY4/21 Topics
1Q FY4/21 Topics Business Summary 20 July 2020 • Webcast of the annual shareholders meeting (year ended April 2020) • Announcement of Smaregi 4 App Market • Announcement of Smaregi self-checkout capability • Opened the Chicken Chotatsu food cart in Osaka to acquire knowledge about the restaurant bus
Slide 21: Launch of the Smaregi App Market!
Smaregi スマレジ4 Progress 4の 進捗 事業Summary Business の状況 21 Launch of the Smaregi App Market! Application program interface (API) for developers released in July 2020 Plan to continue enlarging the app lineup in August 2020 and afterward Anyone can create a Smaregi app with ease The Smaregi app market is
Slide 22: Release of a Self-checkout Capability
Release of a Self-checkout Capability Business Summary 22 In July 2020, Smaregi started the trial operation of a beta-version of a self-checkout capability 反映しながら in order to receive feedback from 、今後積極的に販売予 stores and customers. 定 Demand for fully automated, contact- free purchases is even higher d
Slide 23: Smaregi's Responses to the COVID-19 Crisis
Smaregi’s Responses to the COVID-19 Crisis Business Summary 23 Activities for employees Shorter core time Use of teleworking Personal holidays A shorter core working time allows people to A teleworking framework was established This new program allows people to work on avoid peak commuting times whe
Slide 24: Effects of COVID-19 (Monthly Fee)
Effects of COVID-19 (Monthly Fee) Business Summary 24 Monthly fee for cloud and other services (monthly fee) Monthly fees have been recovering along with the number of retail transactions following the plunge in economic activity in April. Business volume (Based on Smaregi POS data) Monthly fee for
Slide 25: Effects of COVID-19 (Initial Cost)
Effects of COVID-19 (Initial Cost) Business Summary 25 Sales of cloud service products (initial cost) Number of customer sales contracts and YoY change Performance was consistent with the fiscal One-time increase because of the tax reduction Impact of COVID-19 year plan in May, June and July as stor
Slide 26: Smaregi Cumulative Transaction Volume
Smaregi Cumulative Transaction Volume Business Summary 26 Transaction volume has decreased because of more temporary store closings and lower sales at stores because of COVID-19 but volume is expected to start recovering slowly. The share of cash purchases is declining as people increase the use of
Slide 27: Composition of Plan Categories with Fees
Composition of Plan Categories with Fees Business Summary 27 The number of fee-paying registered stores decreased in the fourth quarter of FY4/20 because of COVID-19 but started increasing in the first quarter of FY4/21 as economic activity resumed. As a result, the share of these stores increased 0
Slide 28: Share of Active Stores (Including Stores Paying No Fee)
Share of Active Stores (Including Stores Paying No Fee) Business Summary 28 The active store ratio decreased as COVID-19 forced more stores to temporarily close. But the share of active stores increased 0.7 pct. points to 24.1% as economic activity resumed. 39.5% 31.3% 25.1% 25.3% 25.1% 28.6% 24.1%
Slide 29: Composition of Plan Categories with Fees
Composition of Plan Categories with Fees Business Summary 29 The decline in fee-paying plans due to temporary store closings and plan downgrades associated with COVID-19 has ended and a recovery has started. The Premium Plus and Retail Business plans account for most of the increase. (No. of stores)
Slide 30: Attrition Rate
Attrition Rate Business Summary 30 The monthly recurring revenue attrition rate increased to 1.7% because of COVID-19 but was down to 0.58% in July 2020. The first quarter average attrition rate remained low at 0.89%. 5% Attrition Attrition Attrition Attrition rate* rate* rate* rate* 4% FY4/18 FY4/1
Slide 31: ARPU/ARPPU
ARPU/ARPPU Business Summary 31 ARPPU has returned to the normal level because temporarily closed stores restarted operations and store reopenings increased the number of fee-paying stores. ARPU ARPPU ¥7,280 ¥1,398 May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct
Slide 32: Monthly Fees by Quarter of Start of Services
Monthly Fees by Quarter of Start of Services Business Summary 32 COVID-19 reduced monthly fees in the fourth quarter of FY4/20, the first decline since the launch of these services. But fees began to climb again in the first quarter of FY4/21 as stores reopened and new customers were added. (Million
Slide 33: Business Systems for Small and Midsize Companies
Business Systems for Small and Midsize Companies Business Summary 33 Sales of Smaregi Time Card remained strong despite COVID-19 because of the growth of teleworking, working style reforms and other social trends. Higher sales per customer and the acquisition of new customers are both contributing t
Slide 34: Business Plan for FY4/21
34 Business Plan for FY4/21
Slide 35: Highlights of the FY4/21 Plan
Highlights of the FY4/21 Plan Business Plan for FY4/21 35 •The business climate remains extremely uncertain because of the impact of COVID-19 on the Japanese and global economy • Demand for Smaregi products and services remains strong; expect a return to sustained growth starting in the first quarte
Slide 36: Highlights of the FY4/21 Plan
Highlights of the FY4/21 Plan Business Plan for FY4/21 36 Planning on no significant changes in sales and operating profit. However, after deducting the contribution of the one-time upturn in FY4/20 due to the tax reduction measures, the FY4/21 plan is effectively a continuation of growth as in prio
Slide 37: Changes in Net Sales, Operating Profit and Operating Margin (Plan)
Changes in Net Sales, Operating Profit Business Plan for FY4/21 and Operating Margin (Plan) 37 No significant changes in sales and operating profit, but effectively a continuation of growth as in prior years after deducting the contribution of the one-time upturn in FY4/20 due to the tax reduction m
Slide 38: Plan for Quarterly Sales and Sales Composition
Plan for Quarterly Sales and Sales Composition Business Plan for FY4/21 38 The temporary interruption in sales growth caused by COVID-19 has ended. First quarter sales were already higher than in the third quarter of FY4/20 as the slow recovery in sales continues as planned. (Millions of yen) Monthl
Slide 39: Impact of COVID-19 and Smaregi Responses
Impact of COVID-19 and Smaregi Responses Business Plan for FY4/21 39 As expected in the fourth quarter of FY4/20, transaction volume has started to recover slowly along with a gradual upturn of the Japanese economy. Transaction volume is expected to continue to recover slowly. Transaction Volume For
Slide 40: COVID-19 Has Created an Opportunity to Rethink Retail and Restaurant Operations
Impact of COVID-19 and Smaregi Responses Business Plan for FY4/21 40 COVID-19 has created an opportunity to rethink retail and restaurant operations from the ground up For the retail sector For the restaurant sector Omnichannel services centered on Stronger ties with e-commerce raising efficiency by
Slide 41: Impact of COVID-19 and Smaregi Responses: Strategic Measures
Impact of COVID-19 and Smaregi Responses Business Plan for FY4/21 41 1 Strengthen the showroom strategy 2 More online sales meetings Open showrooms in 10 cities over Increase the online sales share of KPI the next two years KPI new contracts Open low-cost showrooms mainly in large Upgrade capabiliti
Slide 42: Medium-term Plan
42 Medium-term Plan
Slide 43: The Steadily Increasing Use of the Cloud
The Steadily Increasing Use of the Cloud Medium-term Plan 43 The public cloud market, including SaaS, continues to grow. Due to the higher name recognition and reputation for trust following the February 2019 stock listing, there are more large orders and steady growth in orders that are not related
Slide 44: Smaregi 4 Launched in the Summer of 2020
Smaregi 4 - Smaregi 4 Launched in the Summer of 2020 Medium-term Plan 44 Numerous apps released in August! Building a platform centered on POS data will enable Smaregi to achieve the full potential of POS data utilization. Expansion/utilization The first platform service that Establish ties with dev
Slide 45: Focusing on Data Utilization and the Digital Transformation
Focusing on Data Utilization and the Digital Transformation Medium-term Plan 45 Our goal is to become Japan’s largest holder of sales (POS) data and use big data analytical research to grow worldwide in the data utilization field. Ticket vending Artificial machines intelligence Use sales data to e-c
Slide 46: Business plans, forecasts and other forward-looking statements in this presentation are based on the
Business plans, forecasts and other forward-looking statements in this presentation are based on the reasonable judgments of Smaregi based on information that was currently available. Actual results of operations may be different because these statements include uncertainties involving market condit
Slide 47: Results of Operations for the First Quarter of the Fiscal Year Ending April 30, 2021
Results of Operations for the First Quarter of the Fiscal Year Ending April 30, 2021 May 1 – July 31, 2020 Smaregi, Inc.