Exeo Group, Inc. · TSE:1951
Exeo — H1 FY2024 Earnings Presentation
33 slides from Exeo's earnings presentation, Nov 8, 2024
Slide 1: Results for the Six Months Ended September 30, 2024
Results for the Six Months Ended September 30, 2024 November 8, 2024
Slide 2: Contents
Contents 1. Overview of FY24 Interim Results 3. Progress of Medium-Term Management Plan (1) Financial Highlights ・・・ 4 (1) Numerical Targets ・・・ 27 (2) Results Highlights(Orders Received, ・・・ 5 (2) Strengthening Our Business Infrastructure ・・・ 28 Net Sales) (3) Results Highlights(Operating Profit) ・
Slide 3: Overview of FY24 Interim Results
１． Overview of FY24 Interim Results ©2024 EXEO Group, Inc. All Rights Reserved. 3
Slide 4: Financial Highlights
（１） Financial Highlights Orders received and net sales reached record highs Profit growth in telecom carriers; domestic solutions also strong Interim dividend of 31 yen, ongoing share buyback and cancellation of treasury stock in this fiscal year ©2024 EXEO Group, Inc. All Rights Reserved. 4
Slide 5: Results Highlights (Orders Received, Net Sales)
（２） Results Highlights（Orders Received, Net Sales） Record-high orders and net sales, as well as a significant increase in construction projects being carried over ■ Orders Received ■ Net Sales （billion yen） Increased by ＋12％ YOY Increased by +3％ YOY construction construction construction projects be
Slide 6: Results Highlights (Operating Profit)
（３） Results Highlights（Operating Profit） Improved profit margins and increased profits in the telecommunications carrier business ■ Operating Profit （billion yen） Telecoms System Carriers Solutions +2.6 +1.0 Urban Infrastructure transient -0.5 factor -1.1 +1.1 ©2024 EXEO Group, Inc. All Rights Reser
Slide 7: Results Highlights (Segment Information)
（４） Results Highlights（Segment Information） （billion yen） Telecoms Carriers Urban Infrastructure System Solutions Net sales Special Factors Unprofitable projects 1.1 billion yen Segment profit ※ ※ ※ After adjustment of Special Factors ©2024 EXEO Group, Inc. All Rights Reserved. 7
Slide 8: Full Year Forecast
（５） Full Year Forecast We expect to reach our sales target one year ahead of schedule and profit growth due to continued domestic business progress and improved profitability of global business ©2024 EXEO Group, Inc. All Rights Reserved. 8
Slide 9: Initiatives by Segment
２． Initiatives by Segment ©2024 EXEO Group, Inc. All Rights Reserved. 9
Slide 10: Telecom Carriers
（１） Telecom Carriers ■ Trends in net sales （billion yen） Interim Result and FY2024 Plan Progress rate ・ Strong investment in mobile 47％ communication quality improvement ・Profitability improvement through structural reorganizations ・ Expect each telecommunications carriers to continue investment ■ T
Slide 11: Telecom Carriers (Promotion of Group Company Integration)
（１） Telecom Carriers (Promotion of Group Company Integration) Further integration of group companies to achieve sustainable growth and strengthen internal control and governance K. Technos Co., Ltd. Exeo Engineering Hokkaido Co., Ltd. It will merger with DENKEN Co., Ltd and Nishinihondenwakouji Co.,
Slide 12: Telecom Carriers (Disaster Relief Assistance)
（１） Telecom Carriers （Disaster Relief Assistance ） Group-wide support for reconstruction following natural disasters such as the Noto Peninsula Earthquake and Typhoon No.10 ■ 2024 Noto Peninsula Earthquake ■ Typhoon No.10 (in Kagoshima) ©2024 EXEO Group, Inc. All Rights Reserved. 12
Slide 13: Urban Infrastructure
（２） Urban Infrastructure ■ Trends in net sales （billion yen） Interim Result and FY2024 Plan ・ Receive strong orders for data center Progress rate ・ Sales increased due to progress in large 38％ projects ・ Promoting construction progress toward to the end of the fiscal year ■ Trends in segment profit
Slide 14: Urban Infrastructure (Breakdown by Business Unit)
（２） Urban Infrastructure （Breakdown by Business Unit） ■ Trends in net sales （billion yen） ・Energy Unit ・Public infrastructure Unit ・Facility infrastructure Unit (Electricity, Environment, (Railway communications, urban- (700MHz Band TV reception Renewable energy, etc.) civil engineering, etc.) measu
Slide 15: Urban Infrastructure (Data Center)
（２） Urban Infrastructure （Data Center） Responding to rising demand of data center market and sequentially expanding its business domain ■ Domestic Data Center Market Forecast ■ Expansion of Supported Areas Responding mainly to （billion yen） Building construction general contractors Expanding busines
Slide 16: Urban Infrastructure (Profit Improvement Measures)
（２） Urban Infrastructure （Profit Improvement Measures） Shift resources to growth areas and improve profitability by reviewing the policy for public projects ■ Review policy for handling public projects ＜ until now ＞ ＜ from now on ＞ ［ Business Expansion Phase ］ ［ Profit Creation Phase ］ ・ Priority is
Slide 17: Urban Infrastructure (Major Orders)
（２） Urban Infrastructure （Major Orders） Receives orders for large-scale facility construction Building social infrastructure through diverse engineering ■ Construction of electrical equipment for ■ Wireless-activated disaster warning semiconductor plant systems of local government agencies ■Shield t
Slide 18: Urban Infrastructure (Environment-related Business)
（２） Urban Infrastructure （Environment-related Business） We are starting to generate our own energy at two woody biomass power plants ■ Ashikaga Eco Power ■Furudono Ronden Eco Power （operation started from March 2024 ） （ operation started from August 2024 ） ・It generates power using only 100% domesti
Slide 19: System Solutions
（３） System Solutions ■ Trends in net sales （billion yen） Interim Result and FY2024 Plan ・ Domestic solution market is steadily Progress rate 44％ growing ・ IT solution subsidiaries merger is ongoing ・ Overseas field, we struggled with engineering service ■ Trends in segment profit Main Initiatives ・
Slide 20: System Solutions (Breakdown by Business Unit)
（３） System Solutions （Breakdown by Business Unit ） ■ Trends in net sales （billion yen） ・Information system Unit ・Service Unit ・Overseas projects Unit (Contract development, server (Recurring business such as construction, etc.) maintenance and operation) Progress rate 42％ Progress rate Progress rate
Slide 21: System Solutions (Example): Water gate IoT
（３） System Solutions （Example） ■ Water gate IoT (Water monitoring remote control) Contributing to comprehensive flood control measures for local governments and other customers nationwide amid the growing risk of flooding due to rapid climate change AI Water gate IoT in flood control, agriculture, a
Slide 22: System Solutions (Example): Automation of logistics warehouses
（３） System Solutions （Example） ■ Automation of logistics warehouses (Robotics Automation) We collaborated with Hi-Robotics Japan, a rapidly growing pioneer in ACR* for large logistics warehouses, to acquire the NW domain in the field of robotics and automation, Acquired NW domain in the robotics and
Slide 23: System Solutions (M&A)
（３） System Solutions （M&A） Acquisition of Shares in Interactive Communication Design Co., Ltd.（August 2024） Expectations for business synergies such as resolving resource shortages and acquiring regional bases ■ Outline of the new subsidiary ■ M&A policy and Major ・ Strategic mergers and acquisition
Slide 24: System Solutions (Overseas Project)
（３） System Solutions （Overseas Project） Promote reform of global business. Aim to generate profits while establishing a management foundation ■ Overseas Business Restructuring Policy Liquidation ■ Profit improvement in existing businesses ＜As Is＞ ・Reorganization of companies for business withdrawal
Slide 25: System Solutions (Overseas Project): Dhost and NTT Group
（３） System Solutions （Overseas Project） Dhost, which operates an indoor telecommunications infrastructure sharing business in Indonesia, has established a partnership with NTT Group to achieve further growth and create new value July 2024 ■ Business image Dhost acquires indoor communications equipme
Slide 26: Progress of Medium-Term Management Plan
3． Progress of Medium-Term Management Plan ©2024 EXEO Group, Inc. All Rights Reserved. 26
Slide 27: Numerical Targets
（１） Numerical Targets Net sales at record high level, challenging to achieve mid-term targets in FY2024 one year ahead of schedule Improve profitability by increasing productivity, allocating resources to growth areas, and maximizing group synergies Net sales 630 billion yen FY2025 • • ROE over 9.0％
Slide 28: Strengthening Our Business Infrastructure
（２） Strengthening Our Business Infrastructure Steady implementation of strengthening our business infrastructure Theme Main Initiatives Theme Main Initiatives ・Invested heavily in human resources and ・Remote safety monitoring using network R&D/DX cameras ・Raised the DOE of our dividend policy to Fin
Slide 29: Shareholder Return
３．Shareholder Return ©2024 EXEO Group, Inc. All Rights Reserved. 29
Slide 30: Dividends, Share Buybacks
（１） Dividends, Share Buybacks From FY23, the dividend policy has been changed to a 4.0% DOE basis, and we plans to increase dividends for 13 consecutive fiscal years (interim 31 yen, annual 62 yen) Purchase of treasury stock continuously and flexibly Cancellation of 5 million treasury shares at the
Slide 31: Total Shareholder Return, ROE, EPS
（２） Total Shareholder Return, ROE, EPS Active shareholder returns through consecutive dividend increases and continuous share buy-backs ROE declined in FY23 due to loss on valuation, but has been on a steady growth trajectory since FY24 ■ Total Shareholder Return ■ ROE/EPS （billion yen） ※ EPS figure
Slide 32: Disclaimer Regarding Forward-Looking Statements
Disclaimer Regarding Forward-Looking Statements Management of the Company has made estimates and assumptions relating to financial forecasts based on information available as of the reporting date. Actual results could differ from those estimates. 3-29-20 Shibuya, Shibuya-ku, Tokyo 150-0002 JAPAN UR
Slide 33: Bring the benefits of connectivity to all
“Bring the benefits of connectivity to all”