J Frontier Co., Ltd. · TSE:2934
J Frontier — Q1 FY ending May 2024 Earnings Presentation
56 slides from J Frontier's earnings presentation, Oct 13, 2023
Slide 1: Presentation Material on Financial Results for First Quarter of FY ending May 2024
Presentation Material on Financial Results for First Quarter of FY ending May 2024 October 13, 2023 J Frontier Co., Ltd. [Securities code: 2934]
Slide 2: Executive Summary: Financial results for first quarter of FY ending May 2024
Executive Summary: Financial results for first quarter of FY ending May 2024 ◆ Net Sales : 4,223 million yen Full-year plan: 20,598 million yen; progress rate: 21% ➢ The Medical Care Sales Business (SOKUYAKU and D2C sales of medications) is projected to achieve full-year planned results since Busine
Slide 3: Contents
Contents Contents ◼ 01 Consolidated financial results in first quarter of FY ending May 2024 ◼ 02 Major recent initiatives ◼ 03 Corporate overview/business overview ◼ 04 Appendix 2
Slide 4: Consolidated financial results in first quarter of FY ending May 2024
Consolidated financial results in first ■ 01 quarter of FY ending May 2024
Slide 5: The Group's Business Portfolio
The Group’s Business Portfolio Business segment Business Business details ◼ Telemedicine, online drug administration guidance, and medication delivery platform SOKUYAKU ◼ Marketing support and digital transformation (DX) support for medical institutions ◼ Support for medical human resources Medical
Slide 6: Consolidated financial results in first quarter of FY ending May 2024
Consolidated financial results in first quarter of FY ending May 2024* Net sales Operating income • Achieved 21% of progress rate • Achieved 35% of progress rate thanks to success in attracting new customers more efficiently • We expect sales to grow in Q2 and beyond in each business, as we make ste
Slide 7: Consolidated financial results: Details by business
Consolidated financial results in first quarter of FY ending May 2024: Details by business Group Consolidated Financial Results Net sales: 4,223 million yen (progress rate: 21%) Operating income: 36 million yen By Segment Medical Care Sales Net sales: 1,952 million yen (progress rate: 20%) Operating
Slide 8: Summary of Consolidated Statements of Profit and Loss
Summary of Consolidated Statements of Profit and Loss (Million yen) FY2023/5 FY 2024/5 FY2024/5 YoY vs. Plans 1Q results (YoY) annual plan 1Q results change (Progress rate) Net sales 5,542 20,598 4,223 76% 21% Medical Care Sales Business 2,782 9,570 1,952 70% 20% Healthcare Sales Business 930 4,582
Slide 9: Consolidated Balance Sheet Summary
Consolidated Balance Sheet Summary (Million yen) FY2024/5 FY2024/5 Assets 1Q Liabilities and net assets 1Q Current assets 5,173 Total liabilities 4,366 Cash and deposits 1,909 Current liabilities 2,442 Accounts receivable - trade, etc. 1,696 Accounts payable – trade 510 Inventories 1,017 Accounts pa
Slide 10: Recording of net sales on advertising management
[Medical Care Sales Business and Healthcare Marketing Business] Recording of net sales on advertising management Details of changes to recording of net sales on some advertising management ➢ We record the prices of advertising management paid by medical institutions in the SOKUYAKU Business and by m
Slide 11: Medication inventory shortage
[Medical Care Sales Business] D2C sales of medications and SOKUYAKU Medication inventory shortage ◼ Despite strong inquiries from users, inventories were short from late July through September ◼ As of October, the shortage has been resolved and we expect it to have no impact on achievement of full-y
Slide 12: Prospects for sales in the fiscal year ending May 2024
[Medical Care Sales Business] SOKUYAKU Prospects for sales in the fiscal year ending May 2024 ◼ While the rate of progress toward full-year plans was just 14% for SOKUYAKU Online Clinic as well because of the effects of short inventories of generic medications, we expect to achieve full-year plans t
Slide 13: Key Performance Indicators (KPI)
[Medical Care Sales Business] SOKUYAKU Key Performance Indicators (KPI) ◼ The number of partner hospitals and pharmacies grew by 109% and the number of users by 115% from the end of the previous period Numbers of partner hospitals and pharmacies (cumulative) Number of users (number of registered use
Slide 14: Trends in sales
[Medical Care Sales Business and Healthcare Sales Business] D2C Trends in sales ◼ While D2C sales of medications were down because of short inventories of Bofutsushosan, these shortages has now been resolved D2C sales of medications: Net sales D2C sales of health foods: Net sales (Medical Care Sales
Slide 15: Key Performance Indicators (KPI)
[Medical Care Sales Business and Healthcare Sales Business] D2C Key Performance Indicators (KPI) ◼ Rate of progress vs. plans: 21% ◼ We expect the number of subscribers to grow in the future thanks to resolution of the short inventories of Bofutsushosan [D2C KPI] Number of new subscribers (Subscribe
Slide 16: Key Performance Indicators (KPI)
[Healthcare Marketing Business] B2B Key Performance Indicators (KPI) ◼ Promotion of sales activities groupwide has increased the number of trading partner companies to 264 [B2B KPI] Number of trading partner companies Progress*: (Companies) 76% 300 270 264 245 250 200 184 150 131 122 100 50 0 May 20
Slide 17: Major recent initiatives
■ 02 Major recent initiatives
Slide 18: Growing same-day delivery service areas
[Medical Care Sales Business] SOKUYAKU Growing same-day delivery service areas ◼ Same-day delivery introduced in Kochi on September 1, 2023 ◼ Further expansion planned chiefly in ordinance-designated major cities • Sapporo City : Same-day delivery service areas Next-day delivery, parcel delivery, an
Slide 19: Launching new TV commercials and web videos
[Medical Care Sales Business] SOKUYAKU Launching new TV commercials and web videos ◼ We launched new TV commercials and Web videos on August 16, 2023 ◼ We will aim to accelerate growth in new subscribers even further SOKUYAKU Promise (Insured Medical Care) series SOKUYAKU Promise (Uninsured Medical
Slide 20: Launching a web-browser version
[Medical Care Sales Business] SOKUYAKU Launching a web-browser version ◼ We launched a Web browser version of the service on August 17, 2023 ◼ This is expected to lead to further growth in use by users, since there is no need to download the app 19
Slide 21: SOKUYAKU Premium subscription plan
[Medical Care Sales Business] SOKUYAKU SOKUYAKU Premium subscription plan ◼ On October 2, 2023, we introduced the SOKUYAKU Premium subscription plan ◼ Growing stock-based revenue models SOKUYAKU Premium overview Eliminates the 150-yen (tax excl.) fee for telemedicine and online drug administration g
Slide 22: Launching delivery services for pharmaceuticals, daily items, and food products
[Medical Care Sales Business] SOKUYAKU Launching delivery services for pharmaceuticals, daily items, and food products ◼ Service introduced in Sapporo on June 14, 2023 ◼ Future growth planned centered on drugstores that have adopted SOKUYAKU 21
Slide 23: Promoting cooperation with other firms
[Medical Care Sales Business] SOKUYAKU Promoting cooperation with other firms ◼ Accelerating digital transformation (DX) in healthcare by promoting cooperation with other firms Partner Cooperation details etc. • Commencing efforts to register JAL Mileage Bank registered users as SOKUYAKU registered
Slide 24: Releasing the new Faveur brand
[Healthcare Sales Business] D2C (cosmetics) Releasing the new Faveur brand ◼ Releasing the Faveur aging-care *1 series that fuses next-generation *2 ingredients and science with SOKUYAKU Beauty *1 Compared to other Company products *2 Care for specific age ranges 23
Slide 25: Corporate overview/business overview
■ 03 Corporate overview/business overview
Slide 26: Our Management Policies
Our Management Policies ◼ Developing and implementing a mission and plans consistent with our Management Philosophy ◼ Aiming, through our businesses, for solutions to the severe social issues Japan faces Management philosophy Purpose Good health for people and society Goals to achieve Mission ⚫ Keep
Slide 27: Our Future Business Model Goals
Our Future Business Model Goals Mission (goals to achieve) 1 Growth in medical costs and other social security expenses Keeping down medical costs through longer healthy lifespans 2 Shortage of medical human resources, widening healthcare Developing more efficient and effective structures through di
Slide 28: The Group's Business Portfolio (Repeated from Above)
The Group’s Business Portfolio (Repeated from Above) Business segment Business Business details ◼ Telemedicine, online drug administration guidance, and medication delivery platform SOKUYAKU ◼ Marketing support and digital transformation (DX) support for medical institutions ◼ Support for medical hu
Slide 29: Medium-Term Plan (May 2024 – May 2025)
Medium-Term Plan (May 2024 – May 2025) Net sales Operating income • High growth rates continued, driven by the Medical Care Sales • We expect to achieve profitability in the fiscal year ending May 2024 Business (SOKUYAKU telemedicine business and D2C sales of and will promote further efforts to secu
Slide 30: SOKUYAKU Business
SOKUYAKU Business _\( JFRONTIER 29
Slide 31: The worldview we want to realize
[SOKUYAKU Business] The worldview we want to realize ◼ Realizing a society in which anybody can connect with doctors and pharmacists and receive medications any time, any place. • In spare moments during housework and childcare Any time • During breaks at work • Late at night, early in the morning,
Slide 32: Business environment
[SOKUYAKU Business] Business environment ◼ The telemedicine market in Japan is in its early stages, and further market growth is expected in the future Benefits of putting medical services online (a sample case) Growing markets*1 ✓ Elimination of geographical and time Telemedicine offers numerous (U
Slide 33: Deregulation in Japan
[SOKUYAKU Business] Deregulation in Japan ◼ Deregulation of telemedicine and online drug administration guidance is accelerating in Japan recently. ◼ Further easing of related regulations is expected in the future as the government responds to social issues. Telemedicine rates and ➢ Strict restricti
Slide 34: SOKUYAKU service overview
[SOKUYAKU Business] SOKUYAKU service overview ◼ Developing a one-stop platform from telemedicine to online drug administration guidance and delivery of prescription medication Searching for hospitals Telemedicine Online drug Delivery of medication and pharmacies administration guidance ➢ Searching f
Slide 35: SOKUYAKU's Strengths
[SOKUYAKU Business] SOKUYAKU's Strengths ◼ SOKUYAKU delivers solutions to impediments to promoting the online migration of healthcare. ◼ This is demonstrated by rapid growth in the numbers of partner hospitals and pharmacies and the numbers of patients. Impediments to online migration SOKUYAKU's sol
Slide 36: Methods of receiving prescription medications
[SOKUYAKU Business] Methods of receiving prescription medications ◼ Establishing receiving methods that match the needs of users List of methods of receiving prescription medications 1 Same-day delivery 2 Next-day delivery Areas served: : Tokyo Metropolitan Area, Saitama Areas served: : Nationwide P
Slide 37: Service development policies (insured and uninsured medical care)
[SOKUYAKU Business] Service development policies (insured and uninsured medical care) ◼ Able to handle both insured and uninsured medical care ◼ Service development under different policies, reflecting the Japanese legal system Insured medical care Uninsured medical care Service • Attracting patient
Slide 38: Online clinics for uninsured medical care
[SOKUYAKU Business] Online clinics for uninsured medical care ◼ Growing online clinics for uninsured medical care ◼ An increasing trend of customer attraction in the fields of pill, skin beauty, AGA, etc. Online clinic illustration 37
Slide 39: List of current revenue models
[SOKUYAKU Business] List of current revenue models Telemedicine platform Aiming to maximize revenues through means including increasing numbers of registered users and uses Service Charge’s structure* ⚫ [Insured medical care] Telemedicine usage charges ➢ 150 yen per use ⚫ [Insured medical care] Onli
Slide 40: Plan for FY ending May 2024
[SOKUYAKU Business] Plan for FY ending May 2024 ◼ Further telemedicine platform growth through simultaneously investing strategically in advertising and enhancing revenue models *1 Sales Plan for FY ending May 2024 Operating income (Million yen) (Million yen) 4,000 3,681 3,000 [Left axis: Sales] Tel
Slide 41: Strategies toward future revenue growth
[SOKUYAKU Business] Strategies toward future revenue growth ◼ Growing revenues to realize our plans ◼ Building a profit structure quickly through means such as adoption of stock-based revenue models 1 Growing flow-based revenue models 2 Growing stock-based revenue models 3 Enhancement and expansion
Slide 42: Medium-term plan: KPIs
[SOKUYAKU Business] Medium-term plan: KPIs ◼ Number of users revised to planned figure, assuming launch of premium plans ◼ Breakdown of pharmacies and hospitals revised (increasing number of pharmacies) to expand same-day service areas Numbers of partner hospitals and pharmacies (cumulative) Number
Slide 43: D2C Business
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Slide 44: Brand lineup
[D2C Business] Brand lineup ◼ Developing a D2C business that includes original medications, health foods, and cosmetics ◼ Also advancing diversification of the product lineup through M&A activities with companies that own product brands ➢ November 2019: Acquisition of traditional Chinese herbal medi
Slide 45: D2C Business Policies
[D2C Business] D2C Business Policies ◼ Enhancing product capabilities and diversifying products offered, and providing strong support for effective and efficient treatment, self-care, and health maintenance for consumers Health foods Medications Cosmetics New categories Enhancing product capabilitie
Slide 46: Cross-media selling power
[D2C Business] Cross-media selling power ■Advertising production based on abilities in casting and earning consumers' sympathy, build up through Healthcare Marketing ■Reaching consumers across a wide range of ages through a cross-media approach using online and offline advertising ■Realizing effecti
Slide 47: A strict advertising review structure
[D2C Business] A strict advertising review structure ◼ Laws concerning D2C advertising have become increasingly strict in recent years with the amendment of the Pharmaceutical and Medical Devices Act and other developments. ◼ Thanks to our traditional strict approach to advertising review, we have b
Slide 48: Plan for FY ending May 2024
[D2C Business] Plan for FY ending May 2024 ◼ Realizing continuous growth by enhancing the product lineup by promoting the development of products to contribute to a period free from illness, prevention, and health maintenance Sales Operating income (Million yen) Plan for FY ending May 2024 (Million
Slide 49: Medium-term plan: KPIs
[D2C Business] Medium-term plan: KPIs ◼ Aiming to increase the number of subscribers through the development and growth of new products and efficient and effective advertising (Subscribers) Trend in the number of new subscribers 600,000 600,000 500,000 500,000 416,848 400,000 356,909 301,089 300,000
Slide 50: B2B Business
B2B Business _\( JFRONTIER 49
Slide 51: B2B Business Policies
[B2B Business] B2B Business Policies ◼ We will accelerate the updating of information on industry trends and the accumulation of expertise through branding that targets customers and through BPO services to demonstrate synergies with our other businesses Branding BPO services Casting, advertising TV
Slide 52: Plan for FY ending May 2024
[B2B Business] Plan for FY ending May 2024 ◼ Cross selling of branding and BPO services chiefly to mail-order vendors Sales Operating income (Million yen) Plan for FY ending May 2024 (Million yen) 8,000 400 [Left axis: Sales] [Right axis: Operating income] 6,446 6,000 300 5,058 4,000 3,844 200 112 2
Slide 53: Medium-term plan: KPIs
[B2B Business] Medium-term plan: KPIs ◼ Aiming to increase the number of trading partner companies in branding and BPO services through efforts for the cross selling of products and services by strengthening cooperation with subsidiaries Trend in the number of trading partner companies (Companies) 3
Slide 54: Appendix
Jf JFRONTIER m 04 Appendix
Slide 55: Introduction to preferential system for shareholders
Introduction to preferential system for shareholders ◼ A new preferential system for shareholders was established in November 2021 to express gratitude for shareholders' continued support and make investments in our stock more attractive. (Number of shares held) Equivalent to Equivalent to 300 or mo
Slide 56: Good health for people and society
Good health for people and society
J Frontier — Q1 FY ending May 2024 Earnings Presentation on 6ix