Ly Corporation · TSE:4689
Ly — Yahoo Japan — Q1 FY2012 Earnings Presentation
64 slides from Ly's earnings presentation, Jul 25, 2012
Slide 1: FY2012 1Q Business Results (April 2012-June 2012)
Yahoo Japan Corporation FY2012 1Q B Business i R Results lt (April 2012-June 2012) July 25, 2012
Slide 2: Table of Contents
Table ab e o of Contents Co te ts P 3 P. Financial Highlights P 16 Re-acceleration of Profit Growth P. P 46 Appendix P. Statements made at the meeting or included in the documents that are not historical facts are forward- looking statements about the future performance of Yahoo Japan Corporation an
Slide 3: FY2012-1Q Financial Highlights
FY2012-1Q Q Financial Highlights g g (¥100M) YoY Change 2011-1Q Q 2012-1Q Q Ch Change C Contributors ib Revenue 718 775 8.0% Advertising revenue grew Operating Income 388 421 8.6% Ordinary Income 392 427 8.8% Quarterly Expenses incurred because of a data Net Income 233 250 7.6% loss incident at a co
Slide 4: Quarterly Revenue
Quarterly Revenue (¥ 100M) 800 775 600 400 Gross Net 200 0 ‘02/ ‘03/ ‘04/ ‘05/ ‘06/ ‘07/ ‘08/ ‘09/ ‘10/ ‘11/ ‘12/ 4-6 4-6 4-6 4-6 4-6 4-6 4-6 4-6 4-6 4-6 4-6 *Commencing with the FY2008, we started indicating revenue on a net rather than gross basis, by eliminating certain items in cost of sales and
Slide 5: Quarterly Revenue YoY Growth Trend
Quarterly y Revenue YoY Growth Trend 10% 8% 8.0% 6% 4% 2% 0% ‘09/ ‘10/ ‘11/ ‘12/ 4-6 4-6 4-6 4-6 5
Slide 6: Quarterly Revenue Breakdown
Quarterly y Revenue Breakdown (¥ 100M) 775 Total +57(¥100M) 800 718 +8.0 600 Marketing Solutions Business 514 456 +12 5 +12.5 Advertising revenue was strong 400 Consumer Business +1 +1.2 2 Pay digital content revenue grew 200 270 274 0 ‘11/4-6 ‘12/4-6 6
Slide 7: Quarterly Advertising-related Revenue
Quarterly y Advertising-related g Revenue Total +49 (¥100M) (¥ 100M) 500 12% 430 400 381 10% +13.0 10% 8% Listing advertising revenue +12.1 300 Ongoing O i strong growth h iin revenue through h h locally-oriented advertising companies 307 6% Display advertising revenue +15.2 200 274 Revenues ffrom B
Slide 8: Quarterly Advertising-related Revenue YoY Growth Trend
Quarterly Advertising-related Revenue YoY Growth Trend 20% 15% 15.2% 12.1% 10% 5% Listing g Advertising g Display Advertising 0% -5% 5% -10% -15% ‘09/ ‘10/ ‘11/ ‘12/ 4-6 4-6 4-6 4-6 8
Slide 9: YoY Change Contributors by Industry - Listing Advertising Revenue
YoY Change Contributors by Industry - Listing Advertising Revenue (¥ 100M) +33.2 Total +33.2 33.2(¥100M) +12.1 +14 0 +14.0 Information Processing/ Software/ +6.6 +5 9 +5.9 Internet Information Service +3.9 +3.8 +1.8 0 YoY Y Y Oth Others, nett Change -5.7 9
Slide 10: YoY Change Contributors by Industry - Display Advertising Revenue
YoY Change Contributors by Industry - Display Advertising Revenue (¥ 100M) +16.2 Total +16.2(¥100M) +15 2 +15.2 Internet Information +5.0 +5.0 Service/ Email Service +3.2 +3.1 +2 8 +2.8 +2 7 +2.7 Others, net 0 YoY Change -0.3 -5.5 10
Slide 11: Quarterly e-commerce Transaction Value
Quarterly y e-commerce Transaction Value (¥ 100M) Total +28(¥100M) 3,949 3,977 4,000 +0.7 717 746 Shopping +4.0 3,000 Increase in shopping and travel 1,700 1,667 Auctions -1.9 Transaction value decreased 2,000 Others +2.1 (Wallet, card, pay digital content, etc.) 1,000 -Payy digital g content increa
Slide 12: Quarterly Profits
Quarterly Profits (¥ 100M) 500 60% 50% 400 40% Operating Income 300 Ordinary Income 30% Quarterly Net Income Operating Margin 200 Ordinary Margin 20% 100 10% 0 0% ‘02/ ‘04/ ‘06/ ‘08/ ‘10/ ‘12/ 4-6 4-6 4-6 4-6 4-6 4-6 *Margins for ’09/1-3 onward are affected by the change in the presentation basis fo
Slide 13: Quarterly Operating Income YoY Growth Trend
Quarterly Operating Income YoY Growth Trend 14% 12% 10% 8.6% 8% 6% 4% 2% 0% ‘09/ ‘10/ ‘11/ ‘12/ 4-6 4-6 4-6 4-6 13
Slide 14: Review of FY2012-1Q Business Outlook
Review of FY2012-1Q Business Outlook Revenue and Operating/Ordinary Income exceeded the forecast ranges (¥100M) Actual Forecast Reason for Gap As of Apr. 24, 2012) Favorable growth in advertising Revenue 775 730 - 769 revenue Operating Income 421 389 - 412 - Ordinary Income 427 394 - 417 - Expenses
Slide 15: FY2012-2Q Business Outlook
FY2012-2Q FY2012 2Q Business Outlook (¥100M) 2011-2Q 2012-1Q 2012-2Q Change (A t l) (Actual) (A t l) (Actual) (F (Forecast) t) C Contributor ib Advertising revenue Revenue 737 775 778 - 820 expected to grow Operating Income 405 421 428 - 452 - Ordinary Income 410 427 433 - 456 - Quarterly Net Income
Slide 16: Re-acceleration of Profit Growth
Re-acceleration R l i off P fit Growth Profit G th 16
Slide 17: Aim to Achieve 2 Digit YoY Growth in OP
Aim to Achieve 2 Digit YoY Growth in OP -->Double OP by FY 201X ¥165 bn 2012.3 201X.3 17
Slide 18: Measures to Re-accelerate Profit Growth
Measures to Re Re-accelerate accelerate Profit Growth 9 Only 1 Strategy 9 The Most Powerful Tag Team 9 Unexplored Frontier 18
Slide 19: Only 1 Strategy
Only 1 Strategy | YAHOO!
Slide 20: Aiming to become a portal site for "Only 1" services
Auctions News Content rows Partnering Aiming to become a portal site for “Only 1” services i 20
Slide 21: Major portions of traffic and revenue generated through top 20 services
Major j portions p of traffic and revenue are generated through the top 20 services Traffic Revenue Top 20 Top 20 21
Slide 22: Top 20 Services DUB Trend
Top 20 Services DUB Trend * 2010.1Q 2011.1Q 2012.1Q Source Yahoo Japan Corporation *DUB=Daily Unique Browsers 22
Slide 23: Reallocation of Internal Resources
Reallocation of Internal Resources Reallocation Restructuring of services Over TOP5 Most important sing O Over TOP20 Important Keep assess Continue only services with Under TOP21 high user retention Low market share Close or restructure Develop utilizing New services internal resources 23
Slide 24: Measures Taken for Top Services
Measures T M Taken k ffor Top p 20 Services 24
Slide 25: Yahoo! News BUSINESS
Yahoo! News BUSINESS Distribute Distrib te articles of more than 20 economics/business media, journalists and bloggers for free Available on PCs and smartphones (through browsers and Android application) 25
Slide 26: MLB.jp (GyaO!)
MLB jp (GyaO!) MLB.jp Offering “MLB.jp”, an official Japanese MLB site Archives and live broadcasting of games available for free 26
Slide 27: Yahoo! Matchmaking
Yahoo! Matchmaking Became one of the largest matchmaking services in Japan Over 60,000 members’ profiles are registered Smartphone service is to be launched in August 27
Slide 28: The Most Powerful Tag Team
The Most Powerful Tag g Team 28
Slide 29: With SOFTBANK Group
With SOFTBANK Group No.1 Smartphone No.1 Internet Distributor Services Company p y 29
Slide 30: Plan to Offer an Effective Customer-Leads Platform
Plan to Offer an Effective Customer-Leads Platform A mass O2O marketing Special promotion offered on Yahoo! JAPAN site will lead users to advertisers’ shops and stores on the street SoftBank will install terminals in distribution channel A mass promotion on Exchange ticket 30 Yahoo! JAPAN Issue bar-
Slide 31: O2O Promotion Example
O2O Promotion Example “Pre mono” “Pre-mono” Users can apply to win free samples on Yahoo! JAPAN 53.1% of sample monitors visit the store Can expect additional purchases Approx. pp 60 visitors spent p over ¥1,000 Average ¥1,795 31
Slide 32: With ASKUL
With ASKUL No.1 Office Supply * No.1 Internet Delivery y Service Services Company p y *Transaction value of Office Supply by Mail Order, July 2011, Yano Research Institute Ltd. 32
Slide 33: % of population we aim to deliver within
× % of population we aim to deliver within: The same dayy as order The dayy after order % % 33
Slide 34: Steering committee and plan for new service launch
× A steering committee set up by 2 companies with both CEOs included Plan to launch a new service within this year Expect to achieve transaction value of ¥18.0 ¥18 0 billion* in the first year *Askul’s targeted transaction value for the year ending May 2013 34
Slide 35: With Culture Convenience Club
With C lt re Con Culture Convenience enience Cl Club b No.1 Off-line Off line Point Platform No.1 Internet Services Company New services will be started next spring 35
Slide 36: Unexplored Frontier
Unexplored Frontier | YAHOO!
Slide 37: Project DEJIMA
Project DEJIMA A tie-up with SoftBank Capital Resident staff located in NY We aim at creating new business opportunities by contacting overseas venture companies as possible future business partners -Alliances Alliances with Yahoo Japan Corporation -Establishing JVs in Japan Through collaborations w
Slide 38: Continuous Reconstruction Support after the Great East Japan Earthquake
Continuous Reconstruction Support pp after the Great East Japan Earthquake Fukko Department, the online shopping platform dedicated to selling local products from the damaged area Launch of a new office in Ishinomaki A boxed lunch containingg local food products from the damaged area 38
Slide 39: Progress with Smartphone Growth Initiatives
Progress with Smartphone Growth Initiatives 39
Slide 40: Smartphones DUB Trend
Smartphones DUB Trend Million UB 15 10 0 5 0 2011 4 2011.4 2012 6 2012.6 Source Yahoo Japan Corporation 40
Slide 41: Smartphone version of Yahoo! JAPAN
Smartphone version of Yahoo! JAPAN Number of DUB at the end off June J grew 140% YoY Y Y Amount of traffic sent to each service through Yahoo! JAPAN start page increased 190% YoY 41
Slide 42: Yahoo! Weather/Disaster Information Application
Yahoo! Weather/Disaster Information Application Ranked No.1 in the category both for iOS and Android Ranked No.2 for overall free-of-charge free of charge applications 42
Slide 43: Cumulative Number of Yahoo! JAPAN Applications Downloaded
Cumulative Number of Yahoo! JAPAN Applications Downloaded Yahoo! JAPAN offers iOS over 100 applications iOS+Android Cumulative downloads: Android Approx. 30 million 43
Slide 44: Provide all employees with iPhones and iPads
Provide all employees with iPhones and iPads 44
Slide 45: Strengthening Engineering Ability
Strengthening Engineering Ability Hi excellent Hire ll t engineers i “Black Belt” (A prize-giving plan) Black Belt 45
Slide 46: Supplemental Information
Supplemental Information 46
Slide 47: Table of Contents
Table of Contents P 48 P. Quarterly Business Results P 59 P. Quarterly Business Data P. 61 Organization, g , Personnel and Affiliated Companies 47
Slide 48: FY2012-1Q Statements of Income
FY2012-1Q Statements of Income 2011 1Q 2011-1Q 2012 1Q 2012-1Q Ch Change Revenue (¥100M) 718 775 8.0 % C t off S Cost Sales l (¥100M) 67 72 73% 7.3 Gross Profit (¥100M) 650 703 8.0 % SG&A (¥100M) ( ) 262 281 72% 7.2 Operating Income (¥100M) 388 421 8.6 % Ordinary Income (¥100M) 392 427 88% 8.8 Quart
Slide 49: FY2012-1Q Performance Breakdown by Business Segment
FY2012-1Q Performance Breakdown by Business Segment (¥ 100M) Cost of Operating Ordinary Operating Ordinary Revenue Revenue Breakdown Sales SG&A Income Income Margin Margin Advertising-related g 421 Marketing Corporate services, etc. 59 Solutions 514 Information listing 30 71 176 265 266 51.7% 51.9%
Slide 50: Business Segment Breakdown
Business Segment g Breakdown Former Segments New Segments Media Business Advertising: Listing advertising through advertising companies Display advertising (banner, text, e-mail, and video) Business-services Business services Business Marketing Advertising: Listing advertising through online Solutio
Slide 51: Quarterly SG&A Breakdown
Quarterly SG&A Breakdown (¥ 100M) Major Factors for YoY Changes Composition QoQ YoY 11/1Q 11/4Q 12/1Q Ratio Change Change Personnel Expenses 84 84 91 32.6% 9.3% 8.8% Number of employees reached 5,524, up 472 persons (9.3%) Business Commissions 35 35 38 13.6% 7.5% 6.4% Sales Promotion Costs 25 36 27
Slide 52: FY2012-1Q Balance Sheets
FY2012-1Q Balance Sheets Increase/ Major Factors for (¥ 100M) Major Items 2011/6/30 2012/6/30 Decrease Increase/Decrease Assets Current Assets 2,375 4,085 1,710 Increase in cash from operating activities Cash and Cash Equivalents 1,752 2,151 398 Notes and Accounts Receivable - Trade 337 423 85 Incre
Slide 53: FY2012-1Q Cash Flow Statements
FY2012-1Q Cash Flow Statements FY2012-1Q Major Items (Apr.-Jun. 2012) Major Factors for Changes (¥ 100M) Operating Activities 165 Quarterly Net Income before Income Taxes Increase in quarterly net income 414 before income taxes Depreciation Expenses 26 Accounts Receivable and Payable -Trade 42 Other
Slide 54: FY2012-1Q Highlights – Marketing Solutions Business (1)
FY2012-1Q Highlights – Marketing Solutions Business (1) Listing advertising (Paid search advertising [Sponsored Search] and interest-based advertising [Interest Match] ) - Despite a continuous decline in Internet information services, listing advertising revenue increased by 12% year on year due to
Slide 55: FY2012-1Q Highlights – Marketing Solutions Business (2)
FY2012-1Q Highlights – Marketing Solutions Business (2) Display advertising - Overall revenue expanded by 15% compared with the first quarter last year. Advertising from transportation/leisure, mobile communications, and cosmetics/toiletries companies grew, covering the decline in advertising from I
Slide 56: FY2012-1Q Highlights – Consumer Business
FY2012-1Q Highlights – Consumer Business e-commerce-related revenue (Yahoo! Auctions, Yahoo! Shopping, pay digital content and others) - Driven by strong game-related services revenues from Yahoo! Mobage, the Sengoku IXA and MONSTER DRAGON online li games, pay didigital it l content t t revenue incr
Slide 57: Listing Advertising Revenue by Industry
Listing Advertising Revenue by Industry Industries with large year-on-year increase Industries with large year-on-year decrease Transportation/Leisure Information Processing/Software Recruitment and Human Resources Services /Internet Information Service Department Stores/Mail Order/Shopping
Slide 58: Display Advertising Revenue by Industry
Display Advertising Revenue by Industry Industries with large year-on-year increase Industries with large year-on-year decrease Transportation/Leisure Internet Information Service/E-mail Service Mobile Communications Service Finance/Insurance/Securities Cosmetics/Toiletries 11/1Q 2Q 3Q 4Q
Slide 59: Quarterly Business Data (1)
Quarterly Business Data (1) Indicator (Quarterly average) 2011/1Q 2012/1Q Number of total monthly page views (millions) 50,939 51,869 Number of total monthly smartphone page views (millions)(1) 2,461 7,525 Number of Daily UBs (Unique Browsers)(millions)(2) 48.39 51.63 Number of smartphone Daily UBs
Slide 60: Quarterly Business Data (2)
Quarterly Business Data (2) I di t (Quarterly Indicator (Q t l total) t t l) 2011/1Q 2012/1Q Transaction value of Yahoo! Auctions (100 millions of yen) 1,700 1,667 Transaction value of shopping-related (100 millions of yen)(1) 717 746 Transaction value of Yahoo! Auctions and shopping-related (100 mi
Slide 61: Organization Chart of Yahoo! JAPAN
As of July 1, 2012 Organization Chart of Yahoo! JAPAN Board of Auditors Board of Directors President & CEO CMO CSO( * ) CSO(**) CCO Executive Vice President & COO CFO Media Services Marketing Consumer Business Solutions Business Strategy Administrative Company (951) Company (1,015) Compay (607) Grou
Slide 62: Number of Directors and Employees
Number of Directors and Employees (at the End of Quarter) (Number of People) 5,000 4,000 3,000 2 000 2,000 1,000 0 09/6 9 12 10/3 6 9 12 11/3 6 9 12 12/3 6 Directors and Auditors of Subsidiaries 31 32 30 30 24 24 17 17 18 18 18 18 14 Employees of Subsidiaries 1,082 1,228 1,249 1,238 1,238 1,177 1,14
Slide 63: Consolidated Subsidiaries and Companies Accounted for by the Equity Method
Consolidated Subsidiaries and Companies Accounted for by the Equity Method (as of June 30, 2012) •Major consolidated subsidiaries at the end of FY2012-1Q Firstserver, Inc. Feedpath, Inc. GyaO CORPORATION IDC Frontier Inc. Indival, Inc. Netrust, Ltd. Yahoo Japan Customer Relations Corpo
Slide 64: Yahoo Japan Group IR information
Yahoo Japan p Group p IR information is available at : http://ir.yahoo.co.jp/en/ 19