Exeo Group, Inc. · TSE:1951
Exeo — H1 FY2018 Earnings Presentation
40 slides from Exeo's earnings presentation, November 2018
Slide 1: Results for the Six Months Ended September 30, 2018
Results for the Six Months Ended September 30, 2018 November 2018 Building a better, brighter future together Total ICT Solutions: Contributing to the Realization of a Brighter Future by Bringing People Together and Forming Connections with Society URL: http://www.exeo.co.jp/overseas/index.html Resu
Slide 2: Contents
Contents 1. Overview of FY18 Interim Results ・・・ 2 ４．Raising Shareholders’ Value ・・・ 31 （１）Performance Figures ・・・ 3 （１）Shareholder Return Policy ・・・ 32 （２）Orders Received ・・・ 4 (Revision of year-end dividend forecast, etc.) （３）Net Sales ・・・ 5 （２）Plan for shareholder returns for FY18, etc. ・・・ 33 （４
Slide 3: 1. Overview of FY18 Interim Results
1. Overview of FY18 Interim Results (1) Performance Figures (2) Orders Received (3) Net Sales (4) Operating Income (5) Cash Flow －2－ Results for the Six Months Ended September 30, 2018
Slide 4: Performance Figures
1. Overview of FY18 Interim Results (1) Performance Figures ◆ Orders for urban infrastructure were particularly strong, and both orders and sales increased from the previous year and from the plan. ◆ Sales hit another record high, but operating income declined year on year due to an increase in SG&A
Slide 5: Orders Received
1. Overview of FY18 Interim Results (2) Orders Received ◆ NTT Mobile saw a year-on-year decline, but orders received increased overall year on year due to the particularly strong performance of Urban Infrastructure. ◆ Other than NTT Mobile, sales were favorable, and those of Urban Infrastructure wer
Slide 6: Net Sales
1. Overview of FY18 Interim Results (3) Net Sales ◆ Increased YOY by consuming a large number of carried-over work in each segment. ◆ NTT Network and Mobile saw delays due to the extension of the construction period, but orders for urban infrastructure were strong, resulting in an increase from the
Slide 7: Status of projects carried over
1. Overview of FY18 Interim Results Reference: Status of projects carried over ◆ Work carried over after 2Q at all-time high ■ Work carried over at the end of the 2Q (consolidated) (¥bn) 198.5 179.7 156.6 138.6 125.8 FY14 Interim FY15 Interim FY16 Interim FY17 Interim FY18 Interim Note: All amounts
Slide 8: Operating Income
1. Overview of FY18 Interim Results (4) Operating Income ◆ Operating income decreased year on year partly due to an increase in SG&A expenses, but increased from the plan due to an increase in sales. ■ YOY (consolidated) ■ Compared to plan (consolidated) (¥bn) Personnel expenses, Improved constructi
Slide 9: Trends in Group company profitability
1. Overview of FY18 Interim Results Reference: Trends in Group company profitability ◆ The profit of the group companies decreased, but the ratio of consolidated to non-consolidated profits was high. ■ Trends in operating profits over the past five years (consolidated/non-consolidated) (¥bn) (Ratio
Slide 10: Cash Flow
1. Overview of FY18 Interim Results (5) Cash Flow ◆ Stable cash flow ◆ Cash flows from investing activities increased due to M&A in the second quarter of FY18. ■ Cash flow (consolidated) (¥bn) FY15 FY16 FY17 FY18 Interim Full year Interim Cash at beinning of FY 24.2 16.0 15.2 15.2 30.3 Operating act
Slide 11: Performance of the three integrated companies of Western Japan
1. Overview of FY18 Interim Results Reference: Performance of the three integrated companies of Western Japan ◆ The three integrated companies also generally performed well in the second quarter of FY18. ■ Overview of results (consolidated) (¥bn) FY 2017 FY2018 Interim Interim Simple total Simple to
Slide 12: 2. Expectations for the Rest of FY18
2. Expectations for the Rest of FY18 (1) Revision of the full-year plan due to management integration (2) NTT Group (Access/Network) (3) NTT Group (Mobile) (4) NCCs (5) Urban Infrastructure (6) System-Solutions (7) Measures for greater efficiency ( Improved Productivity) －11－ Results for the Six Mon
Slide 13: Revision of the full-year plan due to management integration
2. Expectations for the Rest of FY18 (1) Revision of the full-year plan due to management integration ◆ On October 1, 2018, management integration with C-Cube, Seibu Electric Industry, and Nippon Dentsu was implemented. ◆ Net sales, etc. will increase significantly for the full year, but the operati
Slide 14: NTT Group (Access/Network)
2. Expectations for the Rest of FY18 (2) NTT Group (Access/Network) ◆ Solid performance despite emergence of trend toward slight slowdown in growth of optical access engineering work ◆ NTT East announced that it would terminate ADSL services at the end of January 2023. Expected for investment in opt
Slide 15: NTT Group (Mobile)
2. Expectations for the Rest of FY18 (3) NTT Group (Mobile) ◆ Orders up to 2Q were somewhat weak, but the completion of the construction work of numerous 4G radio base stations on hand was accelerated. ◆ Establishing and reinforcing construction systems for receiving orders for construction work for
Slide 16: NCCs
2. Expectations for the Rest of FY18 (4) NCCs ◆ Both orders received and net sales have been on track to recovery since FY17. ◆ Orders are expected to be received for the construction of radio base stations for the new frequency bands for 4G from the 3rd quarter onward. ■ Net sales of NCCs (consolid
Slide 17: Investment Trends of Major Telecom Carriers
2. Expectations for the Rest of FY18 Reference: Investment Trends of Major Telecom Carriers (Source: Figures released by the telecommunications carriers) (¥bn) ■ NTT East/West ■ NTT DoCoMo LTE-related Optical fiber 661.8 Note: LTE-related from FY16 onward has not been published. 626.6 595.2 597.1 59
Slide 18: Urban Infrastructure
2. Expectations for the Rest of FY18 (5) Urban Infrastructure ◆ Construction work for the measures for 700 MHz Band TV reception will be brisk, with orders ahead of schedule. ◆ Net sales are expected to rise for the full year due to strong orders in all segments. ■ Urban Infrastructure net sales (co
Slide 19: Other Major Construction Projects in Urban Infrastructure
2. Expectations for the Rest of FY18 Reference:Other Major Construction Projects in the Urban Infrastructure Business Note: Orders received do not include those of the three consolidated companies. (1) Construction of electrical facilities ■ Orders Received (¥bn) 14.3 17.0 6.5 16年度 FY16 17年度 FY17 18
Slide 20: Other Major Construction Projects in Urban Infrastructure
2. Expectations for the Rest of FY18 Reference:Other Major Construction Projects in the Urban Infrastructure Business ■ Orders Received (¥bn) (3) Expressway communications 4.9 2.6 1.2 16年度 FY16 17年度 FY17 18年度2Q実績 FY18 Interim (4) Disaster prevention radio communications 3.3 2.7 2.1 16年度 FY16 17年度 FY
Slide 21: System-Solutions
2. Expectations for the Rest of FY18 (6) System-Solutions ◆ Expanding added value by integrating solutions with leading-edge technologies such as RPA and Cloud ◆ Continue to focus on expansion of new solutions such as new energy and Geo Solutions ■ System-Solutions net sales ■ Solution Map (added va
Slide 22: Orders received for new solutions and activities going forward
2. Expectations for the Rest of FY18 Reference: Results of orders received for new solutions and activities going forward 6 ¥5.5bn 6 5 5 4 4 3 3 2 ¥1.0bn New energy field ¥2.0bn 2 1 1 ¥0.8bn 0 ・ Energy management service 0 FY18 FY18 FY18 FY18 Plan Interim ・ Transportable lithium battery Plan Interim
Slide 23: Energy Viewer
2. Expectations for the Rest of FY18 Reference: Energy Viewer ■ Energy Viewer reduces power usage through the remote and automatic control of air conditioning, employing a B2B2X business model in collaboration with local electric power companies. ■ Conduct PoC at around 60 locations. Achieved an ave
Slide 24: Cloud Integration Engineering
2. Expectations for the Rest of FY18 Reference: Cloud Integration Engineering* Development of the market for sound solutions for enterprises and the expansion of the IoT solutions lineup (1) State of activities [April to end of Sep. FY18] ◆ Concept of business development of cloud integration engine
Slide 25: Mesh-Type Beacon (new IoT infrastructure)
2. Expectations for the Rest of FY18 Cloud Reference: Mesh-Type Beacon (new IoT infrastructure) Commercialization of Bluetooth Mesh Sensor Sensor (most advanced in Japan) Beacon (cases) Rapid increase in overseas projects Beacon Beacon GPS cannot reach indoors! Trend of numbers on mesh-type beacon,
Slide 26: Global business initiatives
2. Expectations for the Rest of FY18 Reference: Global business initiatives Building business bases ・ Airport ICT in Southeast Asia ・ Industrial complex ICT Philippines ・ Data center ICT Thailand ・Philippines ・ Expressway ・Thailand communication ・ Railway communication ・・・ Singapore On October 31, 2
Slide 27: Measures for greater efficiency (Improved Productivity)
2. Expectations for the Rest of FY18 (7) Measures for greater efficiency (Improved Productivity) ◆ Measures for greater efficiency have produced a greater impact than planned in past years ◆ Continued groupwide promotion of improved productivity, cost improvements and workstyle reform ■ Enhanced pro
Slide 28: Examples of improvement measures
2. Expectations for the Rest of FY18 Reference:Examples of improvement measures ◎Enhancement of system common platform - Automation of data input using RPA ◎Modularization of individual business processes of business divisions/branches/Group companies Goal Automation of data input using RPA Enhancem
Slide 29: 3. Our M&A Strategy
3. Our M&A Strategy (1) Objective and Growth Picture (2) Development Direction by Business Segment －28－ Results for the Six Months Ended September 30, 2018
Slide 30: Objective and Growth Picture
3. Our M&A Strategy (1) Objective and Growth Picture 600 (¥bn) Aiming for 500 billion yen in sales and further growth 550 - Objective of M&A: Growing together - 500 Targeting companies that own businesses and technology that can generate synergy effects with our group 450 (Currently) 400 Actively co
Slide 31: Development Direction by Business Segment
3. Our M&A Strategy (2) Development Direction by Business Segment Engineering Solutions Engineering Solutions （Urban infrastructure） （NTT Group, NCCs） Implementation of system enforcement, Expanding areas of power/air conditioning and maintenance maintenance area expansion ・M&A in the power/air cond
Slide 32: 4. Raising Shareholders' Value
4. Raising Shareholders’ Value (1) Shareholder Return Policy (Revision of year-end dividend forecast, etc.) (2) Plan for shareholder returns for FY18, etc. －31－ Results for the Six Months Ended September 30, 2018
Slide 33: Shareholder Return Policy
4. Raising Shareholders’ Value (1) Shareholder Return Policy (Revision of year-end dividend forecast, etc.) ◆ Increase DOE from about 3% to about 3.5% from FY18 dividend and strengthen shareholder return ◆ Revision of year-end dividend forecast from ¥32 to ¥38 (considering the equity capital of the
Slide 34: Plan for shareholder returns for FY18
4. Raising Shareholders’ Value (2) Plan for shareholder returns for FY18, etc. ■ Dividend history (per share) ■ Total shareholder return ¥70 (Total dividends + total acquisition of treasury stock) Note: The acquisition of treasury stock will be implemented flexibly. 配当総額 Total dividends 自己株式取得額 Tota
Slide 35: 5. ESG Initiatives
5. ESG Initiatives (1) Major Initiatives －34－ Results for the Six Months Ended September 30, 2018
Slide 36: Major Initiatives
5. ESG Initiatives (1) Major Initiatives ・Reduction of CO2 emissions ⇒ 1% reduction of power/gasoline use compared to the previous year Ｅ ・Use of green energy, forest conservation ⇒ Solar power business, Forest of Exeo, and so on Environment ・Promotion of green procurement ⇒ 70% or more of ecologica
Slide 37: 6. Topics
6. Topics (1) Turning KOHKEN into a wholly owned subsidiary (2) Plan to turn the LAE Group of Singapore into a wholly owned subsidiary －36－ Results for the Six Months Ended September 30, 2018
Slide 38: Turning KOHKEN into a wholly owned subsidiary
6. Topics (1) Turning KOHKEN into a wholly owned subsidiary ◆ On September 13, 2018, KOHKEN a company that handles anticorrosive painting mainly in the Tokyo metropolitan area, was made a wholly-owned subsidiary. The aim is to further expand the urban infrastructure business. Name KOHKEN Co., Ltd. 1
Slide 39: Plan to turn the LAE Group of Singapore into a wholly owned subsidiary
6. Topics (2) Plan to turn the LAE Group of Singapore into a wholly owned subsidiary ◆ On October 31, 2018, the company signed an agreement to acquire all shares of the LAE Group, which engages in work for electrical and integrated facilities in Singapore. The aim is to expand the global business. N
Slide 40: 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 ht