Advance Create Co., Ltd. · TSE:8798
Advance Create — FY2022 Earnings Presentation
54 slides from Advance Create's earnings presentation, Nov 11, 2022
Slide 1: FY09/22 Results Briefing Materials
Advance Create Co., Ltd. FY09/22 Results Briefing Materials (October 2021 to September 2022) November 11, 2022 Securities code: 8798
Slide 2: Contents
Contents I. FY09/22 Results Overview 3 Results Highlights 4 Financial Statements 5 Segment Information 8 II. Advance Create Overview 11 III. Company Strategy 20 IV. Recent Developments 39 Full-Year Forecast 44 Sustainability Management 47 V. Supplementary Materials 50 2
Slide 3: I. FY09/22 Results Overview
I. FY09/22 Results Overview 3
Slide 4: FY09/22 Results Highlights – Consolidated Results
FY09/22 Results Overview (1) FY09/22 Results Highlights ― Consolidated Results ― Net sales and profits reached all-time highs for the second consecutive fiscal year Net sales ¥11,860 million, up ¥841 million YoY (+7.6% YoY) Operating ¥2,061 million, up ¥19 million YoY (+1.0% YoY) profit Ordinary ¥2,
Slide 5: FY09/22 Income Statement (Consolidated)
FY09/22 Results Overview (2) FY09/22 Income Statement (Consolidated) Composition Composition YoY change (Millions of yen) FY09/21 FY09/22 (%) (%) (%) Net sales 11,019 100.0 11,860 100.0 7.6 Insurance Agency business 9,103 82.6 9,548 80.5 4.9 ASP business 195 1.8 206 1.7 5.9 Media business 1,030 9.4
Slide 6: FY09/22 Balance Sheet (Consolidated)
FY09/22 Results Overview (3) FY09/22 Balance Sheet (Consolidated) (Millions of yen) End-FY09/21 End-FY09/22 Change Assets Current assets 7,968 7,856 -111 Cash and deposits 3,337 2,273 -1,064 Total assets increased by ¥682 million from Accounts receivable - trade 1,406 2,231 824 end-FY09/21 to ¥12,49
Slide 7: FY09/22 Statement of Cash Flows (Consolidated)
FY09/22 Results Overview (4) FY09/22 Statement of Cash Flows (Consolidated) (Millions of yen) FY09/21 FY09/22 Change Cash flows from operating activities 1,643 364 -1,278 Profit before income taxes 1,905 1,974 68 Depreciation 434 450 15 Increase (decrease) in trade receivables (307) (824) -516 Other
Slide 8: Sales by Segment
FY09/22 Results Overview (5) Sales by Segment (Unit: Millions of yen) FY09/21 26期 FY09/22 27期 YoY 前期比 1,030 再保険 942 Reinsurance 942 1,030 1,030 9.3% 9.3% メディア Media 1,030 1,030 1,795 1,795 74.2% 74.2% 851 942 1,795 メディアレップ Media Rep. 807 807 1,177 1,177 45.8% 45.8% 775 ASP ASP 195 195 206 206 5.9% 5
Slide 9: Operating profit by segment
FY09/22 Results Overview (6) Operating profit by segment (Unit: Millions of yen) FY09/21 FY09/22 YoY Reinsurance 129 46 -64.2% 46 Media 221 418 89.1% 129 Media Rep. 165 141 -14.3% 221 418 ASP 50 57 14.5% Insurance 1,472 1,395 -5.3% 165 Agency 141 50 Total 2,039 2,059 1.0% 57 110 131 105 211 261 1.0％
Slide 10: Commemorative Dividend in Celebration of the 20th Anniversary of Our Listing
FY09/22 Results Overview (7) Commemorative Dividend in Celebration of the 20th Anniversary of Our Listing Thank you Thanks to your support, on April 23, 2022, Advance Create celebrated 20 years since going public. As part of the market reclassification executed by the Tokyo Stock Exchange, Inc. on A
Slide 11: II. Advance Create Overview
II. Advance Create Overview Achieve Progress through Enhancing People and Technology 11
Slide 12: About Advance Create
Advance Create Overview About Advance Create Advance Create is an insurtech company that is constantly innovating to change the way people think about the insurance business. Ｉｎｓｕｒａｎｃｅ Ａｇｅｎｃｙ Reinsurance Business Business Ａｐｐｌｉｃａｔｉｏｎ Ｓｅｒｖｉｃｅ Ｍｅｄｉａ Business Ｐｒｏｖｉｄｅｒ (ASP) Business Ｂｕｓｉｎｅｓｓ Ｐｒｏｃｅｓｓ Ｍｅ
Slide 13: Long-Term Performance
Advance Create Overview Long-Term Performance Net sales Ordinary profit 売上高（左軸・百万円） (left axis; millions of yen) 経常利益（右軸・百万円） (right axis; millions of yen) Moved to the TSE Listed on the First Section of the Began online Prime Market and 3,000 16,000 Tokyo Stock Exchange consultations launched avata
Slide 14: Advance Create’s Digital Transformation (DX)
Advance Create Overview Advance Create’s Digital Transformation (DX) 〇 Spontaneous insurtech born out of customer service 〇 Obtained a patent for the system we developed and promoted the protection and use of intellectual property Discovery of potential customers Insurance consultation Continued rel
Slide 15: Our History of Progress through Technology
Advance Create Overview Our History of Progress through Technology 1998 Began accepting requests for information via website 1999 Launched Hoken Ichiba website Developed CRM system GOYOKIKI Cf. Amazon founded: 1994 Google founded: 1998 2009 Launched smartphone-optimized website 2012 Complete revampi
Slide 16: Our Strengths
Advance Create Overview Our Strengths Development of insurance Unique methods of Corporate culture that rapidly software in-house online marketing adapts to change ● Despite being a specialized ● We operate one of the ● We develop human insurance agent, we have largest insurance selection resources
Slide 17: In-House Software Development and Agile Development
Advance Create Overview In-House Software Development and Agile Development 〇 We develop software in-house with more than 100 IT personnel including engineers and designers. 〇 We employ agile development through direct connections between management, sales staff, and engineers. Marketing Planning Ma
Slide 18: Growth of the Younger Generation to Support High Productivity
Advance Create Overview Growth of the Younger Generation to Support High Productivity and High Added Value 〇 We have achieved high productivity through online insurance consultations and the use of text communication in addition to employee training to foster IT literacy. 〇 We have created an enviro
Slide 19: Productivity Improvement
Advance Create Overview Productivity Improvement 〇 We are improving productivity by implementing IT and promoting digital transformation (DX). We aim to add value for our customers through a business model that is information-intensive, rather than labor-intensive. 〇 We have increased the average wa
Slide 20: III. Company Strategy
a raranee Create Ill. Company Strategy 20
Slide 21: Industry Size and Outlook
Company Strategy: Business Environment Analysis Industry Size and Outlook Size of insurance-related market (estimate) Approx. ¥47.7 trillion Life insurance: ¥39 trillion + Non-life insurance: ¥8.7 trillion *The Life Insurance Association of Japan, "Life Insurance Trends (2021)" The General Insurance
Slide 22: Efficient Web Marketing
Company Strategy: Evolution to a High-Profit Structure Efficient Web Marketing 〇 We effectively approach prospective customers with apparent insurance product demand through our unique web marketing strategy. As a result, our business has evolved into a high-profit structure with a greatly improved
Slide 23: Strengthening Non-Life Insurance Business to Diversify Revenue Sources
Company Strategy: Evolution to a High-Profit Structure Strengthening Non-Life Insurance Business to Diversify Revenue Sources 〇 The number of applications received and gross written premiums have both increased consistently since we stepped up our non-life insurance efforts. Non-life insurance, as a
Slide 24: Strengthening Our Appointment Generation System
Company Strategy: Evolution to a High-Profit Structure Strengthening Our Appointment Generation System 〇 Besides the traditional telephone, our call center also makes use of other forms of modern electronic communication. With the use of LINE, SMS, “folder,” avatars, and various forms of marketing a
Slide 25: New-Era OMO 2.0: Avatar Consultants
Company Strategy: OMO 2.0 New-Era OMO 2.0: Avatar Consultants 〇 We have partnered with AVITA, Inc., a startup founded by Professor Hiroshi Ishiguro of Osaka University, to use avatars to respond to insurance inquiries. Professor Ishiguro has been studying and developing "avatars that interact with p
Slide 26: Dynamic OMO × folder × Avatar
Company Strategy: OMO 2.0 Dynamic OMO × folder × Avatar 〇 To enhance the convenience and efficiency of online insurance consultation, we developed Dynamic OMO, an insurance-specific online consultation system. Among the patents we have obtained are the technologies required for identity verification
Slide 27: Booking of a Consultant of Choice x Avatar
Company Strategy: OMO 2.0 Booking of a Consultant of Choice x Avatar 〇 Many customers may feel uneasy at their first insurance consultations because they don’t know what to expect from their consultant. With our online insurance consultation, customers can set up an appointment with a consultant of
Slide 28: Pursuing High-Quality Services at Our Physical Locations
Company Strategy: OMO 2.0 Pursuing High-Quality Services at Our Physical Locations 〇 We operate Hoken Ichiba consulting plazas at urban landmarks. We are committed to providing high-quality consulting services at these physical locations so that our customers can have the “impressive experience that
Slide 29: Portfolio Strategy: Portfolio of Channels
Company Strategy: Portfolio Strategy (1) Portfolio Strategy: Portfolio of Channels Face-to-face Mail order Avatar Consultant Online Collaborative 29
Slide 30: Portfolio Strategy: Revenue Portfolio
Company Strategy: Portfolio Strategy (2) Portfolio Strategy: Revenue Portfolio 30
Slide 31: Portfolio Strategy: Revenue Portfolio – Insurance Agency Business
Company Strategy: Portfolio Strategy (3) Portfolio Strategy: Revenue Portfolio Insurance Agency Business ▶ Sell insurance products on behalf of life insurance and non-life insurance companies after concluding agency contracts ▶ Implement promotions centered on Hoken Ichiba, one of the largest insura
Slide 32: ANP and PV by Sales Channel
Company Strategy: Portfolio Strategy (4) ANP and PV by Sales Channel (Unit: Millions of yen) 26期 FY09/21 27期 FY09/22 協 業 Collaborative 1,780 1,699 非対面販売 Non-face-to-face 2,518 3,065 対面販売 Face-to-face 4,272 3,914 1,183 1,546 1,699 合○○計 Total 8,571 8,679 1,780 1,577 2,652 2,640 7,757 7,483 2,944 7,530
Slide 33: Number of Non-life Insurance Policies and Gross Written Premiums
0 50,000 100,000 150,000 200,000 '20/10 10/20 (Thousands of yen) '20/11 11/20 '20/12 12/20 '21/01 01/21 '21/02 02/21 '21/03 03/21 Auto (incl. motorcycles) '21/04 04/21 自動車（バイク含む） '21/05 05/21 '21/06 06/21 '21/07 Bicycle 07/21 自転車 '21/08 08/21 '21/09 09/21 Pet '21/10 10/21 ペット '21/11 11/21 '21/12 12/
Slide 34: Number of Policies in Force
Company Strategy: Portfolio Strategy (6) Number of Policies in Force (Unit: 1,000 policies) Up 2.5% 519 542 579 636 652 YoY *The number of policies in force includes life insurance, medical insurance, and other policies that continue or are renewed (life insurance companies and American Home Assuran
Slide 35: Portfolio Strategy: Media and Media Representative Services
Company Strategy: Portfolio Strategy (7) Portfolio Strategy: Revenue Portfolio Hoken Ichiba Co., Ltd. Media Representative Media Business Services Business ▶ Receives orders for ad placement on Hoken Ichiba, one of Japan’s ▶ Entrusted with advertising operations for insurance companies, among larges
Slide 36: Portfolio Strategy: Reinsurance Business
Company Strategy: Portfolio Strategy (8) Portfolio Strategy: Revenue Portfolio Advance Create Reinsurance Inc. Reinsurance Business [Insurers under reinsurance agreements] ▶ Assumes part of the risk of the insurance sold by the insurer and earns reinsurance As of end-Sep. 2022: Total 11 premiums Lif
Slide 37: Portfolio Strategy: ASP Business – Advance Create Cloud Platform
Company Strategy: Portfolio Strategy (9) Portfolio Strategy: Revenue Portfolio ASP Business ▶ We sell our in-house system, which we have been using for many years and have improved from the user’s perspective, at a low price. ▶ In-house engineers can quickly respond to customers’ requests to improve
Slide 38: Advance Create Cloud Platform: No. of IDs
Company Strategy: Portfolio Strategy (10) Advance Create Cloud Platform: No. of IDs 御用聞き GOYOKIKI 丁稚 DECHI Dynamic OMO (No. of IDs) 10,000 8,000 6,000 4,000 2,000 0 12/18 '18/12 3/19 '19/3 6/19 '19/6 9/19 '19/9 12/19 '19/12 3/20 '20/3 6/20 '20/6 9/20 '20/9 12/20 '20/12 3/21 '21/3 6/21 '21/6 9/21 '21
Slide 39: IV. Recent Developments
a raranee Create IV. Recent Developments 39
Slide 40: No. of folder App Downloads
Recent Developments No. of folder App Downloads 〇 The number of downloads of the folder app, which serves as the first point of contact with customers considering insurance, has been growing steadily. We use this app to communicate with customers through push notifications and other means to provide
Slide 41: Increase in the Number of LINE Friends
Recent Developments Increase in the Number of LINE Friends 〇 To improve convenience, we accept insurance inquiries and send quotation results to customers using familiar communication tools. On LINE, we have over 1.1 million friends, and the number is steadily increasing. (No. of persons) 1,100,000
Slide 42: Appointments
Recent Developments Appointments 〇 Despite some fluctuations depending on the spread of COVID-19, approximately 40% of our customers request online insurance consultations. We have been getting a steady stream of appointments, thanks to the expansion of our call center division and our customers' gr
Slide 43: Trend in ANP at Our Consulting Plazas and Collaborating Agents
Recent Developments Trend in ANP at Our Consulting Plazas and Collaborating Agents 〇 Through the development of our OMO strategy, including online consultations, we have established a robust revenue structure unaffected by COVID-19. Present Value (PV), which represents sales in the Insurance Agency
Slide 44: FY09/23 Full-Year Forecast
FY09/23 Full-Year Forecast FY09/23 Full-Year Forecast (Millions of yen) FY09/23 Consolidated FY09/19 FY09/20 FY09/21 FY09/22 YoY Change forecast Net sales 10,365 10,510 11,019 11,860 16,680 40.6% Operating profit 1,345 1,184 2,041 2,061 3,220 56.2% Ordinary profit 1,297 1,095 1,925 2,015 3,030 50.4%
Slide 45: Annual Dividend per Share
Shareholder Returns Annual Dividend per Share Annual 年間配当（左軸）dividend Payout ratio 配当性向（右軸） (¥) (left axis) (right axis) 35.0 100% 30.0 80% 25.0 20.0 60% No dividend due to reporting a loss 50% 15.0 Listed on the NASDAQ 40% Japan Market of the Osaka Stock Exchange 10.0 20% 5.0 0.0 0% '02/9 9/02 '03/
Slide 46: Key Performance Indicators
Key Performance Indicators Key Performance Indicators Target FY09/22 FY09/23 results forecast ROE 20% or more 18.9% 25.5% Ordinary profit margin 20% or more 17.0% 18.2% Payout ratio 50% or more 54.2% 38.9% Equity ratio 80% or more 57.2% 60.9% 46
Slide 47: Sustainability Management
Sustainability Management 47
Slide 48: Sustainability Management
Sustainability Management Sustainability Management 〇 As customers become more concerned with protecting their livelihoods, we recognize that it is becoming increasingly important for us to pursue the “logic of how to buy" and create a new insurance distribution market. To that end, we have decided
Slide 49: Building and Strengthening the Management Structure
Sustainability Management Building and Strengthening the Management Structure 〇 Continuously building and strengthening the management structure Financial HR investment Strategy Introduced ESOP Trust, Revised Compliance and Governance which supports employee personnel system and stock ownership plan
Slide 50: V. Supplementary Materials
V. Supplementary Materials 50
Slide 51: Company Overview
Supplementary Materials Company Overview Trade name Advance Create Co., Ltd. Representative Yoshiharu Hamada, President Nomura Fudosan Midosuji Building, 3-5-7 Kawaramachi, Location Chuo-ku, Osaka, Osaka Prefecture Established October 1995 Capital ¥3,158 million (as of September 30, 2022) Insurance
Slide 52: Analyst Reports
Supplementary Materials Analyst Reports o Please refer to the research reports by these external organizations for details on the Company’s history, earnings structure, and other information since its establishment. o These research reports will be updated as necessary based on the announcement of f
Slide 53: Disclaimer
Supplementary Materials Disclaimer The forward-looking statements included in this document and any related materials are based on currently available information, and may change due to macroeconomic conditions and trends in the industry in which the Company operates. Accordingly, please note that a
Slide 54: Inquiries
Inquiries Makoto Okita, General Planning Division TEL: +81-6-6204-1193 Email: acir@advancecreate.co.jp URL: https://www.advancecreate.co.jp/