Obic Business Consultants Co., Ltd. · TSE:4733

Obic Business Consultants — Q2 FY2022 Earnings Presentation

39 slides from Obic Business Consultants's earnings presentation, Oct 27, 2021

  1. Slide 1: Financial Results Briefing Materials for the Second Quarter of FY Ending March 2022

    Financial Results Briefing Materials for the Second Quarter of the Fiscal Year Ending March 31, 2022 OBIC BUSINESS CONSULTANTS CO., LTD （Code No. 4733） October 27, 2021 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved.

  2. Slide 2: Index

    Index 1. Summary of Financial Results for the Second P. ２ Quarter of the Fiscal Year Ending March 31, 2022 2. Key Indicators for the Second Quarter of the P. 12 Fiscal Year Ending March 31, 2022 3. Business Plan for the Fiscal Year Ending P. 21 March 31, 2022 4. Business Strategy for the Fiscal Year

  3. Slide 3: 1. Summary of Financial Results for the Second Quarter

    1. Summary of Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2022 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved. 2

  4. Slide 4: Summary of Financial Results for the Second Quarter

    Summary of Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2022  Solution sales: up 2,076 million yen (up 44.1%) Net Sales 16,265 million yen  Service sales: up 238 million yen (up 3.1%) （up 18.0%）  Total sales: up 2,485 million yen ( up 18.0%)  Raw material costs (A

  5. Slide 5: Summary of Financial Results for the Second Quarter

    Summary of Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2022 2Q FY ending 2Q FY ended Mar. 2021 Mar. 2022 2Q FY ending Mar. 2022 YoY change (%) Percentage of Initial Percentage of Increase/ YoY change (%) (Million yen) net sales (%) forecast net sales (%) Decrease Net

  6. Slide 6: Net Sales by Segment

    Net Sales by Segment 2Q FY ending 2Q FY ended Mar. 2021 Mar. 2022 2Q FY ending Mar. 2022 Description of sales by product category Percentage of Percentage of YoY change Initial forecast  Solutions （Million yen） net sales (%) net sales (%) (%)  With the end of support for the Bugyo 8 series (April

  7. Slide 7: Reference: Changes in Sales by Product Category

    Reference: Changes in Sales by Product Category Changes in sales by product category after the change in accounting method (cumulative total) (Million yen) 2019.3 2020.3 2021.3 2022.3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Solutions 2,068 5,129 8,815 12,428 3,045 6,269 8,649 11,011 2,180 4,709 7,

  8. Slide 8: Shipment Volume by Software Package

    Shipment Volume by Software Package (based on number of copies, including upgrades) 2Q FY ended Mar.2021 2Q FY ended Mar.2022 YoY change Percentage of Percentage of YoY change Number of Number of （Unit︓Copies） net sales (%) net sales (%) (%) new copies (%) upgrades (%) Bugyo V ERP 539 9.2 570 5.7 5.

  9. Slide 9: Breakdown of SG&A Expenses

    Breakdown of SG&A Expenses 2Q FY ended Mar. 2Q FY ending Mar. 2022 2021 Description of changes in selling, Percentage general and administrative expenses Percentage of YoY change (Million yen) net sales (%) of net sales (%) (%)  Personnel and R&D expenses Net sales 13,780 100.0 16,265 100.0 18.0 

  10. Slide 10: Balance Sheet—Assets

    Balance Sheet—Assets FY ended Sep. 2020 FY ended Mar. 2021 FY ended Sep. 2021 Percentage of Percentage of Percentage of YoY Increase/ QoQ Increase/ (Million yen) net sales (%) net sales (%) net sales (%) Decrease Decrease Current assets 116,795 80.2 124,849 78.8 127,003 77.8 10,208 2,154 Cash and de

  11. Slide 11: Balance Sheet—Liabilities and Net Assets

    Balance Sheet—Liabilities and Net Assets FY ended Sep. 2020 FY ended Mar. 2021 FY ended Sep. 2021 Percentage of Percentage of Percentage of YoY Increase/ QoQ Increase/ (Million yen) net sales (%) net sales (%) net sales (%) Decrease Decrease Total liabilities 23,354 16.0 29,799 18.8 29,839 18.3 6,48

  12. Slide 12: Summary of Cash Flow Statement

    Summary of Cash Flow Statement March 2021 September 2021 Major reasons for increase or decrease (Million yen) Cash flows from operating activities 11,918 6,752 Profit before income taxes 7,537 Depreciation 280 Increase in trade receivables 2,007 Decrease in unearned revenue -748 Income taxes paid -2

  13. Slide 13: 2. Key Indicators for the Second Quarter

    2. Key Indicators for the Second Quarter of the Fiscal Year Ending March 31, 2022 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved. 12

  14. Slide 14: Reviewing the Content of Information Disclosure in Response to the Global Offerings

    Reviewing the Content of Information Disclosure in Response to the Global Offerings Project Summary Purpose Fulfillment of the current stock ratio, which is a criterion for maintaining a listing on the prime market Offering structure Global Follow-on Offering (Regulation S / 144A) Shares for seconda

  15. Slide 15: Key Indicators

    Key Indicators Customer satisfaction survey※1 Recurring revenue rate※2 Number of systems in operation※3 Nikkei Computer, September 2, 2021 issue Customer satisfaction survey 2021 to 2022 65.4％ 262 thousand systems 1st place in ERP category Contract retention rate※4 ARR※5 ARPU※6 99.4％ 21.8 billion ye

  16. Slide 16: Recurring Revenue

    Recurring Revenue Recurring revenue1 accounts for 65％ of profit, showing high stability Sales composition ratio in the second quarter of the fiscal Steady growth in recurring revenue year ending March 31, 2022 (Comparison as of the second quarter) (¥, mn) (¥, mn) Recurring revenue Recurring revenue

  17. Slide 17: Changes in Net Sales and Operating Profit

    Changes in Net Sales and Operating Profit Changes in net sales by business segment※1 Changes in operating profit and operating margin※2 (Quarterly basis) (Comparison as of the second quarter) （Million yen） （Million yen） 10,000 Services（Maintenance） Solutions(Recurring) Solution(One time) Operating p

  18. Slide 18: Link between Recurring Revenue and Unearned Revenue

    Link between Recurring Revenue and Unearned Revenue Increasing deferred income improves our ability to accurately predict future prospects Changes in unearned revenue balance Earnings structure of on-premises and cloud (Comparison as of the second quarter) (¥, mn) On-premises SaaS ＋3.56 billion yen

  19. Slide 19: Number of Systems in Operation and Contract Retention Rate

    Number of Systems in Operation and Contract Retention Rate Cumulative number of systems in operation1 Number of years elapsed since system implementation2 （10K systems） 2015 26.2 ~1 year クラウド Cloud Cloud 10% オンプレミス On-premises Launch 15 years~ 32% 1-7 years 1995 38% Compatible with 7-15 years Window

  20. Slide 20: Changes in ARR

    Changes in ARR Breakdown of ARR changes※1 YoY （100 million yen） 210 218 ＋14.7％ 196 202 184 190 174 180 172 79 157 162 63 71 153 45 48 52 58 138 142 38 42 33 36 30 2 2 2 3 2 3 1 1 2 25 27 1 Solutions 1 2 1 1 Oter Maintenance 132 131 133 134 136 136 136 138 136 122 123 125 112 114 Q1 Q2 Q3 Q4 Q1 Q2 Q3

  21. Slide 21: Track Record of Cloud Revenue

    Track Record of Cloud Revenue Track record of cloud revenue for each quarter Track record of cloud ARR2 （¥, mn）4 YoY ＋49.4％ （¥, mn）4 ARPU1 ¥308,332 CAGR※3 Bugyo Cloud Edge Cloud ERP 7,850 1,973 ・Cloud ERP 87.4％ 7,059 ・Bugyo Cloud Edge 26.9％ 1,767 6,322 ・Cloud ARR in total 43.4％ 1,585 5,840 3,489 Bug

  22. Slide 22: 3. Business Plan for the Fiscal Year Ending March 31, 2022

    3. Business Plan for the Fiscal Year Ending March 31, 2022 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved. 21

  23. Slide 23: Plan Assumptions

    Plan Assumptions (Reference: Actual results Net sales Up 16.2% year-on-year 34 billion yen for the previous fiscal year) Reclassified based on the accounting method adopted in FY2022 ending March 31, 2022※1 First-half Second-half Full-year First half Second half Full year (Million yen) result plan p

  24. Slide 24: Full-Year Business Plan for the Fiscal Year Ending March 31, 2022

    Full-Year Business Plan for the Fiscal Year Ending March 31, 2022 FY ended Mar. 2021 FY ending Mar. 2022 (Plan) Percentage of Percentage of Increase/ YoY change (Million yen) net sales (%) net sales (%) Decrease (%) Net sales 29,252 100.0 34,000 100.0 4,748 16.2 Gross profit 24,521 83.8 28,470 83.7

  25. Slide 25: Net Sales by Segment

    Net Sales by Segment Net sales by product (plan) Description of sales plan by product  Solutions FY ended Mar. 2021 Plan for FY ending Mar. 2022  Capture demand for upgrades resulting from the Percentage of Percentage of Increase/Decre YoY change (Million yen) end of support for the Bugyo 8 series

  26. Slide 26: Net Sales by Segment (Half-Year Basis)

    Net Sales by Segment (Half-Year Basis) （Million yen） Figures before the fiscal year ended in March 2021 are Services reclassified based on the accounting method in the fiscal year ending in March 2022. 10,000 Solutions Related products Upgrade due to the end of Upgrade due to the end 8,709 9,000 sup

  27. Slide 27: Changes in Financial Results (Semi-annual basis)

    Changes in Financial Results (Semi-annual basis) （Million yen） Net Sales Operating profit 18,000 17,735 16,000 16,513 16,265 15,654 15,472 14,000 14,414 13,780 13,012 12,000 12,543 12,290 10,971 10,000 8,000 8,201 7,843 7,344 7,189 7,085 6,000 5,894 5,742 5,597 5,435 5,270 4,000 3,995 2,000 0 3/17 9

  28. Slide 28: 4. Business Strategy for the Fiscal Year Ending March 31, 2022

    4. Business Strategy for the Fiscal Year Ending March 31, 2022 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved. 27

  29. Slide 29: Main Activity Schedule for the Fiscal Year Ending in March 2022

    Main Activity Schedule for the Fiscal Year Ending in March 2022 April 2021 October March 2022 Subscription conversion (Bugyo Cloud, Bugyo V ERPSmart Plan, Bugyo Cloud Edge)） Promoting the upgrade of target products in the final year of support for the Bugyo 8 series Number of targets: 56,000 systems

  30. Slide 30: Future Growth Strategy

    Future Growth Strategy （C） Increase in unit price per customer through expanding applicable business domains using Bugyo Cloud Edge and increasing sales in the said business domains. Expansion of application areas in which software is used (Acceleration of DX) （A） Maintain high renewal rate and capt

  31. Slide 31: Future Growth Strategy (A): Up to Cloud Strategy

    Future Growth Strategy (A)Maintaining and Strengthening the Existing Customer Base through the Up to Cloud Strategy Number of years elapsed since system implementation1 Efforts to capture the demand for upgrades  Announcement two years ~1 year prior to the end of support (EOS) (Bugyo Cloud)  Onlin

  32. Slide 32: Future Growth Strategy (B): Acquire New Customers

    Future Growth Strategy (B) Acquire New Customers Japanese companies’ utilization rate of packaged software by application Utilization rate of packaged area software: Japan vs the US Strategies to acquire market share 55 （％） <Japan>  Product strategies 50 39 12%  Strengthen cloud-based software 36

  33. Slide 33: Future Growth Strategy (C): Increase Unit Price per Customer

    Future Growth Strategy (C) Increase in Unit Price per Customer through Expanding Applicable Business Domains Using Bugyo Cloud Edge and Increasing Sales in the Said Business Domains Automatic data Automation of Utilization and linkage business processes linkage of data Automatic journalizing of Auto

  34. Slide 34: Future Growth Strategy (C): Achievements and Growth Potential of Bugyo Cloud Edge

    Future Growth Strategy (C) Achievements and Growth Potential of Bugyo Cloud Edge ARR1 Achievements2 Penetration rates3 (¥, mn) ARR CAGR* <Product name> <Client companies/users> *19.3 Q1 to 22.3 Q1 4,361 4,160 3,891 14,000 companies My Number マイナンバー 3,754 27％ (Japanese 23% 3,456 (Bugyo Edge My Number

  35. Slide 35: Differentiation ①: Security with Native Development of Microsoft Cloud Technologies

    Differentiation ①: Security and Worry-free with Native Development of Microsoft Cloud Technologies 1. World-class security Utilize East Japan Data Robust data 24 hours a day, 365 days a Center as the main backup center and data protection through year operation monitoring Disaster recovery measures

  36. Slide 36: Differentiation ②: Native Cloud Development on Microsoft Azure

    Differentiation ② Implement Native Cloud Development Using Open Web Applications Based on Microsoft Azure System architecture of OBC products Features of OBC systems (a) (b) Responding to high-level operations Higher quality Functionality, speed, and operability ERP Peripheral Application (Bugyo ser

  37. Slide 37: Differentiation ③: Target Customers and Market Characteristics

    Differentiation ③ Target Customers and Market Characteristics Customer size Key players2 Key sales routes Market needs  Major system  Global ERP < 10,000 offices1 integrators  Multifunctionality  ERP for large-sized Japanese  Direct sale from  Customizability Employees corporations vendors 1,0

  38. Slide 38: Differentiation ④: Strong Partner Ecosystem with Three Partner Programs

    Differentiation ④ Strong Partner Ecosystem with Three Partner Programs 1 市場シェアトップの製品群 特許取得件数 100件 100 technology patents 300 seats in self-owned support center 390K inquiry calls annually 4M referred Web FAQs annually (Bugyo Cloud) Customer OBC Business Partner Connect Partner DX framework that link

  39. Slide 39: 2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved.

    2021 ©OBIC BUSINESS CONSULTANTS All rights Reserved. 38

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