M&a Capital Partners Co. Ltd. · TSE:6080
M&a Capital Partners — FY2023 Earnings Presentation
80 slides from M&a Capital Partners's earnings presentation, Oct 31, 2023
Slide 1: Presentation Materials for the Earnings Briefing for the Year Ended September 2023
Presentation Materials for the Earnings Briefing for the Year Ended September 2023 Oct 31st, 2023
Slide 2: Agenda
Agenda 1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 1 Earnings Briefing Presentation Materials
Slide 3: Consolidated Financial Highlights
Consolidated Financial Highlights Net sales achieved record high for FY09/23 Despite the low number of deals closed, we made steady progress in the number of active deals and in the hiring of consultants Net sales Ordinary income Contract liabilities (previously “advances received”) 20,851 (million
Slide 4: Results
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 3 Earnings Briefing Presentation Materials for FY0
Slide 5: Non-consolidated Financial Highlights for the Fiscal Year Ended September 30, 2023
Non-consolidated Financial Highlights for the Fiscal Year Ended September 30, 2023 Due to the boost provided by large deals that are highly profitable on stand-alone basis, net sales achieved a record high Lack of progress in winning new clients led to weakness at RECOF M&A Capital Partners Co., Ltd
Slide 6: Changes in Earnings
Changes in Earnings In the 10 years since listing (year ended September 2013), sales have increased by approx. 18x Units: Million of yens Progress for Entire Year Result for the year Forecast for the year □ Net sales (consolidated) 20,851 22,641 92.1% □ Ordinary income 7,470 9,003 83.0% (consolidate
Slide 7: Overview of FY09/23 Statements of Income (Consolidated)
Overview of FY09/23 Statements of Income (Consolidated) Net sales achieved record high (Units: millions of yen, second line is composition ratio) FY09/22 FY09/23 (Consolidated) (Consolidated) Year-on-year Change Main Factors Causing Change 20,706 20,851 ・ Boost provided by highly profitable large Ne
Slide 8: Overview of FY09/23 Balance Sheet (Consolidated)
Overview of FY09/23 Balance Sheet (Consolidated) Solid financial condition backed by stable shareholders equity (Units: millions of yen, second line is composition ratio) September 30, 2022 September 30, 2023 (Consolidated) (Consolidated) Change Main Factors Causing Change 36,717 39,977 Current asse
Slide 9: Number of Deals Made
Number of Deals Made Despite number of deals closed falling slightly year on year, closing of large, highly profitable deals resulted in higher sales Number of Deals Made Forecast for the year Number of deals (consolidated) (deals) Result for Forecast for vs. Forecast 240 Full year the year the year
Slide 10: Number of Active Deals (Non-consolidated)
Number of Active Deals (Non-consolidated) Active deals hit record of 417 (+31.5% year on year) Highly profitable large deals are on a rising trend Number of Active Deals (Non-consolidated) * Moving average: simple average for the end of each quarter for the most recent year in which the period is in
Slide 11: Number of Contract Liabilities
Number of Contract Liabilities 649 million yen contract liabilities (-24.7% year on year) Declined to the deals closed at the end of the fiscal year, but active deals are trending upward Number of Contract Liabilities * Moving average: simple average for the end of each quarter 契約負債 契約負債 移動平均※ for t
Slide 12: Number of Consultants
Number of Consultants Record high of 180 at the consolidated level (+18 year on year) Achieved continuously strong progress in terms of provisional offer acceptance of 34.2% vs. plan for recruitment in FY09/24 (25% increase for full year, to 188 persons on non-consolidated basis) *As of September 30
Slide 13: Consolidated Earnings Forecasts for the Fiscal Year Ending September 30, 2024
Consolidated Earnings Forecasts for the Fiscal Year Ending September 30, 2024 Earnings At non-consolidated level we anticipate the increase in active deals driving record Forecasts highs in the number of deals closed and in sales, while we expect productivity improvements at RECOF to lead to a recov
Slide 14: Non-consolidated Earnings Forecasts for FY Ending September 2024
Non-consolidated Earnings Forecasts for the Fiscal Year Ending September 30, 2024 Increase in active deals projected to achieve record highs in number of deals closed and in sales Background to earnings forecasts ●Year-on-year Change ・Recent recruitment of consultants has Net sales 20,675 million ye
Slide 15: Non-consolidated Earnings Forecasts: RECOF
Non-consolidated Earnings Forecasts for the Fiscal Year Ending September 30, 2024 Expect drastic increase in sharing of MACP know-how with RECOF to raise productivity and lead to recovery in sales and profits Background to earnings forecasts ●Year-on-year Change ・Strengthening recruitment and rejuve
Slide 16: Shareholder Returns
Shareholder Returns Based on a policy of balancing growth investments with fair shareholder returns, we plan to begin paying a dividend from the end of September 2023 Basic policy on distribution of profit Implement shareholder returns We aim to achieve continuous increases in based on dividends as
Slide 17: Growth Strategy
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 16
Slide 18: MACP Group Growth Strategy Going Forward
MACP Group Growth Strategy Going Forward To be the world’s leading investment bank To be the world’s leading One of the world’s investment bank leading M&A groups Flagship group that supports the Japanese economy Now Listed on Listed on Tokyo Stock Tokyo Stock Exchange Exchange Becoming the 2023-202
Slide 19: Brand
Brand Establishing the leading brand with a dominant presence that surpasses all others in the M&A intermediary industry 18 Earnings Briefing Presentation Materials for FY09/2023 ｜ Copyright © 2023 M&A Capital Partners Co., Ltd. All rights reserved
Slide 20: The MACP Group's Business Areas
The MACP Group’s Business Areas Providing the optimal M&A for every client Japan’s most professional M&A group Clients Clients Large corporations Industryrestructuring/Cross- border/Business Succession Medium-sized Financial advisory Business Succession enterprises Growth strategy support Small comp
Slide 21: Target Area for the MACP Group
Target Area for the MACP Group We support every client from small to large corporations with group synergy Domestic companies Main organizations capable Areas in which M&A Capital excels of operating in each area Large corporations Major financial institutions Medium-sized enterprises M&A intermedia
Slide 22: The MACP Group's Three-year Medium-term Vision
The MACP Group’s Three-year Medium-term Vision Three-year plan for the number of deals closed and the number of consultants required to achieve further growth FY09/2024 - FY09/2026 Number of deals Number of consultants M&A Capital Partners RECOF M&A Capital Partners RECOF 26 48 23 41 Average Average
Slide 23: Launch of Local Co-creation Project
TOPICS 1. Launch of Local co-creation Project Rolling out “Options for Business Succession and Growth” initiative in cooperation with newspapers nationwide Launching a project to strengthen dissemination of information in all regions, and to earn referrals to transferor companies San-in Chuo Shimpo
Slide 24: Setting up professional teams for each industry
TOPICS 2. Setting up professional teams for each industry We are establishing professional teams specializing in industries with a high level of M&A demand At the request of clients, we will establish a structure that maximizes the leverage of MACP’s track record and expertise Since the founding of
Slide 25: New campaign to further raise awareness of M&A
TOPICS 3. New campaign to further raise awareness of M&A Start of “Harebare,” the industry-first campaign that portrays the determination of wives of company owners, and the turning points of their lives By interviewing the wives of former company owners who achieved the transfer of the company thro
Slide 26: Launch of new television commercials
TOPICS 4. Launch of new television commercials Four new versions of the popular “lion president” television commercial have been launched From October 2023, a new “lion president” has been appearing on screen [Programs during which the commercial is shown] • TV Asahi Network HODO STATION (Monday to
Slide 27: Nationwide sole-sponsorship television program
TOPICS 5. Industry’s first sole-sponsorship program broadcast nationwide on terrestrial television Activities aimed at raising awareness of “Business Succession” as a leading company in the M&A intermediary industry Nationwide broadcast of television program discussing case studies of M&A deals in w
Slide 28: Further strengthening our industry-leading matching abilities
Further strengthening our industry-leading TOPICS 6. matching abilities Having also been reported in the media, awareness of the MACP Group is permeating financial institutions, leading to steady increases in alliance partners introducing us to transferee companies After commencing alliances with an
Slide 29: Commemorating the day RECOF was founded as M&A Day
Commemorating the day on which RECOF was TOPICS 7. founded as “M&A Day” 35 years after the founding of RECOF, the company that initiated M&A in Japan, the date of its establishment (December 10) has been designated “M&A Day” This is the first time that MACP Group has received an official designation
Slide 30: Advertising activities using the first TV commercials in the industry
Advertising activities using the first TV commercials in the industry Our role in raising awareness of “M&A” as a leading company in the M&A intermediary industry Since their launch in 2018, the popular “lion president” commercials have won unparalleled brand awareness Television commercial lineup -
Slide 31: Interviews with business owners: owner's choices
Advertising Activities to Raise Awareness of “M&A” Interviews with business owners who have actually experienced M&A: “owner’s choices” Web content that depicts the feelings of business owners as they come to a decision about M&A Examples of most recent deals https://www.ma-cp.com/case/success/ Firs
Slide 32: Advertising Activities to Raise Awareness of Fair M&A
Advertising Activities to Raise Awareness of “Fair M&A” MACP hosts seminars about its “Fair M&A” approach Offline seminars held in all parts of Japan Seminars tailored to specific industries Offline seminars are scheduled to be held in the Chugoku and Shikoku MACP’s top consultants talk about issues
Slide 33: Hosting of recruitment events
Hosting of recruitment events Monthly recruitment events held to hire the top talent in Japan With an eye on further growth, this is an initiative implemented to attract outstanding people Putting infrastructure in place to support future expansion, and further accelerating growth Event 1 MACP emplo
Slide 34: Company Overview
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 33
Slide 35: The M&A Capital Partners Philosophy
The M&A Capital Partners Philosophy Management Philosophy Aiming to be the world’s leading investment bank seeking maximum contributions to clients and the happiness of all employees Action Guideliness 1 2 3 We will continually pursue higher Our employees will achieve personal We are not a small-sca
Slide 36: Company Overview
Company Overview Trade Name M&A Capital Partners Co., Ltd. Listed Market Tokyo Stock Exchange Prime Market (Securities Code: 6080) Head Office Location 36F, Yaesu Central Tower, Tokyo Midtown Yaesu, Yaesu 2-2-1, Chuo-ku, Tokyo Business Content M&A-related services Representative Satoru Nakamura, Pre
Slide 37: History
History October 2005 Company ■ Company founded in Shinjuku-ku, Tokyo, for the purpose of carrying out M&A established intermediary business Relocation due to February 2007 growth of company ■ Head office relocated to Kojimachi 3-chome, Chiyoda-ku, Tokyo November 2013 Listed on Tokyo Stock ■ Listed o
Slide 38: Business Content
Business Content Business Content M&A-related services Characteristics We provide advisory services for the realization We propose M&A-focused solutions and support of M&A standing between the transferor (seller) them to implementation for company owners who and the transferee (buyer) from an indepe
Slide 39: Deals
Deals Pharmacy Wholesaling Manufacturing IT/information Real estate Retail and Other Building materials Pharmacy wholesaling industry services Real estate brokerage distribution Lease/rental Data mining Multi-unit apartment Temporary staffing Wooden building Metal products maintenance Investment Sup
Slide 40: Characteristics and Strengths of M&A Capital Partners
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 39
Slide 41: M&A Capital Partners Corporate Identity
M&A CAPITAL PARTNERS CORPORATE IDENTITY Aiming to be the world’s leading investment bank seeking maximum contributions to clients and the happiness of all employees What has never changed since the founding of the company is our approach of always prioritizing the needs of the customer. Even within
Slide 42: Fee Structure
Fee Structure Ever since the founding of the company we have maintained a clear “no commencement fee” structure, which has become the de facto standard in the M&A intermediary industry Conclusion of Due diligence Calculation of Finding the Deciding the Initial consultation agreement with transfer re
Slide 43: Intermediary commission rate
Intermediary commission rate Since the founding of the company we have prioritized the needs of the customer, and charged the lowest intermediary commission rates in the M&A intermediary industry How it differs from other fixed-fee systems (difference between usual Lehman Formula based on total asse
Slide 44: Large Deals Where M&A Capital Partners Excels
Large Deals Where M&A Capital Partners Excels Achieving an extraordinary average value of share transfer in the M&A intermediary industry by working on many difficult large deals Handling difficult large deals 21.5% 34 large M&A deals 1 in 5 deals Total number of are large deals with deals closed co
Slide 45: M&A Capital Partners Business Model
M&A Capital Partners Business Model A “distinctive M&A intermediary” that does not rely on just referrals A unique business model in the industry made possible by overwhelming ability to make direct proposals [MACP] Business model based on “ability to make direct proposals” [Other companies] Busines
Slide 46: M&A Capital Partners Corporate Identity: Human Resources
M&A CAPITAL PARTNERS CORPORATE IDENTITY Aiming to be the world’s leading investment bank seeking maximum contributions to clients and the happiness of all employees As well as being the driver of corporate growth, human resources are also the source of our unique brand. Since the founding of the com
Slide 47: Compensation Structure Attracting the Best Talent in Japan
Compensation Structure Attracting the Best Talent in Japan Average wages have been the highest in the industry for nine consecutive years, since the listing of the Company* Average annual salary for 2022 was 31.613 million yen ■ FY2023 (April-March) Top 5 Ranking Average annual income Average age Ra
Slide 48: Reasons the Best Talent in Japan is Required
Reasons the Best Talent in Japan is Required Highly specialized and diverse M&A operations Importance of a sense of responsibility and mission to growth the Japanese economy Content of highly specialized and diverse M&A operations (1) Consideration/preparation phase (2) Approach/negotiation phase (3
Slide 49: Program for Developing the World's Best Talent
Program for Developing the World’s Best Talent We have created a training program for further developing the best talent in Japan into the best talent in the world 1: Specialist knowledge OJT roadmap Workshops Knowledge test Company valuation training Training for each different phase of M&A 1 Role-
Slide 50: Corporate Culture That Has Achieved Unparalleled Growth
Corporate Culture That Has Achieved Unparalleled Growth in the M&A Intermediary Industry Individual growth is a source of growth of the organization as a whole Corporate culture that has emphasized teamwork, rooted in the management philosophy, since the founding of the company Point 1 Point Point W
Slide 51: Per-Person Productivity Unparalleled in the M&A Intermediary Industry
Per-Person Productivity Unparalleled in the M&A Intermediary Industry Unparalleled productivity per person in the M&A intermediary industry, proving that we have the best consultants in Japan Net sales Ordinary income per consultant per consultant 158.60 million yen 66.34 million yen (+9.5% year on
Slide 52: Large Number of Employees with Professional Qualifications
Large Number of Employees with Professional Qualifications Ratio of consultants holding professional qualifications easily surpasses competitors in M&A intermediary industry 13.7% of consultants hold professional qualifications Number of By type Ratio (%) persons Total number of Ratio of consultants
Slide 53: DNA Passed On from the Founders of M&A in Japan
DNA Passed On from the Founders of M&A in Japan Wholeheartedly responding to customers’ resolutions. M&A Capital Partners’ passion for customers since the company was founded M&A with heart Passion for customers that has continued since the company was founded in 1987 RECOF founder Masaaki Yoshida P
Slide 54: Management Philosophy
Management Philosophy M&A CAPITAL PARTNERS CORPORATE IDENTITY Aiming to be the world’s leading investment bank seeking maximum contributions to clients and the happiness of all employees 53
Slide 55: Our Contribution to Sustainability of Japanese Economy through M&A
Our Contribution to Sustainability of Japanese Economy through M&A Our contribution to the sustainability of the Japanese economy since the Company was founded is over 2 trillion yen In FY09/23, our contribution was 348.9 billion yen and 17,506 jobs in terms of sustainability of the Japanese economy
Slide 56: Social Significance of M&A Capital Partners
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 55
Slide 57: Social Significance (Purpose) of M&A Capital Partners
Social Significance (Purpose) of M&A Capital Partners Drive “fair M&A” to realize a sound future for the Japanese economy 56 Earnings Briefing Presentation Materials for FY09/2023 ｜ Copyright © 2023 M&A Capital Partners Co., Ltd. All rights reserved
Slide 58: What is the Fair M&A concept?
What is the “Fair M&A” concept advocated by M&A Capital Partners? Ever since the founding of the Company, our concept of “Fair M&A” has been that of a “client-first M&A” that prioritizes the interests of Social significance (purpose) the customer. Our role is to guide clients to the best option thro
Slide 59: Changes in the role played in the Japanese economy
Changes in the role played in the Japanese economy A new stage: from “succession” to “growth” The priority for small and medium enterprises is shifting from preservation to transformation and from static to dynamic Following on from our previous initiatives to resolve the problem of companies not ha
Slide 60: Social mission in Business Succession
The social mission we should fulfill in the area of Business Succession Business Save as many SMEs as possible from closure, and contribute to growth of Succession the Japanese economy through M&A Approx. 60,000 companies require support A social issue in the headlines Absence of approximately 1.27
Slide 61: Social mission in business growth
The social mission we should fulfill in the area of business growth Use M&A to create companies with sales of 10 billion yen and contribute Business growth to the growth of the Japanese economy Domestic companies Focus Ministry of Economy, Trade and Industry Sales by category Excerpts from “Interim
Slide 62: Closures of SMEs causing significant losses for the Japanese economy
Closures of small and medium enterprises that cause significant losses for the Japanese economy Despite the number of small and medium enterprises choosing suspension or closure decreasing for three consecutive years, the economic losses are increasing In the volatile external environment, the numbe
Slide 63: The M&A Option
The M&A Option M&A not only maintains employee jobs and relationships with business partners but also enables growth Personal suretyships are also lifted, making it the optimal means of Business Succession and business growth while maximizing founder’s profit Option Advantages Points to bear in mind
Slide 64: Business Succession M&A and Business Growth M&A
Business Succession M&A and Business Growth M&A “Business Succession M&A” resolving the absence of successor, which continues to be in demand “Business growth M&A” leading to growth with an eye to the future that has been increasing in recent years Management’s reasons for transferring the business
Slide 65: Continually Growing M&A Market
Continually Growing M&A Market The number of M&A deals involving Japanese companies declined by 11.8% in January to September 2023, but rose 11.3% in value terms By market, IN-IN and OUT-IN decreased, and IN-OUT increased ■ OUT-IN ■ OUT-IN M&A of Japanese companies by Latest foreign M&A of companies
Slide 66: Continually Increasing M&A Advisory Firms
Continually Increasing M&A Advisory Firms Number of registered M&A advisory firms is 3,011 M&A advisory firms established since 2020 account for approximately half of the total Number of M&A advisory firms registered with the Small and Cumulative total registrations by decade of establishment Medium
Slide 67: Coordinated Initiatives by Government and the Private Sector
Coordinated Initiatives by Government and the Private Sector to Address Social Issues We have begun working with the Small and Medium Enterprise Agency to provide managers of SMEs with understanding of M&A and enable M&A advisory firms to conduct appropriate M&A in order to resolve the Business Succ
Slide 68: Latest government-private sector initiatives
Latest government-private sector initiatives The SME M&A Guidelines were revised in September 2023 to address a variety of issues that had become apparent in the three years since it was originally formulated SME M&A Guidelines revised on September 22, 2023 Four key points of the revision (1) Organi
Slide 69: Opinions on business growth from the Small and Medium Enterprise Agency
Opinions on business growth from the Small and Medium Enterprise Agency The interim report of the Small and Medium Enterprise Agency from June 2023, introduced various companies that have achieved explosive growth Among these three patterns, it was suggested that the use of M&A is key An analysis wa
Slide 70: M&A Capital Partners' Sustainability Initiatives
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 69
Slide 71: Our Approach to Sustainability
Our Approach to Sustainability We will contribute to a sustainable future by encouraging the development of the Japanese economy and working to solve social problems. SDGs SDGs (Sustainable Development Goals): shared goals for international society to At a meeting held in November 2021, the create a
Slide 72: Material ESG issues
Material ESG issues Build a base for infrastructure and End poverty everywhere, technological innovation, and ensure healthy lives for all develop sustainable human Work together in settlements Decent work and partnership to economic growth Implementing Business Succession Develop industry through s
Slide 73: ESG initiatives
ESG initiatives Implement ESG initiatives through M&A-related service business Our approach to ESG Environment The sharp rise in suspensions and closures of SMEs in Japan is widely recognized to be an important issue. According to calculations made by the Small and Medium Enterprise Agency, if it is
Slide 74: Latest ESG initiatives
Latest ESG initiatives Co-sponsored as supplementary materials for career education promoted by the Ministry of Education, Culture, Sports, Science and Technology Provides explanations of the social significance of M&A and the content of M&A advisory work in a form that can easily be understood by e
Slide 75: Business Environment
1 Results P3 2 Growth Strategy P16 3 Company Overview P33 4 Characteristics and Strengths of M&A Capital Partners P39 5 Social Significance of M&A Capital Partners P55 6 M&A Capital Partners’ Sustainability Initiatives P69 7 Business Environment P74 74
Slide 76: Situation of small companies
Situation of small companies Continued high levels of closures, and bankruptcies that have begun to rise Highly volatile external environment is the cause Number of suspensions, closures and Number of bankruptcies dissolutions Every year, more than 50,000 business owners opt to Total liabilities exc
Slide 77: Situation of company presidents
Situation of company presidents Ages of company presidents are higher than ever The number of companies without successors also remains high Average age of company presidents 57.2% of companies do not have a successor Average age of CEO in 2021 was 61.0 60.3 Two in three companies do not have a succ
Slide 78: Problem of companies not having successors becoming apparent
Problem of companies not having successors becoming apparent So-called “2025 problem” approaching: concerns that businesses will collapse due to difficulties in finding successors to aging representatives FY2022 recorded new highs Number of bankruptcies caused by difficulties in finding successors W
Slide 79: Scale of the Business Succession M&A Market
Scale of the Business Succession M&A Market There is still a large Business Succession M&A market, and approaches will continue to be made to companies with business succession needs Targets of Business Succession M&A It is estimated that the targets for Business Succession M&A number around 250,000
Slide 80: Handling of These Materials
Handling of These Materials The plans, forecasts and strategies, etc. contained in these materials are forecasts on future performance based on information available at the time the materials were prepared, and these include inherent risk and uncertainty. Actual performance may differ from forecasts