Fuyo General Lease Co., Ltd. · TSE:8424
Fuyo General Lease — FY2023 Earnings Presentation
57 slides from Fuyo General Lease's earnings presentation, May 13, 2024
Slide 1: Financial Results Briefing for FY2023 IR Presentation
Financial Results Briefing for FY2023 IR Presentation Fuyo General Lease Co., Ltd. Securities code:8424 May 13, 2024
Slide 2: Agenda and definitions of figures and terms
１．Overview of consolidated operating results and business activities P3 ２. Medium-term Management Plan 「Fuyo Shared Value 2026」 P11 ３．Earnings forecast and dividend policy P43 ４．Appendix P47 Definitions of figures and terms used in this document Profit before funding ： Gross profit before deducting
Slide 3: FY2023 Overview of consolidated operating results
FY2023 Overview of consolidated operating results 3
Slide 4: FY2023 results
Overview of consolidated operating results and business activities 1 FY2023 results ⚫ Record-high earnings at all levels of profit due to growth of profit before interest expenses from continuous expansion of business areas, in addition to contributions from a gain on sale of large property and the
Slide 5: Profit before interest expenses; ordinary profit, profit and ROE
Overview of consolidated operating results and business activities ２ Profit before interest expenses ３ Ordinary profit , profit and ROE ⚫ Growth in businesses positioned as growth drivers ⚫ Renew record-highs for ordinary profit and profit contributed to growth in profit before interest expenses ⚫ M
Slide 6: Factors causing the increase in ordinary profit
Overview of consolidated operating results and business activities ４ Factors causing the increase in ordinary profit （¥100million） 4 Extraordinary factors -62 +20 -24 +198 -81 +44 Ordinary -8 Ordinary profit profit Ordinary Excluding extraordinary Profit factors 644 644 684 597 1 2 3 Profit before P
Slide 7: Changes in funding
Overview of consolidated operating results and business activities ５ Changes in funding ⚫ Outstanding balance increased due to the accumulation of operating assets. ⚫ Promoted diversification of funding through proactive leveraging of sustainable finance and conclusion of financial agreement with Ja
Slide 8: Changes in costs; net assets and equity ratio
Overview 決算概況 of consolidated operating results and business activities ６ Changes in costs 7 Net assets and the shareholders’ equity ratio ⚫ Increased personnel/equipment expenses were mainly ⚫ Accumulated net assets through stable profits and due to the Group’s expansion. increased foreign currency
Slide 9: Newly executed contract volume
Overview of consolidated operating results and business activities ８ Newly executed contract volume ⚫ Expansion of initiatives in energy & environment, real estate, and aircraft contributed to growth. ⚫ Newly executed operating lease contract volume, a focus of the current Medium-term Management Pla
Slide 10: Operating assets, ROA
Overview of consolidated operating results and business activities 9 Operating assets, ROA ⚫ Steadily accumulated mainly in business domains positioned as growth drivers. ⚫ In addition to the shift to a more profitable portfolio and expanding business areas, a gain on sale of large property also con
Slide 11: Medium-term Management Plan Fuyo Shared Value 2026
Medium-term Management Plan Fuyo Shared Value 2026 11
Slide 12: Overview of Fuyo Shared Value 2026
Medium-term Management Plan Overview of Fuyo Shared Value 2026 Pursuing sustainable growth as a corporate group by practicing CSV (Creating Shared Value) to resolve social issues while at the same time delivering economic value Vision for New Fuyo Shared Value 2026 Medium-term Achieving sustainable
Slide 13: Management Goals: Financial/Non-financial Goals
Management Goals Financial/Non-financial Goals • Pursue sustainable profit growth by further improving profitability and sustaining the growth we have achieved to date. • Enhance corporate value by realizing a decarbonized society and resolving other social issues. Management Goals Financial goals N
Slide 14: Financial/Non-financial Goals
Management Goals Financial/Non-financial Goals Results for Target value Item Remarks FY2023 for FY2026 Contribution to CO2 reduction 330,000 500,000 t-CO2/year t-CO2/year The amount invested in the promotion of Sum total over the medium-term decarbonization 151.3 billion 300.0 billion management pla
Slide 15: Changes in Results for Our Four Financial Goals
Progress of Medium-term Management Plan Changes in Results for Our Four Financial Goals ◼ Steady progress made on all four of our financial goals (i.e., ordinary profit, ROA (ratio of ordinary profit to operating assets, shareholders’ equity ratio, and ROE) toward targets for the final year of the p
Slide 16: Changes in Ordinary Profit by Business Domain
Progress of Medium-term Management Plan Changes in Ordinary Profit by Business Domain ◼ Profits grew and assets accumulated more than expected in Growing Performance, contributing significantly to profit growth. Continue to pursue steady revenue growth while keeping an eye on the balance of business
Slide 17: Progress of the CSV Management
Progress of Medium-term Management Plan Progress of the CSV Management ◼ Non-financial goals were set as indicators for practicing CSV. Overall, steady progress was made toward our targets for the final year of the medium-term management plan by steadily practicing CSV. ◼ Initiatives to finance deca
Slide 18: Improved External Ratings (ESG Finance Awards Japan/CDP)
Third-Party Evaluation Improved External Ratings (ESG Finance Awards Japan/CDP) Recognized in Japan and abroad for its commitment to sustainability The 5th ESG Finance Awards Japan CDP Climate Change Report/”A List” company ◼ Established a sustainable finance framework incorporating all our non- fin
Slide 19: Improved External Ratings: issuer ratings
External evaluation Improved External Ratings ◼ Rating agencies upgraded issuer ratings in Issue Rating recognition of improved earning power and Japan Credit Rating Rating and Investment financial health, and other factors. Agency, Ltd. Information, Inc. （JCR） （R&I） ◼ We aim to further improve rati
Slide 20: Business Domain-Specific Results and Topics
Business Domain-Specific Results and Topics 20
Slide 21: Zone Management
Positioning of Business Domains Zone Management • In addition to helping our customers resolve their management issues, we contribute to creating value through projects such as jointly run businesses with our partners. • Invest our management resources in the Transformation Zone in our efforts to al
Slide 22: Business Domain-Specific Results
General Business Domain-Specific Results FY2022 FY2023 YoY change Ordinary Operating Ordinary Operating Ordinary Operating （¥100million） ROA ROA ROA profit assets profit assets Profit assets Transformation 130 - 4,318 141 - 5,145 +11 - +827 （Rising + Accelerating） Rising Transformation 57 3.4% 1,713
Slide 23: Business Domain-Specific Results (Comments)
General Business Domain-Specific Results (Comments) Mobility • Ordinary profit grew mainly due to strong performance of the overseas business. • Operating assets increased by approximately 1.5 times (compared to the end of March 2023), partly due to the expansion of the renewable energy business. En
Slide 24: Rising Transformation Mobility (1)
Rising Transformation Mobility (1) Achieved high profit growth mainly overseas ■ Ordinary profit and ROA for the FY2023 Results （¥100 million） mobility business 63 ⚫ Ordinary profit grew mainly due to strong performance of the 57 overseas business. ⚫ The non-financial goals for the percentage of EVs
Slide 25: Mobility (2): Collaboration for Expansion of Business Domains
Rising Transformation Mobility (2) Collaboration for Expansion of Business Domains Expansion of the business domain through collaboration with partners Folofly/Capital and business alliance Vehicles area ◼ This capital and business alliance aims to advance the penetration of EVs in the commercial se
Slide 26: Circular Economy
Rising Transformation Circular Economy（CE） Realizing a circular society through Fuyo Circular Economy LeaseⓇ Established business alliances with seven Received the Selection Committee Chairman Award nationwide leasing companies (Circular Economy Award) at ESG Finance Awards Japan sponsored by the Mi
Slide 27: Energy & Environment (1)
Accelerating Transformation Energy & Environment (1) Steady progress made in building up assets to achieve profit growth ■Ordinary profit and ROA （￥100 million） for the Energy & Environment business FY2023 Results Operating 1,262 1,820 ⚫ Operating assets expanded to approximately 1.5 times (compared
Slide 28: Energy & Environment (2) Expansion of Business Domains
Accelerating Transformation Energy & Environment (2) Expansion of Business Domains In addition to expanding the overseas renewable energy business, new initiatives are also underway in Japan. U.K./ Established New domain Renewable energy Japan/ Off-site* corporate PPA (secondary energy, etc.) a loca
Slide 29: Global expansion of renewable energy power generation business
Energy & Environment (3) Accelerating Transformation Development of Renewable Energy Business Global expansion of renewable energy power generation business ●OECD countries*/ Renewable energy development loan fund ●U.K./ Offshore wind power *For Europe, North America, and Asia Pacific regions genera
Slide 30: BPO/ICT (1)
Accelerating Transformation BPO/ICT（1） Aiming for profit growth through top-line expansion and pursuit of efficiency ■Ordinary profit and ROA for the BPO/ICT business （￥100 million） FY2023 Results The ROA figures shown here are based on the results from the ICT business. ⚫ Ordinary profit maintained
Slide 31: BPO/ICT (2) Building a New Business Model
Accelerating Transformation BPO/ICT（2） Building a New Business Model and Improving Operational Efficiency Joint development of consulting and products through BPO×ICT Realization of business innovation, efficiency improvement, and DX for our customers Fuyo Lease Group (AKARI refers to a business par
Slide 32: Healthcare (1)
Accelerating Transformation Healthcare（1） Progress in initiatives to expand the business domain, but revenue growth remains a work in progress ■Ordinary profit and ROA for the Healthcare business FY2023 Results 18 （￥100 million） 18 • Operating assets were not increased, and ordinary profit remains f
Slide 33: Healthcare (2) Healthcare Platform Concept
Accelerating Transformation Healthcare（2）Healthcare Platform Concept Appendix Expanding and strengthening functions of the Healthcare Platform Concept Functions provided and issues identified Business development Products provided Alliance Capital investment and Energy-saving Lease Loan Factoring wo
Slide 34: Real Estate
Growing Performance Real Estate Ordinary profit expanded partly due to the recording of a gain on large sale ■ Ordinary profit and ROA for the Real Estate business FY2023 Results （￥100 million） 312 ⚫ In addition to an increase in base revenue, the recording of a gain on large sale also significantly
Slide 35: Aircraft
Growing Performance Aircraft Focus on further revenue enhancement by driving asset turnover-type businesses ■Ordinary profit and （¥100 million） ROA for the Aircraft FY2023 Results business 51 ⚫ In FY2023, the accumulation of 9 self-owned aircraft progressed, mainly for North American airlines. 42 ⚫
Slide 36: Towards Sustainable Value Creation
Towards Sustainable Value Creation 36
Slide 37: Non-financial Goals and Business Domains
Non-financial Goals and Business Domains Non-financial Goals and Business Domains Realizing a prosperous society and contributing to sustainable growth Expanding business domains and promoting further evolution in our relentless attempt to create new value Anticipating social changes and taking on t
Slide 38: Initiatives to Reduce Greenhouse Gas Emissions
Realization of a decarbonized society Initiatives to Reduce Greenhouse Gas Emissions Avoided emissions in the Group Avoided emissions by customers and communities Joined RE100 2012 Started renewable energy support for renewable energy-related Investment in and commercialization (first by Japanese co
Slide 39: Establishment of Fuyo Shared Value Creation Center
Investment in human capital Establishment of Fuyo Shared Value Creation Center The Fuyo Shared Value Creation Center, a dedicated training facility, was launched in March 2024 to provide an environment more conductive to ‘learning’ We expect to achieve our non-financial goal, the target of 300% for
Slide 40: Investment in Human Resources
Investment in human capital Investment in Human Resources Establish the “Fuyo Shared Value Creation Center,” an ecosystem for growth and learning, while at the same time promoting an unprecedented and aggressive investment in human resources in an attempt to develop high-value-added human resources
Slide 41: DX Strategy
Digital Transformation DX Strategy Goal of our DX strategies To create long-term shared value by utilizing digital technology to ensure that the value we provide to the society continues to evolve to adapt to the ever-changing external environment Address social issues by effectively utilizing digit
Slide 42: Fund Procurement through ESG Finance
ESG Finance Fund Procurement through ESG Finance Pursuing the CSV-oriented business strategies and ESG finance initiatives in terms of funding. Strengthen engagement on climate change and social issues through ESG finance. Sustainable Finance Framework established with the aim of strengthening fundi
Slide 43: Earnings forecast and dividend policy
Earnings forecast and dividend policy 43
Slide 44: FY2024 consolidated earnings forecast
Earnings forecast and dividend policy 1 FY2024 consolidated earnings forecast FY2023 FY2024 （¥100 million） Results Forecast Operating profit 600 600 Ordinary profit 684 660 Profit attributable owners of parent 472 450 Basic earnings per share（¥） 1,571.44 1,496.71 （Note）Previously up until FY2023, co
Slide 45: Earnings forecast and dividend forecast
Earnings forecast and dividend forecast Supplementary explanation concerning earnings forecast <ordinary profit> Interim goal set for ordinary ⚫ FY2023 Results profit in the current Medium- Earnings were lifted through continuous business growth, and extraordinary factors such as gain on term Manage
Slide 46: Dividend policy
Earnings forecast and dividend policy ２ Dividend policy Total dividend is ¥440, which is ¥50 higher than the year beginning dividend forecast FY2023 results (¥390).Dividend payout ratio is 28.0%. FY2024 forecast Forecasting ¥450 per share dividend (up ¥10 YoY), payout ratio of 30.1% (up 2.1 percenta
Slide 47: Appendix
Appendix 47
Slide 48: Key topics (1)
Appendix 1 Key topics（1） Healthcare Established a “region-specific healthcare fund” management company to provide optimal solutions to medical and nursing care providers Energy & Launched commercial operation of a large-scale “Samegawa Aono Solar Power Plant” in Environment Fukushima Prefecture 1Q I
Slide 49: Key topics (2)
Appendix 1 Key topics（2） Energy & Photon Taiwan Fund, construction of a 120MW solar power plant in Taiwan Environment Green power to be supplied to semiconductor manufacturing company Signed a business alliance agreement to promote the “circular economy leasing” Circular Economy - Business alliance
Slide 50: Key topics (3)
Appendix 1 Key topics（3） Formed a business alliance with HiBot, a start-up company originating from Tokyo Institute of Technology, in the area of RaaS business for facility maintenance, including non-destructive testing Concluded a financial agreement with the Japan Bank for International Cooperatio
Slide 51: Summary of consolidated operating results
Appendix 2 Summary of consolidated operating results （¥100million） YoY Change FY2019 FY2020 FY2021 FY2022 FY2023 （amount） Net sales 7,123 7,403 6,578 6,887 7,085 +199 Cost of sales 6,265 6,478 5,596 5,804 5,800 -4 Profit before interest expenses 858 925 982 1,083 1,286 +203 Interest expenses 94 98 9
Slide 52: Segment results
Appendix 3 Segment results Leases Installment sales Leases and installment sales total （¥100million） YoY YoY YoY YoY YoY YoY FY2022 FY2023 Change Change FY2022 FY2023 Change Change FY2022 FY2023 Change Change （amount） （％） （amount） （％） （amount） （％） Net sales 5,818 5,913 +95 +1.6% 301 285 -16 -5.2% 6,
Slide 53: Operating assets
Appendix ４ Operating assets YoY YoY （¥100million） FY2019 FY2020 FY2021 FY2022 FY2023 Change Change （amount） （％） Leases 16,136 17,133 16,916 16,882 17,949 +1,067 +6.3% Finance leases (11,068) (10,808) (10,198) (8,908) (8,587) (-321) (-3.6%) Operating leases (5,068) (6,325) (6,718) (7,974) (9,361) (+1
Slide 54: Newly executed contract volume
Appendix ５ Newly executed contract volume YoY YoY （¥100million） FY2019 FY2020 FY2021 FY2022 FY2023 Change Change （amount） （％） Leases 5,445 4,536 4,741 4,611 6,077 +1,467 +31.8% Finance leases (3,654) (3,080) (2,594) (2,291) (2,490) (+199) (+8.7%) Operating leases (1,791) (1,455) (2,147) (2,320) (3,5
Slide 55: Newly executed lease contract volume (by type of equipment)
Appendix ６ Newly executed lease contract volume (by type of equipment) YoY Change セグメント名（¥100million） FY2021 FY2022 FY2023 (amount) IT & office equipment 1,254 1,217 1,266 +49 Industrial machinery 224 105 115 +10 Civil engineering and construction machinery 61 36 25 -11 Transportation equipment 606
Slide 56: Summary of the operating results of the major subsidiaries
Appendix ７ Summary of the operating results of the major subsidiaries Sharp Finance Corporation Fuyo Auto Lease Co., Ltd. YAMATO LEASE CO., LTD. Accretive Co., Ltd. (ownership ratio: 65%) (ownership ratio: 100%) (ownership ratio: 60%) (ownership ratio: 74%) FY2022 FY2023 YoY change FY2022 FY2023 YoY
Slide 57: Going Where No One Has Gone Before
“Going Where No One Has Gone Before” 57