Kantsu Hd Co. Ltd. · TSE:9326
Kantsu Hd — Kantsu — Q1 FY2/22 Earnings Presentation
48 slides from Kantsu Hd's earnings presentation, Jul 14, 2021
Slide 1: Results of Operations for the First Quarter of the Fiscal Year Ending February 28, 2022
Results of Operations for the First Quarter of the Fiscal Year Ending February 28, 2022 KANTSU CO., LTD. (Securities code: 9326) July 14, 2021
Slide 2: Contents
Contents I. Company Profile ………… 3 II. Our Services ………… 7 III. KANTSU’s Strengths ………… 16 IV. 1Q FY2/22 Financial Summary ………… 22 V. FY2/22 Earnings Forecasts ………… 33 VI. Medium-term Business Plan ………… 38 2
Slide 3: I. Company Profile
I. Company Profile 3
Slide 4: 1. Company Profile
1. Company Profile KANTSU provides logistics services centered on the EC and catalog logistics sectors and IT automation services centered on the Cloud Thomas warehouse management system. Company name KANTSU CO., LTD. Offices Head office: 1-8-13 Nagata, Higashi Osaka city, Osaka Osaka Branch Office:
Slide 5: 2. History
2. History KANTSU has grown rapidly since 2010 along with the expansion of the e-commerce market. KANTSU formed a capital and business alliance with Rakuten Inc. in February 2019 and was listed on the Tokyo Stock Net sales Exchange Mothers Market in March 2020. (Millions of yen) Founding and early y
Slide 6: 3. Overview of KANTSU's Services
3. Overview of KANTSU’s Services Always using successful activities in EC/catalog logistics services to add new services IT automation business Rakuten Super Logistics services (Cloud Thomas, Annie and other systems) Efficient software created Reputation for thorough logistics services from ideas in
Slide 7: II. Our Services
II. Our Services 7
Slide 8: 1. Logistics Services Business
1. Logistics Services Business EC/catalog logistics support services The core business at the center of growth of KANTSU’s performance KANTSU operates distribution centers for other companies by handling incoming/outgoing shipments, inventories and other operations for EC, catalog and other customer
Slide 9: 1. Logistics Services Business
1. Logistics Services Business Strengthen cold chain logistics services Rakuten Super Logistics services We plan to strengthen logistics for frozen and refrigerated food products, which is expected to be a KANTSU and Rakuten established a capital and growing component of the EC/catalog logistics sup
Slide 10: 1. Logistics Services Business
1. Logistics Services Business Outsourced order processing services Logistics consulting services These upstream support services for EC/catalog By using knowledge gained from providing EC/catalog logistics enable companies to use KANTSU for logistics support services, KANTSU has a consulting confir
Slide 11: 2. IT Automation Business
2. IT Automation Business The software sales business is based on advances originating from our own logistics operations. Major products include the Cloud Thomas warehouse management system for high-quality logistics and the Annie check list system that also started from ideas in our front-line oper
Slide 12: 2. IT Automation Business
2. IT Automation Business The software sales business is based on advances originating from our own logistics operations. Major products include the Cloud Thomas warehouse management system for high-quality logistics and the Annie check list system that also started from ideas in our front-line oper
Slide 13: 2. IT Automation Business
2. IT Automation Business Transforming successful activities at KANTSU into services to sell to other companies has the benefits of improving satisfaction for current customers and attracting new customers. During FY2/21, we used this process to launch the e.can and ippo! services. ippo! – A robotic
Slide 14: 3. Other Businesses
3. Other Businesses Education services for people with a developmental disability After-school daytime classes for children with a developmental disability Operating after-school day classes for children with a developmental disability helps these children develop skills and become more independen
Slide 15: 4. Recent Topics
4. Recent Topics Completion of GLP Amagasaki III, our specialized D-to-C Distribution Center GLP Amagasaki III started operating on June 1, 2021, a specialized D-to-C Distribution Center with a floor area of about 17,200m2. This is KANTSU’s third major distribution center along with the Kansai Prima
Slide 16: III. KANTSU's Strengths
III. KANTSU’s Strengths 16
Slide 17: 1. A Large and Growing Number of Customers
1. A Large and Growing Number of Customers Growth backed by new customers as well as sound relationships with current customers Net sales (Area) (Millions of yen) (100 tsubo*) 12,000 700 売上高（百万円） Net sales (Millions of yen) 物流拠点坪数（百坪） Floor area of distribution centers (100 tsubo) 10,756 600 10,000
Slide 18: 1. A Large and Growing Number of Customers
1. A Large and Growing Number of Customers Support for logistics in many sectors Steady growth of sales from outsourced logistics operations Sales Composition by Market Sector (FY2/21 results) Net sales 1% Average Monthly Sales Per Client Company 3% 9% (Thousands 社 of yen) 3% 27% 7,000 社 6,063社 7% 6
Slide 19: 1. A Large and Growing Number of Customers
1. A Large and Growing Number of Customers New customers contribute to The number of new customers is increasing KANTSU’s growth every year but relationships of at least four years are still about half of all customers Cumulative Sales from New Customers (Millions of yen) We maintain logistics suppo
Slide 20: 2. Ability to Attract New Customers
2. Ability to Attract New Customers We use study tours of warehouses, web marketing and other activities to establish relationships with new customers. Warehouse Study Tours (Seminars) Web Marketing Warehouse Study Tours have hosted more than 200 people We started using the internet more than 10 yea
Slide 21: 3. Recruiting, Training and Productivity
3. Recruiting, Training and Productivity To maintain a well-trained and motivated workforce, we have a recruiting activities as well as measures to strengthen training programs, improve evaluation systems and make other improvements. ■Recruiting ■Training and Productivity ・Started using foreign tech
Slide 22: IV. 1Q FY2/22 Financial Summary
IV. 1Q FY2/22 Financial Summary 22
Slide 23: 1. 1Q FY2/22 Financial Highlights
1. 1Q FY2/22 Financial Highlights Sales were 25.2% higher than one year earlier and operating profit was up 322.1%. In EC/catalog logistics support services, new customers started generating sales faster than expected. In warehouse management systems, the number of Cloud Thomas contracts increased a
Slide 24: 2. 1Q FY2/22 Results Summary
2. 1Q FY2/22 Results Summary Sales and earnings increased due to strong growth of sales in the logistics services business and IT automation business. (Millions of yen, %) 1Q FY2/21 1Q FY2/22 YoY change % to net % to net Results Results Amount % sales sales Net sales 2,179 100.0 2,727 100.0 548 25.2
Slide 25: 3. Quarterly Results Summary
3. Quarterly Results Summary Sales continued to increase from quarter to quarter because of new customers in FY2/21 and faster than expected sales from new customers in 1Q FY2/22. (Millions of yen, %) FY2/21 FY2/22 Vs. 2Q 2Q initial 2Q revised 1Q 2Q 3Q 4Q 1Q FY plan initial plan plan plan Net sales
Slide 26: 4. Analysis of Change in Net Sales
4. Analysis of Change in Net Sales (1) Higher sales of EC/catalog logistics (2) (3) (4) support services (1) Switch of cargo transport rate contracts for some customers reduced sales but sales were higher because of sales from new customers in FY2/21 and faster than expected sales from new customers
Slide 27: 5. Analysis of Change in Operating Profit
5. Analysis of Change in Operating Profit (1) Higher gross profit in the logistics services (3) business Mainly due to higher sales in the EC/catalog logistics support (1) services category (2) +163 million yen YoY (2) Higher gross profit in the IT automation business (4) Higher earnings as the cont
Slide 28: 6. Business Segments (1) Logistics Services Business
6. Business Segments (1) Logistics Services Business • EC/catalog logistics support services increased 481 million yen (23.5%) because of the growth of services provided to existing customers and the faster than expected start of sales from new customers. • Faster than expected sales from new custom
Slide 29: 6. Business Segments (2) IT Automation Business
6. Business Segments (2) IT Automation Business • Segment sales increased 73 million yen (118.1%) primarily because of the increasing number of Cloud Thomas contracts and higher sales of logistics automation hardware as the number of Cloud Thomas users increased. • Segment profit increased 9 million
Slide 30: 6. Business Segments (3) Other Businesses
6. Business Segments (3) Other Businesses • Other education services are performing well, including the employment assistance service for people with developmental disabilities, which started operating in December 2020. There were no new services involving technology education for foreign trainees b
Slide 31: 7. Condensed Balance Sheet
7. Condensed Balance Sheet As of Feb. 28, 2021 As of May 31, 2021 (Millions of yen, %) YoY change Amount Composition Amount Composition Increase mainly due to Current assets 4,142 55.0 4,458 55.3 315 exercise of share acquisition rights Cash and deposits 2,592 34.4 2,941 36.5 348 Accounts receivable
Slide 32: 9. Capital Expenditures
9. Capital Expenditures Plan and Actual Expenditures (As of May 31, 2021) (Millions of yen) Payment Project Purpose Plan Start/Finish made Payments made Construction of Tokyo More space for current Lease deposits 133 million yen Dec. 2019 Others 2 million yen Primary Center customers and space for n
Slide 33: V. FY2/22 Earnings Forecasts
V. FY2/22 Earnings Forecasts 33
Slide 34: 1. FY2/22 Earnings Forecasts
1. FY2/22 Earnings Forecasts • Forecast net sales to increase 12.9% YoY and higher earnings at all levels (Millions of yen, %) FY2/21 Results FY2/22 Forecasts YoY change % to net % to net Results Forecasts Amount % sales sales Net sales 9,530 100.0 10,756 100.0 1,226 12.9 Gross profit 1,126 11.8 1,6
Slide 35: 2. Business Segments (1) Logistics Services Business
2. Business Segments (1) Logistics Services Business • Two new distribution centers in Amagasaki, Hyogo prefecture (total of about 35,700 m ) due to 2 the continuing growth of the EC/catalog logistics support services market. • Forecast a reduction of about 800 million yen in projected cargo transpo
Slide 36: 2. Business Segments (2) IT Automation Business
2. Business Segments (2) IT Automation Business • In addition to the Cloud Thomas warehouse management system, we are adding Cloud Thomas Pro, which can be customized to match each customer’s requirements and scale of operations, to serve a broader range of customers. • Cloud Thomas sales are foreca
Slide 37: 2. Business Segments (3) Other Businesses
2. Business Segments (3) Other Businesses • Sales of technology education services for foreign trainees are expected to decrease because of COVID-19 and political instability in Myanmar. But segment sales are forecast to increase 33.1% to 28 million yen because of the expected sales of the employmen
Slide 38: VI. Medium-term Business Plan
VI. Medium-term Business Plan －2024－ 38
Slide 39: 1. Medium-term Business Plan Overview
1. Medium-term Business Plan Overview • The goal is net sales of 15.3 billion yen and operating profit of 1.0 billion yen in FY2/24 by achieving growth that outpaces the e-commerce market’s expansion. (Millions of yen, %) FY2/22 FY2/23 FY2/24 YoY YoY YoY % to net % to net % to net Plan change Plan c
Slide 40: 2. Medium-term Plan for Business Segments
2. Medium-term Plan for Business Segments • In the logistics services business, the goal is to use capital expenditures for distribution center expansion and robots and other automated logistics equipment in order to grow faster than the e- commerce market. • In the IT automation business, the goal
Slide 41: 2. Business Segment Sales Plan
2. Business Segment Sales Plan • KANTSU aims for net sales of 14.2 billion yen in the logistics services business and of 1.0 billion yen in the IT automation business in FY2/24. (Millions of yen) 16,000 155 15,000 1,000 14,000 13,000 126 800 12,000 11,000 14,215 115 10,000 349 12,178 86 9,000 297 10
Slide 42: 3. Market Conditions
3. Market Conditions Expect the e-commerce market to continue growing strongly Market size EC ratio (100 millions of yen) (%) 250,000 8.00% 6.76% 7.00% 6.22% 200,000 5.79% 6.00% 5.43% 193,609 179,845 4.75% 5.00% 150,000 165,054 4.37% 151,358 3.85% 137,746 4.00% 3.40% 127,970 3.17% 100,000 2.84% 111,
Slide 43: 3. Market Conditions
3. Market Conditions Growth is continuing in the merchandise sales category, the largest component of KANTSU’s customer base B-to-C EC Sector – Market Category Size and Composition Ratio B-to-C EC Sector Merchandise Sales for Product Categories Growth 2018 2019 2018 2019 ratio Market size Classifica
Slide 44: 4. Growth Strategy
4. Growth Strategy 1 New large refrigerated and frozen warehouses • Strengthen logistics sales services for refrigerated/frozen food EC, a category expected to continue growing January 2022 (planned) Automated warehouse with 1,050 pallets for frozen merchandise (1,323 ambient temperature pallets) EC
Slide 45: 5. Internal Strategy that Supports the Growth Strategy
5. Internal Strategy that Supports the Growth Strategy １ Strengthen activities using the internet to attract new customers • Use SEO, an internet advertising strategy and remote sales meetings for effective activities to establish relationships with new customers Use automated logistics equipment an
Slide 46: 6. KPI Number of New Customers
6. KPI Number of New Customers Net sales (Plan) Sales from New Customers (Plan) Contracts at End of Fiscal Year (Millions of yen) Cloud Thomas EC/catalog logistics support services 15,000 Companies 900 830 13,000 1,165 800 1,821 910 700 11,000 817 600 590 408 9,000 642 500 321 400 7,000 2,740 300 23
Slide 47: 6. KPI Scale of Operations and Efficiency
6. KPI Scale of Operations and Efficiency • Plan to complete a 27,400m2 distribution • Sales per tsubo and the utilization rate are expected center in Niiza (Saitama prefecture) at the end to temporarily decrease in FY2/22 because of the of FY2/22 (earlier than originally planned) new Niiza distribu
Slide 48: Disclaimer
Disclaimer Disclaimer and Precautions Concerning Forward-looking Statements ■ Information in this presentation and associated materials contains forward-looking statements. These statements are based on the current outlook and forecasts as well as on assumptions that incorporate risk. All forward-lo