Slide 1: Explanation of financial results: full-year FY ended March 2009
NEXT Co., LTD. TSE Mothers: 2120 Explanation of financial results Full-year financial results for fiscal year ended March 2009 (April 2008 through March 2009) The opinions and projections contained in this document were formulated based on assessments by NEXT CO. LTD at the time the document was cre
Slide 2: Contents
Consolidated financial results for the 4thQ ・・・P 3-15 Full-year financial results for term ended March 2009 ・・・P 16-25 Business performance predictions for full financial year ending March 2010ーMid-term Corporate Vision 2nd term ・・・P 26-36 NEXT Co., LTD. Returning Profits to Shareholders ・・・P 37 Man
Slide 3: Consolidated fiscal period: 4thQ financial results
Quarterly NEXT Co., LTD. TSE Mothers: 2120 Quarterly Consolidated fiscal period: 4thQ －For financial year ended March 2009 Financial results Copyright (c) 2009 NEXT CO.,LTD. All Rights Reserved.
Slide 4: 4thQ Financial Results: sales up 21.1%, operating income down 17.1%
Quarterly Consolidated 4thQ Financial Results Consolidated fiscal period: 4thQ Increase Increase Fall Fall in in Sales increased 21.1% on a year-to-year basis, while Operating Income fell by 17.1% Po int in in revenue revenue profits profits due to prior investment Year- Year-to- to-year change Item
Slide 5: Change in operating profit and loss through the 4thQ
Quarterly Consolidated 4thQ Financial Results Change in operating profit and loss through the 4thQ Achieved record-high quarterly sales. Moderate increase in expenses other than labor costs and Po int advertisement expenses required for prior investment FY ended Mar 2008 FY ended Mar 2009 Unit: mill
Slide 6: Quarterly change in expense-sales structural ratio
Quarterly change in expense-sales Quarterly Consolidated 4thQ Financial Results structural ratio Drastic increase in labor costs and advertisement expenses required for prior investment, structural Po int ratio of fixed costs decreased Unit: Amount Structural ratio million yen FY ended Mar 2008 FY e
Slide 7: Quarterly change in profit and loss by segment
Quarterly Consolidated 4thQ Financial Results Quarterly change in profit and loss by segment Operational deficit for warranty affairs business reduced, while the financial status of other Po int businesses showed quarterly profit for the first time Unit: million yen 700 FY ended Mar 2008 FY ended Ma
Slide 8: Quarterly change in sales by service sector
Quarterly Consolidated 4thQ Financial Results Quarterly change in sales by service sector Po int Sales growth marked for almost all services on a year-to-year, quarter-to-quarter basis FY ended Mar 2008 FY ended Mar 2009 Unit: million yen Service 4Q of FY ended 3Q 4Q 1Q 2Q 3Q Mar 2009 (Oct-Dec) (Jan
Slide 9: Quarterly change in sales
Quarterly Consolidated 4thQ Financial Results Quarterly change Continuing record-high-level quarterly sales thanks to steady development despite severe economic Po int depression Unit: million yen FY ended Mar 2008 FY ended Mar 2009 2,518 2,500 2,276 Other (Other businesses) 2,080 2,135 1,997 Renter
Slide 10: Monthly change in major indicators for real estate lease and transactions: 1
Monthly change in major indicators for Quarterly Consolidated 4thQ Financial Results “Real estate lease and transactions”: 1 Po int Sales growing at a steady pace due to an increased No. of affiliated stores and strong option sales No. of affiliated Average sales FY ended stores Mar 2007 FY ended Ma
Slide 11: Option sales ranking for real estate lease and transactions
Option sales ranking for real estate lease Quarterly Consolidated 4thQ Financial Results and transactions Po int New Service: Sales personnel search newly ranked at No. 5 ！ Rank Option Check Previous Previousterm term Rank Option name name Still in 1st place HOME’S special advertising box (ad points
Slide 12: Monthly change in major indicators for real estate lease and transactions: 2
Monthly change in major indicators for Quarterly Consolidated 4thQ Financial Results “Real estate lease and transactions”: 2 Sharp increase in number of articles posted due to launch of a billing system according to the number Po int of PVs Unit: 10,000 cases Unit: million PV FY ended Mar 2007 FY en
Slide 13: Other topics: Summary
Quarterly Consolidated 4thQ Financial Results Other topics: Summary Contribution from booming mobile-phone viewing of “Real Estate Portal”, improved collection rate for Po int “warranty affairs” Real estate portal business Larger firm that had left our network in Jun 2008 rejoined in Feb 2009. No. o
Slide 14: Other topics (Real estate portal business): 1
Other topics Quarterly Consolidated 4thQ Financial Results (Real estate portal business): 1 Organizing on-site events led to advertising effectiveness and stimulated demand for changing Po int residences ！ Check (1) Jan 24-25, 2009 “HOME’s Fukuoka Living Fair＠Tenjin” (2) Mar 14, 2009: HOME’S Propert
Slide 15: Other topics (Real estate portal business): 2
Other topics Quarterly Consolidated 4thQ Financial Results (Real estate portal business): 2 Implemented a new style of information distribution for HOME’S and took measures to prevent Po int membership withdrawals, targeting in April ！ Check (1) Feb 3, 2009 (2) Apr 1 to Jun 30, 2009: Implementing pr
Slide 16: Other topics (Local community-related business)
Other topics Quarterly Consolidated 4thQ Financial Results (Local community-related business) Po int Enhanced service for individual affiliates ！ Check (1) Feb 3, 2009 (Local community-related business) Commissioned: METI’s “Survey for Local Business and Industry (1) Feb 3, 2009: (Local community-re
Slide 17: Full-year results for term ended March 2009
Cumulative NEXT Co., Ltd. TSE Mothers: 2120 Full-year results for term Cumulative ended March 2009 Financial results Copyright (c) 2009 NEXT CO.,LTD. All Rights Reserved.
Slide 18: Financial results for term ended March 2009
Cumulative Consolidated Financial results for term Consolidated fiscal term ended March 2009 Increase Increase Fall Fall in in Sales increased by 20.1% on a year-to-year basis, while Operating Income fell by 20.1% Po int in in revenue revenue profits profits due to prior investment Year- Year-to- to
Slide 19: Change in operating profit and loss
Cumulative Consolidated Financial results for term ended Change in operating profit and March 2009 loss While sales increased by 20.1%, labor costs also rose by 30.9% and advertisement expenses soared Po int 51.6% (Reference only) [Previous term] [Current term] Increment value over Increase over the
Slide 20: Consolidated balance sheet and goodwill status
Cumulative Consolidated Financial results for term Consolidated balance sheet ended March 2009 and goodwill status Po int Fixed assets increased by 15.3% due to various capital expenditures [Term- [Term-end results [Term- [Term-end results Increase over Unit: million yen for previous term] for curre
Slide 21: Consolidated cashflow
Cumulative Consolidated Financial results for term Consolidated cashflow ended March 2009 Operating cashflow remains stable, consolidated cashflow suffering losses due to repurchased Po int common stock (240 million yen) [Previous term] [Current term] Unit: million yen FY ended Mar 2008 Major factor
Slide 22: Change in cost-sales structural ratio
Cumulative Consolidated Financial results for term Change in Cost-Sales ended March 2009 structural ratio Despite a drastic increase in labor costs and advertisement expenses due to prior investment, the Po int fixed cost structural ratio decreased Unit: million yen Amount Structural ratio FY ended
Slide 23: Change in profit and loss by segment
Cumulative Consolidated Financial results for term ended March 2009 Change in profit and loss by segment Po int Almost all sectors recorded profit decline due to prior investment Unit: million yen FY ended Mar 2008 FY ended Mar 2009 Increment value over Increase over the Unit: million yen the previo
Slide 24: Change in sales by service sector
Cumulative Consolidated Financial results for term Change in sales by service sector ended March 2009 Real Estate Lease and Transaction core sector remains healthy, while New house, warranty affairs Po int showed large increases FY ended Mar FY ended Mar FY ended Mar Increment value over Increase ov
Slide 25: Actual figures for prior investments
Cumulative Consolidated Financial results for term Actual figures for prior investments ended March 2009 (labor costs, advertisement expenses) Po int The first term of "HOME’S Dominantly No. 1" results were almost as planned Net increase in number of affiliate stores boosted due to enhanced new affi
Slide 26: Distribution of affiliated stores and potential market
Cumulative Consolidated Financial results for term ended Distribution of affiliated stores and March 2009 potential market A market exploration ratio of 4.0% (our estimate) means there is profound potential for increasing the Po int number of affiliated stores NEXT’s sales activities are implemented
Slide 27: Business performance predictions for FY ending March 2010
Estimate NEXT Co., Ltd. TSE Mothers: 2120 Full-year business performance predictions Estimate for FY ending Mar 2010 Mid-term Corporate Vision: 2nd term Copyright (c) 2009 NEXT CO.,LTD. All Rights Reserved.
Slide 28: Business performance prediction for FY ending Mar 2010
Estimate Consolidated Business performance prediction Consolidated financial term for FY ending Mar 2010 Increase Increase Sales are predicted to increase by 26.2% (year-to-year comparison), with a Increase Increase Po int in in revenue revenue predicted 71.8% increase in Operating Income in in prof
Slide 29: Change in sales and operating income
Estimate Consolidated Business performance prediction Change in Sales and for FY ending Mar 2010 Operating Income Target increases in revenue and profit, aim to achieve record-high business performance by taking Po int advantage of completion of prior investments Unit: million yen 12,000 11,266 Sale
Slide 30: Change in operating profit and loss (forecast)
Estimate Consolidated Business performance prediction Change in operating for FY ending Mar 2010 profit and loss Po int Advertisement expenses remain flat, profit showed huge expansion (reference only) Previous term Current term Increment value Increase over the over the previous FY ended Mar 2008 F
Slide 31: Change in cost-sales structural ratio (forecast)
Estimate Consolidated Business performance prediction Change in Cost-Sales for FY ending Mar 2010 structural ratio Total share of labor costs and advertisement expenses drastically decreased after completing prior Po int investment Unit: million yen Amount Structural ratio FY ended Mar FY ended Mar
Slide 32: Non-consolidated change in operating profit and loss
Estimate Non- Non-consolidated Business performance prediction Change in Operating for FY ending Mar 2010 profit and loss For non-consolidated performance too, advertisement expenses remain at about the same level and Po int profitability improved (Reference only) Previous term Current term Incremen
Slide 33: Non-consolidated change in cost-sales structural ratio
Estimate Non- Non-consolidated Business performance prediction Change in Cost-Sales for FY ending Mar 2010 structural ratio For non-consolidated performance, profitability will improve despite increased labor cost due to a Po int drastic decrease in the advertisement expenses ratio Amount Structural
Slide 34: Change in sales by service sector (forecast)
Estimate Consolidated Business performance prediction Change in sales by for FY ending Mar 2010 service sector Po int An overall sales increase can be expected, avoiding the full impact of the market situation Increment value FY ended Mar FY ended Mar FY ending Mar Increase over the Unit: million ye
Slide 35: Change in half-year business performance
Estimate Consolidated Business performance prediction Change in half-year for FY ending Mar 2010 business performance Second-half performance is expected to be superior, due to the adopted stock business model and Po int seasonal influences Summary of Profit and loss statement Sales by service secto
Slide 36: Directionality of current term
Business performance prediction Estimate Consolidated Directionality of Current term for FY ending Mar 2010 Focus the portal business while further expanding peripheral businesses to boost the real estate portal Po int business ！ Check Promotion Promotion of of "HOME’S "HOME’S Dominantly Dominantly
Slide 37: Market size (estimate)
Estimate Consolidated Business performance prediction Market size (estimate) for FY ending Mar 2010 Po int Internet market size: 40 billion yen Real estate advertising market for lease and transactions: 95 billion yen/year (our estimate) Above figure includes Approx. 40 billion yen/year Market size
Slide 38: Returning profits to shareholders
Estimate Consolidated Business performance prediction Returning Profits to for FY ending Mar 2010 Shareholders Po int A dividend payout ratio of 10% and annual dividend of 610 yen (a 400 yen increase) are expected FY FY ended ended Mar Mar 2009 2009 FY FY ending ending Mar Mar 2010 2010 Annual divid
Slide 39: Management principles
Management principles NEXT management principles Create a social structure that brings true peace of mind and joy to the greatest number of people through constant innovation. Corporate motto Altruism Always consider everyone’s happiness, everyone around us Copyright (c) 2009 NEXT CO.,LTD. All Right
Slide 40: Reference
Reference Mid-term Corporate Vision ・・・Page 40-46 Consolidated subsidiary ・・・Page 47-49 Our business model ・・・Page 50-51 Issues in IR activities ・・・Page 52 Corporate profile ・・・Page 53-54 Copyright (c) 2009 NEXT CO.,LTD. All Rights Reserved. 39
Slide 41: NEXT GROUP targets: Mid-term Corporate Vision
Mid-term Corporate Vision *No change has been made from the previous term FY ending Mar 2011 Mid-term Corporate Vision NEXT Achieve “Dominantly No. 1” for HOME’S Real estate lease and transactions GROUP targets: Consolidated business performance for FY ending Mar 2011 Sales: 17 billion yen Operating
Slide 42: Consolidated business performance: Target
Mid-term Corporate Vision Consolidated business performance: Target Enter a growth-oriented phase from the fiscal year ending March 2010 after completing an Po int investment-oriented phase ◎ FY ended Mar 2009 Investment phase to achieve HOME’S Dominantly No. 1 ◎ FY ending Mar 2011 Target consolidat
Slide 43: HOME'S target index for real estate lease and transactions
HOME’S target index for real estate Mid-term Corporate Vision lease and transactions Po int Accelerate growth of main service―HOME’S real estate lease and transactions ◎ FY ending Mar Achieve 17,000 affiliate stores for HOME’s real estate lease and transactions by doubling this 2011 number (in compa
Slide 44: What is Lococom?
Mid-term Vision What is “Lococom”?: 1 Po int 1.16 million monthly visitors to the local community-related business site <http://www.lococom.jp> [Outline of Lococom] ■ URL: http://www.lococom.jp/ ■ Launch date: Oct 16, 2006 ■ Posting target: Separated by the 1,850 cities, towns, and villages in Japan
Slide 45: Lococom: number of monthly viewers vs. affiliates, comparison with mixi
Mid-term Corporate Vision What is Lococom?: 2 Po int Number of monthly viewers exceeds the number of individual affiliates ◎ FY ending Mar 2011 Lococom aims to increase number of affiliates to 2.5 million yen Comparison Comparison with with leading leading SNS SNS service service provider, provider,
Slide 46: Comparison of periods required to achieve 5 million affiliates
Mid-term Corporate Vision What is “Lococom”?: 3 Po int Leading SNS website shows accelerated growth after achieving one million affiliates Number of affiliates (10,000) Comparison of periods required to achieve 5 million affiliates 500 450 400 mixi Mobage-town 350 GREE Mar 2011 (target) 300 250 200
Slide 47: Moving towards Lococom, infrastructure for living
Mid-term Corporate Vision What is “Lococom”?: 4 Po int Moving towards “Lococom,” infrastructure for living Future vision Create a real community space where three-dimensional expansion can be seen and that includes the local community Local community-related business, or “Lococom” is a community sit
Slide 48: Consolidated subsidiary: Willnic Co., Ltd.
Consolidated subsidiary Willnic Co., Ltd. ITOCHU Corporation’s joint business ventures Willnic Co., Ltd. Renters, Co., Ltd. Next F.S. Co., Ltd. Willnic Co., Ltd. main page Established through joint financing with ITOCHU Corp. <http://www.willnic.co.jp/> ITOCHU Group NEXT (our company) Investment Inv
Slide 49: Consolidated subsidiary: Renters Co., Ltd.
Consolidated subsidiary Renters Co., Ltd. ASP offers sales support services to real estate companies Willnic Co., Ltd. Renters Co., Ltd. Next F.S. Co., Ltd. Renters main page Renters net functions <http://www. www.ra1.co.jp/> (1) Converter function for portal listings Real estate Real estate company
Slide 50: Consolidated subsidiary: Next F.S. Co., Ltd.
Consolidated subsidiary Next F.S. Co., Ltd. Expansion of warranty affairs business Willnic Co., Ltd. Renters Co., Ltd. Next F.S. Co., Ltd. NEXT FS CO. LTD. main page Offering HOME’ HOME’S Warranty Affairs <http://financial.homes.co.jp/> Issues NFS solutions Tenant Joy of living where you want ● Cann
Slide 51: Our business model
Our business model Client Real estate intermediary/management companies Major real estate companies, developers Builders, homebuilders, renovation companies Miscellaneous ＨＯＭＥ’Ｓ No. of affiliated stores ＨＯＭＥ’ＳNew condominium 542 companies companies 10,120 stores condominium (FC chains, food & Corpor
Slide 52: Billing system: HOME'S real estate lease and transactions
Billing system HOME’S Real estate lease and transactions Po int Ensure steady income as monthly billing is not dependent on commission Shop HOME’ HOME’S Real estate lease and transactions billing system Property information ■ Initial cost 35,000 yen Billing Real estate intermediary company ■ Monthly
Slide 53: Issue in IR activities
Issue in IR activities Po int NEXT will continue to provide investor-friendly information ！ Check ・Enhance web content for individual investors Number of ・Organize presentation meeting for individual shareholders 1,734 Î 3,000 investors (three sessions planned) increased ・Implement contentious profi
Slide 54: Corporate profile
Corporate profile Corporate profile Company Name NEXT Co., Ltd. (TSE Mothers:2120) President Takashi Inoue Date of establishment Mar 12, 1997 (month of settlement: March) Capital Stock 1,984 million yen Shares issued: 185,803 (including 7,800 outstanding stocks) Number of employees (consolidated) 52
Slide 55: Corporate profile: President's profile and award history
Corporate profile President’s profile and NEXT’s award history ■ NEXT’s Award History October 2004 First place in the 2004 Fall Real Estate Leasing Site Ranking from Gomez Consulting Co., Ltd. (“Gomez”) President of NEXT Co., Ltd. October 2005 Takashi Inoue Awarded the 3rd Technology Fast 50 Japan f