Litalico Inc. · TSE:7366
Litalico — Q3 FY2023 Earnings Presentation
34 slides from Litalico's earnings presentation, Jan 29, 2024
Slide 1: FY 2023 Q3 Earnings Presentation
1 Jan 29, 2024 FY 2023 Q3 Earnings Presentation LITALICO Inc. [ TSE Code: 7366 ] ©2023 LITALICO Inc.
Slide 2: Disclaimer
DISCLAIMER 2 The information, future strategies, forecasts, management targets, and other forward- looking projections relating to LITALICO Inc. (“the Company”) is based on information available to the Company as of the date hereof, and is based on reasonable assumptions that may include various ris
Slide 3: Growth Strategy
3 Growth Strategy ©2023 LITALICO Inc.
Slide 4: LITALICO Philosophy and Vision
STRATEGY LITALICO Philosophy and Vision 4 The name “LITALICO” is a combination of two Japanese words: ”利他 / Lita” (altruism) and “利己 / Lico” (individualism). We aim to create an inclusive world where both are achieved interdependently. Creating an Obstacle-free Society Obstacles are created by and w
Slide 5: Rise in Mandated Employment Rate of Disabled Individuals
STRATEGY Rise in Mandated Employment Rate of Disabled Individuals 5 • Legally mandated employment rate for disabled individuals is 2.3% • Rate is scheduled for step-wise increase to 2.7% over the next few years Employment of Individuals with Disabilities Legally Mandated Employment Rate (%) (thousan
Slide 6: Business Environment
STRATEGY Business Environment 6 Number of Welfare Service Users and Provider Facilities (thousand) (thousand) 200 Welfare Service Facilities (left) 1,200 Welfare Service Users 1,000 150 800 100 600 400 50 200 0 0 2012 2013 2014 2015 2016 2017 2018 2019 Ref: MHLW ▶ Disability welfare service users an
Slide 7: Services Across All Life Stages of Persons with Disabilities
STRATEGY Services Across All Life Stages of Persons with Disabilities 7 Services across all life stages provided through integration of B-C facilities and the B-B platform Education Vocation Lifestyle Retirement BtoC • Early detection and diagnosis • Social participation • Dwelling, medical care, as
Slide 8: LITALICO's Bigger Picture
STRATEGY LITALICO’s Bigger Picture 8 • Business expansion into adjacent industries that benefit from synergies with the disability industry Living Essentials Healthcare Disability Education Nursing Care ©2023 LITALICO Inc.
Slide 9: Consolidated Financial Results
9 Consolidated Financial Results ©2023 LITALICO Inc.
Slide 10: Consolidated P&L
RESULTS Consolidated P&L 10 IFRS (million yen) FY2022 FY2023 % YoY Q1-Q3 Q1-Q3 Sales 17,472 22,075 + 26.3% Operating Profit 2,100 2,599 + 23.8% Profit Attributable to 1,210 2,632 2.2x Owners of Parent ©2023 LITALICO Inc.
Slide 11: Segment Income Statement
RESULTS Segment Income Statement 11 IFRS (million yen) FY2022 FY2023 % YoY Q1-Q3 Q1-Q3 Sales 7,091 7,939 + 12.0% Vocational Welfare Profit 2,591 2,665 + 2.9% Sales 5,823 7,001 + 20.2% Child Welfare Profit 1,034 1,086 + 5.0% Sales 2,326 2,820 + 21.3% Platform Profit 880 1,052 + 19.6% Sales 2,232 4,31
Slide 12: FY2023 Q1-Q3 Overview
RESULTS FY2023 Q1-Q3 Overview 12 • 22.1 bln yen in sales (+26% YoY), 2.6 bln yen in operating profit (+24% YoY) CONSOLIDATED • 1 bln yen in gains appropriated from sale of equity method affiliate Olive Union in Q1, bringing net income to 2.6 bln yen (2.2x YoY) • Dividend for the fiscal year ending M
Slide 13: Financial Forecasts
13 Financial Forecasts ©2023 LITALICO Inc.
Slide 14: Consolidated Annual Forecast (IFRS)
FORECAST Consolidated Annual Forecast (IFRS) 14 [ Forecast Assumptions ] • Planned site launches: 16 LITALICO Works, 18 LITALICO Junior, 3 LITALICO Wonder • Majority of LITALICO Junior launches planned for H1, with cost concentration expected in Q1 • Marketing fortification for the Platform business
Slide 15: Financial Summary
FORECAST Financial Summary 15 • Planning for 11 consecutive years of sales and profit increase SALES OPERATING PROFIT (million yen) (million yen) 3,850 30,000 30,000 3,500 3,000 2,928 25,000 24,170 2,444 2,500 19,737 20,000 15,907 2,000 1,678 15,000 13,866 12,127 1,500 10,384 10,000 8,728 982 1,000
Slide 16: Number of LITALICO Service Provision Facilities
FORECAST Number of LITALICO Service Provision Facilities 16 • Total 390 sites planned for FY2023 450 390 400 338 350 88 300 83 262 250 231 210 43 159 186 39 200 173 35 128 140 26 23 113 150 116 100 21 93 92 86 20 84 100 73 57 18 60 43 143 39 13 30 127 50 5 22 106 15 15 82 92 4 66 74 53 59 34 37 38 4
Slide 17: Business Results
17 Business Results ©2023 LITALICO Inc.
Slide 18: LITALICO Segments
RESULTS LITALICO Segments 18 Vocational Welfare HumanGrow Child Welfare Platform (Billing Software) (Nursing Care Software) Others LITALICO Education Software ©2023 LITALICO Inc.
Slide 19: LITALICO Segments
RESULTS LITALICO Segments 19 Vocational Welfare HumanGrow Child Welfare Platform (Billing Software) (Nursing Care Software) Others LITALICO Education Software ©2023 LITALICO Inc.
Slide 20: Vocational Welfare
RESULTS Vocational Welfare 20 • 14 new site launch completed in Q1-Q3 • 141 facilities (LW: 134, HG: 7) • 1,721 job placements in Q1-Q3, pace HumanGrow remains elevated Vocational rehabilitation for • 16 total launches planned for FY23, with individuals with disabilities expected increase in pace *
Slide 21: LITALICO Segments
RESULTS LITALICO Segments 21 Vocational Welfare HumanGrow Child Welfare Platform (Billing Software) (Nursing Care Software) Others LITALICO Education Software ©2023 LITALICO Inc.
Slide 22: Child Welfare
RESULTS Child Welfare 22 • 18 new sites launched in Q1-Q3 • 159 facilities (LJ: 146, U: 13)* • Completed 18 site launches as planned for this FY due to smooth progress in Children’s social skills development hiring and training, with expected and education classes increase in pace going forward * LJ
Slide 23: LITALICO Segments
RESULTS LITALICO Segments 23 Vocational Welfare HumanGrow Child Welfare Platform (Billing Software) (Nursing Care Software) Others LITALICO Education Software ©2023 LITALICO Inc.
Slide 24: Platform
RESULTS Platform 24 • Sales +21%YoY • Launched a matching platform for service users and social workers, and a SaaS DX support business for facility operators • Sales team fortification expected to accelerate contract acquisition in FY23 Platform Business Sales (million yen) 5,000 Information 4,100
Slide 25: Platform: Subscription Contracts
RESULTS Platform 25 • Steady increase and pace acceleration in new contract acquisitions • Churn rate remains low • 25,500 contracted facilities as of Q3 end (Billing Software) (Nursing Care Software) Platform Business Subscription Contracts Service Provision Expansion 30,000 25,000 Consolidation of
Slide 26: Current Product Line-up and Forward Strategy
RESULTS Current Product Line-up and Forward Strategy 26 • Current line-up services disability welfare facilities, schools & nurseries, and nursing care fields • Sequential expansion of product offerings with increasing added value • Contribution to industry-wide quality enhancement through various d
Slide 27: LITALICO Segments
RESULTS LITALICO Segments 27 Vocational Welfare HumanGrow Child Welfare Platform (Billing Software) (Nursing Care Software) Others LITALICO Education Software ©2023 LITALICO Inc.
Slide 28: Others
RESULTS Others 28 • Sales +93% YoY • Active M&A execution Sales Trend Development classes designed for children under 18 with special needs, open to all irrespective of disability (million yen) 5,300 certification. 6,000 5,000 On-site and remote programming classes for children designed to develop c
Slide 29: Reference
29 Reference ©2023 LITALICO Inc.
Slide 30: LITALICO Business Environment (1)
REFERENCE LITALICO Business Environment (1) 30 • Number of individuals with disabilities continue to increase, with more children attending special needs classes in addition to normal school Children with Developmental Disorders Number of All Individuals with Disabilities Receiving Special Needs Sch
Slide 31: LITALICO Business Environment (2)
REFERENCE LITALICO Business Environment (2) 31 • Welfare service spending, service providers, and service users all continue to rise Disability Welfare Service Budget Disability Welfare Service Users and Facilities Government spending on disability welfare services, excluded fees paid by municipalit
Slide 32: Publicly Funded Business Structure
REFERENCE Publicly Funded Business Structure 32 LITALICO Works Pricing Employment Per person; 20 person limit Transition Support 1st Yr: ¥8,100 /session Government 2nd Yr: ¥8,100~9,400 /session Up to 6 mths into Reimbursement: employment 3rd Yr: ¥11,000 /session 90% (Claimed by LITALICO on Per perso
Slide 33: Reimbursement Calculation Method
REFERENCE Reimbursement Calculation Method 33 Reimbursement Unit Price Evaluation Method Vocational Training Business Example Results Based Reimbursement Vocational Training Basic Reimbursement Scale C. Job Retention Rate D. Basic Reimbursement Units Specific KPIs (such as job retention rates) defin
Slide 34: LITALICO Annual Fact Sheet as of Dec 2023
REFERENCE LITALICO Annual Fact Sheet as of Dec 2023 34 Vocational Training Child Welfare LITALICO Wonder • Job Placements: 1,721 • Service Users: 10,240 • Service Users : 4,805 Number of Employee Employee Benefits • LITALICO Works Segment: 1,220 • Discontinuation of mandatory fixed age retirement sy