Makuake, Inc. · TSE:4479
Makuake — Q2 FY2024/9 Earnings Presentation
50 slides from Makuake's earnings presentation, Apr 23, 2024
Slide 1: Financial Results Briefing Materials for Q2 FY2024/9
Makuake Financial Results Briefing Materials for Q2 FY2024/9 (fiscal year ending September 30, 2024) Makuake, Inc. Securities code: 4479
Slide 2: Financial Results
Financial Results
Slide 3: Overview of Q2 FY2024/9
Overview of Q2 FY2024/9 Results In addition to fewer business days in Q2 (January-March) than other quarters and the traditional seasonality of and an especially slow start by companies immediately after the New Year holidays, the gross amount of “support” pre-orders (GMV) and net sales fell short o
Slide 4: Gross Amount of "Support" Pre-orders (GMV) Quarterly
Gross Amount of "Support" Pre-orders (GMV)* Quarterly + Although we had planned for a weaker GMV in Q2 compared with Q1 as businesses slowly returned to operations at the beginning of the year amid fewer business days, the unexpected impact of the earthquake at the beginning of the year and insuffic
Slide 5: Net Sales and Take Rate
Net Sales and Take Rate + Net sales decreased 5.7% YoY due to a temporary drop in the take rate for Makuake services, as GMV fell short of the plan and a special plan was offered to support Noto Peninsula earthquake recovery efforts (Unit: JPY million) 9 Take ate! 1,288 TB Net sates 1,232 1,152 1,10
Slide 6: Gross Profit and Gross Profit Margin
Gross Profit and Gross Profit Margin * Gross profit declined 9.6% YoY due to lower sales and amortization of software (intangible assets) that had accumulated after impairment charges in FY2022/9, but the gross profit margin returned to within the normal range o (Unit: JPY million) 81.1% 43% 40H, g0
Slide 7: Selling, General, and Administrative Expenses
Selling, General, and Administrative Expenses + All SG&A expenses were significantly reduced YoY. In particular, advertising expenses were reduced 43.2% YoY while still maintaining profitability due to ongoing efforts to thoroughly verify the effectiveness of each measure (Unit: JPY million) TV comm
Slide 8: Operating Profit (Loss) and Operating Profit Margin Relative to GMV
Operating Profit (Loss) and Operating Profit Margin Relative to GMV + While an operating loss of JPY 81 million was recorded due to GMV and net sales falling short of plans, this was over JPY 110 million less YoY, and we are thoroughly scrutinizing unnecessary costs (Unit: JPY million) —@— Operating
Slide 9: Interim Performance
Interim Performance + Inthe first half of the fiscal year, GMV and net sales increased, and the operating loss was reduced by JPY 279 million YoY (Unit: JPY million) GMV 11,725 oan 10,393 1 , 9,382 9,249 8,360 H1 H2 H1 H2 H1 H2 FY2021/9 FY2022/9 FY2023/9 Copyright © Makuake, Inc. All Rights Reserved
Slide 10: Key KPIs
Key KPIs + In addition to traditional Q2 seasonality and the partial impact of the Noto Peninsula earthquake, the number of monthly active projects declined as the acquisition of high-quality project owners did not grow as planned. These factors also affected the supporter side, resulting in a sligh
Slide 11: Other KPI (1)
Other KPI (1) + Amid impacts from the external environment, challenges in acquiring high-quality new ad repeat project owners became apparent, resulting in a significant decrease in the number of new projects. Insufficient acquisition of high-quality project owners also drove the decrease in the amo
Slide 12: Other KPI (2)
Other KPI (2) + Access UUs and CVR declined due to a decrease in the number of triggers for inflows to the site as a result of fewer new projects, and consumers refraining from spending after the earthquake. At the same time, the number of members grew steadily, triggered by popular topical projects
Slide 13: Employee Count (Reference Values: Number of Published Projects)
Employee Count (Reference Values: Number of Published Projects) + There was no significant change in employee numbers, and the number of curators was increased only slightly to focus on acquiring and publishing high-quality new and repeat project owners in the second half of the fiscal year and beyo
Slide 14: TOPICS: ESG Management and Project Owner Support
TOPICS: ESG Management (Initiatives Supporting Society) and Project Owner Support Commenced provision of a special plan supporting 2024 Noto Peninsula earthquake recovery efforts SHC FREE SMES RIT WW RRADy & iz tt @ Makuake To support businesses in the Hokuriku region and reconstruction of affected
Slide 15: TOPICS: Strengthening and Expanding Services Offerings
TOPICS: Strengthening and Expanding Services Offerings Copyright © Makuake, Inc. All Righ Prompt payment to project owners on the 25th of the month following the month of project completion ® Makuake FOYILIbRTEAOASE FiHE The payment date for project owners has been changed to the 25th of the month f
Slide 16: TOPICS: Expanding to After Makuake through Collaboration
TOPICS: Expanding to After Makuake (Primary Distribution Market) through Collaboration with Other Companies Collaboration with Yodobashi Camera SB B/SX5 Makuake SHOP SFALN*F ® Makuake TEFL EOP EBD RIAD —ER [Makuake] 2 588%U% ARTAFAUARE! BADER! PRBLT RUST. + Start of initiatives May 2023 + Products h
Slide 17: Temporary Impact on Financial Statements Due to Earlier Remittances
Temporary Impact on Financial Statements Due to Earlier Remittances to Project Owners + Remittances to project owners were forwarded to the 25th of the month following the month in which the project was completed, resulting in a temporary increase in remittances to project owners of JPY 724 million,
Slide 18: Major Projects Launched in Q2 FY2024/9 (Small and Medium-Sized Enterprises)
Major Projects Launched in Q2 FY2024/9 (Small and Medium-Sized Enterprises) + As the perception of “Makuake's strength in gadgets” is gaining ground among consumers, Makuakeis accumulating a track record of projects that could become the second most popular genre after gadgets, such as electric bike
Slide 19: Major Projects Launched in Q2 FY2024/9 (Large Companies)
Major Projects Launched in Q2 FY2024/9 (Large Companies) + These high-quality products that only large companies can provide are attractive and exciting to consumers visiting Makuake. WIFRO oe 5 Ge ee ee ae LG Electronics ; ECOVACS Japan SBM, E>ERSE. BSLEMAS GAT HESO—1 HE ARIAS 1A RopSeC a Achilles
Slide 20: SDGs-Related Projects Launched in Q2 2024/9
SDGs-Related Projects Launched in Q2 2024/9 + Projects commercializing Earth-friendly products have been created using new technologies, materials and the reuse of objects in various forms. These include a number of projects supporting recovery from the Noto Peninsula earthquake that occurred in Jan
Slide 21: FY2024/9 Forecasts and Progress Report
FY2024/9 Forecasts and Progress Report
Slide 22: FY2024/9 Financial Forecasts
FY2024/9 Financial Forecasts + For FY2024/9, we aim to increase net sales by 3.0% from FY2023/9 and return to profitability, targeting operating profit of JPY 16 million (Unit: JPY million) pv2023/9 Change Percent Change Gross Amount of “Support” Pre-orders: GMV 17,609 18,845 1,235 7.0 (Taxincluded)
Slide 23: Growth Strategy for FY2024/9
Growth Strategy for FY2024/9 + Weaim to boost the project unit value by promoting the creation of high-quality projects by repeat project owners and growing the number of active projects, as well as improving project supporter retention through the accumulation of project supporter fans by project o
Slide 24: Progress Toward FY2024/9 Financial Forecasts
Progress Toward FY2024/9 Financial Forecasts + Despite falling short of plans on a quarterly basis, GMV and net sales were 45.4% and 47.4% of the full-year plan, respectively, roughly halfway to achieving the targets. FY2024/9 FY2024/9 (Unit: JPY million) Forecasts Q2 (Cumulative) Progress Rate Gros
Slide 25: Specific Initiatives Implemented in Q2 FY2024/9
Specific Initiatives Implemented in Q2 FY2024/9 + Asin Q1, we continued to focus on improving project unit value while promoting the repeated use of high-quality project owners and engaged in ongoing marketing efforts to acquire high-quality new project owners, but we were unable to acquire a suffic
Slide 26: Analysis of Results for Q2 FY2024/9 (1)
Analysis of Results for Q2 FY2024/9 (1) + The acquisition of new and repeat high-quality project owners fell short of plans, resulting in a decrease in the number of new project publications and a significant decrease in the number of active projects. Despite the adverse external environment, projec
Slide 27: Analysis of Results for Q2 FY2024/9 (2)
Analysis of Results for Q2 FY2024/9 (2) + The number of active projects is not sufficient to achieve the full-year financial forecasts. The problem is that the acquisition system for new and repeat project owners and the benefits that can be provided to businesses in acquiring them are limited in sc
Slide 28: Key Initiatives for the Second Half of Fiscal FY2024/9 and Beyond
Key Initiatives for the Second Half of Fiscal FY2024/9 and Beyond * To resolve problems that emerged in Q2, we will maintain measures that have proven successful, while focusing on acquiring sales by diversifying the services we offer after restructuring our acquisition system. At the same time, we
Slide 29: Medium-Term Management Plan (FY2023/9-FY2025/9)
Medium-Term Management Plan (FY2023/9-FY2025/9)
Slide 30: Main Target Markets through FY2025/9
Main Target Markets through FY2025/9 + We will continue to focus on the online pre-primary distribution market for goods, which is expected to grow to JPY 1 trillion by 2025. Additionally, we will work towards developing the online pre-primary distribution market for services Total Addressable Marke
Slide 31: Factor Analysis of Makuake Service Structure
Factor Analysis of Makuake Service Structure to Achieve Medium-Term Management Plan + GMV, Makuake's key goal indicator (KGI), can be factored into two main components: project owners and project supporters. These components can grow in an accelerated manner through our initiatives to win repeat bus
Slide 32: Medium-Term KPI Targets
Medium-Term KPI Targets + For Q4 FY2025/9, we aim to reach 1,643 active projects during the month, a monthly project unit value of JPY 1.15 million, and a GMV of JPY 21.5 billion (minimum target) Monthly Project Unit Value for ROGUEN Full-year GMV No. of Active Projects during the Month for the Quar
Slide 33: Medium-Term Operating Profit Margin Target
Medium-Term Operating Profit Margin Target + Weare targeting an operating profit margin of approximately 7.5% to 13.5% for FY2025/9, assuming a balance between sales growth and cost management Boosting profitability by increasing "support" pre-orders from highly loyal users 20% 10% FY2023/9 FY2024/9
Slide 34: Revise Timing of Transition to Implementation Phases
Revise Timing of Transition to Implementation Phases for Initiatives to Achieve Medium-Term KPI Targets and Operating Profit Margin + Although we have increased the number of high-quality repeat project owners up to now through Phase 1, the achievements have been insufficient, and since it is also n
Slide 35: Growth Vision for GMV Target
Growth Vision for GMV Target + Starting in FY2025/9, we will gradually launch communication functionalities and loyalty programs to accelerate organic growth as well as supporter retention through new features, thereby growing GMV Increase in GMV through the promotion of repeat business with new fun
Slide 36: Appendix
Appendix
Slide 37: The World Makuake Aspires For
The World Makuake Aspires For * Guided by our vision and mission, we are striving for society enriched through the connection of the "new" that consumers seek and the "new" that companies wish to introduce to the world Create a world where worthy things Vision can come to be, grow and endure Connect
Slide 38: Makuake—Venue for Launch of New Products and Services
Makuake—Venue for Launch of New Products and Services + Weare a marketplace where consumers can buy premiering new products and services faster through “support* pre-orders ®Makuake REDD YY 3 AEXRAEA CE TRB. Hee ILE Gmmet ~/ 0 49H) sxocusent 19,056,950F) =z Ee) =! [a eS PIBLA BOPUHBEMEBAL AS. a ACTF
Slide 39: Makuake's Business Model
Makuake's Business Model + Businesses can pre-sell their new products and services still in the planning phase on Makuake, while consumers, in the spirit of cheering on, can pre-purchase their products of interest through “support” pre-orders “Support” ( ) pre-orders Businesses commission Consumers
Slide 40: Value Provided by Makuake: Businesses
Value Provided by Makuake: Businesses + We not only help businesses avoid the risks and burdens of distribution but also support the creation of a structure to develop new products for sustainable business growth and provide a mechanism that can turn customers of the businesses we serve into a loyal
Slide 41: Value Provided by Makuake: Consumers
Value Provided by Makuake: Consumers + We offer a unique purchasing experience that caters to the current needs of consumers, allowing them to go beyond being mere buyers. By connecting them with project owners and fostering mutual interaction, we help customers become fans of the project owners, an
Slide 42: Financial Results Summary: YoY (Cumulative through Q2)
Financial Results Summary: YoY (Cumulative through Q2) (Unit: JPY million) ariel Gross Amount of “Support” Pre-orders: GMV 8,360 (Taxincluded) Net Sales 1,789 Gross Profit 1,463 Operating Profit (Loss) (378) Ordinary Profit (Loss) (374) Net Income (Loss) (379) Copyright © Makuake, Inc. All Rights Re
Slide 43: Financial Results Summary: YoY (Standalone Quarter)
Financial Results Summary: YoY (Standalone Quarter) . a FY2023/9 Change Percent Change (Unit: JPY million) Q2 (standalone) R=a5 Yor" YoY Gross Amount of “Support” Pre-orders: GMV 4,108 (151) (3.7) (Tax included) tei o a a Gross Profit 718 6a (68) (9.6) Operating Profit (Loss) (192) ) 110 - Ordinary
Slide 44: Financial Results Summary: QoQ (Standalone Quarter)
Financial Results Summary: QoQ (Standalone Quarter) FY2024/9 (Unit: JPY million) Q1 (standalone) Gross Amount of “Support” Pre-orders: GMV 4,592 (Taxincluded) Net Sales 1,029 Gross Profit 715 Operating Profit (Loss) (16) Ordinary Profit (Loss) (15) Net Income (Loss) (6) Copyright © Makuake, Inc. All
Slide 45: KPIs: YoY (Standalone Quarter)
KPls: YoY (Standalone Quarter) FY2023/9 ee Change Percent Change Q2 (standalone) YoY YoY No. of Published Projects 1,732 499° (233) (13.5) Neamt gig 55 | ea) (95) (99) Project Owners Repeat Rate 55.1 TA - 22pt ee 3130 ||) Sas) (92) (28) Repeat “Suppor Preorder 16.2 88 7 0.6pt No. of Access Unique Us
Slide 46: KPIs: QoQ (Standalone Quarter)
KPls: QoQ (Standalone Quarter) FY2024/9 Q1 (standalone) No. of Published Projects 1,799 Not abled jes by 1,070 Project ot Rate 59.5 preorders UPY milion) 3,571 Repeat an 17.8 No. of Access Unique Users 10,176,889 No. of Members 2,684,736 No. of “Support” Pre-orders 376,925 Change (533) (180,267) 91,
Slide 47: Dividend Policy
Dividend Policy As the company is currently in a state of growth, we believe that by retaining profits and prioritizing investment in expanding business size and improving earning power will lead to maximization of our corporate value and a continuous stream of profit return to shareholders. As to f
Slide 48: Disclaimer and Cautions Regarding Future Outlook
Disclaimer and Cautions Regarding Future Outlook @ While the content of this document has been prepared based on generally recognized economic and social conditions as of April 23, 2024 and certain assumptions deemed reasonable by Makuake, Inc., it may change due to shifts in business environment an
Slide 49: IR Inquiries
IR Inquiries |IR@makuake.co.jp 49 Copyright © Ma
Slide 50: Makuake
@® Makuake