Fuyo General Lease Co., Ltd. · TSE:8424
Fuyo General Lease — FY2021 Earnings Presentation
54 slides from Fuyo General Lease's earnings presentation, May 16, 2022
Slide 1: Financial Results Briefing for FY2021 IR Presentation
Financial Results Briefing for FY2021 IR Presentation Fuyo General Lease Co., Ltd. Securities code: 8424 May 16,2022
Slide 2: Agenda
１．Overview of consolidated operating results and business activities P3 ２．Medium-term Management Plan 「Frontier Expansion 2021」Summary P11 ３．New Medium-term Management Plan 「Fuyo Shared Value 2026」 P15 ４．Earnings forecast and dividend policy P42 ５．Appendix P45 Earnings forecasts and other forward-lo
Slide 3: FY2021 Overview of consolidated operating results
FY2021 Overview of consolidated operating results 3
Slide 4: FY2021 results
Overview of consolidated operating results and business activities 1 FY2021 results ⚫ The growth in profit before interest expenses due to the business expansion in strategic areas, and other factors contributed to the increase, and profit at each level reached a record high. (Ordinary profit for 5
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 ⚫ Profits in Leases and Financing continued to increase ⚫ In addition to the growth in profit before interest owing to growth in strategic fields. expenses, non-ope
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 (¥100 million) -35 17 57 4 4 527 480 Ordinary Ordinary profit profit 1 2 3 4 FY2020 Profit before interest Personnel/equipment Interest expenses Reversal of credit Non-operating FY202
Slide 7: Changes in funding
Overview of consolidated operating results and business activities ５ Changes in funding ⚫ Advancing long-term funding utilizing corporate bonds and long-term borrowings, while short-term funding through CP was restrained. ⚫ Proactively promoted ESG finance initiatives and implemented funding by mean
Slide 8: Changes in costs; net assets and shareholders' equity ratio
Overview of consolidated operating results and business activities 6 Changes in costs 7 Net assets and the shareholders’ equity ratio ⚫ The increase in personnel/equipment expenses is due not only to the consolidation of WorkVision Corporation ⚫ Stable profit growth enabled the accumulation of net b
Slide 9: Newly executed contract volume
Overview of consolidated operating results and business activities 8 Newly executed contract volume ⚫ Growth in “operating leases” mainly in strategic areas such as “real estate” and ”aircraft” ⚫ Accretive factoring increased, mainly for medical and nursing care service fee receivables YoY （単位：億円） Y
Slide 10: Operating assets, ROA
Overview of consolidated operating results and business activities 9 Operating assets, ROA ⚫ The progress in the accumulation of operating assets led to an increase in “operating leases.” ⚫ ROA improved steadily due to advanced conversion to a higher profitable portfolio. Operating assets, ROA＊ (¥10
Slide 11: Medium-term Management Plan Frontier Expansion 2021 Summary
Medium-term Management Plan Frontier Expansion 2021 Summary 11
Slide 12: Management Goals
Frontier Expansion 2021 Summary Management Goals • We are expected to exceed all three of our management goals, i.e., an ordinary profit of ¥50.0 billion, a return on assets (ROA) of 2.0%, and operating assets of ¥2.5 trillion. • Businesses in “new areas” such as BPO and mobility business, coupled w
Slide 13: Review of the Medium-term Management Plan
Frontier Expansion 2021 Summary Review of the Medium-term Management Plan Steadily carried out plans along the “three strategic axes” to facilitate business expansion and creation Further enhanced corporate functions by actively advancing inorganic strategies to accelerate group-based business devel
Slide 14: Group Expansion and Main Accomplishments
Frontier Expansion 2021 Summary Review of the Medium-term Management Plan Group Expansion and Main Accomplishments Major M&A achievements New Medium-term Japan INVOICE NOC Outsourcing & Consulting Management Plan WorkVision MerryBiz YAMATO LEASE FUJITA ◼ Acquired WorkVision as our subsidiary. ◼ Made
Slide 15: Fuyo Shared Value 2026
New Medium-term Management Plan Fuyo Shared Value 2026 15
Slide 16: Overview of Fuyo Shared Value 2026
New 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 sustaina
Slide 17: 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 18: Non-financial Goals
Management Goals Non-financial Goals Target value for Item Remarks FY2026 Contribution to CO2 reduction 500,000 t-CO2/year The amount invested in the promotion of decarbonization ¥300.0 billion Sum total for five years Applicable to investments made in the Renewable Energy Generation Business, proje
Slide 19: 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 20: Three Growth Drivers
Growth Strategy Three Growth Drivers • Pursue sustainable profit growth through intensive investment in business domains where market expansion or market creation is expected. • Differentiate our core areas to improve profitability and enable stable growth. Three growth drivers Intensive investment
Slide 21: Intensive investment of management resources
Growth Strategy Intensive investment of management resources • Intensively invest (approximately ¥1 trillion over five years) in growth areas to improve ROA while at the same time accumulating operating assets. • Enhance profitability in core areas to improve ROA for the overall balance of operating
Slide 22: Overview of an Earnings Portfolio
Growth Strategy Overview of an Earnings Portfolio • Business expansion through intensive investment of management resources contributed to increasing the percentages of ordinary profit derived from Rising Transformation and Accelerating Transformation. • The percentage of ordinary profit derived fro
Slide 23: Ordinary Profit Forecast for Each Business Domain
Growth Strategy Ordinary Profit Forecast for Each Business Domain Transformation Zone • Achieve dramatic growth by simultaneously realizing asset expansion and profitability improvement through intensive investment of management resources in the five business domains including Mobility and Energy &
Slide 24: Business Domain-Specific Results and Topics
Business Domain-Specific Results and Topics 24
Slide 25: Business Domain-Specific Results
General Business Domain-Specific Results FY2021 (results) FY2026 (planned) Increase or decrease relative (¥100 million) to FY2021 Ordinary Operating Ordinary Ordinary ROA ROA ROA profit assets profit profit Rising Transformation 33 1.9% 1,641 70 2.5% +37 +0.6% (Mobility) Accelerating 67 - 2,282 180
Slide 26: Mobility (1)
Rising Transformation Mobility (1) Expanding new business domains in markets created as a result of changing environments Frontier Expansion 2021: Results ⚫ Acquired YAMATO LEASE as our subsidiary in our effort to redefine our car lease business as a mobility business, and set out to develop this ne
Slide 27: Mobility (2): Focus Areas
Rising Transformation Mobility (2): Focus Areas Regarding changing environments as business opportunities, that allow us to not only achieve profit growth as a company but also resolve social issues One-stop EV services Fleet BPO ⚫ Promote collaboration with our partners to provide one- ⚫ Help our c
Slide 28: Circular Economy: becoming a platformer
Rising Transformation Circular Economy (CE) Our goal is to become a “platformer” of circular economy Circular economy that expands through leasing Value creation through circular economy (GK$1,990 trillion) (Estimates provided by Accenture) Promote advanced efforts in markets with rapid growth 30 25
Slide 29: Energy & Environment (1)
Accelerating Transformation Energy & Environment (1) Expansion of the renewable energy business on a global scale ■ Ordinary profit and ROA for the Frontier Expansion 2021: Results Energy & Environment business ⚫ Expanded the renewable energy power generation business in Japan and (¥100 million) ove
Slide 30: Energy & Environment (2): Renewable Energy Business and New Domains
Energy & Environment (2): Accelerating Transformation Renewable Energy Business and New Domains Renewable energy business Aggressively expanding the business both inside and outside the country to expand its scale to triple the current level Japan Overseas • While focusing our business efforts • We
Slide 31: BPO/ICT (1)
Accelerating Transformation BPO/ICT (1) Helping customers reform their processes from both systems and operations aspects ■ Ordinary profit and ROA for the Frontier Expansion 2021: Results BPO/ICT business ⚫ Functional enhancement through aggressive M&A turned BPO into a pillar of our The ROA figure
Slide 32: BPO/ICT (2): Business Process Service
Accelerating Transformation BPO/ICT (2): Business Process Service Society Addressing shrinking labor force, improving productivity, etc. Customers Improving business efficiencies, promoting DX, etc. Business process service (BPS) Promotion of a total solution that is based on the “outsourcing and DX
Slide 33: Medical & Social Welfare (1)
Accelerating Transformation Medical & Social Welfare (1) Helping healthcare/nursing-care providers and dispensing pharmacies maximize the value of their management resources, thereby resolving issues for them as well as the society ■ Ordinary profit and ROA for the Frontier Expansion 2021: Results M
Slide 34: Medical & Social Welfare (2): Markets and Solutions
Accelerating Transformation Medical & Social Welfare (2): Markets and Solutions Customers with corporate corporate Large- and medium-sized Clinics (medical, dental), restructuring, business succession, companies or other management needs nursing-care providers Solutions for nursing care Markets Fina
Slide 35: Real Estate
Growing Performance Real Estate Improve profitability through business sophistication and differentiation by expanding business areas Frontier Expansion 2021: Results ⚫ A significant increase in operating assets enabled by diversified deal sources, such as ■ Ordinary profit and ROA for the users and
Slide 36: Aircraft
Growing Performance Aircraft Breaking away from the effects of COVID-19 and promoting asset turnover-type business Frontier Expansion 2021: Results ⚫ We successfully expanded our customer base by promoting leases of aircraft ■ Ordinary profit and ROA for the that we own. Aircraft business (¥100 mill
Slide 37: Towards Sustainable Value Creation
Towards Sustainable Value Creation 37
Slide 38: 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 39: Investment in Human Resources
Investment in human Investment in Human Resources capital (Establishment of the Fuyo Shared Value Creation Center) 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 i
Slide 40: DX Strategies
DX Strategy DX Strategies 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 digital techn
Slide 41: Further Evolution of Corporate Culture
Corporate Culture Further Evolution of Corporate Culture Newly articulating mission/vision/value statement as a corporate group Aligning the values, judgment, and actions of employees and directors so that they can work together to achieve sustainable growth Mission Expand business domains and promo
Slide 42: Earnings forecast and dividend policy
Earnings forecast and dividend policy 42
Slide 43: FY2022 consolidated earnings forecast
Earnings forecast and dividend policy 1 FY2022 consolidated earnings forecast FY2021 FY2022 (¥100 million) results forecast Net sales 6,578 7,000 Operating profit 460 515 Ordinary profit 527 560 Profit attributable to owners of parent 339 360 Basic earnings per share ¥1,130.52 ¥1,202.97 Copyright(C)
Slide 44: Dividend policy
Earnings forecast and dividend policy 2 Dividend policy FY2021 Total dividend is ¥260, which is ¥25 higher than the year beginning dividend forecast (¥285). results Dividend payout ratio is 25.2%. FY2022 Total dividend results is ¥316 (increased ¥31 year on year), and dividend payout is 26.3% foreca
Slide 45: Appendix
Appendix 45
Slide 46: Key topics (1)
Appendix 1 Key topics (1) Energy & Participation in solar energy generation business in the United States Environment - Fuyo Lease’s first participation in solar energy generation business in the United States - Energy & PPA model for solar energy generation system installed at the Yomiuri Shimbun G
Slide 47: Key topics (2)
Appendix 1 Key topics (2) BPO/ICT Acquired WorkVision as our consolidated subsidiary. Submitted an application to the Tokyo Stock Exchange for selection of the new market classification "Prime Market" (Transferred in April 2022). Q3 Mobility Developed “One-Stop Service for Implementation of Autonomo
Slide 48: Summary of consolidated operating results
Appendix ２ Summary of consolidated operating results Sales decreased mainly due to the application of “Accounting Standard for Revenue Recognition.” The application had no impact on profit and loss. *1 Excluding interest expenses *2 Gross profit before interest expenses YoY FY2017 FY2018 FY2019 FY20
Slide 49: Segment results (consolidated)
Appendix ３ Segment results（consolidated) ＊1 Gross profit before interest expenses Leases Installment sales Leases and installment sales total YoY YoY YoY YoY YoY YoY (¥100 million) FY2020 FY2021 Change Change FY2020 FY2021 Change Change FY2020 FY2021 Change Change (amount) (%) (amount) (%) (amount)
Slide 50: Operating assets
Appendix ４ Operating assets YoY YoY change FY2017 FY2018 FY2019 FY2020 FY2021 Change (¥100 million) (%) (amount) Leases 14,744 15,648 16,136 17,133 16,916 -217 -1.3% Finance leases [10,987] [10,835] [11,068] [10,808] [10,198] [-610] [-5.6%] Operating leases [3,757] [4,813] [5,068] [6,325] [6,718] [3
Slide 51: Newly executed Contract Volume
Appendix ５ Newly executed Contract Volume YoY YoY change (¥100 million) FY2017 FY2018 FY2019 FY2020 FY2021 Change (%) (amount) Leases 5,636 5,300 5,445 4,536 4,741 205 4.5% Finance leases [4,052] [3,724] [3,654] [3,080] [2,594] [-486] [-15.8%] Operating leases [1,584] [1,576] [1,791] [1,455] [2,147]
Slide 52: Newly executed lease contract volume (by type of equipment)
Appendix ６ Newly executed lease contract volume (by type of equipment) セグメント名称 (¥100 million) FY2019 FY2020 FY2021 YoY change IT & office equipment 2,072 1,588 1,254 -333 Industrial machinery 442 276 224 -52 Civil engineering and construction machinery 102 91 61 -30 Transportation equipment 571 383
Slide 53: Summary of the operating results of the major subsidiaries
Appendix 7 Summary of the operating results of the major subsidiaries The ownership ratio as of April 1, 2022 is provided. Sharp Finance Corporation Fuyo Auto Lease Co., Ltd. YAMATO LEASE Co., Ltd. Accretive Co., Ltd. (¥100 million) (ownership ratio: 65%) (ownership ratio: 100%) (ownership ratio: 60
Slide 54: Going Where No One Has Gone Before
“Going Where No One Has Gone Before” FUYO GENERAL LEASE CO., LTD. 54