Business Brain Showaota Inc. · TSE:9658

Business Brain Showaota — FY2024 Earnings Presentation

53 slides from Business Brain Showaota's earnings presentation, May 20, 2024

  1. Slide 1: Financial Results Briefing for the fiscal year ended March 2024

    Financial Results Briefing for the fiscal year ended March 2024 Securities code: 9658 May 20, 2024 Business Brain Showa-Ota Inc. © Business Brain Showa-Ota Inc.

  2. Slide 2: BBS Group New Medium-term Management Plan (BBS2026)

    BBS Group New Medium-term Management Plan (BBS2026) © Business Brain Showa-Ota Inc.

  3. Slide 3: Table of Contents

    Table of Contents 1. Review of the Previous Medium-term Management Plan 2. Goal 2030 and the Medium-term Management Plan BBS2026 3. BBS2026 KPI Plan 4. BBS2026 Growth Strategy © Business Brain Showa-Ota Inc. 2

  4. Slide 4: Review of the Previous Medium-term Management Plan

    Review of the Previous Medium-term Management Plan © Business Brain Showa-Ota Inc. 3

  5. Slide 5: Review of the Previous Medium-term Management Plan BBS2023

    Review of the Previous Medium-term Management Plan BBS2023 * Total value with GSX FY2023 Performance * Sales: 41.2 billion yen FY2022 Performance FY2021 Performance Sales: 37.0 billion yen Profit: 3.6 billion yen Sales: 32.3 billion yen Profit: 3.2 billion yen Plan FY2020 Performance Profit: 2.7 bil

  6. Slide 6: Review of the Previous Medium-term Management Plan BBS2023 Strategies

    Review of the Previous Medium-term Management Plan BBS2023 [Company-wide Strategy] [Business Strategy] [Corporate Strategy] Strengthen Group Synergy RCN2 Strategy Strengthen HR Between group companies Sales from 3 Loyal Customers Revision of HR policy 533 referrals, 296 orders to achieve Goal 2030 C

  7. Slide 7: Goal 2030 and the Medium-term Management Plan BBS2026

    Goal 2030 and the Medium-term Management Plan BBS2026 © Business Brain Showa-Ota Inc. 6

  8. Slide 8: Management Philosophy, Management Policy, Business Model

    [Management Philosophy], [Management Policy], [Business Model] Management Philosophy Management Policy Business Model Contribute to society by improving the corporate value of our customers ❝ Management Yatsugatake ❞ Becoming a driving force for our customersʼ ❝ management Wave-riding ❞ development

  9. Slide 9: Management Policy - The Words of Founder Kineo Yamazaki

    Management Policy - The Words of Founder Kineo Yamazaki ―― Practicing Yatsugatake Management If you just sell individual projects, then the future will grow dark when it no longer sells. But if you have multiple businesses, like the Yatsugatake mountain range, then even when the performance of one b

  10. Slide 10: Goal 2030 - Long-Term Vision of BBS Group

    Goal 2030 - Long-Term Vision of BBS Group The Goals and Values of BBS Group Back Office Comprehensive Supporter Become a new management partner Sustainability Management / Strengthening human resources FY2020 Results FY2030 Performance Sales: 29.1 billion yen Sales: 100 billion yen Profit: 2.4 billi

  11. Slide 11: Position of BBS Group Goal 2030

    Position of BBS Group Sales (100 million yen) Goal 2030 DTS NSD BBS2026 JBCC Holdings Future JFE Systems BBS2023 Cresco Obic Business Consultants Avant Group MURC Sigmaxyz Holdings Operating income 10 © Business Brain Showa-Ota Inc. (100 million yen)

  12. Slide 12: BBS2026 KPI Plan

    BBS2026 KPI Plan © Business Brain Showa-Ota Inc. 11

  13. Slide 13: BBS2026 Sales Target

    BBS2026 Sales Target Redesigning the growth scenario under GSX deconsolidation (100 million yen) 1,200 Goal 2030 M&A/New business sales Organic sales Combining M&A/new 100 billion yen 1,000 business for dramatic growth 800 580 600 GSX deconsolidation 487 413 400 342 200 0 FY2023 FY2024 FY2025 FY2026

  14. Slide 14: BBS2026 KPI

    BBS2026 KPI KPI have been set in the three areas of growth, capital efficiency, and investment, to implement strategic performance management. [Growth] [Capital efficiency] [Investment] Sales growth rate (including M&A) ROE M&A Investment 3 Year CAGR 20％ (including organic sales growth rate of 9%) 1

  15. Slide 15: Capital and Financial Strategy

    Capital and Financial Strategy Realizing management that considers capital cost and share price - toward improvement of ROE/PBR Improve ROE/PBR by achieving primary KPIs Business profit margin Increase profits 8.5% by FY2026 ROE on sales ・BPO sales ratio 12% by FY2026 30% by FY2026 9% capital cost S

  16. Slide 16: Capital and Financial Strategy

    Capital and Financial Strategy Total for the three years from FY2024 to FY2026 Shareholder return Shareholder return 3.7 billion yen Investment funds Dividend policy: Consolidated dividend 5.6 billion yen at period start payout ratio 40% Human capital investment 2.2 billion yen R&D expenses 1.0 bill

  17. Slide 17: BBS2026 Growth Strategy

    BBS2026 Growth Strategy © Business Brain Showa-Ota Inc. 16

  18. Slide 18: Existing business Package

    BBS2026 Growth Strategy [Market] [Business Directions] Introduce new services as next markets to approach Grow at 12% CAGR SaaS Solution AI-based SaaS development on management 3.00 100.0 (provide solutions) 2.50 90.0 next-gen platform accounting solution 80.0 70.0 2.00 60.0 1.50 50.0 Towards soluti

  19. Slide 19: Toward 30% of all business

    BBS2026 Growth Strategy Toward 30% of all business BPaaS market Large-scale BPO market Clie nts who need BPO in short term in specif ic domain Clie nts who wish to shif t wide range of operations to BPO BPaaS High Value BPO Strengthen/expand internal systems and BPO menu Large-scale BPO to shadow cl

  20. Slide 20: Strengthen the BBS cycle

    Strengthen the BBS cycle BBS cycle rate FY2026 40% FY2023 31% What is the BBS cycle rate? Ratio of sales from clients being provided two or more services from the three BBS cycle services against company-wide sales Measures Strengthen group-wide sharing of each business /group company solution for i

  21. Slide 21: RCN2 Strategy

    RCN2 Strategy Expand to new stage by expanding target industries and deploying to similar/related companies Cultivate next RC companies Deploy to similar/related companies BBS2026 Mobility Infrastructure Select 3 additional loyal customers BBS2023 Expand target industries Mobility Infrastructure Con

  22. Slide 22: Twinkle Co., Ltd.

    Twinkle Co., Ltd. Established in 1996. Originally focused on staff dispatch and data entry when launched. Later expanded operations to include system support (system and infrastructure development) and help desk operations. Expanding development and consignment business for call centers and educatio

  23. Slide 23: Financial Highlights

    Financial Highlights Hitoshi Uehara Senior Executive Officer, General Manager, Administration Division © Business Brain Showa-Ota Inc.

  24. Slide 24: Consolidated Operating Results

    [Financial Highlights] Consolidated Operating Results (millions of yen) Year ended March Year ended March Change from Earnings Ratio to 31, 2023 31, 2024 previous year forecast* expected value Orders received 39,751 34,691 -12.7% - - Revenue 37,063 34,218 -7.7% 34,000 100.6％ Business profit 3,207 2,

  25. Slide 25: Orders Received, Backlog of Orders, and Revenue (1)

    [Financial Highlights] Orders Received, Backlog of Orders, and Revenue (financial reporting basis) (1) * BBS changed to IFRS from the fiscal year ended March 2021, and the scope of consolidation has changed. 45,000 (millions of yen) Since the impact of this change is minor, the figures before the fi

  26. Slide 26: Orders Received, Backlog of Orders, and Revenue (2)

    [Financial Highlights] Orders Received, Backlog of Orders, and Revenue (financial reporting basis) (2) (millions of yen) 45,000 Orders received, backlog of orders, and revenue Decrease in orders received, 40,000 backlog of orders, and revenue 35,000 ・ Orders received and revenue declined over previo

  27. Slide 27: Orders Received, Backlog and Revenue (after deconsolidation)

    [Financial Highlights] Orders Received, Backlog of Orders, and Revenue (after deconsolidation) (millions of yen) 40,000 Revenue increased but orders received and backlog of orders remained unchanged 35,000 ・ Sales from orders received remained almost unchanged over previous period at 30,000 1.1% (Co

  28. Slide 28: Business Profit (financial reporting basis)

    [Financial Highlights] Business Profit (financial reporting basis) Decline due to impact of 8.7% Business profit 7,000 8.5% margin deconsolidation Business 6,500 profit 7.5% 7.5% 7.4% 6,000 Fiscal year ended March 31. 2023 6.9% (first half) 3,207 5,500 Target business profit margin Gross profit decr

  29. Slide 29: Cash Flow

    [Financial Highlights] Cash Flow Cash balance maintained despite acquisition of subsidiaries (millions of yen) Software Subsidiary Subsidiary sale Lease debt Dividend payment Other 24/3 remainder 23/3 remainder Sales CF acquisition acquisition revenue repayment expenditures Subsidiary acquisition ex

  30. Slide 30: Return on Equity (ROE)

    [Financial Highlights] Return on Equity (ROE) 64.4% Deteriorating in fact despite major improvement due to temporary profits • ROE performance showed major improvement Return on equity of 64.4% due to a gain of 18.1 billion yen from (ROE) loss of subsidiary control 15.7% 15.6% 14.9% 14% Net profit ma

  31. Slide 31: Dividends

    [Earnings Forecast] Dividends Set to 39 yen at the end of period for an annual 75 yen according to basic policy of 40% consolidated dividend payout ratio excluding temporary gains and losses. Dividend 43.0% 38.0% 37.9% 30.9% 27.0% 30.0% 30.9% 22.8% 27.3% Dividend 23.3% 23.3% payout ratio 18.0% 17.2%

  32. Slide 32: Profit (Loss) by Segment (financial reporting basis)

    [Financial Highlights] Profit (Loss) by Segment (financial reporting basis) Consulting and system development business Management services (BPO) business Revenue Revenue ■ YoY: - 3,326 million yen (-11%) ■ YoY: ＋358 million yen (+4%) 29,202 (millions of yen) 8,378 8,736 (millions of yen) 25,876 FY20

  33. Slide 33: Profit (Loss) by Segment (reflecting deconsolidation)

    [Financial Highlights] Profit (Loss) by Segment (reflecting deconsolidation) Significant increase in sales and profit in the consulting and system development businesses Consulting and system development business Management services (BPO) business Revenue Revenue ■ YoY: +1,826 million yen (+8%) ■ Yo

  34. Slide 34: Details of Consulting and System Development Business

    [Financial Highlights] Details of Consulting and System Development Business (financial reporting basis) (millions of yen) Revenue Segment income Year ended Year ended YoY Increase Year ended Year ended YoY Increase March 31, 2023 March 31, 2024 (decrease) March 31, 2023 March 31, 2024 (decrease) Ac

  35. Slide 35: Consulting and System Development Business Details (GSX deconsolidation)

    [Financial Highlights] Consulting and System Development Business Details (GSX deconsolidation) (millions of yen) Revenue Segment income Year ended Year ended YoY Increase Year ended Year ended YoY Increase March 31, 2023 March 31, 2024 (decrease) March 31, 2023 March 31, 2024 (decrease) Accounting

  36. Slide 36: Management Services (BPO) Business Details

    [Financial Highlights] Management Services (BPO) Business Details (financial reporting basis) (millions of yen) Revenue Segment income Year ended Year ended YoY Increase Year ended Year ended YoY Increase March 31, 2023 March 31, 2024 (decrease) March 31, 2023 March 31, 2024 (decrease) HR and payrol

  37. Slide 37: Management Services (BPO) Business Details (excluding MICS)

    [Financial Highlights] Management Services (BPO) Business Details (excluding MICS) (millions of yen) Revenue Segment income Year ended Year ended YoY Increase Year ended Year ended YoY Increase March 31, 2023 March 31, 2024 (decrease) March 31, 2023 March 31, 2024 (decrease) HR and payroll related o

  38. Slide 38: Consolidated B/S [Assets] (IFRS)

    [Financial Highlights] Consolidated B/S [Assets] (IFRS) Assets (millions of yen) 〔20,651〕 〔22,786〕 〔28,296〕 〔30,393〕 〔44,715〕 Other non-current assets 2,840 Deferred tax assets Other financial assets 16,736 Investments accounted for using the equity method 1,951 Goodwill 1,773 2,654 2,495 Right-of-u

  39. Slide 39: Consolidated B/S [Liabilities and Equity] (IFRS)

    [Financial Highlights] Consolidated B/S [Liabilities and Equity] (IFRS) Liabilities and Equity (millions of yen) 〔20,651〕 〔22,786〕 〔28,296〕 〔30,393〕 〔44,715〕 Lease liability (floating) 2,621 40,000 Trade and other payables 4,370 Contract liability 35,000 2,009 4,039 Other current liabilities 30,000

  40. Slide 40: Business Quadrant Analysis (ROIC and Growth) (1)

    [Financial Highlights] Business Quadrant Analysis (ROIC and Growth) (1) Consulting and System Development Business (by Company) Circle size indicates business profits 130.0% Current New growth primary 125.0% businesses Prev. period for PLMJ FRSC* businesses BSC Sales growth rate 149.9% 120.0% ROIC 4

  41. Slide 41: Business Quadrant Analysis (ROIC and Growth) (2)

    [Financial Highlights] Business Quadrant Analysis (ROIC and Growth) (2) Management Services (BPO) Business (by Company) Circle size indicates business profits 115.0% Current New growth primary businesses businesses BOK 110.0% EPCS Sales growth rate BBS 105.0% TEC TWK* 100.0% Existing low profit/grow

  42. Slide 42: Business Quadrant Analysis (ROIC and Growth) (3)

    [Financial Highlights] Business Quadrant Analysis (ROIC and Growth) (3) (Reference) Segments and Companies in Charge Sales Consulting and system development business Accounting system consulting and system BBS BSC JW development System development for financial industry FBS JGAAP, before consolidati

  43. Slide 43: Human Capital Investment

    [Financial Highlights] Human Capital Investment HR Policy Revision - Building HR Policy to Achieve Goal 2030 (Note) Primarily implemented at parent company BBS • Revision policy • Highly acceptable compensation that considers the market • Encourage taking on challenges and reward employees who achie

  44. Slide 44: Earnings Forecast

    Earnings Forecast © Business Brain Showa-Ota Inc.

  45. Slide 45: Earnings Forecast Consolidated Operating Results

    [Earnings Forecast] Consolidated Operating Results Significant revenue increase due to group restructuring, but profit is expected to decrease due to the loss of temporary factors. (millions of yen) Fiscal year ended March Fiscal year ending March 2025 (forecast) Difference YoY change 2024 (actual)

  46. Slide 46: Earnings Forecast: Outlook for Orders and Revenue

    [Earnings Forecast] 1. Outlook for orders received and revenue Consulting and system development business Management services (BPO) business Orders Orders Revenue Revenue received received 28,000 25,876 28,500 25,264 11,500 11,500 8,407 8,736 Fiscal year ended Fiscal year ending Fiscal year ended Fi

  47. Slide 47: Thank you for joining us today.

    Thank you for joining us today. NOTE The earnings forecasts in this document are based on managementʼs assumptions and beliefs in light of the information available to it at the time of writing. Actual results may differ from these forecasts due to various factors and risks, and no assurances or gua

  48. Slide 48: APPENDIX

    APPENDIX © Business Brain Showa-Ota Inc.

  49. Slide 49: BSC - Internal Release of Gen-AI Helpdesk Leveraging In-house Data

    BSC - Internal Release of Gen-AI Helpdesk Leveraging In-house Data BSC has internally released a Gen-AI helpdesk system using in-house data, and is currently testing it. The system meets the following needs. ・Need for a secure generative AI environment dedicated to their own use ・Need to combine gen

  50. Slide 50: Company Profile

    [Company Profile] Name Name in English Business Brain Showa-Ota Inc. Headquarters 15F Hibiya Fort Tower, 1-1-1 Nishishimbashi, Minato-ku, Tokyo Tokyo, Osaka, Nagoya, Shizuoka, Hamamatsu, Fukuoka, Niigata, Kumamoto, Business locations Kagoshima, Nago, Bangkok in Thailand, Ho Chi Minh City in Vietnam,

  51. Slide 51: BBS Group

    BBS Group Let the combined strengths of our group solve your management needs We combine the forces of our entire group to propose solutions to meet your management needs, thereby answering the needs of diverse clients. We will constantly evolve our group operations moving forward according to our c

  52. Slide 52: Urban Connections, 2024-05-29T00:22:28.637

    スライド 51 UC0 正式な英語表記を確認できませんでした。ご確認をお願いします。 Urban Connections, 2024-05-29T00:22:28.637

  53. Slide 53: END

    END © Business Brain Showa-Ota Inc.

Business Brain Showa-Ota — FY2024 Earnings Presentation on 6ix