Lifull Co.ltd. · TSE:2120

Lifull Co.ltd — Q1 FY2019/9 Earnings Presentation

60 slides from Lifull Co.ltd's earnings presentation, February 2019

  1. Slide 1: Earnings Presentation IFRS

    LIFULL Co., Ltd. Earnings Presentation IFRS First Quarter of the Fiscal Year Ending September 30, 2019 (October to December 2018) Disclaimer The opinions and projections, etc. contained herein represent the judgment of LIFULL Co., Ltd. at the time this document was prepared. We provide no guarantees

  2. Slide 2: Index

    Index 1. Key Points P.02 2. LIFULL Group Growth Strategy P.03 3. Consolidated Financial Results for FY2019/9 Q1 P.11 4. Business Update P.18 5. Revision of the Full-year Forecast P.32 6. Appendix P.38 7. IR Office Information P.59

  3. Slide 3: Key Points

    Key Points 1. FY2019/9 Q1 Revenue: JPY 8.3 billion, +3.2% YoY EBITDA: JPY 1.8 billion, +34.1% YoY 2. Media enhancement initiatives underway to improve ARPA 3. Trovit continuously on the growth track: Revenue Oct-Dec (local currency basis) +16.1% YoY 4. Completed procedures to make Mitula Group Limit

  4. Slide 4: LIFULL Group Growth Strategy

    LIFULL Group Growth Strategy (No change from the previous disclosure) Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 3

  5. Slide 5: Company Slogan

    Company Slogan “Becoming the best life-event database and solution company in the world.” 4

  6. Slide 6: LIFULL HOME'S Core Strategy

    Mid-to-Long Term Global Strategy Roadmap Platform Expand in the real estate field real estate Stimulate markets real estate Transform the markets real estate industry Cover Akiya Bank Cover investment Data- information and evaluations property Build global database base (property info, pricing, asse

  7. Slide 7: Mid-Term Management Plan Quantitative target

    Mid-Term Management Plan Quantitative target FY2020/9 Revenue JPY 50+ billion EBITDA ratio approx. 20% 6

  8. Slide 8: Mid-term Plan 2020

    FY2019/9 is an investment phase to achieve the targets of the “Mid-term Plan 2020” 7

  9. Slide 9: To achieve Mid-term Plan 2020

    To achieve “Mid-term Plan 2020” Investing in FY2019/9 to achieve the targets of the “Mid-term Plan 2020” 01 Growth of HOME’S Services Business 02 Growth of Overseas Business • ARPA*1 x Number of customers*2 • Strengthen Trovit business ┗ Improve ARPA through growth • Make Mitula a subsidiary ┗ Enhan

  10. Slide 10: Multi-dimensional initiative to strengthen media capability

    Multi-dimensional initiative to strengthen media capability Campaigns Aim to be the absolute Branding number one in the market by strengthening media Strengthening Marketing Power of SEO capability and maximizing the LIFULL HOME’S value proposition Optimization Paid Marketing 9

  11. Slide 11: Growth of overseas business

    Growth of overseas business - Accelerate growth through M&A - In addition to achieving organic growth of Trovit, accelerate overseas growth through Mitula acquisition. Integrated management to strengthen earning capacity Area Strategy Competitive Service Strategy Sales Strategy Organization Strategy

  12. Slide 12: Consolidated Financial Results for FY2019/9 Q1

    Consolidated Financial Results for FY2019/9 Q1 Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 11

  13. Slide 13: Condensed statements of income and loss IFRS

    Condensed statements of income and loss IFRS Revenue was up 3.2% YoY, EBITDA was up 34.1%, quarterly net profit was up 69.6% Unit: JPY mil FY2018 Q1(Oct.-Dec.) FY2019 Q1(Oct.-Dec.) Change Change % Revenue 8,128 8,391 +262 +3.2% *1 Cost of sales 928 1,048 +119 +12.8% *2 SG&A (excl. depreciation and a

  14. Slide 14: Expense-to-revenue ratio IFRS

    Expense-to-revenue ratio IFRS EBITDA margin improved significantly thanks to a lower ratio of advertising expenses following the ad-optimization and profit generated by business transfer. +1.5pt -3.3pt 28.7% -2.6pt 26.0% 30.4% 32.0% Cost of sales and other SG&A -1.9pt 28.0% Advertising expenses 24.3

  15. Slide 15: Sales by segment, segment income and loss IFRS

    Sales by segment, segment income and loss IFRS Revenue growth achieved in all segments Income generated by the HOME’S Services Business increased YoY due to a decrease in temporary expenses and an effort to reduce costs Significant increase in Overseas Business following the Trovit revenue growth an

  16. Slide 16: Progress of business forecast for the FY2019/9 IFRS

    Progress of business forecast for the FY2019/9 IFRS Condensed Statemants of Income and Loss Revenue by Service FY2019/9 FY2019/9 FY2019/9 FY2019/9 Oct.-Sep. Oct.-Sep. Progress Oct.-Sep. Oct.-Sep. Cahnge Unit: JPY mil [Full-year [Actual] % Unit: JPY mil [Full-year [Actual] % forecast] forecast] Reven

  17. Slide 17: Condensed statements of financial position and goodwill IFRS

    Condensed statements of financial position and goodwill IFRS Short-term borrowing increased by JPY 3.2 billion for acquisition of Mitula shares As of As of Change Change% Main items Unit: JPY mil Sep 30, 2018 Dec 31, 2018 Decrease in cash and deposits -117 Current assets 12,900 12,705 -195 -1.5% Dec

  18. Slide 18: Condensed statements of cash flow IFRS

    Condensed statements of cash flow IFRS Cash and cash-equivalent was JPY 7.4 billion decreased by JPY 100 million QoQ FY2018/9 Q1 FY2019/9 Q1 Change Main items Unit: JPY mil Oct.-Dec. Oct.-Dec. Items FY2018/9 Q1 FY2019/9 Q1 Profit for the period before tax +1,080 +1,520 Depreciation and amortization

  19. Slide 19: Business Update

    Business Update Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 18

  20. Slide 20: KPIs - Client network・ARPA

    KPIs - Client network・ARPA - ARPA improved by 1.2% YoY (JPY) ARPA Number of Clients 120,000 29,000 27,373 100,000 27,042 84,049 85,017 27,000 83,074 80,000 25,000 23,629 23,000 60,000 21,000 40,000 19,000 20,000 17,000 0 15,000 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 FY2017

  21. Slide 21: New proposal for house hunting - LIFE LIST

    New proposal for house hunting - LIFE LIST - LIFE LIST Released: Service which allows users to find a house based on their own ideal lifestyle 01 Introduce various lifestyles # living near the beach # amazing scenery # cyclers #・・・・・ etc. 02 Suggest properties which fit the user’s lifestyle LIFE LIS

  22. Slide 22: Enhance media capability - Promotion

    Enhance media capability - Promotion - Execute a marketing mix, such as TV commercials and campaigns, linked to new content to further increase traffic to LIFULL HOME’S LIFE LIST Campaigns TV Commercials See P20 for the details. https://www.homes.co.jp/chintai/cp/201901-01/ https://www.youtube.com/u

  23. Slide 23: Enhance media capability - Promotion

    Enhance media capability - Promotion - Launched a short TV program from Oct. 6, 2018 to increase awareness of LIFULL HOME’S brand Title : Stories - A home to explore your life - Chanel : Nippon Television Network *Kanto region only あなたのライフを探す家 検索 Schedule : Every Saturday 22:54 - 23:00 http://www.nt

  24. Slide 24: LIFULL HOME'S ability to attract traffic

    (Ref.) LIFULL HOME’S ability to attract traffic Apr. 2017 - Steady Apr. 2018 - progress 4月 Apr 5月 May 6月 June 7月 July 8月 Aug 9月 Sep 10月 Oct 11月 Nov 12月 Dec 1月 Jan 23

  25. Slide 25: Overseas business growth - Growth of Trovit

    Overseas business growth - Growth of Trovit - Continued to grow in Q1 (Oct–Dec): +16.1%* YoY +16.1% Continuous growth * Trovit results based in Euro 24

  26. Slide 26: Overseas business growth - Mitula compared with Trovit

    Overseas business growth - Mitula compared with Trovit - 【Markets】 73% overlap (46 out of 63 markets) 【Services】 100% overlap Aggregation website for: Aggregation website for: Real estate, pre-owned cars and jobs Real estate, pre-owned cars and jobs Portal website for real estate Aggregation website

  27. Slide 27: Mitula joined LIFULL Group

    Jan 8, 2019: Mitula joined LIFULL Group 26

  28. Slide 28: Acquisition of Mitula Group Limited

    Overseas business growth - Acquisition of Mitula Group Limited - Mitula joined LIFULL Group on Jan 8, 2019 Business Operation of aggregation websites (Real estate, pre-owned cars, fashion and jobs) Operation of portal website (Real estate) Business Performance (2018) Sales JPY 3.8 billion EBITDA JPY

  29. Slide 29: Mitula business performance

    (Ref.) Mitula business performance Continuous growth in both sales and profit Revenue (AUD) EBITDA (AUD) 18 60 $16.2m $56.6m 16 50 $47.8m 14 $12.3m $11.9m $11.6m 12 40 $33.6m 10 *2 30 $28.0m 8 $7.5m $20.6m 6 $5.4m 20 4 $10.7m 10 $1.9m $5.3m 2 $3.8m $1.0m 0 0 CY2012 CY2013 CY2014 CY2015 CY2016 CY2017

  30. Slide 30: Business consolidation of Trovit and Mitula

    Overseas business growth - Business consolidation of Trovit and Mitula - Plans to establish and co-manage LIFULL CONNECT Utilize a multi-brand approach to increase market share without combining websites Streamline Management through Organization Leverage Enhance competitiveness in the global market

  31. Slide 31: Benefits of management consolidation

    Overseas business growth - Benefits of management consolidation - Continuous growth by leveraging the strength of Trovit and Mitula 01 Ability to Attract Traffic 02 Technological Capability 03 Marketing Ability 04 Great Corporate Management 05 Streamlining • Market share • Share advanced • Will be a

  32. Slide 32: Overseas business growth - Growth strategy

    Overseas business growth - Growth strategy - Increase the potential value for traffic and enable multilateral opportunities for future revenue. ③ Transaction • High-quality High Increase opportunities referrals for future revenue • Turn-overs • Secondary markets New (Peripheral domains) Products ②Ad

  33. Slide 33: Revision of the Full-year Forecast

    Revision of the Full-year Forecast Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 32

  34. Slide 34: Revision of FY2019/9 forecast IFRS

    Revision of FY2019/9 forecast IFRS Started to consolidate Mitula from Jan 2019 Expected synergy from the joint management of Trovit and Mitula is not reflected in this revision Condensed Statemants of Income and Loss Revenue by Service FY2019/9 FY2019/9 FY2019/9 FY2019/9 Change Cahnge Change Cahnge

  35. Slide 35: Details of the revision of the forecast

    Details of the revision of the forecast Mitula contributions including (temporary) costs associated with the acquisition are reflected in the forecast Revised currency assumption for the full-year: EUR 1=JPY 129 -> EUR 1=JPY 127 Revenue（百万円） (JPY million） EBITDA（百万円） (JPY million） 42,378 42,306 6,73

  36. Slide 36: Forecast for FY2019/9 if temporary factors eliminated

    (ref.) Forecast for FY2019/9 – If temporary factors etc. are eliminated - Revenue (JPY million) EBITDA (JPY million) 43,401 6,741 42,306 ■ Mitula 5,975 (Oct. – Dec.) ■ Temp. Costs (M&A Costs) FY2019/9 FY2019/9 FY2019/9 FY2019/9 Revised Forecast Actual Value Est. Revised Forecast Actual Value Est. *

  37. Slide 37: Roadmap to achieve targets of the Mid-term Plan 2020

    Roadmap to achieve targets of the Mid-term Plan 2020 Achieve targets of the Mid-term Plan by increasing revenue with the consolidation of the management of Mitula and Trovit. Revenue and EBITDA margin over 500 (Unit: JPY 100 million) 434 * ① Revenue of 345 +25.6% *① +15.2% over *② 15.2%+ in FY2020/9

  38. Slide 38: Pushing Forward

    ~ hor Forward — ae | ) Ly LIFULL 54 LIFE *, FULLE. *

  39. Slide 39: Appendix

    Appendix Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 38

  40. Slide 40: Corporate Info (as of January 8, 2019)

    Corporate Info (as of January 8, 2019) Company LIFULL Co., Ltd. Stock code 2120 (TSE 1st Section) Representative Takashi Inoue, President and CEO History Mar. 12, 1997 Established Oct. 2006 Listed in TSE, Mother’s Section Mar. 2010 Listed on TSE 1st Section Capital JPY 9,716 million Stock issues 134

  41. Slide 41: LIFULL HOME'S

    LIFULL HOME’S LIFULL HOME’S, a real estate and housing information listing site https://www.homes.co.jp/ • “LIFULL HOME'S” is the No.1* real estate and housing information listing site in Japan. *Sankei Medix (2018.1.30) • LIFULL has an internal team specialized in improving information accuracy and

  42. Slide 42: LIFULL Group Services

    LIFULL Group Services LIFULL Kaigo (nursing care) LIFULL Hikkoshi (moving) LIFULL Storage LIFULL Interior Website to search nursing care homes Website to make an inquiry A website to search rental storage rooms/units Furniture / interior EC website or elderly housing and reservation with movers Oper

  43. Slide 43: LIFULL Group Companies

    LIFULL Group Companies (in chronological order by effective date of establishment or addition to the scope of consolidation) PT. LIFULL MEDIA INDONESIA *1  Planning and operation of “LIFULL Rumah” a real estate and housing information website in Indonesia  Home hunting proxy service in Jakarta for

  44. Slide 44: Other Data

    Other Data Copyright(c) LIFULL Co., Ltd. All Rights Reserved. 43

  45. Slide 45: Segments and Major Services

    Segments and Major Services Segments Main services HOME’S Services Business LIFULL HOME’S AD Master (former Renter’s Net) NabiSTAR LIFULL Marketing Partners Co., Ltd. Overseas Business Trovit (Trovit Search, S.L.) Mitula (Mitula Group Limited) LIFULL Tech Vietnam Co., Ltd. Others Business LIFULL Kai

  46. Slide 46: KPI - Number of Total Information Listed

    KPI - Number of Total Information Listed - Number of Total Listings 総掲載情報量 (Mil. Listings) (万件) Maintained an unprecedented amount of data while improving reliability 7.79mil 6.68mil Strengthen efforts to improve information accuracy 2015年 2015 2017年 2017 2018年 2018 4月 9月 9月 Apr. Dec. Dec. *Total in

  47. Slide 47: Number of properties listed

    Number of properties listed – Units for rent and sale & new houses and condos Units for Rent and Sale New Houses and Condos (Mil. units) 8 (Projects) 14,000 12,392 buildings 7.75mil 6.64mil 12,000 6 10,599 buildings 10,000 8,000 4 6,000 4,000 2 2,000 0 0 2008 2017 2018 Co. Co. Co. 2010 2017 2018 Apr

  48. Slide 48: Number of affiliated realtors

    Number of affiliated realtors Affiliated realtor *network has been expanding steadily Mid to Long-Term Target 40,000 realtors *Number of real estate brokerages included in number of clients (realtors) on P19 Steady Growth 25,185 realtors 24,440 realtors 2011 2017 2018 Mar. Dec. Dec. 20XX 47

  49. Slide 49: LIFULL service list

    LIFULL service list LIFULL provides a wide range of user-friendly and realtor-friendly services Mortgage estimates Escrow Being Under development/in Not provided planning undertaken Online property Counter For users Call Center Viewing Online contact Started in FY18/9 Q1 LIFULL HOME’S app LIFULL HOM

  50. Slide 50: Definition of number of clients and ARPA

    Definition of number of clients and ARPA Number of clients: Number of total paying clients of LIFULL HOME’S and LIFULL Marketing Partners (including the clients who use DMP and CRM) Definition ARPA: Average Revenue Per Agent, revenue per clients HOME’S Services Business revenue / number of clients *

  51. Slide 51: All-around services to increase ARPA

    All-around services to increase ARPA Aim to increase ARPA through provision of media and services for realtors Media To increase ARPA Enhance media capability ARPA Increase services For Realtors Admin. Support Services Strengthen admin. support Subsidiary Services services Other Services Product dev

  52. Slide 52: Consolidated statements of profit and loss (quarterly)

    Consolidated statements of profit and loss (quarterly) FY2017/03 FY2017/09 FY2018/09 FY2019/09 Unit : JPY mil 1Q 2Q 3Q 4Q 1Q 2Q 1Q 2Q 3Q 4Q 1Q Revenue 6,846 6,910 7,107 9,056 7,793 8,154 8,128 9,541 8,345 8,549 8,391 HOME'S Services Business 5,616 5,782 5,955 7,662 6,472 6,816 6,742 8,062 6,833 6,96

  53. Slide 53: Overseas business results - Revenue (by quarter)

    Overseas business results - Revenue (by quarter) Growth in Overseas Business focused around Trovit 1,058 Unit: JPY mil 984 986 941 936 Others 910 884 866 868 847 824 796 751 751 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 FY2016/3 FY2017/3 FY2017/9 FY2018/9 FY2019/9 52

  54. Slide 54: Overseas business results - Operating Profit (by quarter)

    Overseas business results - Operating Profit (by quarter) Growth in Overseas Business focused around Trovit Unit: JPY mil 334 331 294 Others ３00 267 260 204 216 204 200 200 125 １00 ０ PPA Mitula Acquisition －100 -54 -78 Related Costs - 105 - 118 - 134 - 134 - 126 International - 144 - 136 ２00 Busines

  55. Slide 55: Overseas business growth - Number of employees

    (Ref.) Overseas business growth - Number of employees - Number of employees in overseas subsidiaries has been increasing as a result of the expansion of the Overseas Business (Number of employees) 1,500 1,421 Overseas employee ratio 1,251 264 1,133 125 over the past five years 946 146 1,000 755 138

  56. Slide 56: Others business results - Revenue

    Others business results - Revenue Growth in the Business focused around the four subsidiaries <Revenue by quarter> 単位：億 Unit: JPY mil 543 553 528 526 502 New businesses 480 excluding the 462 four businesses “LIFULL senior” transferred to Others Business Establishment of the four Existing businesses

  57. Slide 57: Others business results - Operating income (quarterly)

    Others business results - Operating income (quarterly) Existing business increased steadily. Other business is investment stage, but plan to further grow further 117 98 100 <Operating Income by quarter> Unit: JPY mil 61 62 49 50 51 47 30 25 22 20 10 Existing businesses * 0 -13 -19 -19 -30 -31 New bu

  58. Slide 58: External market data

    External market data 2015 2016 2017 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 (Jan-Dec) (Jan-Dec) (Jan-Dec) Capital Region 40,449 35,772 35,898 1,384 2,310 3,408 2,741 2,603

  59. Slide 59: Overseas competitors

    (Ref.) Overseas competitors Competitors have high market capitalization due to their user shares in each country. *Zoopla acquired Silver Lake Partners [Rightmove, UK] (US) in July 2018 for £ 2.2bn Revenue 34.7B.JPY Market Cap Market Cap [LIFULL, JP] EBITDA 25.7B.JPY 930.7 B.JPY [Zoopla, UK] 612.3 B

  60. Slide 60: IR Office Information

    IR Office Information IR Website English https://LIFULL.com/en/ir/ Japanese https://LIFULL.com/ir/ TEL 03-6774-1603 (Monday to Friday 10:00AM-6:00PM) E-mail ir@LIFULL.com FAX 03-6774-1737 Annual Report 2017 Other Information Twitter Facebook Page Japanese https://lifull.com/news/10305/ English https

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