EXEO Group, Inc. · TSE:1951
EXEO — FY2015 Earnings Presentation
40 slides from EXEO's earnings presentation, May 12, 2016
Slide 1: Annual Results for the Fiscal Year Ended March 31, 2016 (FY 2015)
Annual Results for the Fiscal Year Ended March 31, 2016 (FY 2015) May 12, 2016 Building a better, brighter future together Total ICT Solutions: Contributing to the Realization of a Brighter Future by Bringing People Together and Forming Connections with Society URL: http://www.exeo.co.jp/overseas/in
Slide 2: Contents
Contents 1. Overview of FY15 Results ・・・3 (5) NTT Group (Access/Network) ・・・23 (1) Performance Figures ・・・4 (6) NTT Group (Mobile) ・・・24 (2) Orders Received ・・・5 (7) NCCs ・・・25 (3) Net Sales ・・・6 (8) Urban Infrastructure ・・・26 (4) Operating Income ・・・7 (9) SYSTEM-SOLUTIONS ・・・27 (5) Cash Flow ・・・9 (
Slide 3: 1. Overview of FY15 Results
1. Overview of FY15 Results (1) Performance Figures (2) Orders Received (3) Net Sales (4) Operating Income (5) Cash Flow －3－ Annual Results for FY 2015
Slide 4: Performance Figures
1. Overview of FY15 Results (1) Performance Figures ◆ Orders received and sales both down due to effects of reduced investment by telecom carriers, etc. ◆ Operating income slightly up due to increased efficiency countering reduced sales ■ Overview of FY15 results (consolidated) (¥bn) FY14 FY15 FY15
Slide 5: Orders Received
1. Overview of FY15 Results (2) Orders Received ◆ Down YOY as non-NTT down greatly despite SYSTEM-SOLUTIONS rise due to AID consolidation ◆ Did not meet plan target despite NTT increase, as non-NTT and others down ■ YOY (consolidated) ■ Compared to plan (consolidated) (¥bn) ○ Access ○ Network NTT Gr
Slide 6: Net Sales
1. Overview of FY15 Results (3) Net Sales ◆ Down YOY due to reduced carrier projects, despite environmental/social infra increase ◆ Missed plan target as strong NTT performance failed to counter major non-NTT stagnation ■ YOY (consolidated) ■ Compared to plan (consolidated) (¥bn) ● Public works orde
Slide 7: Operating Income
1. Overview of FY15 Results (4) Operating Income ◆ Up YOY due partly to improved efficiency, but reduced sales meant did not meet plan target ■ YOY (consolidated) ■ Compared to plan (consolidated) (¥bn) ● Increased SG&A expenses (AID, goodwill, etc.) ● Decreased profitability due to reduced NCC busi
Slide 8: Trends in Group company profitability
1. Overview of FY15 Results Reference: Trends in Group company profitability ◆ Continued high level of profits in Group companies ■ Trends in operating profits over the past five years (consolidated/non-consolidated) (¥bn) (Ratio of consolidated to non-consolidated profits) (1.3) (1.6) (1.7) (1.8) (
Slide 9: Cash Flow
1. Overview of FY15 Results (5) Cash Flow ◆ Stable cash flow ■ Cash flow (consolidated) (¥bn) FY13 FY14 FY15 Cash at beginning of FY 14.6 16.2 24.2 Operating activities 9.8 23.1 5.3 Investing activities -7.4 -2.8 -13.9 Financing activities -0.9 -12.3 0.3 Cash at end of FY 16.2 24.2 16.0 Note: All am
Slide 10: 2. Medium-Term Management Plan
2. Medium-Term Management Plan (1) Analysis of Medium-Term Management Plan (FY13–FY15) (2) Medium-Term Management Plan (FY16–FY20) －10－ Annual Results for FY 2015
Slide 11: Analysis of Medium-Term Management Plan (FY13–FY15): Performance
2. Medium-Term Management Plan (1)Analysis of Medium-Term Management Plan (FY13–FY15): Performance ◆ Record sales/profit in first year of plan, but fell subsequently ◆ Greatly affected by lower carrier capital investment; expansion of non-carrier business required Sales Operating income (¥bn) (¥bn)
Slide 12: Analysis of Medium-Term Management Plan (FY13–FY15): Measures
2. Medium-Term Management Plan (1)Analysis of Medium-Term Management Plan (FY13–FY15): Measures ◆ Launched solutions business, which is new growth field ◆ Increased profitability by ¥0.5 bn via Group reorganization and increased productivity measures ●Expanded new core businesses ・Expanded scope of
Slide 13: Medium-Term Management Plan (FY16–FY20)
2. Medium-Term Management Plan (2) Medium-Term Management Plan (FY16–FY20) ■ Medium-term vision ■ Basic Policies １．Reorganize business portfolio, fostering solutions into second core business ２．Expand engineering peripheral businesses by combining existing technologies and services ３．Expand business
Slide 14: Business environment and target portfolio
2. Medium-Term Management Plan (2) Medium-Term Management Plan (FY16–FY20): Business environment and target portfolio FY20 FY15 13% 25% Expansion of sales and 23% ¥287.4bn business domains by ¥400.0bn 50% development into new domains 64% 25% Increased traffic despite reduced fixed-line investment an
Slide 15: Principal Measures
2. Medium-Term Management Plan (2) Medium-Term Management Plan (FY16–FY20): Principal Measures ◆ Boost cost competitiveness and target business expansion through organic growth and M&A ◆ Meticulously manage human resources and Group structure to meet changes in business environment Establish solut
Slide 16: Segment Changes
2. Medium-Term Management Plan (2) Medium-Term Management Plan (FY16–FY20): Segment Changes ◆ NCCs clearly categorized as telecom carrier business ◆ Overseas projects, which will expand solutions business, becomes part of SYSTEM-SOLUTIONS Previous segments New Segments Business Focus Access Access A
Slide 17: 3. Plans for FY16
3. Plans for FY16 (1) Performance Figures (2) Orders Received and Net Sales (3) Operating Income (4) Investment Trends of Major Telecom Carriers (5) NTT Group (Access/Network) (6) NTT Group (Mobile) (7) NCCs (8) Urban Infrastructure (9) SYSTEM-SOLUTIONS (10) Improved Productivity －17－ Annual Results
Slide 18: Plans for FY16: Performance Figures
3. Plans for FY16 (1) Performance Figures ◆ Targeting YOY rise in income and profit through completion of ongoing construction jobs and increased orders ■ Plans for FY16 (consolidated) (¥bn) FY15 FY16 Actual Plan YOY A B B/A Orders received 300.4 305.0 102% Net sales 287.4 300.0 104% (12.5%) (12.5%)
Slide 19: Orders Received and Net Sales
3. Plans for FY16 (2) Orders Received and Net Sales ◆ Make up for reduced telecom carriers orders through urban infra and SYSTEM-SOLUTIONS ◆ Increase income again through lucrative carried-over projects and steady accumulation of orders ■ Orders received (consolidated) ■ Net sales (consolidated) (¥b
Slide 20: Status of projects carried over
3. Plans for FY16 Reference: Status of projects carried over ◆ Work carried over into 4Q at all-time high ■ Balance of projects carried over to next period by fiscal year (consolidated) (¥bn) 118.3 117.9 105.4 103.7 101.0 85.6 FY11 FY12 FY13 FY14 FY15 FY16 Note: All amounts less than ¥100m are disre
Slide 21: Operating Income
3. Plans for FY16 (3) Operating Income ◆ Increase profit through higher income and greater efficiency, despite deteriorating sales mix ■ Operating income (consolidated) (¥bn) ● Expansion of new fields ● Sales mix Up due to Others increase in sales -1.0 +1.6 Improved efficiency 20.0 +1.0 18.4 +1.6 FY
Slide 22: Investment Trends of Major Telecom Carriers
3. Plans for FY16 (4) Investment Trends of Major Telecom Carriers ■ NTT East/West ■ NTT DoCoMo (¥bn) 754.9 753.7 690.7 703.1 661.8 626.6 583.4 595.2 585.0 545.0 387.8 406.7 365.4 339.0 291.0 263.0 224.0 177.0 218.9 165.0 FY12 FY13 FY14 FY15 FY16 Plan FY12 FY13 FY14 FY15 FY16 Plan Optical fiber 合計 LT
Slide 23: NTT Group (Access/Network)
3. Plans for FY16 (5) NTT Group (Access/Network) ◆ Continuing downward trend for fixed-line network ◆ Profits secured by streamlining business ■ Net sales of NTT Group ■ NTT facilities management (fixed-line related) (fixed-line network, consolidated) 【Net sales (consolidated)】 （¥bn） (¥bn) 5 130.4 0
Slide 24: NTT Group (Mobile)
3. Plans for FY16 (6) NTT Group (Mobile) ◆ LTE-Advanced construction work at full pace ◆ Boost efficiency by applying process management systems and reviewing business processes ■ Net sales of NTT Group ■ NTT DoCoMo Network Development (mobile network, consolidated) Video Video Video (High resolutio
Slide 25: NCCs
3. Plans for FY16 (7) NCCs ◆ Rapid slowdown in FY15 due to cuts in capital investment ◆ Targeting return to increased income through expanded market share ■ Net sales of NCCs (consolidated) ■ Trial consolidation of KDDI construction and maintenance orders ＥＸＥＯ orders Hokkaido (no. of companies) (¥bn
Slide 26: Urban Infrastructure
3. Plans for FY16 (8) Urban Infrastructure ◆ Expand government communication construction through disaster wireless, road telecommunications, etc. ◆ Electrical construction and power pole elimination related to Tokyo metropolitan area redevelopment remain strong ■ Urban Infrastructure net sales (con
Slide 27: SYSTEM-SOLUTIONS
3. Plans for FY16 (9) SYSTEM-SOLUTIONS ◆ Shift focus from software development to system integration ◆ Make full-fledged start on cloud integration engineering through partnership with Microsoft ■ SYSTEM-SOLUTIONS net sales ■ SI (system integration) business (consolidated) (Expand business by increa
Slide 28: Performance and future initiatives of new solutions
3. Plans for FY16 Reference: Performance and future initiatives of new solutions ¥3.8bn 4 4 3 3 ¥2.1bn ¥1.8bn 2 2 New energy 1 ¥900m 1 0 field 0 15 16 15 16 ・ Regional power companies ・ Power Producers and Launched survival power supply (March) Suppliers (PPSs) Expand business in the ・ Smart meter S
Slide 29: Cloud service for new electric power companies
3. Plans for FY16 Reference: Cloud service for new electric power companies Cloud service for new electric power companies Power generation Management of customers and billing businesses Fee calculation Japan Electric Power supply Supply and demand Power Exchange procurement management Power trading
Slide 30: Survival power supply
3. Plans for FY16 Reference: Survival power supply World’s first portable high-capacity lithium-ion battery system that can be separated into units 5 Advantages １. Can be separated into units 1 unit 10 kg World first! Patent pending Separated units can be carried in a backpack ２. Light enough to car
Slide 31: Cloud Integration Engineering
3. Plans for FY16 Reference: Cloud Integration Engineering* Bolster partnership with Microsoft in corporate communication and IoT fields Existing Telecommunications Cloud Business Groupware Storage Authentication IoT Big Data Mail Cloud PBX Server processing /Analysis (1) Conduct joint promotion wit
Slide 32: Geospatial Business Development
3. Plans for FY16 Reference: Geospatial Business Development Geo services to meet different user needs Integrating management with WHERE to accelerate geospatial pioneering business using beacon (transmitters that can be placed anywhere) and other technologies Develop mesh-network next-generatio
Slide 33: EXTravel Distribution
3. Plans for FY16 Reference: EXTravel Distribution Carefree first-time travel! Disaster and evacuation information distribution to foreign tourists Distribution of EXTravel and other apps ◆EXTravel tourism/disaster info app Nikko; Daigoji, Kyoto; Ebina; Fujisawa; Fuefuki; Koya ; Fukaya ; adopted off
Slide 34: Global business initiatives
3. Plans for FY16 Reference: Global business initiatives ■ MG Exeo sales trends （¥100m） 1peso≒¥2.7 10 5 0 FY11 FY12 FY13 FY14 FY15 FY16 Plan MG Exeo (Philippines) as a base for development across SE Asia Development of ICT technology educators in the Philippines Philippines → Spread to other SE Asia
Slide 35: Improved Productivity
3. Plans for FY16 (10) Improved Productivity ◆ FY15 targets achieved ◆ Continued measures to improve profits ■ Enhanced profitability through cost reductions ＦＹ 2013 2014 2015 2016 ¥1.5bn ¥1.5bn ¥1.0bn ¥1.0bn Improvement Aims (cumulative ¥5.0bn) (cumulative ¥3.5bn) (cumulative ¥6.0bn) (cumulative ¥7
Slide 36: Reorganization of Group companies
3. Plans for FY16 Reference: Reorganization of Group companies ◆ Accelerated reorganization of Group companies aimed at improved streamlining and optimization of resources ■ Trends in number of subsidiaries (excluding Exeo Tech, Daiwa Densetsu) 33 companies ◇ Merger of 29 companies Kansai/Chugoku 27
Slide 37: Example of efficiency measure using EXRescue
3. Plans for FY16 Reference: Example of efficiency measure using EXRescue (facility management version) Former workflow After introducing ＥＸＲescue Construction site Construction site Construction Construction Smartphone photographs Use smartphone to take and send photos of Photos of meters with digi
Slide 38: 4. Raising Shareholders' Value
4. Raising Shareholders’ Value (1) Payment of Dividends －38－ Annual Results for FY 2015
Slide 39: Payment of Dividends
4. Raising Shareholders’ Value (1) Payment of Dividends ◆ Annual dividend up ¥8 YoY to ¥46, acquisition of ¥300m of treasury stock ◆ Targeting 3% DOE and continued stable mid- to long-term dividend rise ■ Dividend history (per share) ■ Total shareholder return (Total dividends + total acquisition of
Slide 40: Disclaimer Regarding Forward-Looking Statements
Disclaimer Regarding Forward-Looking Statements Management of the Company has made estimates and assumptions relating to financial forecasts based on information available as of the reporting date. Actual results could differ from those estimates. 3-29-20 Shibuya, Shibuya-ku, Tokyo 150-0002 JAPAN ht