Ir Japan Holdings Ltd. · TSE:6035
Ir Japan — Q1 FY2021 Earnings Presentation
34 slides from Ir Japan's earnings presentation, Aug 21, 2020
Slide 1: Financial Results for the Fiscal Year Ending March 31, 2021 1Q
Financial Results For the Fiscal Year Ending March 31, 2021 １Q （April 1, 2020～ June 30, 2020 ） August 21, 2020 IR Japan Holdings, Ltd. (6035)
Slide 2: Disclaimer
This presentation is made by IR Japan Holdings, Ltd. (hereinafter, “the Company”) solely for the disclosure of the financial statements, and not published for the purpose of soliciting sales or purchases of securities in Japan, United States, and any other regions. In addition, the Company makes no
Slide 3: Financial Results for the Fiscal Year Ending March 2021 1Q
１．Financial Results for the Fiscal Year Ending March 2021 1Q 3
Slide 4: FY2021 1Q: Financial Highlights
FY2021 1Q: Financial Highlights We achieved record high consolidated sales as well as record highs for all measures of profit during the quarter. Fiscal Year 2021 Q1 Previous （April 2020―June 2020） （April 2019―June 2019） Change from Change Amount Previous Amount （Millions of （Millions of Yen） Period
Slide 5: FY2021 1Q: Sales by Segment
FY2021 1Q: Sales by Segment Current Quarter Previous (April 2020-June 2020) （April 2019―June 2019） Amount % of total Change Amount （Millions of Yen） （％） （％） （Millions of Yen） IR・SR Consulting 2,265 95.2 10.7 2,046 Disclosure consulting 73 3.1 ▲1.7 75 Database/Other 40 1.7 ▲15.6 47 5
Slide 6: FY2021 1Q: Cost Breakdown
FY2021 1Q: Cost Breakdown SG&A expenses increased as a result of continued investment in personnel. (¥mln) Breakdown Item Current Previous Change （April 2020―June 2020） （April 2019―June 2019） Variable Costs Outsourcing 161 144 16 (Costs of Sales） Fixed Costs (SG&A) Personnel 504 434 70 Depreciation
Slide 7: FY2021 1Q: Main Financial Points
FY2021 1Q: Main Financial Points We achieved steady progress in winning unique PA/FA projects and while the growth rate is low we achieved record highs in sales and profits. ＜Factors＞ The risk of increased votes opposing public company’s proposals at shareholder meetings did not increase due to do
Slide 8: Q2 Revised Earnings Forecast (Announced July 31, 2020)
Q2 Revised Earnings Forecast (Announced July 31, 2020) We have successfully strengthened our front-office systems, and we anticipate that compared to the same period last year, the number of large-scale projects related to PA・FA activist defense and corporate control TOBs will increase by the end of
Slide 9: Trend of Quarterly Sales
Trend of Quarterly Sales 1Q 2Q 3Q 4Q （¥mln） 9,000～9,500 （Full-year forecast） 7,682 2,584 ＋133％ 4,350 4,827 （2Q forecast) 3,837 4,134 1,107 1,699 3,210 3,470 ＋20％ 923 +47% 909 ＋2％ 1,971 ＋2％ 1,160 676 ＋31％ 887 ＋22％ ＋28％ ＋13％ 949 1,230 ＋5％ 843 ＋5％ 791 ＋1％ 801 ＋6％ 1,173 862 ＋29％ 1,111 869 ▲12％ 766 ＋13％
Slide 10: Trend of Quarterly Operating Profit
Trend of Quarterly Operating Profit （¥mln） 1Q 2Q 3Q 4Q 3,626 1,308 2,218 (2Q forecast) ＋341％ 844 872 1,434 1,157 296 ＋207% 232 ＋50％ 1,010 ＋87％ 158 781 203 ▲22％ 198 ＋39％ 275 ▲25％ 550 107 ＋85％ 303 ▲23％ 1,346 269 120 315 ▲4％ 1,242 +161％ ＋8.3％ 125 ＋31％ 164 ＋34％ 152 ▲83％ 27 +353％ 579 ▲16％ 486 ＋15％ 560 ＋1
Slide 11: Our Workplace in the Corona Pandemic
Our Workplace in the Corona Pandemic Customers Implementation of in-person and online business activities Front of Kasumigaseki・Marunouchi Office Middle and back-office employees are working remotely 11
Slide 12: Trends in the Number of Large-Scale Projects
Trends in the Number of Large-Scale Projects *Projects over 50 million yen Trends in the number of large-scale projects* and sales (estimate) (¥mln） First Half Second Half Total Number Sales Number Sales Number Sales FY ended March 7 702 16件 2,537 23 3,239 2020 FY ending March 12 1,482 ー ー ー ー 2021
Slide 13: Pipeline of Large-Scale Projects In-Progress
Pipeline of Large-Scale Projects In-Progress＊ Type of deal Contracted Firm Type of Contract Content TOB Listed Firm（Mkt. Cap>¥500b） FA・PA TOB TOB Listed Firm（Mkt. Cap>¥500b） FA・PA Business Strategy, TOB TOB Listed Firm（Mkt.Cap>¥500b） FA・PA Business Strategy, M&A TOB Listed Firm（Mkt. Cap>¥10b） FA・PA
Slide 14: Activist Campaigns
Activist Campaigns In addition to companies that received activist proposals for the first time, the number of companies that have received proposals from the same activists consecutively for two years has risen. Number of Shareholder Proposals Submitted by Activists 23 11 16 13 10 9 10 6 5 12 4 4 2
Slide 15: Percentage of Companies with Activist Shareholders
Percentage of Companies on Main Stock Exchanges/Indices with Activist Shareholders Percentage refers to companies that have confirmed activist shareholders as of June 2020 100% 90.0％ 90% 80% 70% 59.4％ 60% Over 3 Activist Shareholders 50% 77% 23% 2 Activist Shareholders 40.0％ 40% 1 Activist Sharehold
Slide 16: Japanese Companies at Risk From Activists
① Japanese Companies at Risk From Activists Total internal reserves have risen year-on-year, surpassing ¥300 trillion in 2018, and are now currently at ¥365 trillion. Internal Reserves of Listed Japanese Companies ※Internal Reserves = Retained earnings + assumptions (Trillion 380 Yen) 365 360 上場企業内部
Slide 17: Japanese Companies with High Potential Risk from Activists
②Japanese Companies with High Potential Risk from Activists At present, more than 600 companies are at risk of being the target of activism. ※Companies with risk value quotient over 60 according to our firm’s AI analysis. Companies with Risk Quotient > 60 Companies with Risk Quotient > 80 637 101 62
Slide 18: Voting Results at Shareholders' Meetings
Voting Results at Shareholders’ Meetings (Trends in Voting at June 2020 Meetings) 319 companies received against votes of more than 20% at the June 2020 shareholder meetings. Assuming that voting guidelines had not been loosened because of the coronavirus, we estimate that this year more than 422 co
Slide 19: Important Guidelines Related to Management, M&A and Corporate Governance
Announcements of Important Guidelines Related to Management, M&A and Corporate Governance by the Ministry of Economy, Trade & Industry On July 31, the Ministry of Economy, Trade and Industry released the Business Restructuring Practical Guidelines and Practical Guidelines for Independent Directors T
Slide 20: Practical Guidelines for Business Transformation
「Practical Guidelines for Business Transformation （Corporate responses to shareholder opinions） Receiving shareholder opinions on a company’s business portfolio* presents firms with a prime opportunity to consider the optimal structure of their business portfolio to drive sustainable growth and in
Slide 21: Increased M&A by Strategic Buyers
Increased M&A by Strategic Buyers There has been an accelerated movement to promote strategic growth based on business restructurings TOB of Family Mart by Itochu TOB of Ootoya by Colowide TOB of Sony Financial Holdings HD by Sony TOB of Hitachi Chemicals by Showa Denko TOB of LIXIL Leverage by Arcl
Slide 22: Creation of a Huge Corporate Control M&A Market in Japan
Creation of a Huge Corporate Control M&A Market in Japan A huge market for corporate control M&A Public Hostile TOB Hostile TOB Companies Proxy contest Proxy contest Strategic Buyers Activists Activists and strategic buyers (Domestic & accelerate M&A activity while cleverly Overseas) utilizing vario
Slide 23: IR Japan's Strengths (Integration of PA & FA)
IR Japan’s Strengths (Integration of PA & FA) Financial Proxy Advisor Advisor Largest and most advanced Overwhelming record of professional group for activist gathering power of defense, hostile TOB defense, attorney • All strategy planning and execution advanced MBO and M&A for proxy contests • Hos
Slide 24: IR Japan's Strengths (AI-supported PA & FA Operations)
IR Japan’s Strengths (AI-supported PA & FA Operations) Ownership status Trading status Average acquisition price Capability to determine the real ・・・ shareholders of listed companies in Europe, America and Asia Approx. 20,000 companies Instantly grasp activist status (new ownership/sale) 3,500 c
Slide 25: Support for MBO Projects
Support for MBO Projects Even when companies are delisted via MBO, specialized FA groups with abundant experience in shareholder ownership analysis that can support companies in their strategic planning and execution are highly valued. 2020: Companies to be delisted via MBO Trend in the Number of MB
Slide 26: Transfer Agency Business
Transfer Agency Business The number of client companies contracted is 75, and the number of shareholders we administrate is 359,309 (as of June 30, 2020). Contrary to traditional agency’s strategy, we will continue to promote strategic business development by focusing on defending companies against
Slide 27: Forecast of Financial Results & Shareholder Return
２．Forecast of Financial Results & Shareholder Return 27
Slide 28: Revised FY2021 Earnings Forecast (Announced July 31, 2020)
Revised FY2021 Earnings Forecast (Announced July 31, 2020) We revised the full-year forecast upward as we expect the number of large-scale project contracts in the PA・FA investment banking division to increase along with the steady expansion of SR. Full-year Forecast (ending March 31, 2021) Change f
Slide 29: Shareholder Return
Shareholder Return For FY2021, the annual dividend is expected to be 70 yen, with an interim dividend of 25 yen per share and a year-end dividend of 45 yen per share. Payout Dividend per Share Interim Year-End Annual Ratio FY2019 15 yen 23 yen 38 yen 69.3% Actual FY2020 25 yen 45 yen 70 yen 51.0% Fo
Slide 30: Supplementary Information
3. Supplementary Information 30
Slide 31: Field Power of Equity and Market Size
Field Power of Equity and Market Size SR （Shareholders Relations） M&A IR （Mergers and Acquisitions） （Investor Relations） Shareholder Support Corporate Acquisition Investor Support SR Market in the wide sense: 100 billion yen M&A Market: 600 billion yen IR Market in the wide ◆Transfer Agency ◆M&A Com
Slide 32: The Company's Long-Term Goals
The Company’s Long-Term Goals The Current SR (“Shareholder Relations”) Market (the broad market measure which includes TA (“Transfer Agency”) SR Market The Group’s current market share: 3 Billion Yen TA Market (share breakdown: 60% of SR Market narrow measure + TA Market) ＊ narrow measure (95 billio
Slide 33: Total Shareholder Return (TSR)
Total Shareholder Return (TSR) Period 3/31/2020 7/31/2020 1 Year 304.09% 415.54% 3 Years 673.90％ 1864.50％ 5 Years 1222.39％ 2819.18％ From Listing (3/11/2011) 2820.25％ 8660.79％ ※TSR: calculated as capital gain + income gain assuming the income gain is re-invested and the value of the re-invested divid
Slide 34: Power of Equity is a registered trademark of IR Japan
We, IR Japan, are a consulting firm that provides services with high additional value based on voting power, for the development of the capital market. 「Power of Equity」 is a registered trademark of IR Japan