Lifull Co.ltd. · TSE:2120
Lifull Co.ltd — NEXT Co., Ltd. (now LIFULL Co., Ltd.) — Q3 FY2016 Earnings Presentation
65 slides from Lifull Co.ltd's earnings presentation, March 2017
Slide 1: Earnings Presentation [IFRS] Q3 FY ending March 2017
Designing Delightful Encounters NEXT Co., Ltd. (TSE 1st Section 2120) Earnings Presentation [IFRS] Third Quarter of the Fiscal Year Ending March 31, 2017 (April to December 2016) Disclaimer The opinions and projections, etc. contained herein represent the judgment of NEXT Co., Ltd. at the time this
Slide 2: Index
Index › Segments and Main Services Page 2 › Consolidated Results for FY2016/Q3 Page 3 › FY2016 Forecasts Page 11 › Business Strategies Page 12 › Appendix. Page 54 - Corporate Info Page 55 - Statements of Profit and Loss (quarterly) Page 56 - External Market Data (monthly) Page 57 - Subsidiaries and
Slide 3: Segments and Main Services
Segments and Main Services Segments Main Services (subsidiary providing each service) Domestic Real Estate HOME’S Information Services HOME’S Kaigo (nursing care) (Lifull Senior) Domestic Services AD MASTER (former Renter’s Net) (Renter’s) for Realtors NabiSTAR Lifull Marketing Partners Co., Ltd. Ov
Slide 4: Consolidated Results for FY2016/Q3
Consolidated Results for FY2016/Q3 Copyright(c) NEXT Co., Ltd. All Rights Reserved. 3
Slide 5: Condensed Statements of Profit and Loss
Condensed Statements of Profit and Loss IFRS * Significant growth in revenue by 14.8%, EBITDA by 6.3% and net profit by 4.2% YoY. FY2015 FY2016 Change Unit: JPY mil Q3 Q3 Change Main items % (Apr.-Dec.) (Apr.-Dec.) Revenue increase in Domestic Real Estate Information Services and Revenue 18,180 20,8
Slide 6: Expense-to-Sales Ratio
Expanse-to-Sales Ratio IFRS Cost of sales and other SG&A-to-sales ratio increased due to revenue generated by Lifull MP increased, which was in line with our expectation. 27.1% +1.2p 28.3% +2.2p 30.5% Cost of sales and other SG&A -0.4p -1.1p Advertising expenses 28.2% 27.8% 26.7% 25.5% 24.1% +0.4p P
Slide 7: Sales by Segment
Sales by Segment IFRS Domestic Services and Others made a steady growth. Overseas revenue decreased mainly due to foreign currency exchange rate. FY2015 FY2016 Change Unit: JPY mil Q3 Q3 Change Main items % (Apr.-Dec.) (Apr.-Dec.) Revenue 18,180 20,864 +2,684 +14.8% Domestic Real Estate 12,919 14,73
Slide 8: Segment Income and Loss
Segment Income and Loss IFRS Domestic Real Estate Information Services, the core business, achieved a significant growth. FY2015 FY2016 Change Unit: JPY mil Q3 Q3 Change Main items % (Apr.-Dec.) (Apr.-Dec.) Segment profit and loss 3,025 3,122 +97 +3.2% Although marketing cost and other costs Domesti
Slide 9: Condensed Statements of Profit and Loss (quarterly)
(ref.) Condensed Statements of Profit and Loss (quarterly) EBITDA decreased by 32.7% due to increase in advertising expenses and depreciation. FY2015 FY2016 FY2015 FY2016 Change Change Unit: JPY mil Q3 Q3 Change Unit JPY mil Q3 Q3 Change % % (Oct.-Dec.) (Oct.-Dec.) (Oct.-Dec.) (Oct.-Dec.) Revenue 6,
Slide 10: Condensed Statements of Financial Position and Goodwill
Condensed Statements of Financial Position and Goodwill IFRS Decrease in assets due to changes in foreign currency exchange rate. As of As of Unit: JPY mil Change Main items Mar 31, 2016 Dec 31, 2016 Decrease in cash and deposits -361 Assets 25,265 24,625 -639 Decrease in accounts receivable-trade -
Slide 11: Condensed Statements of Cash Flows
Condensed Statements of Cash Flows IFRS Cash and cash equivalents increased by JPY 0.3 billion to JPY 6.2 billion (Apr. to Dec.) FY2015/Q3 FY2016/Q3 Main items Unit: JPY mil (Apr.-Dec.) (Apr.-Dec.) Change FY2015/Q3 FY2016/Q3 Items (Apr.-Dec.) (Apr.-Dec.) Income before income taxes 2,958 3,065 Deprec
Slide 12: FY2016 Forecasts and Progress
FY2016 Forecasts and Progress IFRS Statements of Profit and Loss Sales by Segment [Full-year [Actual] [Full-year [Actual] forecast] Progress forecast] Progress Unit: JPY mil FY2016 FY2016/Q3 Unit: JPY mil % FY2016 FY2016/Q3 % (Apr.-Dec.) (Apr.-Dec.) Revenue 31,653 20,864 65.9% Revenue 31,653 20,864
Slide 13: Business Strategies
Business Strategies Copyright(c) NEXT Co., Ltd. All Rights Reserved. 12
Slide 14: NEXT Co., Ltd.
1997.3.12 » NEXT Co.,Ltd.
Slide 15: Create a system in which all real estate information is open and available
Our goal always remains the same “Create a system in which all real estate information is open and available” 14
Slide 16: Further growth
Revenue (JPY bn) 40.0 Established Stage Expansion Stage Global Expansion Stage 35.0 30.0 25.0 20.0 15.0 Toward 10.0 further 5.0 growth 0.0 -5.0 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 J-GAAP IFRS 15
Slide 17: Becoming the absolute No.1 in Japan
First priority Becoming the absolute No.1 in Japan 16
Slide 18: Domestic Real Estate Information Services
Domestic Real Estate Information Services Rentals and Real Estate Sales, New Houses and Condominiums, and Custom-built Homes and Renovations 17
Slide 19: 40,000 stores
Number of Affiliated Stores The network of affiliated stores is expanding. (Store) Target 40,000 40,000stores Record high 21,944 stores 18,438stores Mar. Dec. Dec. 2011 2015 2016 18
Slide 20: Steady growth: number of properties listed
Number of Properties Listed No. of Properties Listed (mil) Rentals & Real Estate Sales 8.15mil (mil) Number of Properties 百万 Listed by Peers (rentals and real estate sales) 8.00 As of Dec. 2016 8.00 6.20mil 6.00 6.00 4.00 4.00 Steady 2.00 growth 2.00 0 0.00 0.00 Apr. Company Company Company Dec. Dec
Slide 21: Growth Strategy
Domestic Real Estate Information Services Growth Strategy Market outlook Strategy (estimated by NEXT) Rentals Stable Real estate sales Expand Accelerate the growth cycle Custom-built homes Shrink and expand Renovations Expand the market share New houses & condos Shrink 20
Slide 22: Growth Cycle
Accelerate the cycle by taking various initiatives Growth Cycle Maximize customer experience. Strengthen advertisement and web marketing. 21
Slide 23: Strengthen Mobile Service Capabilities: Approx. 70%
Maximize Customer Experience - Strengthen Mobile Service Capabilities HOME’S Users PC vs Mobile Approx. 70% users are using it on their mobile devices PC Mobile *Actual results of Rentals & Real Estate Sales, New Houses & Condos, Custom-built Homes, and Renovations during December 2016. *Mobile: sma
Slide 24: LINE Inquiry and new Android functions
Maximize Customer Experience - Strengthen Mobile Service Capabilities Topic 1 LINE Inquiry now available Partner with LINE as a SME partner Direct inquiry available from users to realtors using LINE application (no need to be “friends”). Chat record with each realtor will be kept separately. Topic 2
Slide 25: Best of 2016
Maximize Customer Experience - Strengthen Mobile Service Capabilities Google Play Best Local Apps Best of 2016 24
Slide 26: Gomez Smartphone Site Ranking
Maximize Customer Experience - Strengthen Mobile Service Capabilities Gomez Smartphone Site Ranking Real Estate Information (Feb. 2017) Rank Service name Score No.1 1st HOME’S 7.71 Smartphone 2nd SUUMO 7.45 site 3rd Eheya Net 6.82 4th At Home 6.49 5th Mynavi Chintai 6.43 (source) Morningstar http://
Slide 27: Omni-channel Strategy
Maximize Customer Experience – Omni-channel Strategy Provide optimal information Utilize customers’ DB by multiple channels (under development) Lots of information Optimal information for customers Seamless proposal 26
Slide 28: HOME'S Sumainomadoguchi (HOME'S Counter)
Maximize Customer Experience - HOME’S Sumainomadoguchi (HOME’S Counter) Unimo Chiharadai Opened on Dec. 23, 2016 Shinjyuku Ginza shop * Shinagawa shop * shop * Tressa Yokohama Opened on Dec. 15, 2016 Continue to expand in the metropolitan area HOME’S Sumainomadoguchi https://sumainomadoguchi.homes.j
Slide 29: Information Visualization: HOME'S PRICE MAP
Maximize Customer Experience – Information Visualization Reference rents and sales prices in the metropolitan and Kinki areas are available. HOME’S PRICE MAP The service will became available in Aichi and Fukuoka areas in March 2017 HOME’S PRICE MAP www.homes.co.jp/price-map 28
Slide 30: Improve Service Quality: Wrong Image Detection by AI
Maximize Customer Experience － Improve Service Quality Wrong Image Detection System by AI Use deep learning to detect wrong images Submitted image Item Match ratio Judge “Kitchen” 70.3% Kitchen “Entrance” 23.7% “Equipment” 2.804% “Kitchen” Kitchen AI 97.3% “Kitchen” 0% Kitchen “Entrance” 0% Aim for
Slide 31: New Advertisement Strategy
New Advertisement Strategy Homes-kun will help you find a house♪ Use Homes-kun for promotion Awareness Rate of The brand awareness and Homes-kun service utilization are increased with an increase of awareness of Homes-kun 1.5x New TV commercial started on Oct. 17 LINE stickers available for a limite
Slide 32: Renovation market
The third growth area in Japan Renovation market 31
Slide 33: Room for Home Renovation Market to Grow in Japan
A Room for Home Renovation Market to Grow in Japan (JPY t) 12 JPY 12.0t Home renovation 10 market is expected to 8 6.9 7.3 keep growing 6.6 6.6 6.2 6.5 6.2 6 5.9 4 2 0 (Source) Yano Research Institute Ltd 2010 2011 2012 2013 2014 2015 2016 0 2020 1 2025 “Survey on home renovation market (2016)” (gov
Slide 34: A Challenge of HOME'S Renovation Business
A Challenge of HOME’S Renovation Business Unfulfilled orders Close rate drops during the peak season No. of No. of orders of renovation renovation company *The graphs are image. 33
Slide 35: Established a Renovation Contractor
Established a Renovation Contractor Kuwazawa Corporation 10％ 90％ Lifull Remodel (established on Nov. 30, 2016) 34
Slide 36: Lifull Remodel
Lifull Remodel Increase the no. of fulfilled orders Lifull Remodel takes the unfulfilled orders No. of No. of orders of renovation renovation company *The graphs are image. 35
Slide 37: Domestic Services for Realtors
Domestic Services for Realtors Lifull Marketing Partners, DMP, and CRM 36
Slide 38: One year since consolidation of new houses and condos sales divisions
One year has passed since the consolidation of sales divisions of new houses and condos in October 2015 New Houses & Condos Team 37
Slide 39: Lifull Marketing Partners
Lifull Marketing Partners Revenue approx.+ 42% (FY2015/Q2 vs FY2016/Q3) Projects approx. +30% Employees * +65 people Substantial growth since the acquisition *The average number of employees in FY2015/Q2 vs the average number of employees in FY2016/Q3. *Include the number of employees seconded from
Slide 40: Steady growth: new construction listings
Number of Properties Listed (building) No. of Properties Listed New Construction Houses & Condos 7,624 buildings 8,000 6,000 6,934 buildings Steady growth 4,000 2,000 0 Apr. 2010 Dec. 2015 Dec. 2016 39
Slide 41: To be the best partner of condo developers
Lifull Marketing Partners Project flow image Product design Concept work Create material Ad placement CRM field Flow (develop ad concept) (interview, shooting, (create website and web ad) (membership management, mail magazine, etc.) and writing) Full-service ad agency Web agency and production Consu
Slide 42: DMP NabiSTAR
Domestic Services for Realtors – DMP “NabiSTAR” DMP specialized for real estate company No. of Companies Using NabiSTAR HOME’S data Real estate company Customer data (No. of visits and info requests) Audience data from each company’s website NabiSTAR Personalize the activities YoY Ad placement Websi
Slide 43: Service List
Service List Becoming the absolute No. 1 by providing a wide range of solutions for both users and companies. Home mortgage calculation Being provided Under development/in planning Not undertaken Services Call center Service counter HOME’S app Home inspection New house/ HOME’S PRICE MAP Smart Viewin
Slide 44: Home Sharing
Home Sharing In preparation to launch a full-scale home sharing business in 2017 “Home sharing business bill (tentative)” will be submitted to the Diet in early March 2017 43
Slide 45: Investment-type Cloud Funding: Acquiring JG Marketing
Investment-type Cloud Funding – Acquiring JG Marketing Acquired shares of JG MARKETING on Jan. 27, 2017 to accelerate cloud funding business Use Idle property development Monetization remodeling renovation interior attract customers Accommodation, Café, etc… Return Cloud Funding Lending Investing In
Slide 46: Overseas: Trovit and Lifull
Overseas Trovit and Lifull 45
Slide 47: Trovit
trovit
Slide 48: Countries of Operation: 51 countries
Countries of Operation Available in 51 countries Trovit Arab Emirates Columbia Hungary Malaysia Peru Spain Ukraine Argentina Costa Rica India Mexico Philippines Sweden Uruguay Australia Czech Republic Indonesia Morocco Poland Switzerland Venezuela Austria Denmark Ireland Netherlands Portugal Taiwan
Slide 49: Initiatives in 2017
Initiatives in 2017 Initiatives in 2017 1. Strengthen SEO and roll out in each market 2. Strengthen sales capabilities 3. Strengthen mobile service capabilities Recover the traffic as early as possible and aim for further growth 48
Slide 50: Lifull Australia: Approx. 4x users
Lifull Australia AU No. of Users Increase significantly in one year since the site launch No. of info listed: approx. 410k * (No. 3 in Australia) Approx. 4x Jul. Aug. Sep. Oct. Nov. Dec. *As of Dec. 2016 2016 49
Slide 51: Lifull × Trovit: Case in Australia
Lifull × Trovit Case in Australia Place ads AU Send customers Entered Australia Started to operate in Australia in Dec 2015 earlier than Lifull Smooth start-up of Lifull by placing ads on Trovit website 50
Slide 52: Toward a New Stage
2017.4.1 Toward a New Stage 51
Slide 53: Name change to LIFULL and headquarters relocation
For Making all kinds of LIFE FULL NEXT Co., Ltd will change its name to “LIFULL Co., Ltd” and relocate its headquarters on April 1, 2017. New headquarters address 1-4-4 Koji-machi, Chiyoda-ku, Tokyo 102-0083 52
Slide 54: Toward the World's Best Life Database and Solutions Company
Toward the World’s Best Life Database and Solutions Company 53
Slide 55: Appendix
Appendix. Copyright(c) NEXT Co., Ltd. All Rights Reserved. 54
Slide 56: Corporate Info
Corporate Info Company Name NEXT Co., Ltd. (TSE 1st section: 2120) Representative Takashi Inoue, President and CEO March 12, 1997 Established History October 31, 2006 Listed in Tokyo Stock Exchange, Mother’s Section March 12, 2010 Listed on TSE 1st Section Capital 3,999 million yen Stock Issued 118,
Slide 57: Condensed Statements of Profit and Loss (quarterly)
Condensed Statements of Profit and Loss (quarterly) <J-GAAP> < IFRS > Consolidated statements of Profit and Loss (quarterly) FY2013 FY2014 FY2015 FY2016 Unit : JPY mil 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q Revenue 3,398 3,454 3,556 4,281 3,852 3,897 4,318 6,096 5,457 6,441 6,280 7,527 6,846 6
Slide 58: External Market Data (monthly)
External Market Data (monthly) Number of Apartments for sales Source : Real Estate Economic Institute Co., Ltd. 2014 2015 2016 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 (Jan-
Slide 59: HOME'S, a real estate and housing information listing site
Domestic Real Estate Information Services HOME’S, a real estate and housing information listing site http://www.homes.co.jp/ “HOME‘S” is the No.1 real estate and housing information listing site in Japan. Besides the quantity of information, HOME’S established screening team to improve information a
Slide 60: Services for Real Estate Industry
Services for Real Estate Industry CRM services for realtors Website creation service “Annex” A business support service provided by NEXT subsidiary Renters for Annex is a "next-generation homepage service" that allows rental property realtors The service provides CRM, batch conversion of even users
Slide 61: Other Businesses
Other Businesses Insurance agency search and appointment website Furniture / interior EC website “Lifull Hoken Soudan (insurance consultation)” “HOME’S Style Market” HOME’S Hikkoshi (move) HOME’S Trunk Room (self-storage) Other “Lifull” services 60
Slide 62: NEXT Group Companies (1)
NEXT Group Companies (1) （in chronological order with effective dates of establishment) - Planning and sales of “AD MASTER ”, CRM service for realtors - Consultation service Renter’s - Planning and operation of “Lifull Rumah”, a website providing real estate and housing information in Indonesia PT.
Slide 63: NEXT Group Companies (2)
NEXT Group Companies (2) （in chronological order with effective dates of establishment) - Operation of “HOME’S Kaigo (nursing care)”, one of the largest Lifull Senior websites in Japan to search for nursing care homes or elderly housing - Operation of ”HOME’S Hikkoshi (move)”, a website where quotes
Slide 64: NEXT Group Companies (2)
NEXT Group Companies (2) （in chronological order with effective dates of establishment) - Online home building mediation service Lifull Remodel - Reconstruction work mediation service - Contract work for interior decoration - Operating crowd-funding platform “Japan Giving” JG MARKETING and “Shooting
Slide 65: IR Information
IR Information IR Official account on Twitter Official Facebook page https://twitter.com/Next_2120_IR http://www.facebook.com/next.group.jp Contact Us Guide to IR News NEXT Co., Ltd. IR Support Desk We provide monthly performance data and timely disclosure data Tel: +81-3-5783-3603 (Monday to Friday
NEXT Co., Ltd. (now LIFULL Co., Ltd.) — Q3 FY2016 Earnings Presentation on 6ix