Hennge K.k. · TSE:4475
Hennge K.k — FY2021 Earnings Presentation
69 slides from Hennge K.k's earnings presentation, Nov 12, 2021
Slide 1: FY09/2021 Full-year Consolidated Financial Results
Note: This is a translation of part of the original Japanese version and is provided for reference purposes only. In the event of any discrepancy between the Japanese original and this English translation, the Japanese original shall prevail. FY09/2021 Full-year Consolidated Financial Results HENNGE
Slide 2: Table of Contents
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Table of Contents 1. FY09/2021 Full-year Consolidated Financial Results 2. FY09/2022 Full-year Forecasts 3. Growth Strategy 4. Appendix Corporate Overview Total Addressable Market Others 5. Past Materials 2
Slide 3: FY09/2021 Full-year Consolidated Financial Results (Financial Results)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2021 Full-year Consolidated Financial Results (Financial Results) 3
Slide 4: Net Sales
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Net Sales (YoY, 12 months accumulated comparison) The net sales increased by 16.7% YoY to 4.85 billion yen. The sales of HENNGE One, our key driver of the growth, grew by 20.4%. HENNGE One Professional service and others Total
Slide 5: Overview of Consolidated Financial Results
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Overview of Consolidated Financial Results (YoY, 12 months accumulated comparison) (unit: million yen) 1. The net sales rose by 16.7% YoY to 4.85 billion yen. The sales of HENNGE One rose by 20.4% YoY to 4.36 billion yen. 2. T
Slide 6: Gross Profit
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Gross Profit (YoY, 12 months accumulated comparison) The gross profit increased by 0.61 billion yen YoY to 4.02 billion yen. The gross profit margin increased by 0.7pt YoY to 83.0%, and remains high. (unit: million yen) (Referenc
Slide 7: Profit Attributable to Owners of Parent
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Profit Attributable to Owners of Parent (YoY, 12 months accumulated comparison) The SG&A to sales ratio increased by 5.9pt YoY to 75.2% due to intensive advertising activities during the year. The profit attributable to owners o
Slide 8: SG&A
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Structure of Operating Expenses (YoY, 12 months accumulated comparison) SG&A to sales ratio 75.2% (SG&A to sales ratio) YoY (unit: million yen) Other SG&A increased mainly due to SG&A to sales (19.3%) enhanced recruitment acti
Slide 9: SG&A
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Structure of Operating Expenses (QoQ comparison of Q3 & Q4 FY09/2021) QoQ (unit: million yen) (unit: million yen) Other SG&A increased as a result of actively carried out recruitment activities. Other SG&A +47 Advertising expe
Slide 10: Net Sales and Operating Expenses
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Net Sales and Operating Expenses (unit: million yen) 10
Slide 11: Breakdown of Employees by Function
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Breakdown of Employees by Function 213 employees (Excluding part-time employees, as of 2021-09-30) 11
Slide 12: Number of Employees
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Number of Employees (unit: employee, Excluding part-time employees) 12
Slide 13: Cash Flow Statement
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Cash Flow Statement (YoY, 12 months accumulated comparison) (unit: million yen) (unit: million yen) CF from operating activities decreased by 247 million yen YoY mainly due to the payment of advertising expenses, such as for H
Slide 14: FY09/2021 Full-year Consolidated Financial Results (Business Activities)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2021 Full-year Consolidated Financial Results (Business Activities) 14
Slide 15: Business Highlights
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Business Highlights ● Advertisements and events ○ Holding HENNGE Partners Meeting 2021 (July 2021) ○ Hosting, sponsoring and participating in online events (July to Sep. 2021) ● Others ○ Release of new features and renewal of
Slide 16: Advertisements and Events
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Advertisements and Events Held a number of follow up events for HENNGE NOW!, a large-scale digital event held in the 2nd quarter, and to raise recognition of the new services announced in August. Q2 Q3 Q4 and so on... 16
Slide 17: Cooperation with partner companies
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Cooperation with partner companies HENNGE held an online meeting for resellers of HENNGE One in relation to new service. Enhancement of relationship with resellers will be continued and this will lead to further improvement of
Slide 18: New Features for HENNGE One
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results New Features for HENNGE One New features providing more secure file transfer, smartphone access security, and e-mail protection from targeted attacks were added on HENNGE One from Oct 2021. HENNGE Secure Download recipient send
Slide 19: Renewal of Service Lineup for HENNGE One
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Renewal of Service Lineup for HENNGE One Service lineups were renewed from Oct 2021. Approaching varieties of customers with high value-added suite plans, as well as setting up single-function plans for light users. Set plan P
Slide 20: FY09/2021 Full-year Consolidated Financial Results (KPI Results)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2021 Full-year Consolidated Financial Results (KPI Results) 20
Slide 21: HENNGE One KPI
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One KPI (YoY, compared to the end of FY09/2020) # of HENNGE One # of HENNGE One HENNGE One ARR contracted companies contracted users YoY +17.1% YoY +9.7% YoY +21.2% (as of 2021-09-30) (as of 2021-09-30) (as of 2021-09-3
Slide 22: HENNGE One KPI Highlights
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One KPI Highlights (compared to the end of FY09/2020) 1. Average monthly churn rate over the past 12 months rose by 0.09pt to 0.25% compared to the end of FY2020 and remains low. 2. The number of user companies increase
Slide 23: HENNGE One Gross Revenue Churn Rate
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Gross Revenue Churn Rate Continuously maintained a stable and sustainable growth model with a low churn rate. Average monthly churn rate over the past 12 months: 0.25% Theoretical average lifetime: over 33 years (as
Slide 24: HENNGE One Contracted Companies & Users
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Contracted Companies & Users +67 K users +52 companies 24
Slide 25: HENNGE One ARR & ARPU
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One ARR & ARPU +19 yen per user +0.19 B yen 25
Slide 26: FY09/2022 Full-year Forecasts
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2022 Full-year Forecasts 26
Slide 27: Our Policy of FY09/2022
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Our Policy of FY09/2022 Accelerate mid-term growth in HENNGE One ARR by aggressively investing in marketing and capture growth opportunities in the new normal. HENNGE One Business Achieve the sustained annual growth of more th
Slide 28: Overview of FY09/2022 Forecasts
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Overview of FY09/2022 Forecasts Accelerate mid-term growth in ARR for HENNGE One by investing aggressively in marketing and capture growth opportunities under the new normal. (unit: million yen) 1. The sales of HENNGE One, our
Slide 29: FY09/2022 Forecasts of Sales by Business
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2022 Forecasts of Sales by Business Sales of HENNGE One is expected to grow by 21.8% YoY to 5.31 billion yen. HENNGE One Professional service (unit: million yen) (unit: million yen) and others ■Actual ■Forecast 29
Slide 30: FY09/2022 Forecasts of Operating Expenses
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results FY09/2022 Forecasts of Operating Expenses Advertising expenses is expected to increase by 2.1% YoY to 0.67 billion yen. Operating expenses excl. advertisement is expected to increase by 22.8% to 4.68 billion yen. Operating exp
Slide 31: Growth Strategy
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Growth Strategy 31
Slide 32: Vision
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Vision We want to deliver the power of technology to as many people as we can. Liberation of Technology テクノロジーの解放 32
Slide 33: Maximize LTV
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Maximize LTV Our growth strategy is to maximize LTV. Currently, Y and r are already in a high number, therefore our focus is to maximize ARR. LTV = ARR × Y × r Y = [Average contract duration in years] r = [Gross profit rate] AR
Slide 34: Maximize ARR
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Maximize ARR ARR = N × n × ARPU maximize N maximize n N = # of contracted n = Average # of contracted companies users per contracted company maximize ● Increase our sales force ● Target large companies ● Expand our presence in
Slide 35: Progress of Our Growth Strategy
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Progress of Our Growth Strategy (HENNGE One) Aim to accelerate ARR growth by focusing on increasing N in the short term while increasing ARPU in the mid to long term. 35
Slide 36: Growth Strategy on and After FY2022
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Growth Strategy on and After FY2022 By FY2025, having HENNGE One’s ARR growth at mid-20% in CAGR, we aim to exceed 10 billion yen for HENNGE One’s ARR. Focus on increasing the number of contracted companies (N) and raising ARP
Slide 37: HENNGE One, supporting customers' change
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One, supporting customers’ change Supporting customers’ SaaS utilization and continuously liberate technology. Analytics SSO Messaging Security Device control Sending large files Free-PPAP Receiving large files Behavior d
Slide 38: HENNGE One as a SaaS platform
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One as a SaaS platform HENNGE One, an IDaaS, growing as the global SaaS market expands Currently integrates with over190 Cloud services and more 38
Slide 39: Appendix (Corporate Overview)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Appendix (Corporate Overview) 39
Slide 40: Corporate Profile
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Corporate Profile Company name: HENNGE K.K. Executives: Kazuhiro Ogura Representative Director & Chief Executive Officer Kazuaki Miyamoto Representative Director & Executive Vice President Yoshiki Nagatome Director & Executive Vi
Slide 41: Locations
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Locations Japan Taiwan Nagoya branch office 2016/8 Tokyo Head office Osaka branch office 2015/6 Fukuoka branch office 2018/8 41
Slide 42: Vision
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Vision We want to deliver the power of technology to as many people as we can. Liberation of Technology テクノロジーの解放 42
Slide 43: History
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results History Our business domain is ever-changing, but our will remains steadfast. Linux server management eCRM software HENNGE One IoT as a Service Establishment software HDE Customers Care (f.k.a. HDE mail service) HENNGE Worksty
Slide 44: Sales Structure by Business
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Sales Structure by Business About 90% of the net sales comes from HENNGE One business. (as of FY2021) 44
Slide 45: HENNGE One
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Identity as a Service (IDaaS) Provides centralized authentication to various SaaS-es, with Single-Sign-On (SSO) technology ID federation Access control Customizable policy Administrator Various cloud services Micros
Slide 46: HENNGE One
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Provides a balanced work environment of both convenience and security through five key features 1. HENNGE Access Control Unknown device Deny 3. HENNGE Email DLP Local device Delayed sending Content filtering Local IP
Slide 47: HENNGE One Solid Customer Base
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Solid Customer Base HENNGE One is used by 1,952 customers in various industries, and has 2.14 million users. Average users per contracted company is approximately 1,095 users. (as of 2021-09-30) Breakdown by Contrac
Slide 48: Appendix (Total Addressable Market)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Appendix (Total Addressable Market) 48
Slide 49: Cloud Adoption Rate in Japan
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Cloud Adoption Rate in Japan Cloud adoption rate in Japan has increased by 4.0pt to 22% from 2020. (Reference: Press release ‘Average Cloud Computing Adoption Rate in Japan’ in June 2021 by Gartner, Inc. URL of the original re
Slide 50: Changes in the Market Environment
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Changes in the Market Environment The number of companies using cloud services in Japan is expected to rapidly increase due to the impact of COVID-19. Domestic companies HENNGE Great East Japan Temporary cloud usage Approach e
Slide 51: Number of companies by employee size in Japan
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Number of companies by employee size in Japan N Huge potential within the market exists as Cloud adoption will accelerate going forward. Customers’ demands # of employees # of companies by each employee scale ID Management for
Slide 52: Regional split in the number of companies
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Regional split in the number of companies Japan has number of metro areas other than Tokyo. Our focus is to expand the business not only in Tokyo but also within other metro areas, such as Tokai, Kansai, Kyushu and others. Tok
Slide 53: Appendix (Others)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Appendix (Others) 53
Slide 54: Diversity & Inclusion
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Diversity & Inclusion Focusing our efforts on the Global Internship Program (GIP) to not only provide career development opportunities for the most talented candidates from all over the world, but also to be the precedent organ
Slide 55: Recurring Revenue Ratio
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Recurring Revenue Ratio The recurring revenue ratio increased 0.3pt YoY to 97.4%. Continuously achieving a strong and stable recurring revenue model. (unit: million yen) 55
Slide 56: Business Investments & New Business Development
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Business Investments & New Business Development Aiming to expand into new business fields adjacent to its existing businesses, our focus is on business investment and new business development, along with R&D activities. Busines
Slide 57: Past Materials (New Services, etc.)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Past Materials (New Services, etc.) 57
Slide 58: HENNGE One Business
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Business Licence lineup for HENNGE One announced in June 2019 ※ New contracts taken into place after Oct 2021 will apply new licence lineup which was announced in Aug 2021. 58
Slide 59: HENNGE One Business
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE One Business HENNGE One for Education (Since July 2020) In response to GIGA School Program advocated by the Japanese Ministry of Education, Culture, Sports, Science and Technology (MEXT), HENNGE One for Education has be
Slide 60: Professional Services and Other business
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Professional Services and Other business SumaMachi (Since Aug 2020) SumaMachi is a communication service that enables smooth two-way communication with community residents to municipalities nationwide. (Previously named as “CH
Slide 61: Past Materials (Marketing)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Past Materials (Marketing) 61
Slide 62: Marketing Activities for HENNGE One
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Marketing Activities for HENNGE One Conducting various activities to acquire customers (N) and improve ARPU in the mid-term. meeting Unreached potential customers event event Customer Large-scale event Marketing campaign engag
Slide 63: HENNGE NOW! and its Marketing Campaigns
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results HENNGE NOW! and its Marketing Campaigns Held the large-scale digital event HENNGE NOW! in Q2 FY2021. Spent approximately 490 million yen on advertising expenses and aggressively carried out the advertising activities such as T
Slide 64: Participant Attributes of HENNGE NOW!
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Participant Attributes of HENNGE NOW! As a results of the aggressive advertising activities in Q2 FY2021, approached a wide range of companies and partners nationwide who are considering a cloud adoption. Aiming to promote the
Slide 65: Past Materials (Our Surveys, etc.)
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Past Materials (Our Surveys, etc.) 65
Slide 66: Our Survey
HENNGE K.K. (4475:TYO) FY09/2021 Full-year Consolidated Financial Results Our Survey SaaS usage survey to our customers (Dec 2019) On average, our customers are using 7 cloud services per company, and 24% of them are using 10 cloud services. (# of companies) (# of cloud services) Survey overview: Sa
Slide 67: Glossary
Glossary ARR (Annual Recurring Revenue) refers to revenue, normalized on an annual basis, that a company expects to receive from its customers for providing them with products or services of subscription-based model. Email DLP (Email Data Loss Prevention / Email Data Leak Protection) prevents confide
Slide 68: Disclaimer
Disclaimer This document has been prepared by HENNGE K.K. (the “Company”) solely for information purpose. This document does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company in Japan, th
Slide 69: HENNGE
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