1Q FY2019 Results Briefing Materials · 2019-08-27 · net sales are firm relative to forecasts....
Transcript of 1Q FY2019 Results Briefing Materials · 2019-08-27 · net sales are firm relative to forecasts....
1Q FY2019 Results Briefing MaterialsAugust 9, 2019
1Q FY2019 Financial Results Overview
1Q FY2019 Financial Results Overview
2
Promoted core policies towards achieving Medium-Term Management Plan Commitment 2022 Reinforced cost management, with progress for all divisions progressing largely as planned
EBITDA
Ordinary Income
Operating Income
Gross Margin
Net Sales 3.391Q FY2019
-0.087-0.169
-0.1620.46
Initial forecast
−
−
3.31
0.45
-0.129
Ratio
− %
− %
+2.5%
+3.1%
− %
+0.08
Change
+0.041
−
−
+0.01
(unit: JPY billion)
About our Business Domains
Ad technology domains
Marketing technology domains
Marketing Automation PlatformMarketing inside sales
Chat-based customer service tool / Inquiry response
CRM/SFA (sales force/customer relations management)
Expand business domains
Expand service domains
Indonesia IndiaSingapore ThailandVietnamJapan
Supply side (GenieeSSP)
Supply Side Platform
19/02GenieeDMP
Data Management Platform
GenieeDSP
Demand Side Platform
DOOH
Digital Out Of Home
Trading DeskClient development/ad
management
18/06 18/11
18/10
3
Expand from ad technology domains to marketing technology domains Improve the world by providing innovative software and advancing client business
Change Business Name
Segment name
Project segment
Primary services
Ad Technology Business
Ad Platform Business
Supply side (GenieeSSP) GenieeDSP
Marketing Automation
Business
Trading Desk
Overseas Business
Supply side (GenieeSSP)GenieeDSP
Previous
Marketing Technology Business
Overseas Business
Supply side (GenieeSSP)GenieeDSP
Ad Platform Business
Supply side (GenieeSSP) GenieeDSP
DOOH
Marketing solutions business
Trading Desk
Current
4
Changed segment names and business categories to reflect domain expansion
Business-Specific Highlights
5
Promoted initiatives to increase revenue, including maintaining and optimizingexisting domains, expanding sales of new products, expanding share in new domains, and improving logic. Received contract for new development project in the DOOH domain. Impact of policy changes affecting client ad network operators has subsided, and net sales are firm relative to forecasts. Making firm progress towards achieving full-year goals.
Ad Platform Business
Net Sales
¥2.7bn
*Business-specific net sales indicate figures prior to elimination of inter-segment transactions
Used MAJIN to strengthen sales to target clients.Increased new orders for ad management services.For Chikyu, we increased clients and reduced turnover.Chamo also contributed to sales.
Marketing Solutions Business
Net Sales
¥0.36bnYoY +43.0%
In cross-border business, we secured order for large-scale campaign with major cosmetics company.Firm transitions in new client numbers.
Overseas Business
Net Sales
¥0.36bnYoY +44.6%
Topics
6
One-stop management from distribution settings to reporting.
Optimized management
Ad posting
Reporting ad
distribution
Advertiser/Advertising agency
OEM Provision
ad distributionSystems
Call bell
Distributed digital signage ads to 200 food courts in Japan. OEM provision of ad distribution functions for Geo Nexus Co., Ltd. pager with video playback function.
Topics
7
TikTok Audience NetworkA world-class video ad platform provided by ByteDance, the operator of TikTok. This system can also distribute ads distributed over TikTok Ads to other linked mobile apps.
GenieeSSPSupply Side Platform
Media
TikTok Audience Network enables ad distribution to TikTok Ads to provide
high profitability
Advertiser
TikTok Audience Network provides reach to the inventory retained by
GenieeSSP
Launched link between TikTok Audience Network and GenieeSSP
Recent Releases
8
8/09 OEM provision of ad distribution functions for Geo Nexus Co., Ltd. next-generation call bell
7/24 Notice on absorption of consolidated subsidiary via merger (short-form merger)
6/28 Published results of validation tests on collaboration with Collabos on MAJIN and GenieeDSP
6/25 Started link between GenieeSSP and TikTok Audience Network, provided by ByteDance
6/19 Notice on issuance of performance-linked stock options (share warrants)
6/18 Booth at 6th Marketing & Sales Promotion EXPO [June] demonstrating CRM/SFA Chikyu, marketing automation tool MAJIN, and chat bot Chamo
6/13 Chat bot (Chamo) featured in Nikkei Online (Japanese)
6/07 Geniee and DeNA joint seminar at Digital Signage Japan (DSJ) 2019
5/27 Started provision of Gmail-linked function using Gmail add-on for Chikyu CRM/SFA
4/19 Presented marketing automation tool MAJIN and CRM/SFA Chikyu at Web & Digital Marketing EXPO Spring
4/18 Geniee and Cocoo collaborate on digital marketing support
Current FY Core Policies
Current FY Core Policies
10
Strengthen business portfolio management 1
Expand cross-sell initiatives 2
Optimize business structure by delegatingauthority to business supervisors 3
Promoted 3 core policies towards achieving Medium-Term Management Plan
Strengthen Business Portfolio Management
11
Overseas ad technology
DOOH
Operating income
Timeframe
Supply side (GenieeSSP)
GenieeDSP
Trading Desk
Expand operating income from main services
Prioritize expanding share for new businesses
From 2H, turn profit for investment businesses
Split into main businesses, investment businesses, and new businesses, to strengthen portfolio management and KPI management for each business phase
Expand cross-sell initiatives
12
Market automation toolproviding uniform management & implementation, from marketing to sales promotion
Centralized CRM/SFA, from customer/negotiation
management to analysis
No. 1 chat tool in Japan adopted by 4,500 companies
Merge data and UI
Aggressive development of inter-product cross sales Provide one-stop coverage for marketing domain to build success for our clients
DOOH
Increase company numbers
Increase per-
company net sales
Increase continuity
Supply side
Transfer authority for following businesses
DSP
- Add new functions to improve product quality - Increase cross-selling to reduce client unit price and
increase per company net sales and continuity rates
Optimize Organization Structure
13
Expectations of clients Net Sales
Provided value Gross Margin
Business efficacy EBITDA
Use executive officer system to transfer authority to business supervisors and optimize organization structure Achieve growth this year by prioritizing gross margin
FY2019 Full-Year Business Outlook
FY2019 Full-Year Business Outlook
Gross Margin growth of 33.1% YoY Rapid recovery of EBITDA to ¥0.35 billion
EBITDA
Ordinary Income
Operating Income
Gross Margin
YoY
− %
− %
FY2018 (Actual)
-0.33
-0.31
Net Sales +4.1%14.95 15.57FY2019 (Forecast)
0.3590.007
0.0232.59
15
1.94 +33.1%
0.019 +1789.9%
(unit: JPY billion)
FY2019 Full-Year Earnings Forecast (1H/2H)
Net Sales
(Reference) FY2017 Net Sales
Gross Margin
EBITDA
Full-year
15.57
14.38
2.59
0.359
1H
6.86(44.1%)
6.48 (45.1%)
0.97
-0.136
8.7(55.9%)
7.89(54.9%)
2H
1.61
0.49616
Planning on weighted 2H due to ad industry demand period Profitability for investment business from 2H onward
(unit: JPY billion)
FY2019 Quarterly Earnings Forecast by Business
17
■ Net Sales■ Gross Margin● EBITDA
3Q FY2019 4Q FY20191Q FY2019 actual
3.39 3.554.11
4.59
0.46 0.520.72
0.88
0.3140.181
2Q FY2019
-0.007-0.087
Planning on weighted 2H due to ad industry demand period Projecting annual growth by building profit platform
(unit: JPY billion)
Upside/Downside
18
Net Sales ¥15.57 billion
Factors not included in above earnings forecast include the following.
Growth for each business exceeding projections
Increased per-company net sales thanks to increased cross-selling
Rapid commercialization of new businesses
Major change in client business policy
Development delays due to hiring difficulties, increased hiring costs
Impairment from fixed assets, investments
Changes in customs and government regulations unique to each oversea office
Other
Impact of M&A on consolidated accounting: Growth from adding acquired companies to scope of consolidation or negative from investments
Upside Downside
Other
Gross Margin ¥2.59 billion
EBITDA ¥0.35 billion
Reference Materials: Commitment 2022
The Geniee spirit and mission
Founding Spirit
To create a global technology company founded in Japan.
Use technology to create new value and work together with clients to build successWe believe in the possibilities of technology.
We bring new value to corporate marketing activities to create products that promote innovation.
As a Japanese technology company, we have a deep understanding of business in Asia.We reflect this understanding in our products and services to achieve new success for Asian companies.
Mission
20
Sales Trends
21
2015.3*2013.3 to 2015.3 are unit sales, 2016.3 to 2019.3 are consolidated sales figures.
14.9
2019.32011.3
Listed on Tokyo Mothers stock market
1.22.9
7.3
11.7
14.3
0.80.30.05
Capital and business alliance withSoftBank Group Corp.
Started providing
Achieve record high net sales, highest ever since our founding
(unit: JPY billion)
Numerical Goals of Medium-Term Management Plan Commitment 2022
22
25.015.5Net Sales
6.02.5Gross Margin
3.00.3EBITDA
FY2019 (Forecast) FY2021 (Target)
(unit: JPY billion)
Drafted Commitment 2022 as the 1st step towards becoming a global technology company
Our Reason for Being
Source: KAIKA "Japanese Company Management Issues 2017"
Our technology resolves the highest-priority management problems.From startup to becoming an established corporation,improve work efficiency to resolve worker shortage, improve profitability, and contribute to sales growth.
Geniee's reason for being
Japanese company senior management
issues
(3) Improve human resources (Response to hiring, training, and diversification)
(1) Increase sales and share
(2) Increase profitability
Market Scope and Business Opportunities (Japan)
(Source: Fuji Chimera Research Institute, Inc. "Outlook for Digital Transformation Market 2018") (Yano Research Institute "Online Advertisement Market in Japan: Key Research Findings 2018“)
Marketing Solutions Business
2017 Actual 2021 Estimation2017 Actual 2022 Estimation
Online ad market Digital transformation market
2,300
1,300
1,400
560
Ad Platform Business
24
Strong demand on DX market Continue 10%-20% annual growth
(unit: JPY billion)
*Geniee calculations based on eMarketer data
¥670 billion
Asia online ad market
2022
Market Scope and Business Opportunities (Overseas)
2017 Actual 2022 Estimation
¥320 billion
¥670 billionVIETNAM
INDIA
INDONESIA
SINGAPORE
THAILAND
MALAYSIA
2525
Growth speed exceeding Japan to develop products with Japanese quality on a scale of ¥670 billion by 2022, expecting market share growth
26
Marketing technology domain
Ad technology domain
2018/11
2018/06
Supply side
2014/03DSP
DMP2015/01
2019/02DOOH
Overseas expansion of high-share
services
Expand new domains
2016/07
Continue Expanding Business Domains and Areas of Service Provision
26
Service provision areas
2011/04 Indonesia2015/09
India2018/10
Singapore2012/08
Thailand2017/08Vietnam
2013/09
Expand business domains and service provision from ad technology domain to marketing technology domain
Strengths of Geniee
27
3 competitive advantages
Business alliances offering numerous business merits
SB Group
An organization of nearly 100 engineers creating innovative products
Nearly half have a Ph.D. in information engineering
Technology
Entrepreneurial spirit and will to face difficulties
Sell innovative products in Asia
Business development capabilities
What is the Ad Platform Business?
Advertiser
MediaSupply side
(SSP)
User
User attributes and behavior history used to display optimal and high-revenue ads
Supporting ad management to maximize media revenue
Ad slots
Ad
Ad slots
Access 1
Ad request 2 Bid request 3
GenieeDSP
Ad Ad Ad
DSP (Company A)
DSP (Company B)
Ad Ad Ad
Ad Ad Ad
Selectedoptimal ad
bid 5
Bid request 4
Ad placement 6
28
Use user information to achieve all processes related to delivering advertiser's message, from sender website access to add display, in 0.1 seconds or less.
About DOOH
29
Advancing commercialization based on an ad distribution platform for taxi dispatch services launched in February
2017 Actual 2025 Estimation
digital signage domestic market
(Source: Fuji Chimera Research Institute, Inc. estimates) * OOH: Short for Out of Home, which refers to ad media consumers encounter outside the home such as transportation ads and outdoor billboard ads.
Growth to market scope of ¥300 billion by 2025
Aggressive development of rapidly expanding OOH domain
¥318.6 billion
¥143.7 billion
SFA/CRM Chikyu
30
Constant access to accurate information regardless of time, place, or device
Proposal materials Schedule
Activity history
Daily report
Budget process
Contracts
Estimates
Client information
Tool for real-time visualization and management of sales status Enables data-driven sales activities for all companies, regardless of IT literacy
Maximize sales and
improvement opportunities
Chat Bot Chamo/AI.BiS
31
Chamo Tool enabling auto-push and anonymous communication; adopted by over 4,500 companies
AI.BiS Chamo basic functions combined with additional functions including a tree-structured general chat bot scenario control, search, email transmission, and JS execution
A single tag allows chat support on a website
Auto-chat enables 24-hour web-based customer service Achieve both increased sales and cost reductions
Marketing Automation MAJIN
32
Covers all domains, from customer development and sales to order receipt
Want customers Want to increase inquiries Want to increase visits What to increase
contracts Want to increase loyal
customers
Customer development strategy Site improvements Nurturing qualification strategy Retention strategy
Increase impressions
Increase Website CVR
-Listing -Display ads
-Popups -Website push
-Email campaigns (development existing clients) -Strategy impact analysis -SMS distribution (maximize distribution reach)
Effe
ct
Func
tion
Phas
e
Web ad domain MA domain
Increases business meetings
Increase orders Increase LTV
Tool for achieving 1on1 communication between companies and users
Overseas Business
Distribute ads targeting foreigners visiting Japan to major supermarkets, drug stores, and consumer goods manufacturers
* Cross-border services: Cross-border ad distribution services that generate inbound and cross-border EC marketing opportunities
Ad
INDIA
SINGAPORE
THAILANDVIETNAM
INDONESIA
33
Sell products developed in Japan mainly in Southeast Asia and India
Strengthen and expand cross-border services offered in collaboration with Softbank.
Company Profile (As of the end of March 2019)
34
Company Name Geniee, Inc.
Business Marketing Technology Business
Headquarters Sumitomo Realty & Development Shinjuku Oak Tower 6th Floor, 6-8-1 Nishi Shinjuku, Shinjuku-ku, Tokyo 163-6006
Establishment April 14, 2010
Representative President and CEO Tomoaki Kudo
Executive Officers Director Hiroshi HiroseKatsumasa Niki (Outside)Daisuke Fujihira (Outside)Michimasa Naka (Outside)
Director and Audit & Supervisory Committee MemberKatsuyuki Toritani (Full-time, Outside)Yukio Todoroki (Outside)Fumiaki Goto (Outside)
Employee 258 (Geniee Japan: 163; overseas subsidiaries: 95)* Temporary staff and outsourced workers are not
included in the number of employees.
Capital ¥1,539 million
End of Fiscal Year March 31
Group company Geniee International Pte., Ltd.Geniee Vietnam Co., Ltd.PT. Geniee Technology IndonesiaGeniee Adtechnology (Thailand) Co., Ltd.PT. Adstars Media PariwaraAdskom India Private LimitedChamo, Ink.
The consolidated earnings goals and other figures indicated in these materials reflect judgments based on information available at the time of creation and contain elements of uncertainty.Actual performance may differ from actual results due to various factors.