Copro-Holdings Co., Ltd. · TSE:7059
Copro-Holdings — Q1 FY2022 Earnings Presentation
30 slides from Copro-Holdings's earnings presentation, Aug 11, 2021
Slide 1: Fiscal Year Ending March 31, 2022 – 1Q Results
Fiscal Year Ending March 31, 2022 August 11, 2021
Slide 2: Contents
Contents 1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 1
Slide 3: 1. Financial Highlights
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 2
Slide 4: Consolidated Financial Results
Consolidated Financial Results • Net sales were slightly lower than in the previous fiscal year, but trended in line with internal forecasts. • Operating profit increased 40% year on year. • Profit attributable to owners of parent decreased due to the absence of extraordinary income (insurance surre
Slide 5: Consolidated Operating Profit
Consolidated Operating Profit • Gross profit increased as progress was made in gross profit ratio improvement through negotiations for a charge-up, which absorbed the impact of the decline in sales. • SG&A expenses increased due to M&A-related expenses at ATMOS, which became a subsidiary in April 20
Slide 6: Quarterly Financial Results
Quarterly Financial Results • Cost of sales ratio improved 3.2 percentage points due to successful charge-up negotiations and an improvement in the contract cost ratio with the clients. • Sales per head was 628 thousand yen (up 4 thousand yen/monthly or +0.6% year-on-year) due to an increase in cont
Slide 7: Balance Sheet
Balance Sheet • (Assets) Current assets decreased due to payments related to the acquisition of a subsidiary and dividends paid. On the other hand, fixed assets increased due to the acquisition of a subsidiary, the relocation of the head office, and the development of the new core system. • (Liabili
Slide 8: 2. Breakdown of Sales
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 7
Slide 9: Sales by Business Partner and Area
Sales by Business Partner and Area • Sales of major general contractors and sub-contractors, which are experiencing a transition from Olympic demand to urban redevelopment demand, declined. • Due to the above factors, growth in the Kanto area, where the ratio of construction projects by private inve
Slide 10: Sales by Industry
Sales by Industry • Orders for construction declined overall, reflecting sluggish growth in major general contractors. • Orders for steel plants were sluggish due to the impact of COVID-19, while orders for water treatment, chemicals, and electric power plants grew steadily. FYE2021 1Q FYE2022 1Q （m
Slide 11: 3. Key Performance Indicators
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 10
Slide 12: Number of Engineers & Occupancy Rate
Number of Engineers & Occupancy Rate • The number of engineers at the end of 1Q was 1,957, down 87 from the end of the same period in the previous fiscal year. • The occupancy rate at the end of 1Q was 97.4%, up 3.0 percentage points y-o-y. （No. of engineers） 2,400 98.1% 99% 97.7% 97.8% 97.4% 98% 2,
Slide 13: Recruitment / Turnover, Retention Rate & Contract Renewal
Recruitment / Turnover, Retention Rate & Contract Renewal • The number of recruitment progressed in line with the company's internal plan. On the other hand, due to the spread of COVID-19, the number of new graduates hired was reduced, and the company temporarily curbed mid- career hiring. As a resu
Slide 14: Average Monthly Contract Amount per Engineer by Years of Experience
Average Monthly Contract Amount per Engineer by Years of Experience • Significant improvement in monthly contract amount for first-year engineers due to new assignments with an emphasis on contract cost ratio. • Reinforcement of charge-up negotiations was successful, and the monthly contract amount
Slide 15: 4. Forecast Revision and Business Outlook
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 14
Slide 16: Revised FYE2022 Financial Forecast
Revised FYE2022 Financial Forecast • Accompanying the consolidation of ATMOS, the company revised FYE2022 consolidated earnings forecasts (incorporating ATMOS's earnings from June 2021 to March 2022). • Net sales were upwardly revised by 600 million yen from the initial forecast to 16,943 million ye
Slide 17: Business Outlook
Business Outlook ▪COPRO-ENGINEERD. Co., Ltd.（Construction and plant engineer dispatch business） Urban redevelopment projects, which had been halted by Olympic demand, are expected to move into the second half. Orders received However, due to the spread of COVID-19, the company will be affected if pr
Slide 18: Medium-term Management Plan to Be Announced
Medium-term Management Plan to Be Announced Medium-Term Management Plan “COPRO Group VISION 2025" (tentative) Scheduled to be announced around spring 2022 Aiming to achieve sustainable growth and medium-to long-term improvement in corporate value, scheduled to announce a medium-term management plan
Slide 19: 5. Returning Shareholders
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 18
Slide 20: Returning Shareholders
Returning Shareholders • Maintain stable dividends with a target consolidated dividend payout ratio of 30% or more, while paying attention to the balance with investments that will contribute to future business expansion. • In FYE2022, the company expects to pay a 40 yen per year, an increase of 2.5
Slide 21: 6. Appendix
1. Financial Highlights 2. Breakdown of Sales 3. Key Performance Indicators 4. Forecast Revision and Business Outlook 5. Returning Shareholders 6. Appendix ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 20
Slide 22: Company Outline
Company Outline Company name COPRO-HOLDINGS Co., Ltd. Representative Kosuke Kiyokawa, CEO Kosuke Kiyokawa, CEO Dai Nagoya Building 25F , 3-28-12 Meieki, Nakamura-ku, Head office Nagoya, Aichi Foundation October, 2006 Fiscal year-end March First Section of the Tokyo Stock Exchange and the Nagoya Stoc
Slide 23: Company Philosophy
Company Philosophy ©2021 COPRO-HOLDINGS. Co., Ltd. All rights reserved. 22
Slide 24: Business Model①
Business Model① • The engineer dispatch business specializing in the high-value-added "engineer dispatch field“. About Dispatch Business Service Covered Construction management and design support services associated with new construction and Construction renovation work in high-rise buildings, Engin
Slide 25: Business Model②
Business Model② • "Stock-type business" in which sales accumulate in proportion to the number of dispatched engineers. • The compound annual growth rate of the number of engineers for the last 5 years has been 15% and the sales has been 18%. （hundreds of （No. of engineers） millions of yen） 2,600 Com
Slide 26: Features of COPRO
Features of COPRO Expanding 17 Recruited 1,000 branches nationwide engineers annually In addition to the Tokyo metropolitan area, Tokai, and Kansai regions, we Recruitment staff assigned to have built a sales network covering branches nationwide develop the entire country of Japan in the Hokkaido, T
Slide 27: Long-term Growth Image
Long-term Growth Image • Increase sales and operating profit by approximately 7-fold from FYE2021 to FYE2030. ✓ Step 4 M&A strategy and considering new businesses ✓ Step 3 Global business advancement ✓ Step 2 Increase market share for plant engineer dispatches FYE2030 (24th period) ✓ Step 1 Further
Slide 28: Business Environment Supporting Our Growth (Labor Shortages)
Business Environment Supporting Our Growth (Labor Shortages in the Construction Industry) • In the wake of the collapse of the bubble economy, the global financial crisis, and other long-term slumps, general contractors have restrained hiring to avoid the conversion of labor costs to fixed costs. As
Slide 29: Business Environment Supporting Our Growth (Aging)
Business Environment Supporting Our Growth (Aging of The Construction Industry) • The percentage of workers aged 55 or older in the construction industry is 35.3%, which is 4.8pts higher than the average for all industries of 30.5%. • The percentage of workers aged 29 or under in the construction in
Slide 30: Disclaimer and Forward-Looking Statements
Disclaimer and Forward-Looking Statements ◼ This document has been prepared by COPRO-HOLDINGS. Co., Ltd. (the “Company”) to assist investors in understanding the current status of Company. ◼ The information contained in this document is based on economic, social, and other conditions generally recog