En Inc. · TSE:4849
En — en Japan — Q3 FYE Mar/2023 Earnings Presentation
79 slides from En's earnings presentation, Feb 9, 2023
Slide 1: 3rd Quarter of FYE Mar/2023 Earnings Review
1 en Japan Inc. 3rd Quarter of FYE Mar/2023 Earnings Review February 9, 2023 Security Code 4849 TSE Prime section Copyright © 2023 en Japan Inc. All rights reserved
Slide 2: Index
Index 2 P3 （Published）Medium-Term Management Plan ／ （Published）Revision of Full-Year Earnings Forecast P11 Executive Summary P14 Consolidated Performance Summary for the 3rd Quarter of FYE Mar/2023 P17 Performance Overview by Segment for the 3rd Quarter of FYE Mar/2023 P38 Policy for Financing/Retur
Slide 3: Basic Policy in Medium-Term Management Plan
3 （Published on May 12, 2022） FYE Mar/2023 -FYE Mar/2027 Basic Policy in Medium-Term Management Plan
Slide 4: Basic Policy in Medium-Term Management Plan
Basic Policy in Medium-Term Management Plan 4 Make businesses with investment have the same size as the existing ones in five years Businesses with Make aggressive investment in engage and AMBI to position investment them as our next core businesses Make certain investment in existing businesses to
Slide 5: Medium-Term Management Plan: Performance Summary
Medium-Term Management Plan: Performance Summary 5 Consolidated performance targets Increase sales and operating income to a level more than double in five years Sales Operating OP margin Income FYE Mar 2022 Actual FYE Mar 2027 Target FYE Mar 2022 Actual FYE Mar 2027 Target FYE Mar 2022 Actual FYE M
Slide 6: Numerical plan
Numerical plan 6 Focus totally on front-loaded investment in 1st half of the Medium- Term Plan: accelerate sales in 2nd half with large income returns *Graph reflects upward revision of FYE Mar 2023 announced on Nov.10 Operating income Sales (consolidated) (consolidated), OP margin 300 25% Period of
Slide 7: Revision of Full-Year Earnings Forecast
7 （ Published on November 10, 2022 ） FYE March 2023 Revision of Full-Year Earnings Forecast
Slide 8: Full-Year Revised Plan Summary
Full-Year Revised Plan Summary 8 Revised Sales 66.19bill From initial plan ＋4.19bill plan Operating income 4.37bill From initial plan ＋1.28bill – Based on steady progress in the first half, we have upwardly revised the full-year plan. – Sales in the second half will also exceed the initial expectati
Slide 9: Full-Year Revised Plan for FYE March 2023
Full-Year Revised Plan for FYE March 2023 9 FYE Mar 2023 FYE Mar 2023 YOY change Initial plan FYE Mar 2022 FYE Mar.2022 vs (Initial Plan) (Nov.10 Revised Plan) change change vs Revised Plan （Apr.2021-Mar.2022) （Apr.2022-Mar.2023） （Apr.2022-Mar.2023） (%) (%) Revised Plan change (million yen) % of Sal
Slide 10: Revised Plan by segments
（Reference）Revised Plan by segments 10 FYE Mar 2023 YOY change Change FYE Mar 2023 FYE Mar 2022 Initial plan FYE Mar 2022 (Nov.10 Revised （bil JPY） (Apr.2021–Mar.2022) Initial Plan Plan) vs vs (Apr.2022–Mar.2023) (Apr.2022–Mar.2023) Revised Plan Revised Plan HR-Tech Sales 1.95 3.17 3.77 1.82 93.8% 0
Slide 11: 3rd Quarter Executive Summary
11 3rd Quarter of FYE Mar/2023 Executive Summary
Slide 12: Executive Summary 1/2
Executive Summary 1/2 12 Total（Apr.-Dec.） Sales 49.56bill YoY +27％ FYE Mar 2023 Operating income 3.94bill YoY -45% 3Q Point ・Hiring demand of companies remained strong and revenue increased in all segments ・Operating income continued to exceed expectations in each quarter: 1Q was 1.8 billion yen, 2Q
Slide 13: Executive Summary 2/2
Executive Summary 2/2 (3rd Quarter of FYE Mar/2023 ) B u s i n e s s e s w i t h 13 HR-Tech Sales +91% YoY, continuing high growth i n v e s t m e n t • Promotions for toC implemented as planned. Membership reached 1.88 million engage • persons by the end of December (end of September: 1.65 million
Slide 14: Consolidated Performance Summary for 3rd Quarter
14 Consolidated Performance Summary for 3rd Quarter of FYE Mar/2023
Slide 15: Consolidated Income Statement
[3Q FYE Mar/2023 Results] Consolidated Income Statement 15 3Q FYE Mar 2022 3Q FYE Mar 2023 YOY Actual Actual (Apr.-Dec.2021） (Apr.-Dec.2022） change change (million yen) (%) (million yen) % of Sales (million yen) % of Sales Net Sales 38,904 100.0% 49,564 100.0% 10,660 27.4% Cost of Sales 8,033 20.6%
Slide 16: Changing Factor of Earnings Year on Year
Changing Factor of Earnings Year on Year 16 (JPY) Sales increased 10.66 bill or +27.4％ YOY 49.56bill HR-Tech engage +1.18bill Sales 38.90bill Human resource platform +1.19bill Domestic +3.71bill Overseas +4.72bill etc. Expenses 31.65bill Cost increased 13.96 bill or +44.1% YOY Advertising, Sales Pro
Slide 17: Performance Overview by Segment
17 Performance Overview by Segment * for 3rd Quarter of FYE Mar/2023 *a management accounting basis
Slide 18: 3Q Performance Overview by Segment
3Q FYE Mar/2023 Performance Overview by Segment 18 3Q FYE Mar 2022 3Q FYE Mar 2023 （bil JPY） Actual Actual YoY (Apr.–Dec.2021) (Apr.–Dec.2022) HR-Tech Sales 1.30 2.48 1.18 91.2% Businesses engage Operating Income 0.03 -2.63 -2.66 - with OP margin 2.0% -106.4% - Human resource Sales 3.16 4.35 1.19 37
Slide 19: Businesses with investment
19 Businesses with investment
Slide 20: engage
engage
Slide 21: HR-Tech engage Summary
HR-Tech engage Summary 21 3Q Sales （Yen） Company KPIs Growth remains high KPIs remain steady 2.48bill YoY 91% Total number of users 490,000 companies YoY +24% about Publicized job offers Job seeker KPIs 1.18mil. listings YoY + 40% Membership more than expected Paid user companies Users 12,00
Slide 22: HR-Tech engage Quarterly Sales
HR-Tech engage Quarterly Sales 22 Active investment in promotion and sales expansion for the advertising- based billing plan were successful, leading to a sales increase of 89% YoY < Sales > YoY ＋89％ 850 925 646 701 Million 425 489 yen 324 375 386 43 240 247 269 82 111 1Q1Q 2Q 3Q 4Q 1Q 1Q 2Q 3Q 4Q 1
Slide 23: HR-Tech engage Quarterly operating income
HR-Tech engage Quarterly operating income 23 A deficit trend remained from the investment in promotion to acquire job seekers, but active investment continued for future growth < Operating income> 18 40 -317 -236 -30 -393 -370 -295 -87 -486 -472 -694 -754 -918 -966 Million yen 1Q1Q 2Q 3Q 4Q 1Q 1Q 2Q
Slide 24: Total number of user companies
HR-Tech engage Total number of user companies 24 Total number of user companies exceeds 490,000mark. Japan’s top class recruitment service in terms of the number of user companies 490,000 < Total number of users > companies Aug.2016 Dec.2022
Slide 25: Number of advertised recruitments
HR-Tech engage Number of advertised recruitments Number of advertised recruitments: quarterly average of recruitments advertised in “engage,” 25 whether paid or unpaid Favorable rate of increase in advertised recruitments A strong position has been built as a recruitment platform YoY+40％ < Number of
Slide 26: Number of paid user companies
HR-Tech engage Number of paid user companies Number of paid user companies: quarterly sum of companies charged for 26 paid “engage” services (and with their sales recorded) Activities improved thanks to abundant advertised recruitments and strengthened toC promotions, contributing to increase in pai
Slide 27: Number of paid advertised recruitments
HR-Tech engage Number of paid advertised recruitments Number of paid advertised recruitments: quarterly sum of recruitments put in for 27 via paid “engage” services Steady increase in the number of paid advertised recruitments by SMB companies thanks to the advertising-based billing plan that increa
Slide 28: Number of member job seekers
HR-Tech engage Number of member job seekers 28 Membership steadily increased due to the improved search engine optimization (SEO) from abundant advertised recruitments and increased brand word inflow through strengthened promotion 1,880,000 Persons < Number of member job seekers > 190 170 1,650,000
Slide 29: HR-Tech engage MAU
HR-Tech engage MAU *Quarterly average number of UUs who visited the site in a month *Due to a change in aggregation tools, previously disclosed MAU figures 29 have been retrospectively revised Activities of job seekers continued to be strong due to the increasing number of job openings and increasin
Slide 30: Promotion Effect Assumptions in the Medium-Term Plan
（Reference）HR-Tech engage Promotion Effect Assumptions in the Medium-Term Management Plan 30 Effect on applications due to job seeker acquisition calculated based on the Company’s past site performance. Front-loaded investment costs are recovered over several years Number of applications plan based
Slide 31: Human resource platform
Human resource platform AM B | COSKLot hy
Slide 32: Human resource platform Summary
Human resource platform Summary 32 3Q Sales （Yen） Progressed as expected; AMBI + 69% YoY in 3Q cumulative 4.35bill YoY +38% Job seeker KPIs Company KPIs The number of members acquired The number of user companies exceeded exceeded expectations expectations User Companies 4,490 YoY +78% Users 3.0
Slide 33: Human resource platform Quarterly Sales/Operating income
Human resource platform Quarterly Sales/Operating income 33 QoQ sales declined slightly due to seasonality, but AMBI and [en] Career Change Consultant both performed well Operating loss was smaller than expected < Sales > < Operating income> YoY + 33％ 1,464 1,464 1,426 Million yen 392 1,241 230 230
Slide 34: Human resource platform KPI
Human resource platform KPI 34 Increase in the number of membership due to stronger toC promotion led to an improvement in activities of companies User Companies Job offers Users（Job seekers） 3.01 4,490 300 2.89 mil. Companies 253 290 4,009 27.0 thousand280 2.74 250 270 25.0 3,382 260 2.57 2,914 23.
Slide 35: Existing businesses
35 Existing businesses
Slide 36: Domestic Performance Summary
Domestic Performance Summary 36 3Q Total Sales/Operating income – Sales 30.8bill YoY+13% Permanent Operating dom – Operating income 6.9bill YoY+5% Job Board 求人サイト 人材紹介 Recruitment Other その他 営業利益 income estic ・Hiring demand of companies is strong （JPY Billion） 20.0 60.0 ・Revenue and profit increased
Slide 37: Overseas Performance Summary
Overseas Performance Summary 37 3Q Total Sales/Operating income – Sales 12.3bill YoY+62% India インドIT派遣 Vietnam ベトナム Other その他 Operating 営業利益 Over – Operating income 0.8bill YoY+24% IT Temp income ・Growth continued to be steady in India and Vietnam, although （JPY Billion） seas their previous high gro
Slide 38: Policy for Financing / Return to Shareholders
38 Policy for Financing Return to Shareholders
Slide 39: Basic Policy for Financing
Basic Policy for Financing 39 Funds in possession are mainly for growth investment (M&A), while further shareholder return is considered accordingly Dividends maintain the previous term’s level (70.1 yen) during three years of strengthened front-loaded investment Cash& savings Usage Policie s Single
Slide 40: Status of treasury share purchase
Status of treasury share purchase 40 Resolution dated August 10, 2022 As of January 31, 2023 ・Aggregate number of shares to ・Aggregate number of shares be repurchased repurchased ➡ 5,000,000 shares ➡ 1,623,000 shares (32.4%) ・Aggregate price of shares to be ・Aggregate price of shares repurchased rep
Slide 41: Return to Shareholders (The dividend plan)
Return to Shareholders（The dividend plan） 41 Dividends are to be fixed during period of front-loaded investment In FYE March 2026 and onward, when earnings increase substantially, dividend payout ratio is to be set at 50% Medium-Term Management Plan （JPY） （dividend payout ratio） 200 200% 150 150% 10
Slide 42: Appendix
42 Appendix
Slide 43: Reference: Market Environment
Reference ：Market Environment Source: Association of Job Information of Japan 43 “Total Number of Job Advertisements for Full-Time and Part-Time Workers, Temporary Staff” The number of job advertisements remains on a recovery path in both the entire market and for full-time workers (Ten Thousand) (Y
Slide 44: Factors Underlying Quarterly Performance Changes (Major Cost of Sales)
Reference ：Factors Underlying Quarterly Performance Changes （Major Cost of Sales） 44 +42.4% YoY in 3Q. Mainly increase in expenses related to temporary staffing in IT staffing business in India Cost of Sales 4,500 ,000 4,134 4,214 30% （％＝Cost of sales ratio） 3,778 （million yen） 3,468 4,000 ,000 25.0
Slide 45: Factors Underlying Quarterly Performance Changes (Major SGA Expenses)
Reference ：Factors Underlying Quarterly Performance Changes （Major SGA Expenses） 45 +39.5% YoY in 3Q. Personnel expenses rose due to increased personnel and strengthening of human resource investment for structure enhancement SGA 14,00 0,000 90% （％＝SGA of sales） 11,701 （million yen） 12,00 0,000 11,5
Slide 46: Financial Position
Financial Position 46 FYE Mar 2022 FYE Mar 2023 YOY change YOY change （million yen） （Mar. 2022） （Dec. 2022） (%) Current asset 42,301 37,474 -4,827 -11.4% Cash 35,849 28,429 -7,420 -20.7% Decrease due to dividend payments Accounts receivable 5,467 6,097 630 11.5% Other current assets 985 2,948 1,962
Slide 47: Non-consolidated Income Statement for 3Q
47 Non-consolidated Income Statement for 3Q FYE Mar/2023
Slide 48: Non-consolidated Income Statement
[3Q FYE Mar/2023 Results] Non-consolidated Income Statement 48 3Q FYE Mar 2022 3Q FYE Mar 2023 YOY Actual Actual YOY change change (million yen) (Apr.-Dec.2021） (Apr.-Dec.2022） (%) (million yen) % of Sales (million yen) % of Sales Net Sales 25,053 100.0% 30,865 100.0% 5,812 23.2% Cost of Sales 2,161
Slide 49: Changing Factor of Earnings (Non-consolidated)
Changing Factor of Earnings (Non-consolidated) 49 Year on year (JPY) Sales increased 5.81bil or +23.2％ YOY HR-Tech engage +1.18bil Sales 25.05bil Human resource platform Domestic Job Board +1.19bil +3.19bil 30.86bil etc. Expenses 19.50bil Cost increased 9.25 bil or + 47.5 % YOY 28.75bil Advertising,
Slide 50: ESG
50 ESG
Slide 51: en Japan Integrated Report
en Japan Integrated Report 51 The Integrated Report (for Apr. 2020 to Mar. 2021) has been prepared and is available at the below links Integrated Report（Japanese） Integrated Report（English）
Slide 52: Action to ESG
Action to ESG 52 An industrial structure in which short-term earnings are contributed to more by non-retention of Social Contribution and repeated job changes by the newly employed is an issue and considered as not leading to Through Core Business sustainable business growth. Service is provided by
Slide 53: Social Impact Recruitment Project
Example of realizing our purpose：Social Impact Recruitment Project 53 Total of 26 projects with 116 successful recruitments during the last period: doubled from two periods ago - en Japan changes society from the hiring front with its various services and know-how
Slide 54: Social Impact Recruitment Project
Example of realizing our purpose：Social Impact Recruitment Project 54
Slide 55: Measures for the environment
Measures for the environment 55 CO2 emissions are reduced continually, though our business model originally has only a small impact on the environment FYE Mar FYE Mar FYE Mar 2019 2020 2021 (Examples) Item (Apr.2018-Mar.2019) (Apr.2019-Mar.2020) (Apr.2020-Mar.2021) CO2 emissions (scope 1) (City gas
Slide 56: Measures for society
Measures for society 56 The goal is to continue growth of society and employees based on our purpose （Examples） Promote businesses based on our purpose “To make the world better by increasing the number of people who work hard for others and society” Update corporate philosophy reflecting employ
Slide 57: Action to ESG (Internal Engagement)
Action to ESG（Internal Engagement) *Non-consolidated data for en Japan (as of September 2022) Employees include regular employees and contract workers 57 Systems & Initiatives ■Promotion of Women’s Participation and Advancement * Percentage of women to all employees 55.2％ ■Revitalization of human ca
Slide 58: Action to ESG (Governance Structure)
Action to ESG（Governance Structure) 58 Director Takatsugu Suzuki Michikatsu Ochi Megumi Kawai Teruyuki Terada Takuo Iwasaki Kayo Murakami Wataru Sakakura Yuri Hayashi President Chairman Director Director Director Outside Directors Outside Directors Outside Directors Directors who will serve on the A
Slide 59: Company Overview
59 Company Overview
Slide 60: Company Overview
Company Overview 60 【 Company Name 】 en Japan Inc. 【 Establishment 】 January 14, 2000 【 Representatives 】 Takatsugu Suzuki （President） 【 Headquarters 】 Shinjuku I-land Tower, 6-5-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo 【 Total Stockholder’s Equity 】 JPY 1,194million (as of Dec. 2022) 【Stock Listing 】 T
Slide 61: Business model of Job Board and Permanent Recruitment
Business model of Job Board and Permanent Recruitment 61 Providing recruitment information, Planning, Proposing, Interviewing Resume coaching, and and creating job advertisements Advice of interview Online Job Board Recruitment information General [en]Career Change Info companies Recruitment Permane
Slide 62: Business model of Overseas Subsidiary
Business model of Overseas Subsidiary 62 Online Job Board Job advertising fee Registration Application Creating job advertisements, Advertising on site IT temporary staffing Job Free of charge Temporary General seeker staffingfees companies Introduction to job IT temporary offers staffing Registrati
Slide 63: Our business contents 1
Our business contents ① 63 ＜ HR-Tech engage ＞ Service brand Contents Characteristics Clients Company A freemium-model recruitment support tool Can create high-quality corporate recruitment websites and job listings easily and quickly Digital platform aimed Job offers created are automatically
Slide 64: Our business contents 2
Our business contents ② 64 ＜Job Board (Domestic）＞ Service brand Contents Characteristics Users Clients Company Companies which put their recruitment ads on the job board are Site for [en]Career Change Info carefully researched and taken pictures by en-japan. General Comprehensive Mainly 20s Hone
Slide 65: Our business contents 3
Our business contents ③ 65 ＜Job Board (Domestic）＞ Service brand Contents Characteristics Clients Company One of the largest freelance job search engine sites in Japan Job search engine site for freelance engineers Allows users to collectively search and apply by compiling listings by freelance F
Slide 66: Our business contents 4
Our business contents ④ 66 ＜ Domestic Other Business / Subsidiary＞ Contents Characteristics Clients Company Hiring management Temporary Uniform management of various data and functions, e.g.hiring information, interviewers, system response to applications, and effectiveness measurement. staffing c
Slide 67: Our business contents 5
Our business contents ⑤ 67 ＜Domestic Other Business / Subsidiary＞ Contents Characteristics Clients Company A cloud service that enables uniform management of orders placed with Freelance management freelancers, progress and billing service General Companies en Japan Orders received and placed ar
Slide 68: Our business contents 6
Our business contents ⑥ 68 ＜Overseas＞ Service brand country Contents Characteristics Clients Company Clients are local business companies and global business companies operating in Permanent ・Local Companies NEWERA India. Recruitment ・Global Companies INDIA Mainly places high income-earning zone
Slide 69: engage Service Introduction
engage Service Introduction
Slide 70: engage overview
engage overview 70 Creation of high-quality job offers through engage to increase high-quality matching between many more companies and job seekers Job listing linkage Preparation of recruitment websites Company Preparation of job listings Job seeker Browsing/application
Slide 71: Creating corporate recruitment websites / Post job listings
Creating corporate recruitment websites / Post job listings 71 Provision of free “recruiting support tool” with functions such as creating corporate recruitment websites, listing job offers, and managing applicants creating corporate recruitment websites Post job listings • Easily create own recruit
Slide 72: Monetization flow
Monetization flow 72 Significant increase in exposure through paid plans to increase speedy applications and improve recruitment rate Advertisement-based billing model is newly adopted from the current period in addition to the Listing-based model Revenue recorded ・Application-based billing Billing
Slide 73: Characteristics of engage Paid Plan
Characteristics of engage Paid Plan 73 Publicity of paid recruitment significantly increased (compared with free service: PV up 23-fold), and improved rate of successful recruitment Allow listing in paid spots of various recruitment services Using a new paid plan “engage Premium” [en]Career Change I
Slide 74: Potential for expansion
Potential for expansion 74 *Source：Statistics Bureau, Ministry of Internal Affairs and Communications Potential expansion mainly in local areas and SMEs among approximately 3.3 million corporations in Japan “engage” usage rate among domestic corporate clients 3.3 465 490 14.8% million companies thou
Slide 75: Data of Main service
75 Data of Main service
Slide 76: Cost relative to sales - Labor cost and Sales & Promotion cost
Cost relative to sales - Labor cost and Sales & Promotion cost (consolidated) 76 1Q 1Q 1Q 1Q 2Q 3Q 4Q 2Q 3Q 4Q 2Q 3Q 4Q 2Q 3Q FYE Mar FYE Mar FYE Mar FYE Mar 2020 2021 2022 2023 Ordinary Income (million yen) 2,892 3,305 1,979 2,881 1,236 1,758 2,155 2,788 2,314 2,495 2,675 2,653 1,907 1,033 1,235 %
Slide 77: Earnings for Fiscal year end and each quarter
Earnings for Fiscal year end and each quarter 77 Fiscal year end Sales (million yen) Ordinary Income(million yen) Ordinary Income ratio *FY2011 converted 15 months to 12 months due to the change of accounting period（Change from December to March） Quarter
Slide 78: Trends in Unemployment Rate & Job Offers-to-Applicants Ratio
The market environment 78 – Trends in Unemployment Rate & Effective Job Offers-to-Applicants Ratio < Latest Unemployment Rate > (%) ＜Year Average＞ Unemployment Rate （％） (times) Effective Job Offers-to- Applicants Ratio Dec. 1.28 times for 2022 2.5% ＜Latest Effective Job Offers-to-Applicants Ratio ＞
Slide 79: en Japan Inc. Corporate Planning Department IR Group
79 ■ en Japan Inc. Corporate Planning Department IR Group TEL：+81-3-3342-4506 Mail: [email protected] URL:https://corp.en-japan.com/en/ Cautionary Statement This material is for informational purpose only. You are fully responsible for the final decision to invest in the company. The statements inc