Internet Initiative Japan Inc. · TSE:3774
Internet Initiative Japan — FY2017 Earnings Presentation
25 slides from Internet Initiative Japan's earnings presentation, May 15, 2018
Slide 1: Consolidated Financial Results for FY2017
Consolidated Financial Results for FY2017 Internet Initiative Japan Inc. TSE1(3774), NASDAQ(IIJI) May 15, 2018 Internet Initiative Japan Inc.
Slide 2: Agenda
Agenda Ⅰ. Summary of FY2017 Financial Results Ⅱ. FY2018 Business Plan Ⅲ. Consolidated Financial Results for FY2017 Ⅳ. Reference Materials Internet Initiative Japan Inc. 1
Slide 3: Summary of FY2017 Financial Results
bn = billion Ⅰ. Summary of FY2017 Financial Results % ＝Year over year comparison *Income before income tax expense **Net income attributable to IIJ Revenue JPY176.1 bn +11.6% Adjusted EBITDA JPY19.1bn +18.7% Gross margin JPY28.2 bn +11.8% ROE 7.3% Operating income JPY6.8 bn +31.7% Annual cash divide
Slide 4: FY2018 Business Plan
Ⅱ. FY2018 Business Plan Unit: JPY billion YoY = Year over year comparison Aim to increase income with continuous recurring revenue growth while full-MVNO-related costs increase, Seek significant income growth in FY19 by strengthening revenue accumulation % of Revenues % of Revenues Target & Assumpti
Slide 5: Consolidated Financial Results for FY2017 (1)
Ⅲ - 1. Consolidated Financial Results for FY2017 (1) Unit: JPY billion % of Revenues % of Revenues FY17 Results FY16 Results Year over Year Change (Apr. 2017 - Mar. 2018) (Apr. 2016 - Mar. 2017) Total Revenues 176.1 157.8 +11.6% +18.3 84.0% 84.0% Total Cost of Revenues 147.8 132.5 +11.5% +15.3 16.0%
Slide 6: Consolidated Financial Results for FY2017 (2)
Ⅲ - 1. Consolidated Financial Results for FY2017 (2) Unit: JPY billion Operating Income YoY change in NW services gross margin NW gross margin SI gross margin SG&A expenses YoY change in SI gross margin (incl. equipment sales) YoY change in ATM operation business gross margin Increased mainly Increa
Slide 7: Revenues
Ⅲ - 2. Revenues Unit: JPY million [ ] , YoY = Year over year comparison NW Services Systems Integration (SI) Internet Connectivity Services (Enterprise) Systems Construction Internet Connectivity Services (Consumer) Systems Operation and Maintenance Outsourcing Service Equipment Sales WAN Service AT
Slide 8: Cost of Revenues & Gross Margin Ratio
Ⅲ - 3. Cost of Revenues & Gross Margin Ratio Unit: JPY million Cost of revenues: NW Services SI Equipment Sales ATM Operation Business [ ] , YoY = Year over year comparison Gross margin ratio: NW Services SI Total Gross Margin Total FY17: JPY28,233 million (up 11.8% YoY) FY16: JPY25,247 million (u
Slide 9: Network Services (1) Revenues
Unit: JPY million Ⅲ - 4. Network Services (1) Revenues [ ] , YoY =Year over year comparison QoQ = 4Q17 compared to 3Q17 WAN Services Outsourcing Services Internet Connectivity Services (Consumer)* NW Services Revenues Internet Connectivity Services (Enterprise) Internet Connectivity (Enterprise) To
Slide 10: Network Services (2) Cost of Revenues
Unit: JPY million Ⅲ - 4. Network Services (2) Cost of Revenues [ ] , YoY =Year over year comparison QoQ = 4Q17 compared to 3Q17 Outsourcing-related costs Others Cost of NW Services Personnel-related costs FY17: up 16.1% YoY Network operation-related costs • Along with an increase in mobile traffic
Slide 11: Systems Integration (SI) (1) Revenues
Ⅲ - 5. Systems Integration (SI) (1) Revenues Unit: JPY million [ ] , YoY = Year over year comparison Systems construction Systems operation & maintenance revenues Order backlog (sum of systems construction & equipment sales) revenues Cloud revenues within systems operation & maintenance revenues Ord
Slide 12: Systems Integration (SI) (2) Cost of Revenues
Ⅲ - 5. Systems Integration (SI) (2) Cost of Revenues Unit: JPY million Purchasing costs [ ] , YoY = Year over year comparison QoQ = 4Q17 compared to 3Q17 Outsourcing-related costs Others Network operation-related costs Personnel-related costs FY16: 50,992 [+10.3%] FY17: 53,612 [+5.1%] Cost of SI F
Slide 13: Number of Employees
Ⅲ - 6. Number of Employees Unit: JPY million YoY = Year over year comparison Contract worker Full time worker Employee Distribution Administration Sales Engineers 4Q17: up JPY208 million, up 3.7% YoY Hired 175 new graduates in Apr. 2018 (148 in Apr. 2017, 137 in Apr. 2016) Personnel related cost
Slide 14: SG&A Expenses/R&D
Unit: JPY million Ⅲ - 7. SG&A Expenses/R&D [ ] , YoY =Year over year comparison QoQ = 4Q17 compared to 3Q17 Research & development expenses General & administrative expenses Sales & marketing expenses ( ) % of total revenues Sales & marketing expenses FY16: 20,113 [+12.7%] FY17: 21,471 [+6.8%] FY1
Slide 15: Operating Income & Net Income
Ⅲ - 8. Operating Income & Net Income Unit: JPY million [ ] , YoY = Year over year comparison Operating Income Net Income Attributable to IIJ Operating Margin Ratio Income Income before income tax expense: FY17: JPY7,840 million FY16 Operating income: 5,134 FY17 Operating income: 6,762 (up JPY2,4
Slide 16: Consolidated Balance Sheets (Summary)
Ⅲ - 9. Consolidated Balance Sheets (Summary) Unit: JPY million Mar. 31, 2017 Mar. 31, 2018 Changes Cash and Cash Equivalents 21,959 21,403 (556) Accounts Receivable 27,384 31,831 +4,447 Inventories 2,798 1,715 (1,084) Increased mainly due to DeCurret Inc. Prepaid Expenses (Current and Noncurrent) 14
Slide 17: Consolidated Cash Flows
Ⅲ - 10. Consolidated Cash Flows Unit: JPY million YoY = Year over year comparison Operating Activities FY16: 7,368 FY17: 13,262 Major Breakdown YoY Change 4,966 Net income 5,279 +1,947 4,190 2,960 3,237 2,865 2,194 Depreciation and amortization 12,365 +1,471 335 Net gain on sales of other investment
Slide 18: Other Financial Data (CAPEX etc.)
Ⅲ - 11. Other Financial Data (CAPEX etc.) Unit: JPY million [ ] = Year over year comparison CAPEX Depreciation and Amortization Cash CAPEX Cloud-related: JPY7.9 billion (Including GIO P2 facility in Western Japan of Capital Lease approx. JPY3 billion which is for FY18 usage) Ordinary CAPEX (i.e. N
Slide 19: Cloud Business
Ⅳ - 1. Cloud Business Unit: JPY billion [ ] , YoY = Year over year comparison Cloud-related revenue 4Q17 revenue Cloud-related revenue General purpose SaaS 0.08 Quarter-end month’s revenue Task-specific SaaS 0.58 Public 0.64 FY16: 15.66 [+11.1%] FY17: 17.91 [+14.4%] Private 3.44 *IIJ Raptor revenue
Slide 20: Mobile & IoT Business
Ⅳ - 2. Mobile & IoT Business YoY＝Year over year comparison Total subscription & revenue IIJmio Mobile (consumer) & IIJ Mobile (enterprise) Total subscription (thousand) Subscription (thousand): Total revenue (JPY billion) IIJmio Mobile IIJ Mobile ＜ ＞ MVNE Revenue (JPY billion): IIJmio Mobile IIJ Mob
Slide 21: Further Expansion of Existing Services
Ⅳ - 3. Further Expansion of Existing Services Unit: JPY billion Security % = Year over year revenue growth IoT Security service revenue Continuously accumulating IoT related prospective +26.2% project: over 320 as of FY17-end +10.9% In-store camera +7.5% Security camera Metric camera for marketi
Slide 22: FY2018 Financial Target (1)
Unit: JPY billion Ⅳ - 4. FY2018 Financial Target (1) YoY = Year over year comparison Subs. = subscription % of Revenues % of Revenues % of Revenues Target & Assumption FY17 Results 1H18 Target FY18 Target YoY Change (Apr. 2017 - Mar. 2018) (Apr. 2018 - Sep. 2018) (Apr. 2018 - Mar. 2019) NW service
Slide 23: FY2018 Financial Target (2)
Unit: JPY billion Ⅳ - 4. FY2018 Financial Target (2) YoY = Year over year comparison OP = operating income Operating Income YoY change in NW services gross margin NW gross margin SI gross margin SG&A expenses YoY change in SI gross margin (incl. equipment sales) NW fixed cost to Margin improve While
Slide 24: Mid-to-Long term Business Growth
Ⅳ - 5. Mid-to-Long term Business Growth Unit: JPY billion Business foundation enhancement with aggressive investment Further business developments Total revenue Revenue growth accelerating Scale-merit Income improvement Total revenue annual growth Established DeCurret Adjusted EBITDA Launched full
Slide 25: Forward-looking statements
※ Forward-looking statements Statements made in this presentation regarding IIJ’s or managements’ intentions, beliefs, expectations, or predictions for the future are forward-looking statements that are based on IIJ’s and managements’ current expectations, assumptions, estimates and projections abou
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