information meeting · 2018. 1. 23. · 2.0 2.5 0 10 20 30 40 50 dec '09 dec '10 dec...

First Half Results for the Six Months Ended June 30, 2014

August 12, 2014

Information Meeting

SBS Holdings, Inc.

Copyright SBS Holdings, Inc. All rights reserved. FY2014 (1H) Information Meeting

Table of Contents

• FY2014 First Half Results and Full Year Forecasts

• FY2014 Group Management


1

FY2014 First Half Results and Full Year Forecasts

SBS Holdings, Inc.Executive Officer, Finance & Accounting

Yasuhiro Yamashita


Consolidated 1H Performance (YOY Comparison) 2

Amount % of Total Amount % of Total YOY Change(amount)

YOY Change(% )

Net Sales 61,805 100% 65,777 100% 3,971 6.4%

OperatingIncome

703 1.1% 1,480 2.3% 776 110.3%

OrdinaryIncome

534 0.9% 1,373 2.1% 838 157.0%

NetIncome

149 0.2% 1,761 2.7% 1,611More

than tentimes

1st Half ofFY2013

1st Half of FY2014(Millions of yen)


Consolidated 1H Performance (Actual vs. Planned) 3

(Millions of yen)

Planned % of Total Actual % of Total YOY Change(amount)

YOY Change(%)

Net Sales 63,000 100% 65,777 100% 2,777 4.4%

OperatingIncome

1,100 1.7% 1,480 2.3% 380 34.5%

OrdinaryIncome

900 1.4% 1,373 2.1% 473 52.6%

NetIncome

500 0.8% 1,761 2.7% 1,261 252.2%

1st Half ofFY2014

1st Half of FY2014


Performance by Segment (YOY Comparison) 4

(Millions of yen)

Reference: FY2013 1H (For the six months ended June 30, 2013)

FY2014 1H (For the six months ended June 30, 2014)

Logistics PropertyManagement Other Consolidation/

Corporate Total

Net Sales 61,237 1,195 3,344 － 65,777YOY Change (% ) 5.9% -11.1% 25.7% － 6.4%

Operating Income(Loss) 605 612 171 91 1,480

YOY Change (% ) － -11.9% 440.1% － 110.3%

Operating Margin 1.0% 51.2% 5.1% － 2.3%


Corporate Total

Net Sales 57,801 1,344 2,659 － 61,805YOY Change (% ) -1.3% 12.0% -13.3% － -1.7%

Operating Income(Loss) (77) 694 31 54 703

YOY Change (% ) － 16.9% 29.2% － -47.2%

Operating M argin － 51.6% 1.2% － 1.1%


Trends of Consolidated Balance Sheets 5

As of December 31, 2013

Total Assets 108.3Equity Ratio 26.7%

As of June 30, 2014

Total Assets 108.3Equity Ratio 28.1%

Current Assets

39.4

Non-Current Assets

68.9

Current Liabilities

41.4

Net Assets30.6

Non-Current Liabilities

36.2

-2.5-0.2

+0.2

+1.1

+1.4

±0

Equity ratio increased 1.4 points

Current Assets

39.6

Non-Current Assets

68.6

Current Liabilities

43.9

Net Assets29.2

Non-Current Liabilities

35.1

(Billions of yen)


46.3

37.3 39.1 38.1 39.2 38.6

20.7 22.524.8

27.3 28.6 29.9

2.23

1.65

1.571.39 1.37

1.29

1.0

1.5

2.0

2.5

0

10

20

30

40

50

Dec '09 Dec '10 Dec '11 Dec '12 Dec '13 June '14

■Management of interest-bearing debt and enhancement of shareholders’ equity

Establishing a Sound Financial Base 6

Net IBD (Long-term debts + Corporate bonds - Cash and deposits)

Shareholders’ EquityNet IBD/Shareholders’ Equity

Times(Billions of yen)


Overview of Consolidated Statements of Cash Flows 7

As of December 31, 2013 As of June 30, 2014Billions of yen

14

12

10

8

6

4

2

0

Cash and cash equivalents at end of year

10.3

Cash flows from investing activities

-0.3 Cash flowsfrom

financing activities

Cash and cash equivalents at end of Q2

9.0

Cash flows from operating activities

-2.7-1.3

+1.7


FY2014 Forecasts

(Millions of yen)

8

* Forecast values are as revised July 30, 2014.

Actual % of Total Forecast* % of Total YOY Change(amount)

YOY Change(%)

Net Sales 132,205 100% 137,000 100% 4,795 3.6%

OperatingIncome

4,141 3.1% 4,800 3.5% 659 15.9%

OrdinaryIncome

3,801 2.9% 4,400 3.2% 599 15.8%

NetIncome

1,571 1.2% 3,500 2.6% 1,929 122.8%

FY2013 FY2014


FY2014 Forecast by Segment

FY2014 Forecast* (For the year ended December 31, 2014)(Millions of yen)

Reference: FY2013 (For the year ended December 31, 2013)

9

* Forecast values are as revised July 30, 2014.


Corporate TotalNet Sales 125,000 5,300 6,700 － 137,000

YOY Change 3.5% -4.6% 14.2% － 3.6%Operating Income 2,050 2,400 350 0 4,800

YOY Change 68.2% -5.9% 73.3% － 15.9%Operating Margin 1.6% 45.3% 5.2% － 3.5%


Corporate TotalNet Sales 120,786 5,554 5,865 － 132,205

YOY Change 1.2% 121.8% -3.9% － 3.3%Operating Income 1,219 2,550 202 169 4,141

YOY Change -29.5% 111.3% 351.0% － 42.7%Operating Margin 1.0% 45.9% 3.4% － 3.1%


10

FY2014Group Management

SBS Holdings, Inc.President

Masahiko Kamata


Review of Operations and Topics

Logistics Business Special demand in runup to increase in

consumption tax, limited pullback afterward 3PL operations: New operations, new orders received Overseas business: Acquisition of Transpole in India

Property Management Business Warehouse completed in Thailand

(Building No. 1 in June, Building No. 2 in August) Order placed for construction in Sugita, Yokohama Transfer of remaining 49% of trust beneficiary rights

to private placement fund No. 1 (August)

Other Business Results in Human Resources Business on firm trend 2nd phase of construction under way in solar power

generation business

11

Construction under way at Nagatsuta Logistics Center in Yokohama

Shipping at logistics center for Takashimaya Co., Ltd.

Location of phase 2 of construction of Shibayama solar Power Plant

Generating Station No. 1

Generating Station No. 2 (planned location)


Business Model Combining Logistics and Finance 12

Acquire 3PLcustomers

Logisticsinnovation

+Facilities

innovation↓↓↓

Proposal sales

Construction supervision Surplus

leasing

Complete construction of buildingStart 3PL business

Rentalincome ＋

3PLoperation income

Utilize financial know-how to achieve liquidation and off-

balance-sheet financing

Growth strategy combining facilities

development and 3PL business

Capital recoveryReceipt of

capital gains

⇒Reinvestment

Acquire land for construction Logistics Facility

Private placement fund scheme, etc.


Progress in 3PL Business

Achievements for the first half Major meat processor (construction of dedicated center covering the

Kanto area) Major department store group in Kansai (operation of a food delivery

logistics center) Major department store in Kanto (operation of a food mail-order logistics

center)

Orders received Manufacturer of eyeglass lenses (move toward joint center for eyeglass

lenses) Drugstore chain (operation of logistics center for 140 stores in Kansai) Major supermarket chain (operation of 33,000sqm logistics center)

(Billions of yen)

13

3PL Business FY2012 FY2013 FY2014 Plan

Net Sales 44.3 46.1 48.0YOY Change +4.7% +4.1% +4.1%

(Midterm target for net sales: ¥70 billion)


Pipeline for Development of Logistics FacilitiesOver a 5-year period, planning to invest a total of

50 billion yen in Japan and overseas

14

Sugita (Yokohama) Logistics Center(Artist’s conception)

２０１４・・・・・・・・２０１５・・・・・・・・・・２０１６・・・・・・・・・２０１７・・・・・・・・２０１８

Planned fiscal year for completion

BSaitama

Mar 2016

YokohamaSugitaFeb 2016

ThailandBldgs. No. 1 & 2Jun, Aug 2014

A

YokohamaKanazawa

Thailand Bldg. No. 3

Aug 2015

YokohamaNagatsuta

Jan 2015


Securitization Through Private Placement Fund

Transfer to SBS Logifund No. 1 complete

SBS Logifund No. 2 is expected to be formed next fiscal year.

15

West Japan Logistics

Center¥6.14 billion

SeniorLoan

¥3.7 billion

Investmentin Silent

Partnership¥1.44 billion

MezzanineLoan

¥1.0 billion

Major financial institution: Company BDevelopment Bank of JapanIndustrial & Infrastructure Fund Investment CorporationA-MAX (¥0.18 billion), etc.

Major financial institution: Company A

SBS Logifund No. 1SBS Logifund No. 1

West Japan Logistics CenterKyotanabe City, Kyoto Pref.

Dec 2013: Transfer of 51％

Aug 2014: Transfer of 49％

Transfer price: Approx. ¥2.9 billionGain from transfer: Approx. ¥1.2 billion

Transfer price: Approx. ¥2.8 billionGain from transfer: Approx. ¥1.2 billion(Operating income)

Trust beneficiary right


Completion of first Group-owned logistics center in Thailand

Acquisition of partners active in Asia ex-Japan

Progress on Overseas Strategy 16

Hong KongTaiwan

KoreaJapan

PhilippinesVietnam

Laos

Thailand

Myanmar

Bangladesh

Cambodia

Malaysia

SingaporeIndonesia

Sri Lanka

Shanghai

India

China

ASEANBrunei

New Delhi

Bagalore

Drayage shipping launched in Singapore.January 2014: Acquisition of GimGuan Freight Pte. Ltd.

Bldg. No. 2 is scheduled for completion August 2014.

Formation of a presiding company for the Asia region

January 2014

Transpole LogisticsAcquired July 2014

Atlas LogisticsAcquired November 2011

Bldg. No. 1: Completed June 2014

10,000sqm facility, already occupied with Japanese

corporate tenants

Notes: The logo indicates a country or city in which an SBS Group local affiliate is located.

(Midterm target for net sales: ¥30 billion)


Overview of Transpole Logistics

Transpole Logistics Pvt. Ltd.Established: August 2004Headquarters: New DelhiCEO: Anant Kumar ChoudharyShareholders: SBS 66%, founders’ group 28%, employee shareholders’ association 6%Number of locations: 18 cities in India plus 11 countries worldwide including Hong Kong,

Singapore and South KoreaBusiness: Air forwarding 54%, marine forwarding 42%, other 4%Major customers: Samsung (electronics), Micromax (communications), Honda, Toyota

(automobiles)Number of employees: 744 (as of March 31, 2014)

17

Transpole 10th anniversary celebration and joint meeting with SBS (New Delhi, Aug 4, 2014)


Transpole is an Indian Company Active Throughout Asia

Indian rupee = 1.72 yen

Rapid growth: Average growth rate from 2008 to 2013 is over 60%. Sales are generated 60% in India and 40% elsewhere in Asia (and

growing rapidly)

TranspoleBases in India

TranspoleBases in Asia

18

2.13.7

6.3

9.9

14.0

17.0

0.10.3

0.6

0.9

0.7

1.2

0

5

10

15

20

Mar '10 Mar '11 Mar '12 Mar '13 Mar '14 Mar '15E0

0.5

1

1.5

2

(Billions of Yen) (Billions of Yen)

Net Sales

Operating Incom

e


South Korea

Hong KongThailand

Shenzhen

Brazil

Argentina

Chile

Peru

SingaporeMalaysia

ShanghaiChengdu

Qingdao Japan

India

South Korea

Hong KongThailand

ShenzhenShenzhen

Brazil

Argentina

Chile

Peru Brazil

Argentina

Chile

Peru

SingaporeSingaporeMalaysiaMalaysia

ShanghaiShanghaiChengduChengdu

QingdaoQingdao JapanJapan

IndiaIndia

Transpole’s Strengths

Top management Mr. Choudhary is a 36-year-old former

executive with DHL. In the 10 years since its foundation, Mr. Choudhary hasbuilt Transpole into a 10 billion yen company.

Transpole attracted investment from Fidelity Growth Partners in 2011 and Everstone Capital in 2013.

Success in opening markets Since establishment: In India Since 2008: Expanded into ASEAN

and East Asia Since 2013: Expanded into South America

Customer assets Global companies

Micromax, Samsung, LG, Wipro, HCL, etc. Japanese companies

Toyota, Honda, Panasonic, Daikin, Casio, Toshiba, etc.

19

Anant Kumar Choudhary, CEO


Synergies between the SBS Group and Transpole

A partner in opening overseas markets Transpole offers powerful sales capability as an advance guard in opening

overseas markets. Effective deployment and reorganization

of bases in ASEAN and East Asia Aiming for IPO in the Indian market

Using Japanese quality to attract a high-caliber clientele Provision of logistics facilities (from construction to operation) Provision of logistics (3PL)

Partnership with Atlas Logistics

Top level in sales among Indian forwardingcompanies

Transpole’s leadership will promote management reform and streamlining.

20

Atlas chairman H.R. Venkatesh Raodelivers address at meeting with Transpole(August 4, 2014, New Delhi)


0

10

20

30

40

50

Jan. Feb. Mar. Apr. May June

KyotanabeNodaChikumaKawagoeShibayama No.1

Energy sales in FY2014 1H

Planned future investments 2H: 6 locations including Shibayama No. 2

(increase of 2.1MW) FY2015: Nagatsuta Center (increase of 1.0MW) Shibayama No. 2

under construction

(Millions of yen)

32

23

13

2825

16

Generating capacity: 5.3MWEnergy sales: Approx.¥140 million

Noda Yoshiharu(solar panels on roof)

Shibayama No. 1(using Group land)

Solar Power Generation Business 21


Strengthening the Group’s Management Base

Merging of management and some personnel of two key Group companies Personnel management, general affairs, accounting, transport safety and

other duties, as well as some personnel, of SBS Logicom and SBS Flec are to be merged in SBS Holdings.

This move will promote improved efficiency, standardization and shared operation of administrative functions.

22

SBS Holdings

SBS Holdings

SBS FlecSBS Flec SBS Logicom

SBS Logicom

SBS Sokuhai

SBS Sokuhai SBS ZentsuSBS Zentsu

SBS Global Network

SBS Global Network

SBS Freight Service

SBS Freight Service

SBS Transport

SBS Transport

SBS Support Logi

SBS Support Logi

Other Domestic

Group Companies

Other Domestic

Group Companies

Nippon Record Center

Nippon Record Center

Overseas Group

Companies

Overseas Group

Companies

General affairs (joint purchasing, etc.)

General affairs (joint purchasing, etc.)

Personnel operations (payroll, etc.)

Personnel operations (payroll, etc.)

Finances (funds management, etc.)Finances (funds

management, etc.)

Transport safety (safety measures, training, etc.)Transport safety (safety measures, training, etc.)

Accounting (accounts processing, etc.)

Accounting (accounts processing, etc.)


New Organization for SBS Holdings 23

As of September 16, 2014

※ Functions made separate and independent

＃ Roles and functions changed

Duties and personnel from subsidiaries merged into this department

Senior DirectorSenior

Director

ICT Div.ICT Div.

Logistics Quality Management Div.Logistics Quality Management Div.

PresidentPresidentGeneral Affairs Div.General Affairs Div.

Legal Div.Legal Div.

Finance Div.Finance Div.

Accounting Div.Accounting Div.

Audit Div.Audit Div.

CSR Div.CSR Div.

Corporate Planning Div.Corporate

Planning Div.

Corporate Management Div.

Corporate Management Div.

Corporate Communication Div.

Corporate Communication Div.

Human Resources Div

Human Resources Div

Accounts handling under contract, streamlining/standardization, internal controls

Transport safety, fleet management, safety management, environmental management

Fiscal-year planning, budget management, management of subsidiaries

Consolidated accounts, finances

CSR, risk management, compliance, the environment

Auditing and internal control

Management strategy, international business, M&A

IR, advertising, online presence

Personnel, labor, payroll calculation under contract, training

General affairs

Legal affairs

Information infrastructure, system development and operation, information security

※

※

※

※

※

＃

＃

＃

＃

Nine divisions expanded into 12


Aiming for Net Sales of 200 billion yen 24

121.1 127.9 132.2 137.0

200.0

2.22.9

4.14.8

8.0

0

2

4

6

8

10

0

50

100

150

200

Dec '11 Dec '12 Dec '13 Dec '14 Dec '17

(Billions of yen)

Brand unificationTokyo StockExchange,

First Section

(Billions of yen)

Net Sales

Tokyo Stock Exchange,

Second Section

Start MidtermManagement

Plan

Plan

Midterm Management Plan Target

Operating Incom

e

Reach target for Midterm

Management Plan!

155.0

M&A contribution

・・・・・・

◆6.2

Net sales Operating income

Organic Growth

Organic growth


Reference: Midterm Management Plan

Name: SBS Growth 2017 Period: 4-year period from 2014 to 2017 Vision

As we move toward our 30th anniversary,form a “3PL Corporate Group which has logistic functions in all directions” and become a leading group in the industry.

Numerical targets

Growth driven by 3PL, Asia, facilities development and M&A

Net SalesNet Sales 200 billion yen200 billion yen

Operating IncomeOperating Income 8 billion yen8 billion yen

Operating MarginOperating Margin 4% and more4% and more

Equity RatioEquity Ratio 30% and more30% and more


Reference: Midterm Performance Targets

Reach targets through self-sustained growth and M&A(Billions of yen)

Midterm ManagementPlan Targets

Dec. 2017

137.0 155.0 45.0 200.0Logistics 125.0 137.0 45.0 182.0

PropertyManagement 5.3 9.0 0.0 9.0

Other 6.7 9.0 0.0 9.0

4.8 6.2 1.8 8.03.5% 4.0% 4.0% 4.0%

Breakdown ofM&A

190 overseas + 260 in Japan (of which 150 3PL) = 450

OperatingIncome

OperatingMargin

Self-sustained Growth M&A

Net Sales2014 ⇒⇒⇒ 2017

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