TKP Corporation 3 rd Quarter of fiscal year ending Feb. 2018

Transcription

1 Creating 1 from 0 Space Regeneration & Distribution Company TKP Corporation 3 rd Quarter of fiscal year ending Feb January 16 th, 2018 株式会社ティーケーピー 東証マザーズ :3479

2 AGENDA 1 Characteristics of the TKP Business...P 2 2 Main Topics from 3 rd Quarter of Fiscal Year Ending Feb P 5 3 Highlights of the 3rd Quarter...P 8 4 TKP Growth Strategy...P 17 5 Appendix...P 27 1

3 1 Characteristics of the TKP Business 2

4 1. TKP business model (1) Property owners Underutilized assets Asset light management Large-volume transactions (inexpensive space acquisition) Regeneration to create multipurpose spaces Training, seminars Parties, social events Exhibitions Events, concerts Small-lot space sales Conference room users Reduction in expenses Multipurpose use Niche & sharing Sharing economy that makes effective use of underutilized assets that have profit-earning potential 3

5 2. TKP business model (2) Food and beverages Catering Boxed lunches Simultaneous interpretation system Video conferencing system Options Training coordination Video, audio, lighting Café Restaurant Rental services for recruiting Office furniture/ equipment Setting up partitions High-spec projector Accommodations Others Training trip packs Employee trip packs Affiliated hotels Accommodation arrangements Transportation arrangements Event production Event management system Resort-type seminar hotels High grade resort-type seminar ryokan (Japanese style inn) Hybrid hotels with conference rooms Resort-type training hotel in Tokyo Compact hotel with conference rooms We are expanding our operations by providing catering, lunch boxes, and other food and beverage services, as well as optional services such as simultaneous interpreting systems, and other services such as accommodation and transportation arrangements. 4

6 2 Main Topics from 3 rd Quarter of Fiscal Year Ending Feb

7 3. Main Topics from 3 rd Quarter of Fiscal Year Ending Feb (1) Sept.: Opening of First Cabin Nagoyaeki Sept.: Acquisition of Majors, Inc. Nov.: Conclusion of capital and business alliance with Otsuka Kagu, Ltd. 6

8 4. Main Topics from 3 rd Quarter of Fiscal Year Ending Feb (2) TKP was awarded the Nikkei CNBC Outstanding IPO Company of the Year award! TKP President and CEO Takateru Kawano was selected as the Japan winner at EY Entrepreneur of the Year 2017 Japan Next step: The global competition to be held in Monaco in June, featuring entrepreneurs from leading businesses in around 60 countries 7

9 3 Highlights of the 3rd Quarter 8

10 5. Highlights of Q3 FY 2018(cumulative, consolidated) (Millions yen) Sales (Millions yen) Operating income 25,000 Year-on-year 129.0% 21,301 3,500 3,000 Year-on-year 117.0% 3,042 20,000 2,599 16,510 2,500 15,000 2,000 10,000 1,500 1,000 5, Q FY Feb Q FY Feb Q FY Feb Q FY Feb Sales and operating income reached historical high. 9

11 6. Highlights of Q2 FY 2018 (cumulative, consolidated) (Millions Yen) 3Q Q Year-onyear Amount % to sales Amount % to sales change Sales 16, % 21, % 129.0% Gross profit 6, % 8, % 129.6% SG&A 3, % 5, % 138.2% Operating income 2, % 3, % 117.0% Ordinary income 2, % 2, % 112.8% Net income 1, % 1, % 147.7% * Net income indicates the net income attributable to owners of the parent. We achieved growth in income, and set new records in all income categories. The growth in income is being driven by an improved gross profit margin in the rental conference room business and by strong performance from business hotels. 10

12 7. Highlights of Q2 FY 2018 (Sept. Nov. 2017, consolidated) (Millions Yen) 3Q Q Year-onyear Amount % to sales Amount % to sales change Sales 5, % 7, % 137.0% Gross profit 1, % 2, % 147.3% SG&A 1, % 1, % 142.4% Operating income % % 162.4% Ordinary income % % 167.5% Net income % % 185.8% * Net income indicates the net income attributable to owners of the parent. We achieved large income growth, primarily as a result of new facilities and strong operating rates at business hotels. The gross profit margin in the rental conference room business improved, and the operating income rate was higher than the same period of the previous year. 11

13 8. Trends in consolidated sales (by grade) (Millions yen) 24,000 22,000 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, , ,303 5,231 4,793 1, , ,416 6,196 5, , (1) (2) 2,617 1,651 1,468 7,328 6,327 1,771 1, Q FY Q FY Q FY (Rooms) 2,000 1,800 1,600 1,400 1,200 1, (1) Mainly because 1, acquisition of Majors as of Sep , Azur Takeshiba (2) Mainly because APA Hotel TKP Nippori Ekimae and APA Hotel TKP Sapporo EXCELLENT Others Accomodation STAR rental conference rooms Business Center(BC) Conference Center(CC) Garden City(GC) Garden City PREMIUM(GCP) Total meeting room Sales grew as a result of opening more facilities in the top 3 grades (GCP/GC/CC). 12

14 9. Trends in consolidated sales (by service) (Millions yen) 25,000 20,000 (1) 1,609 1,878 (1)Mainly because Azur Takeshiba and APA Hotel TKP Nipppori Ekimae 15,000 1, , ,368 (2) 4,558 2,015 (2) Mainly because Azur Takeshiba and food and beverage sales 10,000 2,974 1,276 1,630 Others 5,000 7,821 9, % 11, % Accomodations F&B 0 3Q FY Q FY Q FY Options Room rent Sales grew as a result of food and beverage sales and new operating hotels. Ratio of accommodation over total sales increased to 52.7% (Previous 3Q 58.6%) 13

15 10. Numbers of facilities and conference rooms by grade High addedvalue grades including food and beverage sales 写真写真写真 Total Garden City PREMIUM (GCP) Garden City (GC) Conference Center (CC) FY 2015 FY 2016 FY Q FY 2018 Facilities Rooms 1,410 1,536 1,752 1,829 Facilities Rooms Facilities Rooms Facilities Rooms Reasonable price grades Subtotal 写真写真 Business Center (BC) STAR rental conference rooms Rooms 1,008 (71%) 1,111 (72%) 1,281 (73%) 1,362 (74%) Facilities Rooms Facilities Rooms At training facility Subtotal Rooms 382 (27%) 405 (26%) 442 (25%) 440 (24%) LecTore, Ishinoya, others Rooms We intend to continue opening high added-value facilities in the Conference Center and higher grades which include food, beverage, and other sales. 14

16 11. Balance sheet (consolidated B/S summary) Feb Aug. end Nov. end (2-1) (Millions Yen) Amount Amount Amount Change Current asset 8,489 11,634 10,397 1,237 (Cash and savings) 5,494 8,051 6,915 1,136 (Receivable) 2,165 2,188 2, Fixed asset 15,650 16,243 19,459 3,216 (1) (Tangible fixed asset) 10,822 10,836 11,948 1,112 Total assets 24,140 27,878 29,857 1,979 Current liabilities 5,284 6,991 6, Fixed liabilities 14,385 12,701 14,173 1,472 (2) Total liabilities 19,669 19,693 21,093 1,400 (Balance of interest-bearing debt) 16,607 15,250 17,043 1,793 Total net assets 4,470 8,185 8, Total liabilities and net assets 24,140 27,878 29,857 1,979 (1) The primary causes include shares of Otsuka Kagu, the Nishi-Kasai hotel, and deposits for new facilities. (2) The primary causes are bank borrowing of 2.5 billion yen and scheduled repayment of 1.0 billion yen. 15

17 12. 3Q progress relative to the full-year plan, and the plan for new facilities this year 3Q results relative to the FY Feb sales plan (Millions yen) Results from 3Q of FY Feb FY Feb plan 3Q progress relative to FY Feb plan Sales 21,301 26, % Operating income 3,042 3, % Ordinary income 2,821 3, % Net income 1,985 1, % We have made steady progress through 3Q relative to the full-year results plan, and are now examining the full-year plan forecast. Plan for new facilities this year (facilities with decided opening dates as of January 2018) Conference rooms, banquet facilities Timing Area m2 Grade Hotels Tokyo 1782 Garden City 693 Conference Center 455 STAR Nagoya 1782 Garden City PREMIUM Hiroshima 3564 Garden City Fukushima 363 Conference Center Sendai 76 Business Center Fukuoka 340 Conference Center Kanazawa 96 STAR Kokura 330 Business Center Tokyo 713 Hiroshima 251 Fukuoka 333 Conference Center Kawasaki 241 STAR Nagoya 1861 Garden City PREMIUM 1365 Osaka 777 Garden City Hiroshima 479 STAR Shizuoka 367 Conference Center Timing Area Rooms Hotel type Nagoya 199 First Cabin Nishi-Kasai 124 APA Hotel 16

18 4 TKP Growth Strategy 17

19 13. TKP growth strategy (1) Strengthening of marketing power through collaboration with Majors (2) Azur Takeshiba Now on track (3) Objectives of capital and business alliance with Otsuka Kagu 18

20 14. Strengthening of marketing power through collaboration with Majors (1) Acquired Majors Inc. as a subsidiary in Sept Total marketing production Production business Marketing support services - Support for formulation of corporate marketing strategies - Planning and implementation of marketing measures - Contracted operation of marketing systems (BPO) - Support by permanent on-site marketing personnel Event marketing services Synergy for diversification of the TKP Group Product business Event Cloud Mix Operation and promotion of business for the next-generation event product Event Cloud Mix Event cloud system We can now accept orders for large-scale event production at venues other than those operated by TKP, and will engage in deeper marketing to existing customer and entry into new markets. Leads to up-selling through system updates for existing customers. 19

21 15. Strengthening of marketing power through collaboration with Majors (2) Projects with Majors [Example of order for large-scale event production received through marketing collaboration] Order received from TKP customer A related to an event for all its Japan customers (approx. 2,000 persons) Event date: Dec Venue: Large hotel in Tokyo Price: Approx. 35 million yen [Start of personnel exchange system] Prior business with Company A for use of rental conference rooms amounted to approx. 20 million yen annually. However this event exceeded the capacity of TKP facilities and we could not receive the order. Through our collaboration with Majors, we were able to received an order for total event production covering everything from event planning to operation at a large-scale venue not operated by TKP. This single use resulted in a large increase in annual usage income. TKP is sending its staff to Majors to improve the level of the overall Group. (Start planned from March 2018.) By sending our staff to work temporarily at Majors, we intend to improve their skills in the event production and marketing fields. They will then share the knowledge they gained at Majors to improve the level of the overall Group. 20

22 16. Strengthening of marketing power through collaboration with Majors (3) Contribution of Majors to TKP business results Majors income began contributing from this 3Q. 3Q sales: Approx. 336 million yen 3Q operating income: Approx. 8 million yen [Majors nonconsolidated mid-term business plan] Feb Feb Feb (Millions yen) Sales 2,204 3,446 4,383 Operating income Operating margin % 8% 15% Aiming for further added-value marketing approaches to the TKP top customers and for general event production orders, Majors is planning to recruit and train marketing personnel and expand its marketing system. This system construction is expected to result in higher profitability. 21

23 17. Azur Takeshiba Now on track (1) About Azur Takeshiba This is a facility owned by the Mutual Benefit Association for Tokyo Metropolitan Government Employees. Operation was contracted to TKP in April The conference rooms and banquet facility are operating as TKP Garden City Hamamatsucho. TKP Garden City Hamamatsucho Conference rooms and banquet facility Accommodations Restaurant Weddings Hot spring The establishment of an operating system, orders for conferences and banquets operated by our company, and strong hotel demand all combined so that this facility successfully achieved a profit in November. 22

24 18. Azur Takeshiba Now on track (2) Future developments We are planning to increase the number of guest rooms and fully renovate the hotel, aiming for completion in spring or summer [Increase in guest rooms] By making efficient use of hotel space that is currently not efficiently used, we will increase the number of guest rooms and the number of users. Current: 122 rooms Future: 227 rooms (planned) [Renovations] Based on a new concept, extensive renovations will be carried out in order to raise the ADR (average room price). Current ADR and post-renovation target Current: 11,030 yen (avg. April Nov. 2017) Target: 18,000 yen (standard class annual avg.) Aiming to be a boutique hotel that is highly rated globally 23

25 19. Objectives of capital and business alliance with Otsuka Kagu (1) Capital and business alliance with Otsuka Kagu Ltd. [Main contents of business alliance] (1) Interior planning for facilities operated by TKP, and delivery of Otsuka Kagu furniture products (2) TKP operation of event spaces and other spaces at properties owned or leased by Otsuka Kagu (3) Mutual introduction of customers, construction of a system for coordination and cooperation to meet customer needs (4) Development of new facilities jointly by both companies Otsuka Kagu Reduce fixed expenses by optimizing shop space. TKP Can create new facilities in good locations under advantageous terms. This is possible due to the TKP customer base and space regeneration expertise. Diversify acquisition methods by identifying inefficient spaces and underutilized assets. 24

26 20. Objectives of capital and business alliance with Otsuka Kagu (2) Specific projects with Otsuka Kagu Ltd. (1) Contracted operation of the 8th floor at the Otsuka Kagu Shinjuku Showroom Name: IDC OTSUKA Hall (provisional name) Planned opening: Spring 2018 Access: 2 min on foot from Shinjuku Station 1 min on foot from Shinjuku 3-chome Station (2) Operation of the 7th/8th floors at the Otsuka Kagu Sendai Showroom Name: Not decided Planned opening: Spring 2018 Access: 5 min on foot from Sendai Station Planning to operate as rental conference rooms of various sizes. 25

27 21. Future possibilities Centered on the rental conference room and banquet businesses, we have achieved profits with a multidirectional web connecting our space regeneration business and peripheral business areas. Business regeneration? Space regeneration? Weddings Azur Takeshiba First Cabin APA Hotels LecTore Call centers Co-working Ishinoya Accommodations Restaurants Bento box catering Rental conference rooms, banquet facilities Tokiwaken Event production Rentals TKP Medicalink Overseas Majors In the future, we will also work for business regeneration based on the TKP assets and customer-attracting strength

28 54 Appendix 27

29 1Corporate philosophy T K P otal ukan ー roduce Our logo symbolizes the flag waved by Liberty, in the famous painting Liberty Leading the People by Eugene Delacroix, and expresses our revolution to lead customers, society and employees in a better direction. TKP aspires to be a Space Regeneration & Distribution Company through the rental conference room business for companies, and create quality places, spaces and time, by making use of and adding value to underutilized properties and land and regenerating space 28

30 2Repeated innovation and growth since our founding Sales (units: JPY MM) Multi-use of banquet halls and conference rooms 17,941 21,978 Regeneration of hotel banquet halls 14,162 Focus on niche and sharing businesses FY May 2006 FY May 2007 FY May 2008 FY May 2009 FY May 2010 FY Feb 2011 FY Feb 2012 FY Feb 2013 FY Feb 2014 FY Feb 2015 FY Feb 2016 FY Feb

31 35 different grades, suitable for different purposes Garden City PREMIUM State-of-the-art luxury office banquet / conference rooms Suitable for diverse purposes, from conferences to banquets, with high-end interiors and unique atmosphere Garden City Hotel banquets, and office banquets with large multi-purpose halls Rental conference rooms in large hotels, with a strong focus on quality and suitable for various types of events Conference Center Suitable for office banquets (banquets that mainly consist of conferences) Covers a diverse range of business purposes, mainly conferences and seminars Business Center Conference facilities with a focus on conferences (rather than banquets) Suitable for internal meetings, large and small Star Rental Conference Rooms Local community-based conference rooms Suitable for small-scale meetings/assemblies, by companies as well as individuals No. of locations: 11 No. of rooms: 122 Brand new / relatively new facilities No. of locations: 32 No. of rooms: 370 Mainly renovated facilities No. of locations: 77 No. of rooms: 870 Mainly renovated facilities No. of locations: 55 No. of rooms: 364 Mainly renovated facilities No. of locations: 38 No. of rooms: 76 Mainly renovated facilities *Figures are as of November

32 4Network of rental conference rooms TKP operates 1,829 conference rooms in and out of Japan. Thanks to our nationwide network of conference rooms, can handle large-scale projects such as university entrance exams and nationwide hiring by large companies. Japan 1,783 rooms Overseas 46 rooms Hokkaido 93 rooms Kyushu/Okinawa 137 rooms Kansai 352 rooms Osaka Hokuriku / Koshinetsu 37 rooms Tokyo Kanto 859 rooms Tohoku 113 rooms Taiwan Myanmar Hong Kong Malaysia Singapore New York / New Jersey Overseas 46 rooms 那覇 Chugoku/Shikoku 68 rooms Tokai 124 rooms *As of November

33 5Mid-term management plan (hotels business) The TKP Group operates a total of 5 brands and 20 hotels. We are proceeding with hybrid hotel operations aimed at capturing both BtoB and BtoC demand. LecTore Ishino-ya APA Hotel First Cabin Azur Takeshiba No. of facilities 5 6 No. of facilities 1 No. of facilities 1 No. of facilities 3 10 No. of facilities 1 2 Resort-type seminar hotels, within 1 hour from CBD High grade resort-type seminar ryokan (Japanese style inn) Resort-style training city hotel in central Tokyo Hybrid business hotel with conference rooms Compact hotel with conference rooms

34 6Stable client base Number of users per year has reached 22,500 companies. More than half of listed companies in Japan are TKP users. Repeat ratio is approximately 80%. Number of corporate users per year 22,500 High repeat user ratio New and repeat user ratio Number of users of listed companies per year 2,000 Average usage of 100 rooms for top 500 clients facilities per customer New Users 20% Repeat Users 80% Repeat client means the client used our facilities FY 2016/2 and FY 2017/2. 33

35 7Diversified client base and use of the space Sales and use of space are fully diversified. Diversified client base Breakdown by sales ranking Variety of use of space Breakdown by space use 2500> Top to 20 Oters Meeting Briefing Party 501 to to 500 Exam Seminar Recruiting Training

36 8Different approaches for different user classes Choosing the best approach depending on the type of user (heavy, potential heavy, oneoff/light users) Sales Up to 500 companies Up to 2,500 companies Event concierge More than 2,500 companies~ User classification Heavy users Potential heavy users One-off users, light users Active proposals and care by VIP sales staff Digging up of user needs by designated sales staff, leading to higher revenues, building a relationship of trust, and turning users into repeat customers Efficient operations using call center and Cloudspace (no assigning of sales staff) 35

37 9Market environment The training service market is expanding, while the number of MICE events is also steadily increasing. The market for corporate banquets in hotels is large. Strong potential for ancillary services such as dining & restaurants. Market size of corporate training services(2016) Advertising market(2016) (million yen) 5,500 5,080 4,970 4,790 4,860 5,000 4,670 4,500 4,250 4,000 3, Source: Yano Research Institute Corporate Training Service Market 2016 Size of hotel market(2016) Newspaper 6% Others 26% Magazine 1% TV 25% Radio 1% Internet Outdoor 11% SP/Event Overseas 14% 1% Source: Ministry of Economy, Trade and Industry Transportation1% Leaflet 3% 11% Size of dining/restaurant market(2015) Others 12% Accommo Dining dation 21% 1.93 trillion yen 39% Weddings/Banquets 28% Ready-made food industry 21% 32.9 trillion yen Dining industry 76% Catering 900 billion yen 3% Source: Yano Research Institute 2016 Hotel Industry Source: Fuji Economic Research Institute Restaurant Marketing Data 2016 No.3 36

38 10Corporate overview TKP Corporation Name TKP Corporation K.K. Convenistation Rental conference room service Headquarter 2F, TKP Ichigaya Building 8 Ichigaya-Hachimancho Shinjuku-ku, Tokyo K.K. TKP Properties K.K. TKP Telemarketing Building management service Telemarketing service Established August 15, 2005 Representative Director Takateru Kawano Capital JPY 287,795,000 No. of employees Business 827 (as of Feb. 2017) excluding part-timers Space Regeneration & Distribution Company Hotel banquet hall and rental conference room business Dining & catering business Hotel & resort business Event operation & production business Call center & BPO business K.K. Tokiwaken foods K.K. TKP Medicalink 3L entrance K.K. Majors K.K.. TKP MEETING AND CONFERENCE (M) SDN. BHD. TKP International Limited TKP New York, Inc. TKP SINGAPORE IN PTE.LTD. TKP New Jersey LLC K.K. TKP SPV No.1~6 Dining service Operation & support service for medical academic conferences Rental office / co-working service Event produce/ Event management system Rental conference room / dining / optional services Rental conference room / dining / optional services Rental conference room / dining / optional services Rental conference room / dining / optional services Rental conference room / dining / optional services Accommodation services 31

39 11Shareholders as of Aug. end 2017 Outstanding shares Shares out 4,730,000 shares 1 to 7 split took place on Sep. 1 st # of issued shares is 33,110,000 Major shareholders # of shareholders:1,443 Shareholding ratio # of holding (shares) Rate of holding (%) 1 River Filed Co. Ltd. 1,924, % 2 Takateru Kawano(CEO of TKP) 1,434, % 3 Imon Corporation 363, % 4 Japan Trustee service 146, % 5 Japan Master Trust bank 86, % 6 TKP corporation 72, % 7 Morgan Stanley MUFG 30, % 8 Individual investor 30, % 9 Asset management service trust bank 28, % 10 Japan Securities Finance Co. Ltd. 27, % 1.8% 1.5% 4.2% 48.8% holders 6.7% 37.1% Indivisual Financial companies Japanese corporations Foreign companies Brokerage firms Treasury stock 38

40 [Disclaimer] This is English translation only for the purpose of reference. Please be sure to refer to the original version. This material has been prepared to improve understanding towards our group, and no information contained herein shall be construed as solicitation for purchase or sale of our shares. This material has not been prepared for investment advisory purposes. Forecasts etc. contained in this material are estimates, based on information available to the TKP group at the time of preparing the material, and will be impacted by uncertainties including market conditions and future business progress. Please be informed that the actual results etc. could differ significantly from what is stated in this material. 39