Fiscal Year Ending June 30, 2021
Financial Results Presentation Materials
WILLPLUS Holdings Corporation
(First Section of the Tokyo Stock Exchange: 3538)
Organized by The Securities Analysts Association of Japan
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Contents
Outline of 2Q Financial Results
Initiatives in the Fiscal Year Ending June 30, 2021
Consolidated Financial Results
Consolidated Financial Forecasts for the Fiscal Year Ending June 30, 2021
Shareholder Returns
APPENDIX
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Outline of 2Q Financial Results
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Japan's Market for Imported Vehicles
・COVID-19 cases surged once again starting in the 2nd half of November, as the end of the pandemic remains difficult to predict
・In recent months, the market for imported new cars has almost completely recovered to previous-year levels. However, on a full-year basis, vehicle purchases and registrations remain down, YoY
・Forecast 2020 levels during the pandemic; then a gradual convergence to the annual average
(Oct ~ Dec) Domestic Imported Vehicle Registrations
WILLPLUS HD's Initiative Policies
Additionally, we will strive to further improve customer satisfaction by offering as added-value a high-quality dealership experience conforming to the latest CI features. Based on our 3 growth strategies, we will continue
Transition to optimal business activities adapted to changes caused by the COVID-19 pandemic - such as business negotiations conducted online and digitizing documents, etc. - all the while carrying out thorough infection prevention measures, and promote efficiency improvements to our operations.
New cars are the key to growing recurring revenue business.
New cars remain a special purchase, even during the COVID-19 pandemic, so demand for test drives at dealerships is high.
The worldwide trend towards decarbonization is making its way to Japan, making this an issue in need to be tackled pro-actively.
European vehicles have the advantage, as Europe is a pioneer in terms of EVs.
Towards the widespread adoption of EVs - which is expected to accelerate going forward - we will be promoting CapEx and providing opportunities - as soon as possible - for customers to experience EVs.
working toward increasing market share through pro-active dealership openings.
・Continued focusing on new car sales, towards the expansion of recurring revenue business ・Advance both COVID-19 countermeasures and optimize internal corporate functions ・Customer footfall increased YoY for October and November, with December registering record YoY growth
→Execute preparations allowing for maximum performance, even amidst COVID-19
Initiatives Amidst the COVID-19 Pandemic
Initiatives by the WILLPLUS Holdings Corporation
・Thorough countermeasures ・Shorter business hours ・B商u談sin予es約s 制discussions by reservation
Accelerating Trend Toward Decarbonization Also in Japan
World
Japan
EU: Reduce greenhouse gas emissions by 80~95% from 1990-levels (Effectively net zero)
UK:Ban the sale of new gasoline and diesel vehicles
France / Spain:Ban the sale of all non-EV vehicles
December 2015 ~
Following the signing of the Paris Agreement, countries around the world - with Europe at the forefront - started formulating targets and initiatives towards a decarbonized society
EU: Reduce greenhouse gas emissions by at least 40% from 1990-levels; 30 million EVs
UK:Ban the sale of new hybrid vehicles
US : (State of California, etc.):
Ban the sale of new gasoline vehicles
(including HVs)
China:All new vehicles sold to be hybrid or electric-powered
Share of NEV(EV/PHV/FCV) above 50%
(including PHV)
Achieve a "Decarbonized Society"
Japan also formulated its "Green Growth Strategy"
Decarbonization target: "2nd half of the 21st Century" → "Within the next 30 years"
Reduce CO2 emissions by 26% from 2013-levels
(Expected to revise this in 2021, to a more ambitious target)
All new passenger cars sold are expected to be electric-powered by the mid-2030s at the latest
* Electric-powered =EV / PHV / FCV
(Zero net emissions of greenhouse gases)
Share of electric-powered vehicles through to 2019: approx. 35%)
Initiatives Towards the Transition to EVs
European countries are ahead in decarbonization, with auto makers moving to EVs ahead of Japan
WILLPLUS has already carried out CapEx towards the transition to EVs, and we will continue expanding this into the future
EVs from brands carried
* Example
2020~
・JEEP 『Renegade 4Xe』*PHV ・FIAT 『500e』
・BMW 『iX』『iX3』
Model based on the popular X3
・MINI 『MINI Cooper SE』
・VOLVO 『XC40 Recharge』
EV model of the popular XC40
・PORSCHE『Taycan』
Porsche's first full EV
・Promote installing the latest charging infrastructure at all our dealerships
Initiatives by us
Charging infrastructure already installed at 84%
of our dealerships
Additionally, we are in the process of installing
quick chargers
Cutting-edge quick charger at Porsche Center Sendai → 175w
Approx. 400km of range after charging for 15 minutes
・Introduce full-featured demonstration acars giving customers the experience of test driving EVs
Technological Innovation CASE
connected
An increasing number of repairs will only be possible at dealerships, as these will require exclusive diagnosis tools offered by manufacturers. → The importance of official dealerships will grow
Vehicles incorporating SIM cards and allowing users to check up on the status of their vehicle or control it remotely are on the rise.
Some manufacturers offer over-the-air updates for the car navigation system and vehicle control program.
Initiatives in the Fiscal Year Ending June 30, 2021
Initiatives in the Fiscal Year Ending June 30, 2021
• Focus on the sale of new cars - primarily of new models
• We expect continued instability in the supply of new cars, so we will also be focusing on used car sales
• Further strengthen recurring revenue-based businesses
FY 2021
LAND ROVER |
BMW |
JEEP |
PORSCHE |
MainNewModelLaunches
DEFENDER
5 Series
RENEGADE 4xe
Taycan
11
Initiatives Related to Opening Dealerships
Relocated and reopened the Jaguar/Land Rover Approved Shonan and Jaguar/Land Rover Shonan Service dealerships on December 5,2020
Conforming to the latest corporate identity (CI) features
Proactively Invest in Dealerships
Address CI changes
Provide various retail experiences for each brand, in conformity with the latest CI features
Provide high-quality services through cutting-edge facilities, etc.
Invest in existing dealerships
Increase the number of repeat customers by increasing the number of customers visiting dealerships, and by improving customer satisfaction
13
Consolidated Financial Results
Consolidated Financial Highlights
• Net Sales: ¥19,909 million (Up 10.7% YoY)
• Operating Profit: ¥1,205 million (Up 61.0% YoY)
Net Sales (Millions of yen)
+10.7%
2Q FY 2020
2Q FY 2021
O営p業er利at益ing
Profit
+61.0%
2Q FY 2020
2Q FY 2021
Reasons for the increase in net sales
■ Delays in new car shipments on a slight recovery trend
■ Sales of used cars were also strong
■ Recurring revenue-based business like vehicle maintenance and insurance were also strong
Reasons for the increase in operating profit
■ Increase in used car sales - which offer high levels of profitability
■ Efficiency improvements through the effective use of resources and by reviewing workflows ■ Employee training expenses and travel expenses decreased due to the COVID-19 pandemic
Consolidated Statements of Income
Record 2Q net sales performance thanks to a recovery trend in new car shipments and to strong used car sales
(Millions of yen)
2Q FY 2020
Net Sales
17,981
Operating profit margin continued improving, following an improvement in 1Q
Trend in Operating Profit (Analysis of Changes)
Net sales were up YoY across almost all categories, primarily used cars
Increase in expenses due to an increase in the number of dealerships and personnel
(Millions of yen)
2Q FY 2020
Analysis of Changes in Net Sales by Category
Net sales increased across almost all categories, centered on used cars
(Millions of yen)
We have caught up on our efforts to address a wider variety of engine types. This resulted in a flat growth trend in the number of demonstration cars per dealership.
The percentage of vehicle depreciation expenses out of total depreciation expenses decreased slightly.
However, total amounts increased as a result of an increase in the number of dealerships and the handling of high-priced vehicles.
Total assets decreased by ¥146 million
While cash and deposits increased by ¥587 million, merchandise decreased by ¥762 million
Consolidated Statement of Cash Flows
(Millions of yen)
Operating CF
Investing CF
Financing CF
Balance
Net increase (decrease) in cash and cash equivalents Cash and cash equivalents
Main reasons for an increase in Operating CF
Decrease in notes and accounts payable-trade:¥1,305 million
Main reasons for a decrease in investing CF
Expenses for the acquisition of non-current assets: ¥259 million…Expenses related to dealership relocations
Consolidated Financial Forecasts for the Fiscal Year
Ending June 30, 2021
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
In addition to an increase in net sales, we are progressing above initial forecast levels thanks to profit margin improvements, etc., allowing us to exceed the initial forecast
Operating
Profit
1,160
Operating Profit Margin
Ordinary
Profit
3.3% 1,196 3.4%
Profit margin
2.2%
Based on the recent level of orders and 2Q results, we have revised the forecast as shown above
Net sales: ¥38,344 million (Up 9.3% YoY)
Operating profit: ¥1,836 million (Up 58.2%YoY)
・We expect the impact of COVID-19 to continue being felt at least during the current fiscal year
・Focus on the sale of new cars - primarily of new models
・We expect continued instability in the supply of new cars, so we will also be focusing on used car sales
・Expansion of Recurring revenue-based businesses
・Improve inventory rotation and aim for management with high capital efficiency
Highlights of Consolidated Financial Forecasts
Shareholder Returns
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Shareholder Returns
・Raised the dividend payout ratio target from 15.0%→17.5%, starting in fiscal year 2021
・We expect to raise the annual dividend for fiscal year 2021, to ¥21.77, on the basis of an upward guidance revision
FY 2021 (Revised forecast)
(Per share)
FY 2020 (Results)FY 2021 (Initial forecast)
Ordinary Shareholder Benefits
* For shareholders holding at least one share unit (100 shares) and who are stated or recorded in the shareholder registry of the Company on the record date
Number of shares held*
100 shares
APPENDIX
Corporate Outline and History
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Corporate Outline
Tradename
Representative Takaaki Naruse, President
Established Head office
Capital Listed stock exchange
First Section, Tokyo Stock Exchange
(Securities code: 3538)
Shiba Mita Mori Building 8th Floor, 5-13-15, Shiba,Minato-ku, Tokyo, Japan
¥218 million (as of December 31, 2020)
WILLPLUS Holdings Corporation
October 25, 2007
Corporate History
July 2008
April 2014
December 2018
Made CHECKER MOTORS CORPORATION a subsidiary
Made Teio Auto Corporation a subsidiary
Took over the business of Porsche Sendai
⇒Entered the Kanto area in earnest ⇒Began carrying the FIAT and Alfa
⇒Began carrying the VOLVO brand
⇒Began carrying the
Romeo brands
November 2017
July 2009
Took over two directly operated dealerships from Chrysler Japan Co., Ltd.
Established Willplus Eins Corporation
PORSCHE brand ⇒Entered the Tohoku area for the first time
March 2019
April 2018
Newly opened MINI Yamaguchi, MINI NEXT Shunan
September 2009
Took over the business of Jaguar/ Land Rover Shonan
⇒Entered the Chugoku area for the first time
Willplus Motoren Corporation took over the business of 5 BMW/MINI dealerships ⇒Began carrying the BMW and MINI brands
⇒Began carrying the JAGUAR and April 2019
LANDROVER brands
Took over the business of Jaguar/Land Rover Mitaka
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
35
CHECKER MOTORS Co., LTD.
Approved Munakata
Approved Munakata
786-4, Omaru, Munakata, Fukuoka Prefecture
TEL: 0940-37-7007
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
44
Description of Business
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Recurring Revenue-Based Businesses
The vehicle maintenance and other business has a recurring revenue-based business model
Because of our large sales volume,
(1) Vehicle maintenance generates a large amount of revenue
(2) Commissions are paid on favorable terms
Growth Strategies
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
Leveling out
Multi-Brand Strategy
Level out the impact of differences in the timing of launching new models among brands by carrying a total of ten brands
Illustration of how the impact of differences in the timing of launching new models is leveled out
Dominant Strategy
神奈川エリア ディーラーネットワー
Kanagawa area dealer network ク
❶Jaguar/Land Rover Shona (Shonan Showroom)
❷Jaguar/Land Rover Shonan
(Approved Shonan /Service Center)
❸JEEP Fujisawa Shonan
❹Alfa Romeo Fujisawa Shonan ❺FIAT/ABARTH Fujisawa Shonan
Kitakyushu area dealer network
❶Volvo Car Kitakyushu
❷JEEP Kitakyushu ❸BMW Kokura ❹BMW Yahata ❺MINI Kokura
❻Jaguar/Land Rover Kitakyushu
51
M&A Strategy
Expanding into new areas
Acquisition of new brands
(Multi-brand strategy)
Expanding the market share of existing brands
M&A Strategy
Candidate areas for 進出候補エリア new dealerships
Government designated 人口100万人超の cities with a population 政of令ov指er定1 都mi市llion
Core cities with 人口40万人超のa population of 中ov核er都40市0,000
53
M&A Strategy
Identification and execution of M&A deals
▪️Identify deals through such means as referrals from financial institutions and other intermediaries, and proposals put forward by importers and business owners
▪️Conduct due diligence only on M&A deals that meet the Company's criteria for recovering investment, and execute the M&A deals following negotiations
• Confirm the investment recovery period, etc.
• Perform various types of due diligence
• Formulate business plans
Internally consider matters centered on the following:
• Future growth potential
• Business synergies, etc.
Financial institution intermediaries
The Company approaches the counterpart directly
Importers
The counterpart approaches the Company directly
• Imported car dealers
• Domestic car dealers
• Specialist used car distributors
• Car rental companies, etc.
55
*As of June 30, 2020
Trend in the Number of Dealerships and Net Sales
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Net sales increased due to proactive M&A
and new dealership openings
Net Sales
Market Trends
1995
2000
2005
2010
2020
Japan's Automobile Market
A declining trend in the number of new motor vehicle registrations in Japan
Aging society with fewer children
Lengthening periods of vehicle ownership due to improved vehicle performance
Changes in consumption styles and
preferences
Trend in the number of new motor vehicle registrations in Japan (excluding kei minicars)
1996
5.38 million vehicles
Source: Prepared by WILLPLUS Holdings based on reports issued by the JAPAN AUTOMOBILE DEALERS ASSOCIATION
Japan's market for Imported Vehicles
Growth trend in Japan's market
for imported vehicles
The number of new motor vehicle registrations has increased since the Lehman Brothers bankruptcy
1996
Number of new motor vehicle registrations for foreign branded imported vehicles
161,000
1995
2009
2020
Source: Prepared by WILLPLUS Holdings based on reports =by the JAPAN AUTOMOBILE DEALERS ASSOCIATION
6.0%
Japan's Market for Imported Vehicles
The share of imported vehicles in the domestic passenger vehicle market (excluding kei minicars) has increased
Share of imported vehicle registrations in the number of new motor vehicle registrations in Japan (excluding kei minicars)
1996 2020
Market Share Expansion of Imported Vehicles in Japan
The market share of imported vehicles in Japan is growing, but it is still lower than in various other countries
Germany has these brands and a market share of imported vehicles of 39.5%
Copyright © 2021 WILLPLUS Holdings Corporation. All rights reserved.
61
The Importance of the Recurring Revenue- Based Business Model Going Forward
The automobile industry is about to undergo aperiod of great change
1970
2020
Upward trend in vehicle ownership numbers and average automobile lifespan, despite stagnant population growth
Changes in the Market Environment
Changes in domestic population and vehicle ownership numbers
70 140
(Unit:millions)
1989
1996
Ownership
Pop.
2009
2019
Households
(Unit:years)
14 13 12 11 10 9 8 7
(Unit:10million)
Market Scale and Future Outlook
Continued robust growth in the market scale and WILLPLUS HD's net sales.
Amidst a consolidation trend amongst small-to-medium-sized dealers, we will aim to expand our share through M&A
Market scale for imported new cars 2019
FY 2015
FY 2016
FY 2017
* Market scale calculated by WILLPLUS Holdings based on data by the JAPAN AUTOMOBILE DEALERS ASSOCIATION
Disclaimer and Contact Information
These presentation materials contain forward-looking statements such as the forecasts of the Company (including consolidated subsidiaries).
The forward-looking statements concerning plans, forecasts, strategies, and other matters in these presentation materials are based on the judgments and assumptions of management, reflecting information currently available to the company. In light of the uncertainties inherent in these judgements and assumptions, and the possibility of changes in future business management and internal and external conditions, the Company's actual financial results could differ materially from those forward-looking statements. In addition, information on companies and other entities other than the Company and the WILLPLUS Holdings Group, are derived from published information and related sources. Accordingly, the Company cannot guarantee the accuracy of this information.
For investor-relations inquiries, please contact:
IR Department, WILLPLUS Holdings Corporation
E-mail:ir-info@willplus.co.jp
Tel.: (+81)3-5730-0589 (10 a.m. - 5 p.m. excluding weekends and holidays)
URL:https://www.willplus.co.jp
+More pleasure for your future
We will continuously tackle the challenge of presenting customers with lifestyle proposals featuring imported cars, thereby contributing to the happiness of everyone we serve
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Willplus Holdings Corporation published this content on 11 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 March 2021 05:31:02 UTC.