Aiming to be the world's leading investment bank seeking maximum contributions to clients and the happiness of all employees
Presentation Materials for the
Earnings Briefing for the Three Months Ended December 2020
January 29, 2021
1
Company Overview and Strengths of the Company
・・・ 2
2
Results for the Three Months Ended December 2020 ・・・ 10 and Forecast for the Year Ending September 2021
3 Growth Strategy
・・・ 20
1
Company Overview and Strengths of the Company
Trade Name | M&A Capital Partners Co., Ltd. |
Listed Market | Tokyo Stock Exchange First Section (Securities Code: 6080) |
Head Office Location | 38F, Gran Tokyo North Tower,1-9-1 Marunouchi, Chiyoda-ku, Tokyo |
Business Content | M&A-related services |
Representative | Satoru Nakamura, President and Representative Director |
Established | October 2005 |
Capital | 2.7 billion yen (as of December 31, 2020) |
Employees | Consolidated:197 Non-consolidated: 125 (as of December 31, 2020) |
Affiliates | RECOF Corporation, RECOF DATA Corporation |
Management Philosophy | Aiming to be the world's leading investment bank seeking maximum contributions to clients and the happiness of all employees |
Leveraging Group power to provide extensive M&A services
Business succession M&A
Industry reorganization M&A | 経b営us統in合esにsesよtoり、 |
Me&xpAan関d 連theの | |
business area for | |
Cross-border M&A | |
M&A media business |
Integrating these
事業領域を拡大
M&A services
Aiming to maximize the contribution to clients through the provision of extensive services
Business Content
CharacteristicsBusiness Model
M&A-related services are our main business.
Mainly business succession M&A. We propose solutions through M&A and support their realization for owner managers who have concerns about business succession.
We provide advisory services for the realization of M&A standing between the transferor (seller) and the transferee (buyer) from an independent and impartial position.
Owner of transferred company (seller)
Successor issues
No successor Aging president
Uncertainty about business
Shrinking domestic marketIntensifying competition
Provision of advisory services
Interim fee
Contingency fee
Payment of consideration for the transferTransfer of shares and businesses
Provision of advisory services
Interim feeContingency fee
Transferee (buyer)
1Abundant track record of
closing deals across
multiple industries and
sectors
Stable track record in closing deals across a wide range of industries and sectors
6/27
Dispensing pharmacy
Dispensing pharmacy
Wholesaling
Building materials wholesaling
Wooden building materials wholesaling
Processed lumber products wholesaling
Cosmetics wholesaling Lifestyle products wholesaling
Machinery and appliances wholesaling
Electronic materials wholesaling
Track record of closing deals in a variety of sectors
Dental materials/pharmaceuticals wholesaling
Solar power wholesaling Textiles/clothing wholesaling Miscellaneous goods wholesaling
Food ingredient wholesaling Fishery product wholesaling Wholesaling of confectionery Second-hand machinery wholesaling
Construction/engineering works
Air-conditioning facility construction
Water supply/drainage facility construction Electrical facilities construction Telecommunications construction
General contractor construction Public works
Residential construction Construction-related surveys Building structural design Building structural diagnostics Painting
Manufacturing industry
Metal products manufacture/processing Chemical industry
Industry
Industrial machinery manufacture Tool manufacture
Precision parts manufacture Electrical machinery/appliance manufacture
Steel fabrication
Rolled-copper product processing Electronic components manufacture/processing Transportation machinery/appliance manufacture Automotive parts manufacture Air-conditioning equipment Energy-saving machinery design/manufacture Cleaning/drying equipment manufacture
Machinery repair
Concrete products manufacture Medical appliance manufacture Supplement planning/manufacture Women's clothing manufacture Daily goods planning/manufacture Textile product manufacture Fishery product processing Confectionery manufacture
Food manufacture/processing Pharmaceutical manufacture Beauty products manufacture
IT
Data mining Information services
Retail/EC/mail order
Mail order
SupplementsOutsourced software development Health goodsSystem development Consulting
Distribution
General freight transportation Distribution processing Truck rental
Eating out
Eating out
Food & drink delivery services
Real estate
Real estate brokerage Multi-unit apartment maintenance Investment real estate development
Building maintenance
Nursing care/healthcare
Nursing care business Clinical study support Medical corporationsInteriors Daily goods Outdoor
Vehicle sales/servicing
Advertising/printing/media
Printing
Advertising agency Paper bag manufacture Event planning/preparation Design
Video creation
Package software development
Other
Lease/rental Temporary staffing Temporary engineer staffing Medical preparatory school Childcare facilities Preparatory school Hot spring resorts Hotels
Operation of amusement facilities Facilities security
Insurance agency Buying/selling of tickets Trading company Waste processing Funerals
2Fee schedule that clients find convincing, and that makes it easy to consider M&A
(1) Adoption of fee structure without commencement fee expands the options for
M&A
(2) Searching for counterparties is free to both buyer and seller which enables convincing matches
3Fee structure that is convincing for clients Use of fee based on share price
- Fees of an M&A intermediary company generally use the Lehman Formula (calculated by multiplying the transaction amount by a certain rate)
- The company's calculations of fees are based on the share value. This is more convincing than being based on the moving average of total assets
[Example] A company with share value of 500 million yen and 1.5 billion yen of debt
Fee Structure (Lehman Formula)
M&A Capital
Partners Calculated based on the 500 million yen share value
The general Lehman Formula rates used by major financial institutions. | |
Transaction amount | Commission rate |
Up to 500 million yen | 5% |
500 million yen up to 1 billion yen | 4% |
1 billion yen up to 5 billion yen | 3% |
5 billion yen up to 10 billion yen | 2% |
Over 10 billion yen | 1% |
e.g.) Calculation of fee when the transaction amount is 2 billion yen 500 million yen x 5% = 25 million yen + (1 billion yen - 500 million yen x 4% = 20 million yen + (2 billion yen - 1 billion yen x 3% = 30 million yen 75 million yen |
4Stable Results Making Deals
M&A Capital Partners has produced stable results making deals by focusing on "business succession M&A proposals and advice" for small and medium enterprises using share transfers or business transfers.
Through the business integration with RECOF Corporation and RECOF DATA Corporation, we will promote M&As to solve challenges like business succession, growth strategies, and industry reorganization, and will strive to become a diversified M&A group that caters to various needs.
Cumulative Number of Deals Made
800 700 600 500 400 300 200 100
735 deals
769 deals
596 deals
452 deals 337 deals
226 deals
168 deals 124 deals
37 deals
50 deals
68 deals
89 deals
0
Sep 2010 Sep 2011 Sep 2012 Sep 2013 Sep 2014 Sep 2015 Sep 2016 | Sep 2017 | Sep 2018 | Sep 2019 | Sep 2020 | Dec 2020 |
(Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) | (Consolidated) | (Consolidated) | (Consolidated) | (Consolidated) | (Consolidated) |
2
Results for the Three Months Ended December 2020 and Forecast for the Year Ending September 2021
1Q | Forecast for the year | Progress for Entire Year | |
Number of deals (consolidated) | 34 | 166 | 20.5% |
Number of Deals Made
YE Sep 2011 YE Sep 2012 YE Sep 2013 YE Sep 2014 YE Sep 2015 YE Sep 2016 (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated)
+47.8% Year-on-year
・Steady progress on a non-consolidated level, closing record number of deals in 1Q.
YE Sep 2017 (Consolidated)YE Sep 2018 (Consolidated)YE Sep 2019 (Consolidated)YE Sep 2020 (Consolidated)YE Dec 2020 (Consolidated)
・Number of active deals (non-consolidated) also hit a record high of 347 (+26.6% year on year), and large deals are showing good progress.
Earnings Highlights (Consolidated)
Earnings for the Three Months Ended December 2020 (Consolidated)
Net sales | 3,972 million yen | (+206.7% year-on-year) |
Ordinary income | 1,810 million yen | (+1473.3% year-on-year) |
Number of deals | 34 deals | (+47.8% year-on-year) |
Number of consultants | 150 | (+22 year-on-year) |
・Record number of deals at non-consolidated level in 1Q, plus increase in large deals from 1 to 8, resulting in record sales also in 1Q. As a result, net sales for the Group as a whole in 1Q also hit a record.
Closed 8 large deals (+700.0% year on year)
・In addition, advances received, which is a useful indicator of order backlog, increased steadily to ¥516 million (+10.7% year on year.)
Earnings for the Three Months Ended December 2020 (Non-consolidated)
M&A Capital Partners | RECOF | |||
Year-on-year Change | Year-on-year Change | |||
Net sales | 3,743 million yen | +260.4% | 175 million yen | -14.1% |
Ordinary income | 1,987 million yen | +653.5% | -117 million yen | - |
Number of deals | 32 deals | +68.4% | 2 deals | -50.0% |
Number of consultants | 103 | +19 | 47 | +3 |
・Record number of deals in 1Q, plus increase in large deals from 1 to 8, resulting in record sales also in 1Q.
Closed 8 large deals
・Deals closed fell from 4 to 2, causing results to fall below previous-year levels.
Zero large deals
* Because non-consolidated information is shown, consolidated amortization of goodwill (56 million yen) due to business integration is not included.
* We have omitted listing Group companies of relatively low importance.
Number of Active Deals (Non-consolidated)
Number of Active Deals (Non-consolidated)
Number of Active Deals (Non-consolidated)
400
350 300 274
347 328
273
272
250 200 150 100 50
214
220
224
228
239
226
172
197 175
155
127
139
149
109
0
Q3 ended Q4 ended Q1 ended Q2 ended Q3 ended Q4 ended Q1 ended Q2 ended Q3 ended Q4 ended Q1 ended Q2 ended Q3 ended Q4 ended Q1 ended Q2 ended Q3 ended Q4 ended Q1 ended Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2020 2020
Number of Deals Handled (Non-consolidated)
・Number of active deals (non-consolidated) hit record high of 347 (+26.6% year on year), with large deals showing good progress.
Units: Millions of yen
(consolidated) | 1Q | Forecast for the year | Progress for Entire Year |
Net sales | 3,972 | 14,030 | 28.3% |
Ordinary income | 1,810 | 6,210 | 29.2% |
Net sales
15,000
Ordinary income
14,000
YE Sep 2011 YE Sep 2012 YE Sep 2013 YE Sep 2014 YE Sep 2015 YE Sep 2016 (Non-Consolidated) (Non-Consolidated) (Non-Consolidated) (Non-Consolidated) (Non-Consolidated) (Non-Consolidated)
14,030
13,000
7,000
12,000
6,000
11,000
10,000
5,000
9,000
8,000
4,000
7,000
6,000
3,000
5,000
4,000
2,000
3,000
2,000
1,000
1,000
0
YE Sep 2011 YE Sep 2012 YE Sep 2013 YE Sep 2014 YE Sep 2015 YE Sep 2016 (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated) (Non-consolidated)
0
YE Sep 2017 (Consolidated)YE Sep 2018 (Consolidated)YE Sep 2019 (Consolidated)YE Sep 2020 (Consolidated)YE Sep 2017 (Consolidated)YE Sep 2018 (Consolidated)YE Sep 2019 (Consolidated)YE Sep 2020 (Consolidated)
In 7 years since year of application for listing (YE Sep 2013), sales have increased by more than 10x.
Impact of spread of novel coronavirus
During the state of emergency, we are continuing our sales activities while working to prevent the spread of novel coronavirus by using telework, etc. to restrict visits by employees to the head office, and restricting movement between the regions and Tokyo by utilizing regional satellite offices.
The full-year forecast for the fiscal year ending September 30, 2021 is unchanged, but going forward we will continue to monitor the impact of novel coronavirus .
• Visits to the head office are restricted through the use of telework, etc. by more than 60% of employees for the Group as a whole.
• In the regions, we pursue sales activities by utilizing the multiple satellite offices with which we have agreements, thus restricting movement between the regions and Tokyo.
• The full-year forecast for the fiscal year ending September 30, 2021 is unchanged, but assumes that economic activities will not slow substantially due to the spread of new novel coronavirus related infections. We will continue to monitor the impact of novel coronavirus going forward, and promptly disclose any significant impact on results.
Overview of Statements of Income (Consolidated)
Three Months Ended Dec 2019 | Three Months Ended Dec 2020 | |||
Year-on-year Change | Overview of Performance | |||
Net sales | 1,295 (100.0%) | 3,972 (100.0%) | +206.7% | At non-consolidated level, closed record number of deals in 1Q Closed 8 large deals |
Gross profit | 715 (55.2%) | 2,687 (67.7%) | +275.8% | Impact of higher revenue |
SG&A | 600 (46.4%) | 880 (22.2%) | +46.5% | Provision for directors' bonuses +192 Taxes and dues +36 Rents +26 |
Operating income | 114 (8.8%) | 1,807 (45.5%) | +1480.7% | Impact of higher revenue |
Ordinary income | 115 (8.9%) | 1,810 (45.6%) | +1473.3% | |
Net income | 13 (1.1%) | 1,117 (28.1%) | +7923.5% | |
Number of deals made | 23 | 34 | +47.8% | At non-consolidated level, closed record number of deals in 1Q |
Employees | 172 | 197 | +14.5% |
Forecast for the
Year Ending September 2021
14,030
(100.0%)
6,211
(44.3%)
6,210
(44.3%)
4,173
(29.7%)
166
September 30, 2020 | December 31, 2020 | |||
Change | Main Factors Causing Change | |||
Current assets | 21,673 (90.1%) | 23,224 (91.4%) | +1,551 | Cash and deposits +1,067 Accounts receivable - trade +479 |
Noncurrent assets | 2,386 (9.9%) | 2,184 (8.6%) | -202 | Deferred tax assets -125 Goodwill -48 (Amortization of goodwill) |
Total assets | 24,060 (100.0%) | 25,409 (100.0%) | +1,349 | |
Current liabilities | 3,199 (13.3%) | 2,747 (10.8%) | -451 | Provision for bonuses +395 Accounts payable - other -759 |
Noncurrent liabilities | 229 (1.0%) | 228 (0.9%) | -0 | |
Total liabilities | 3,428 (14.2%) | 2,975 (11.7%) | -452 | |
Total net assets | 20,632 (85.8%) | 22,433 (88.3%) | +1,801 | |
Total liabilities and net assets | 24,060 (100.0%) | 25,409 (100.0%) | +1,349 |
Market capitalization
Units: 100 million yen
時M価ar総ke額t capitalization
2,500
2,000
1 | |||
1,654 | 1,5 | ||
1 | ,072 | 1,383 | |
8 | 48 | 1, 593 | 011 803 |
132 13 | 2 5 | 30 20 | 5 |
1,966
*As of January 28, 2021
Market capitalization has increased more than 13 times over the seven years since listing (November 2013).
3
Growth Strategy
Three-year Plan for Number of Deals (Year Ending September 2021 to Year Ending September 2023)
M&A Capital PartnersRECOFTotal
280
260
240
220
237 35
200
180
166 26
198 30
160
140
120
139 21
100
202
80
168
140
60
118
40
20
0
YE Sep 2020 | YE Sep 2021 | YE Sep 2022 | YE Sep 2023 |
Result | Target | Target | Target |
成Nu約m件be数r of Deals
Average increase of 20% per year
Average increase of 10% per year will be maintained in each company.
M&A Capital Partners
RECOF
Three-year Plan for Number of Consultants (Year Ending September 2021 to Year Ending September 2023)
M&A Capital PartnersRECOFTotal
280
260
240
220
214
260 65
200
180
176
58
160
151
140
51
120
51
100
195
80
156
60
125
40
100
20
0
YE Sep 2020 | YE Sep 2021 | YE Sep 2022 | YE Sep 2023 |
Result | Target | Target | Target |
成Nu約m件be数r of Consultants
Average increase of 25% per year
Average increase of 10% per year will be maintained in each company.
M&A Capital Partners
RECOF
Growth scenario going forward
Domestic M&A market (IN-IN) is forecast to remain strong
Number of M&A deals between Japanese companies from January to December 2020 was more or less flat year on year at 2,944 (down 1.9%), with domestic M&A demand holding up well despite the novel coronavirus pandemic
成In長itiにati向veけs たfor取gりrow組thみ
Create deals through direct-proposal sales
Strengthen our ability to respond to regional needs by creating more finely subdivided sales network Promote impact of high-quality proposals
Create deals through reactionary sales
Strengthen IT measures such as Internet marketing and advertisements
Promote increased awareness of our services through commercials, etc.
Create deals from referral network
Strengthen ability to respond to emerging M&A demand through promotion of alliances with financial institutions, etc.
TBS network
"Houdo Tokushu"
TV Tokyo network
"World Business Satellite"
Continue to air commercials.
Implement promotion activities using a total of six patterns of airing commercials.
Strengthening of Reactionary Sales 2
Strengthening and expanding referral network
- Conclusion of business alliance agreement between Mizuho Bank and the Company to strengthen support for business succession needs of small and medium-sized companies.
- Mizuho Bank refers small and medium-sized companies with needs for business succession through M&A to the Company, which will provide detailed services to meet the succession needs of small and medium-sized companies expected to expand and diversify in future.
Continuing to strengthen Internet-based measures
・Internet advertisements
・SEO measures (maintain high search ranking) ・Renewal of website
Issuance of super-long-term stock options
The Company allows employees to purchase stock options with age and performance conditions to ensure that they are committed to super-long-term growth rather than short-term performance targets alone.
Eligible persons | Officers: 2 Employees: 37 |
Eligible persons | Employees: 2 |
Eligible period | Target profit |
Exercise conditions (1) | Operating profit of ¥6 billion or more (FY2021/9) |
Exercise conditions (2) | Operating profit of ¥7.2 billion or more (FY2022/9) |
Exercise conditions (3) | (1)+(2)= ¥13.2 billion or more |
Age-related conditions |
|
Eligible period | Target profit |
Exercise conditions (1) | Operating profit of ¥360 million or more (FY2021/9) |
Exercise conditions (2) | Operating profit of ¥432 million or more (FY2022/9) |
Exercise conditions (3) | (1)+(2)= ¥792 million or more |
Age-related conditions |
|
Aiming to be the world's leading investment bank seeking maximum contributions to clients and the happiness of all employees
The plans, forecasts and strategies, etc. contained in these materials are forecasts on future performance based on information available at the time the materials were prepared, and these include inherent risk and uncertainty. Actual performance may differ from forecasts and predictions due to such risk and uncertainty.
Information considered useful for explaining our business environment has been provided in these materials. The results in the data may vary depending on the method or timing of the survey.
Information within these materials on other topics besides the Company is quoted from published information and other sources. As such, the accuracy, appropriateness, etc. of the information has not been verified, nor are any guarantees provided thereof.
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M&A Capital Partners Co. Ltd. published this content on 02 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 March 2021 05:02:08 UTC.