Investment Development Business

CyberAgent, Inc
Results Briefing for the Financial Year
Ending September 2006
(October 2005 – September 2006)
http://www.cyberagent.co.jp/
Tokyo Stock Exchange Mothers: 4751
The opinions and forecasts contained within this document are based on the judgments of CyberAgent, Inc., at the time the
document was prepared. No guarantee is made as to the accuracy of this information.
Opinions and forecasts may differ significantly from actual performance and results due to changes in a variety of factors.
Table of Contents
Overview of Consolidated Financial Results
Business Forecast for the Year Ending September 2007
Media Business
Advertising Agency Business
Investment Development Business
Medium-to Long-Term Outlook
Reference Material (1)
Reference Material (2)
1
Overview of Consolidated
Financial Results
Overview of Consolidated Financial Results for the FY2006
(October 2005 – September 2006)
2
Overview of Consolidated
Financial Results
Highlights of the Year Ending September 2006 (October 2005 – September 2006)
Net Sales: 60.1 billion yen
Increased by 38.9%
over the previous year.
Operating Income: 4.3 billion yen
Increased by 63.8%
over the previous year.
“Ameba Blog”
Focused on Web2.0 Media
Advertising Agency Business: 29.2 billion yen
Increased by 48.6% over the previous year.
Media Business: EC 20.9 billion yen
Increased by 33.8% over the previous year.
While conducting priority investment in “Ameba Blog,” a
“continuous increase in profits three years in a row” has been achieved.
1.7 billion yen in 2004, 2.6 billion yen in 2005, 4.3 billion yen in 2006.
Investment Development Business:
actual performance for investments in Web2.0 companies.
Number of Persons who have accounts of Ameba Blogs
510,000 persons (September 2005); 1,340,000 persons (October 2006)
Monthly PV
260 million PV (September 2005); 650 million PV (October 2006)
3
Overview of Consolidated
Financial Results
Overview of Consolidated Financial Results
Unit: million yen
Yr to Sep 2006
7,000
6,503
Net Sales
Unit: million yen
Yr to Sep 2006
Unit: million yen
Yr to Sep 2005
30,000
Unit: million yen
10,000
3,000 Existing Business
3,268
7,000
Net Sales: 60.1 billion yen
(increased by 38.9% over the previous year)
Operating Income: 4.3 billion yen
(increased by 63.8% over the previous year)
1,000
0
5,000
43,273
-1,000
Priority Investment Business
3,650
40,000
60,115
Investment Development Business
60,000
50,000
Operating Income
3,235
5,000
Yr to Sep 2005
3,000
Net Sales: 43.2 billion yen
(increased by 61.9% over the previous year)
Operating Income: 2.6 billion yen
(increased by 53.6% over the previous year)
1,413
Investment Development Business
Existing Business
-2,161
-3,000
2,237
1,000
5,000
26,728
0
-1,000
4,342
-999
Priority Investment Business
20,000
10,824
10,000
0
1,726
6,392
3,276
452
19
-2
0
-34
-106
-278
-1,636
-10,000
2,651
16,202
-3,000
Yr to Sep
1998
Yr to Sep
1999
Yr to Sep
2000
Yr to Sep
2001
Yr to Sep
2002
Net Sales
-142
Yr to Sep
2003
Yr to Sep
2004
Yr to Sep
2005
Yr to Sep
2006
-2,000
Operating Income
Note: Existing business is the J1 business in CyberAgent’s CAJJ program (reference: pages 53-54).
Note: Priority Investment business is the J2, J3 and Ameba businesses in CyberAgent’s CAJJ program (reference: pages 53-54).
4
Overview of Consolidated
Financial Results
Results for Financial Year Ending September 2006: PL
Unit: million yen
Yr to Sep 2006
Yr to Sep 2005
Change
Net Sales
60,115
43,273
38.9%
Gross Income from Sales
23,600
18,039
39.3 %
41.7%
30.8%
-2.4points
19,257
15,387
SG&A Ratio
32.0 %
35.6%
Operating Income
4,342
2,651
7.2 %
6.1%
63.8%
1.1points
Ordinary Income
3,722
2,700
37.9%
Current Net Income Before
Tax and Other Adjustments
7,567
3,756
101.5%
Net Income
4,300
2,487
72.9%
Gross Margin
SG&A
Operating Profit Margin
25.2%
-3.6points
Investment loss due to the equity method: 401million yen.
Loss from changes in equity accompanying increased
investment in consolidated subsidiaries: 2,346 million yen.
Gain on sales of shares in associated companies: 1,999 million yen.
4
5
Overview of Consolidated
Financial Results
Financial Year Ending September 2006: BS
Yr to Sep 2006
Unit: million yen
Yr to Sep 2005
Change
Current Assets
50,483
22,075
128.7 %
(cash + marketable securities, etc.)
20,170
11,354
77.6 %
Fixed Assets
8,928
9,755
-8.5 %
Total Assets
59,411
31,830
86.7 %
Current Liabilities
20,451
9,574
113.6 %
351
438
-19.9 %
38,608
21,817
77.0 %
Fixed Liabilities
＊
Shareholders' Equity
Increase of unrealized capital gains in operational
investment securities: 13,703 million yen.
Consolidated subsidiaries’ increase of capital: 5,335 million yen.
Deferred tax liabilities due to unrealized capital gains of
equity shares: 5,426 million yen.
＊ Due to enforcement of the Company Law, the September 30, 2005 shareholders' equity is the total of the
total capital and minority interests on the September 2005 period financial statements.
4
6
Overview of Consolidated
Financial Results
Quarterly Consolidated Net Sales
Led by the Investment Development Business and Advertising Agency Business,
an excellent condition was actualized with a 39.3% increase over the same period of the previous year.
Unit: million yen
20,000
18,402
Increased by 39.3%
15,000
14,580
13,857
13,275
13,213
11,360
10,118
10,000
8,582
7,873
7,103
6,334
5,416
5,000
0
2004
2005
2006
1Q (October – December)
2004
2005
2006
2004
2Q (January – March)
2004
2005
2006
3Q (April – June)
2005
2004
2005
2006
4Q (July – September)
2006
7
Overview of Consolidated
Financial Results
Quarterly Consolidated Operating Income
Centered on Web2.0 companies, the Investment Development Business performed favorably.
Mail media (PC/mobile) is currently being transferred to Web2.0 media.
Unit: million yen
Unit: million yen
3,000
1Q
Unit: million yen
2Q
Unit: million yen
1,500
1,500
1,500
1,000
1,077
1,000
249 Investment
Development Business
1,108
0.4 Investment
Development Business1,000
1,107
Operating
828 Consolidated
Income
500
1,200
Existing Business
604
500
Existing Business
単位：百万円
3,500
4Q
3,147
1,170
2,510
2,722
Investment
262 Development Business
1,000
Consolidated Operating
Consolidated Operating
Income
612
3Q
Investment
2,510
Development Business
908 Income
615
500
Consolidated Operating
Income
500
Existing Business
1,270
Existing Business
425
0
0
900
0
-555
-496
-473
-500
0
-500
Priority Investment
Business
Priority Investment
Business
Ameba 事業への投資
-637
-500
-500
Priority Investment
Business
628
612
604
Priority Investment
Business
615
600
506
482
472
409
363
247
300
0
2004
2006
2004
1Q (October – December)
2005
2Q
2005
2006
2004
3Q
(January – March)
2004
2005
2005
2006
(April – June)
2004
4Q
2005
2006
(July – September)
2006
Note: Existing business is the J1 business in CyberAgent’s CAJJ program (reference: pages 53-54).
Note: Priority Investment business is the J2, J3 and Ameba businesses in CyberAgent’s CAJJ program (reference: pages 53-54).
8
Overview of Consolidated
Financial Results
Quarterly Consolidated Net Sales/Gross Margin Rate
Net sales grew steadily.
Investment Development Business contributed to an increase in the gross margin rate.
Unit: million yen
20,000
Unit: %
18,402
3,093
15,000
43.4
42.7
41.2
44.1
43.4
42.7
39.6
39.2
41.7
10,000
13,857
13,213 13,275
28
314
42.2
41.2
41.5 41.5
39.4
547 1,053
36.7
10,118
11,360
14,580
327
70.0
60.0
50.0
42.3
40.0
37.8
8,582
30.0
7,873
7,103
6,334
5,000
4,735
3,984 4,173
3,067
5,416
20.0
3,309
2,510 10.0
1,270
0
-1,000
-54
02/
7-9
Yr to Sep
2002
-358
-127
02/
10-12
03/
1-3
121
222
03/
4-6
03/
7-9
363
472
409
247
506
604
628
612
615
0
03/
10-12
Yr to Sep 2003
Net Sales
482
04/
1-3
04/
4-6
Yr to Sep 2004
Operating Income
04/
7-9
04/
10-12
05/
1-3
05/
4-6
05/
7-9
Yr to Sep 2005
Net Sales of Investment Development Business
05/
10-12
06/
1-3
06/
4-6
06/
7-9
Yr to Sep 2006
Gross Margin Rate
Note: The Investment Development Business net sales shown above are same figures as the segment information in financial statements.
9
4
Overview of Consolidated
Financial Results
Fourth Quarter of the Year Ending September 2006: PL (year-on-year)
Unit: million yen
Jul – Sep 2006
Jul – Sep 2005
Change
18,402
13,213
39.3%
Gross Income from Sales
7,776
5,579
Gross Margin
42.3 %
42.2%
39.4%
0.1points
SG&A
5,265
4,309
SG&A Ratio
28.6 %
32.6%
Operating Income
2,510
1,270
Operating Profit Margin
13.6 %
9.6%
97.6%
4.0points
Ordinary Income
2,010
1,272
58.0%
Current Net Income Before
Tax and Other Adjustments
661
894
-26.1%
Current Net Income
-242
540
Net Sales
22.2%
-4.0points
Investment loss due to the equity method: 222 million yen.
Loss due to applying the accounting for
impaired assets: 1,191 million yen.
10
4
Overview of Consolidated
Financial Results
Fourth Quarter of the Year Ending September 2006: CF (year-on-year)
Jul – Sep 2006
Apr – Jun 2006
CF from Operating Activities
1,646
883
CF from Investing Activities
- 155
- 1,347
CF from Financing Activities
503
187
2,015
-153
20,029
18,013
Unit: million yen
Change in Cash and
Cash Equivalents
Term-End Balance of Cash
and Cash Equivalents
11
4
Overview of Consolidated
Financial Results
Consolidated SG&A Expenses
Unit: %
50.0
Unit: million yen
6,000
5,265
4,622
40.0
38.7
4,090
38.4
37.4
35.8
36.0
36.5
2,875
3,292
2,558
30.0
1,834
2,026
3,695
4,309
4,479
5,000
4,889
4,000
36.0
36.5
32.6
3,000
34.8
32.3
2,266
33.5
28.6
2,000
1,000
20.0
03/
07-09
03/
10-12
Yr to Sep
2003
04/
01-03
04/
04-06
04/
07-09
04/
10-12
Yr to Sep 2004
05/
01-03
05/
04-06
05/
07-09
05/
10-12
Yr to Sep 2005
06/
01-03
06/
04-06
06/
07-09
Yr to Sep 2006
Sales
Consolidated
adjustment
259
304
354
454
404
528
550
666
691
770
732
790
866
24
18
33
35
28
33
22
45
43
54
46
62
67
Advertising
191
260
265
277
323
328
424
463
404
467
403
378
380
Personnel
846
929
990
1,193
1,306
1,507
1,726
1,932
1,958
2,069
2,024
2,338
2,476
Office
150
154
156
159
195
218
261
293
363
361
403
419
441
Others
364
361
468
440
619
678
712
691
850
901
871
902
1,035
SG&A Expenses Ratio
0
Note: Beginning with the April – June 2006 quarter, payment service expenses of 101 million yen
for consolidated subsidiary GCREST, Inc., have been appropriated from "Others" (payment fees) to "Sales."
12
4
Overview of Consolidated
Financial Results
Number of Employees in Consolidated Companies
Increase of 333 in the year ending September 2006. Scheduled increase of 300 in the year ending September 2007.
Media Business: increase of 206; Advertising Agency Business: increase of 110; Investment Development Business: increase of 7.
Unit: People
1,600
1,561
Increase of 333
Increase of 429
1,200
1,171
1,464
Others
5%
Administration
9%
1,228 1,212 1,235
1,040
900
Management
16%
799
800
Sales
21%
734
609
495
548
Production
25%
Operation
15%
400
Technical
9%
0
03/
7-9
03/
04/
04/
10-12 1-3
4-6
Yr to Sep
Yr to Sep 2004
04/
7-9
04/
10-12
2003
05/
05/
1-3
4-6
Yr to Sep 2005
05/
7-9
05/
06/
06/
10-12
1-3
4-6
Yr to Sep 2006
06/
7-9
310
359
411
507
584
675
781
860
912
886
901 1,055 1,118
Advertising 150
Investment
Development
156
162
193
178
184
3
210
5
258
7
265
7
271
7
282
7
344
14
375
14
35
33
36
34
37
38
44
46
44
48
45
51
54
Media
Corporate HQ
As with the diagram on the left,
does not include temporary and part-time workers.
Note: Employees who are in the Investment Development Business are specified separately from the Oct-Dec 2004 quarter.
13
4
Business Forecast for the
Year Ending September 2007
Business Forecast for
the Year Ending September 2007
14
Business Forecast for the
Year Ending September 2007
Business Forecast for the Year Ending September 2007
Business Forecast for the Year Ending September 2007
Unit: hundred million yen
Net Sales
Operating Income Ordinary Income
Net Income
Business Forecast for
the Year Ending September 2007
750
50
50
25
Actual Performance for
the Year Ending September 2006
601
43
37
43
24.8%
15.2%
34.3%
-41.9%
Change
Dividend Forecast per Share
Yr to Sep 2007
1,000 yen
Yr to Sep 2006
900 yen
Note: The number of outstanding shares (659,424 shares) as of September 30, 2006 is used for the dividend forecast per share shown above.
15
Business Forecast for the
Year Ending September 2007
Business Forecast for the Year Ending September 2007
Net Sales
Operating Income
Unit: million yen
80,000
Unit: million yen
75,000
10,000
Business Forecast for the Year Ending September 2007
Net Sales: 75 billion yen (increased by 24.8% over the previous year)
Operating Income: 5 billion yen (increased by 15.2% over the previous year)
60,115
60,000
43,273
40,000
5,000
4,342
5,000
26,728
2,651
20,000
10,824
3,276
0
16,202
1,726
6,392
452
19
-2
0
-34
-106
-1,636
-278
-142
-2,000
-10,000
Yr to Sep
1998
Yr to Sep
1999
Yr to Sep
2000
Yr to Sep
2001
Yr to Sep
2002
Net Sales
Yr to Sep
2003
Yr to Sep
2004
Yr to Sep
2005
Operating Income
Yr to Sep
2006
Yr to Sep
2007
(forecast)
16
Business Forecast for the
Year Ending September 2007
Revenue from Sales/ Component Ratio by Segment
Media Business
Media Business
Commissions/
Charged Services
Commissions/
Charged Services
Media Business
Own/
Partner Media
Ameba Business
3.5 billion yen
5%
Product Sales
Own/
4.6 billion yen
Partner Media
8%
13.7 billion yen
Product Sales Performance 23%
16.4 billion yen Yr to Sep 2006
27%
11.5 billion yen 14.5 billion yen
15%
11%
7.5 billion yen
14.0 billion yen
10%
19%
Commissions/
Charged Services
Media
Challenge
1 billion yen
2.5 billion yen
3%
11.2 billion yen
15%
2%
100 billion yen
5.0 billion yen
5%
15.0 billion yen
15%
16.3 billion yen
21%
Change
Ameba
Business
Change
Other Company
Media
Investment
Development Business
Advertising Agency
Business
Change
22 %
Paid Search Advertisements
Paid Search Advertisements
Investment
Development Business
Other Company
Media
22.0 billion yen
Paid Search Advertisements
Advertising Agency
Business
8%
Yr to Sep 2008
20.0 billion yen
27%
75.0 billion yen Other Company
12.4 billion yen
3.7billion yen
20%
6%
8.3 billion yen
14%
Own/
Unit: hundred million yen Partner Media
24.5 billion yen
24%
Performance
Forecast
Yr to Sep 2007
Ameba Business
Ameba Business
7.5 billion yen
Product Sales
Media
60.1 billion yenOther Company
Investment
Development Business
Own/
Partner Media
Paid Search
Advertisements
Change
Advertising Agency
Business
Product Sales
Change
Commissions/
Charged Services
Change
Investment
Development
Business
Change
Net Sales Total
Yr to Sep 2006(Performance)
137
6.2%
10
900.0%
124
77.1%
83
38.3%
164
29.1%
46
58.6%
37
131.3%
601
Yr to Sep 2007
140
2.2%
35
250.0%
163
31.5%
112
34.9%
200
22.0%
75
63.0%
25
-32.4%
750
(PerformanceForecast)
Note: Ameba business net sales also include MicroAd net sales.
17
Media Business
Internet Media Business
18
Media Business
Consolidated Subsidiaries and Divisions that Constitute the Media Business
Media Business
Advertising
EC
EC
(product sales)
(charged services)
Other
Advertising
Agency Business
Media Business
Investment
Development Business
Ameba Headquarters
MicroAd Company
Media Headquarters
All Navi Company
CA Guide Company
Blog Accessory Group
CA MOBILE, Ltd.
EC Navi Company
netprice, ltd.
GCREST, Inc.
CyberAgent FX, Inc. (CA Capital, Ltd.)
International Sports & Marketing Co., Ltd.
WeddingPark, Ltd.
CyberBuzz, Inc.
cybozu.net, Inc.
StoreFactory, Inc. (established 7/3)
Financial Plus, Inc.
Ameba Books, Ltd.
Crown Jewel, Inc.
LX, Inc.
19
Media Business
Internet Media Business (net sales)
Unit: million yen
10,000
Increased by 12.1%
8,139
8,206
8,728
8,266
7,784
8,000
7,085
6,719
6,000
Increased by 20.7%
5,596
5,238
4,713
4,000
4,300
3,896
Decreased by 1.3%
2,000
0
2004
2005
2006
1Q (October – December)
EC
2004
2005
2006
2Q (January – March)
2004
2005
2006
3Q (April – June)
2004
2005
2006
4Q (July – September)
1,995
3,142
5,173
2,289
3,556
5,004
2,637
4,242
5,085
3,009
4,752
5,735
Advertising1,901
2,453
3,033
2,011
3,163
3,135
2,075
2,843
3,181
2,229
3,032
2,993
Note: Net Sales are reference values before excluding internal transactions.
20
Media Business
EC (e-commerce) Net Sales
Mobile Commerce and Commissions/Charged Services (online games) performed well.
Unit: million yen
6,000
5,173
5,085
5,004
5,735
Increased by 20.7%
4,752
4,500
4,242
Increased by 18.3%
3,556
3,142
3,009
3,000
2,638
2,289
1,994
Increased by 13.6%
1,500
Increased by 37.5%
0
2004
2005
2006
1Q (October – December)
2004
2005
2006
2Q (January – March)
2004
2005
2006
3Q (April – June)
2004
2005
2006
4Q (July – September)
1,199
1,673
2,652
1,301
1,876
2,591
1,370
2,215
2,522
1,677
2,414
2,856
PC Commerce
590
932
1,463
694
1,045
1,347
881
1,225
1,374
858
1,401
1,591
Commissions/
Charged Services
205
537
1,058
294
635
1,066
387
802
1,189
474
937
1,288
Mobile Commerce
Note: Net Sales are reference values before excluding internal transactions.
21
Media Business
Advertising Sales
Effects of Advitisers who refrains to place ads(cosumer finance industry and others)
Shift from e-mail advertising to Web advertising.
Unit: million yen
4,000
3,181
3,163 3,135
3,033
Decreased by 1.3%
3,032 2,993
2,843
3,000
2,453
1,901
2,000
2,229
2,075
2,011
1,000
0
2004
2005
2006
1Q (October – December)
2004
2005
2006
2Q (January – March)
2004
2005
2006
3Q (April – June)
2004
2005
2006
4Q (July – September)
476
736
220
587
689
202
578
513
151
680
378
162
78
158
949
106
404
957
108
440
951
75
719
816
684
832
1,097
764
1,054
1,207
772
1,074
1,404
736
1,097
1,231
42
252
186
79
356
256
105
200
177
141
212
238
Others
621
(including affiliate advertising)
475
581
475
660
513
512
616
498
597
626
546
PC (e-mail) Advertising
PC (WEB) Advertising
Mobile
(cell phone) Advertising
Research Business
Note: Net Sales are reference values before excluding internal transactions.
22
Media Business
The Road to Overwhelming Top Domestic Blog Media
Aiming for one billion PV by December 31, 2006.
“Ameba Blog” PV
Unit: million PV
800
4Q, 2006
1.47 billion PV
(increased by 30.6% over the previous quarter)
600
654
3Q, 2006
1.13 billion PV
(increased by 17.7% over the previous quarter)
381
313
291
287
286
260
502
440
2Q, 2006
0.96 billion PV
(increased by 11.3% over the previous quarter)
400
536
348
351
400
301
224
200
172
138
48
0
71
95
107
68
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
01
02
03
04
05
06
07
08
09
10
11
12
01
02
03
04
05
06
07
08
09
Yr to Sep 2005
Yr to Sep 2006
2006/
10
Yr to Sep
2007
Note: Values above are calculated using the measurement tool “Analog” .
23
Media Business
The Road to Overwhelming Top Domestic Blog Media
4Q, 2006: 330 million yen
(increased by 2.5% over the previous quarter)
Monthly Sales of the “Ameba Blog”
Unit: thousand yen
140,000
3Q, 2006: 322 million yen
(increased by 54.2% over the previous quarter)
124,142
122,884
120,000
114,740
2Q, 2006: 209 million yen
(increased by 41.2% over the previous quarter)
104,853
101,273
100,000
1Q, 2006: 148 million yen
(increased by 73.0% over the previous quarter)
84,887
77,408
80,000
70,393
61,287
58,696
53,726
60,000
40,000
33,716
30,139
21,749
16,892
12,931
20,000
9,933
6,534
4,727
0
Ameba
MicroAd
35,709
4,901
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2005/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
2006/
01
02
03
04
05
06
07
08
09
10
11
12
01
02
03
04
05
06
07
08
09
824
349
913
1,185
1,512
3,040
4,960
9,518
8,660
9,443
18,786
14,817
24,544
32,438
31,648
61,795
40,562
54,928
70,001
53,970
54,690
9,109
4,378
5,621
3,716
11,419
13,852
16,789
24,198
21,479
26,266
39,910
38,909
36,743
37,955
45,760
61,089
44,325
59,812
54,141
50,883
46,583
Ameba: Net Sales of tie-up advertisements, etc. run on Ameba Blog.
MicroAd: Net Sales of advertisements that shown with analyzing blog contents, user situations, etc.
24
Advertising Agency
Business
Internet
Advertising Agency Business
25
Advertising Agency
Business
Consolidated Subsidiaries and Divisions that Constitute the Advertising Business
Advertising
Agency
Others
Advertising
Agency Business
Internet Advertising Headquarters
CA Search, Ltd.
Fraudia Communications, Inc.
CA/H, Inc.
Adplayin’ , Inc. (established 9/1)
Business Development Group, New Business Division
Media Alliance Group (established 10/1)
Media
Business
Investment
Development Business
26
Advertising Agency
Business
Internet Advertising Agency Business (net sales)
Unit: million yen
10,000
8,180
7,756
8,000
Increased by 39.1%
7,134
6,151
5,882
6,000
5,001
4,783
4,002
4,000
3,579
3,220
2,916
2,263
2,000
0
2004
2004
2005
2006
2004
2005
2006
2004
2005
2006
2,209
3,806
5,531
2,815
4,556
6,512
3,083
4,730
6,894
3,414
5,389
7,120
54
196
362
101
227
387
137
271
430
165
344
489
149
418
CA Search, Ltd.
Fraudia Communications, Inc.
Others
2006
2Q (January – March)
Advertising Headquarters
CA/H, Inc.
2005
1Q (October – December)
258
235
4Q (July – September)
3Q (April – June)
425
7
135
18
Note: Net Sales are reference values before excluding internal transactions.
27
Advertising Agency
Business
Internet Advertising Headquarters Net Sales
Led by Yahoo! and Paid Search Advertising, revenues increased.
Unit: million yen
8,000
7,120
6,894
6,512
Increased by 32.1%
6,000
5,531
5,389
4,730
4,556
3,806
4,000
3,414
3,083
2,815
2,209
2,000
0
2004
2005
2006
1Q (October – December)
688
1,283
1,679
309
1,081
1,040
1,303
139
Own/Partner Media
Paide Search Ads.
Other Company Media
Other Production Fees, etc.
172
2004
2005
2006
2Q (January – March)
939
1,664
1,874
1,756
585
1,197
1,895
1,116
1,572
201
175
123
2004
2005
2006
3Q (April – June)
1,017
1,537
2,141
1,826
754
1,497
2,559
1,156
1,576
253
156
120
2004
2005
2006
4Q (July – September)
1,142
1,652
1,834
1,987
838
1,616
2,075
2,527
1,246
1,929
2,936
239
188
192
275
Note 1: Internet Advertising Headquarters net sales (before exclusion of internal transactions)
28
Advertising Agency
Business
Quarterly Net Sales Productivity per Sales Employee
Quarterly productivity per employee is on an upward trend.
Unit: million yen
Unit: people
180
60
166
145
50
37.1
30.2
30
69
31.5
98
29.5
75
90
94
128
40.7
108
37.9
150
136
40.5
40
50.9
145
42.2
166
41.5
42.9
120
37.2
32.6
90
76
20
60
10
30
0
03/
7-9
Yr to Sep
2003
03/
10-12
04/
1-3
04/
4-6
Yr to Sep 2004
04/
7-9
04/
10-12
05/
1-3
05/
4-6
05/
7-9
Yr to Sep 2005
Quarterly Productivity
05/
10-12
06/
1-3
06/
4-6
06/
7-9
0
Yr to Sep 2006
Number of Sales Employees
Note: Number of sales employees in the Internet Advertising Headquarters.
29
Investment Development
Business
Investment Development Business
30
28
Investment Development
Business
Consolidated Subsidiaries and Divisions that
Constitute the Investment Development Business
Advertising
Agency Business
Media Business
Investment
Development
Investment
Development Business
Investment Development Business
VC Business Division
CyberAgent Investment, Inc.
31
Investment Development
Business
Actual Investment Performance in Web2.0 companies.
Unit: million yen
18,000
Investment will be made up to no more than 20%
of consolidated total assets.
Operational Investment Securities
15,881
Companies invested in as of September 30: 44
Invested Companies List (as of September 30, 2006)
12,000
mixi, Inc. President: Kenji Kasahara
13,703
Established June 3, 1999.
SNS service, recruitment advertising, etc. (listed September 14, 2006 on Tokyo Stock Exchange Mothers: 2121)
interspace co., ltd. President: Shinichiro Kawabata
Established November 8, 1999.
Affiliate service and price-comparison site operation. (listed September 19, 2006 on Tokyo Stock Exchange Mothers: 2122)
G.plan Inc. President and CEO: Hiroshi Watanabe
Established February 9, 2001.
Comprehensive point conversion site operation, etc. 6,000
Unoh Inc. CEO: Shintaro Yamada, Executive Vice President: Atsushi Ishikawa
Established August 1, 2001.
Internet media business, etc.
133
430
504
821
3,796
3,568
Real Communications Co., Ltd President and CEO/COO: Hidenori Suzuki
2,041
1,912
Wholesale, mail-order, product distribution, system development, and advertising businesses
1,536
280
1,256 1,755
1,656
2,178
0
Dec 31,
2004
+
Mar 31,
2005
Jun 30,
2005
Sep 30,
2005
Dec 31,
2005
Mar 31,
2006
Jun 30,
2006
Sep 30,
2006
= Operational Investment Securities
Book Value after Considering Losses
Web Do Japan Co., Ltd.
President and CEO: Koji Obuchi
Established November 7, 2003.
Established May 24, 2001.
Internet media content business, etc. CROSSWARP Inc. President and CEO: Shingo Yamazaki
Established October 4, 2001.
Internet marketing business, etc. WEBSHARK Inc. President: Seiji Kimura
Established February 1, 2002.
Drop shipping business, etc. Unrealized Capital Gains and Losses
Note: Includes amount invested for sales.
32
Investment Development
Business
Investment Development Business (net sales)
Sold off a portion of mixi, Inc. shares and Drecom Co., Ltd. shares.
Unit: million yen
3,500
3,232
1,127
1,000
543
500
336
333
47
0
31
11
04/10-12
05/1-3
05/4-6
05/7-9
05/10-12
06/1-3
Yr to Sep 2005
Net Sales from Sales of
Operational Investment Securities
06/4-6
06/7-9
Yr to Sep 2006
532
1,088
308
0
316
3,108
Fund Establishment/Management/
Execution Compensation
47
11
11
39
25
31
20
124
Operating Income
47
11
431
1,071
289
31
306
3,138
Operated by consolidated subsidiary CyberAgent Investment, Inc.
Note 1: The Investment Development Business sales figures above are reference values before excluding internal transactions.
Note 2: Operating income amounts are before consolidation offset.
33
Medium- to Long-Term
Outlook
Medium- to Long-Term Outlook
∼ Blog Media “Ameba Blog” ∼
34
36
Medium- to Long-Term
Outlook
Web2.0 Media Expectations
What is Web2.0 Media?
This is a concept which encompasses all of the rising trends in net services,
and includes CGMs etc. created in conjunction with service users.
Portal
Blog
SNS
Reach
Number of Users
Net Sales
Magnitude of Needs
Web2.0 Media
Long Tail
Type of Internet Media
35
Medium- to Long-Term
Outlook
Web2.0 Media Expectations – Web2.0-induced Changes –
1）Increase of blog use and page view hours.
2）Development of word-of-mouth
marketing through blogging.
3）Blogs turn into individual incomes
(advertising income, EC, affiliates, etc.).
36
44
Medium- to Long-Term
Outlook
Service Expansion and PV of “Ameba Blog”
Challenge
“Ameba Blog” PV
Unit: million PV
1,000
1,000
Number of Blog Writers exceeded 1.34 million.
・【Profile Function】added
・【Access Analysis】started
700
654
・【Affiliate】started
・Mobile【Initial Registration/Login Function】added
600
【Point Return】started
・【BLOPPA!】added
・【Ameba Message】started
・【AmebaVision】started
・Mobile【Reader Registration/Comment Function】added
500
400
Number of Blog Writers exceeded 0.5 million.
300
313
291
287
286
Nov
Dec
440
400
Number of Blog Writers exceeded 1 million.
“Ameba Scrapbook Beta Version” started.
536
502
381
348
351
Mar
Apr
301
260
224
200
172
Number of Blog Writers
exceeded 0.1 million.
100
Published first-ever blog-based book:
“Jitsuroku Oniyome Nikki”
Sep. “Ameba Blog” started
30
138
95
107
71
45
48
Dec
Jan
68
9
0
Oct
Nov
Feb
Mar
Apr
May
Yr to Sep 2005
Jun
Jul
Aug
Sep
Oct
Jan
Feb
May
Yr to Sep 2006
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Yr to Sep
2007
Note: Company values calculated using the measurement tool “Analog” .
37
44
Medium- to Long-Term
Outlook
“Ameba Blog” Services
AmebaVision [Video Sharing Service]
Service Start: July 2006
This is a video sharing service in which users post their videos.
Point Affiliate Function
Start: August 2006
This is a function which lets users introduce products on
their blogs and collect points if they are sold. Revitalizes
blogs since the points are returned to the users.
Message Function
Start: July 2006
This is a function which lets messages to be sent and received.
Promotes communication between bloggers and readers.
Profile Function
Start: October 2006
This is a function which lets bloggers search for others with
similar hobbies/tastes.
Revitalizes communication between bloggers.
Access Analysis
Start: October 2006
This is a function which records and analyzes blog access.
Increases blog use since analysis is done in a way that is
even easy for beginners to understand.
Ameba News
Displayed on the Top page from August 2006.
Original news is created and distributed.
Many Functions improve user circuit rate and PV.
38
44
Medium- to Long-Term
Outlook
“Ameba Blog” Services
AmebaVision Video Sharing Service
AmebaVision Top Page
Creators Collection
As of October 31, 2006
Approximately 37,000 videos posted.
Approximately 150,000 streamings per day.
Profile Function
Communication Promoting Tool for Bloggers
Bloggers can search for others with similar hobbies/tastes.
This tool promotes communication between bloggers and
increases blog-viewing hours and access number.
Profile Editing Window
Topic Sharing (baton) Function
Message Function Communication Tool
With just one click, readers can send e-mail-like messages to the writers.
Expanding services which focuses on the readers will increase PV.
Message In-Box
Message
39
44
Medium- to Long-Term
Outlook
“Ameba Blog” Services
Point Affiliate Function
Return Advertisement Posting Fee to Bloggers
Return of advertisement fee to users started from
August 22, 2006 (10% - 20%).
Aim to become a “profitable media”
by giving away Ameba points.
Affiliate Start: September 20, 2006
Search Window
Search Result Window
Blog which Utilizes this Service
Check Points
Access Analysis
Ameba News
This is a function that analyzes access number of blog viewers
and attributes of visitors.
Aim to increase high-quality contents that focus on the readers.
News, etc. from blogs are regularly displayed on the administration window.
By citing the news, updating blog entries is easy.
Sharing topics between the readers and writers can conveniently be done.
Access Number by Time
Ameba Blog Ranking-of-the-Week
Ameba News Top Page
Blog Site Citing Ameba News
40
44
Medium- to Long-Term
Outlook
Celebrities’ Blogs that Lead PV Increase
As of October 31: 451 celebrities
Eriko Sato
SATOERI TMES
Tetsuo Nakanishi and Associates
CHEERS! KIDS SPORTS
Yakkun Sakurazuka
Sakurazuka Yakkun no Minaito Gakkaridayo
Hidekazu Nagai
Ore no Omoikomi
Tokyo Philharmonic Orchestra
Orchestra wo Iku
Maggy Shinji
Dekkaku Nacchatta!
Kahoko Tsunezawa
Jinsei wo Ajiwaitsukusu Blog
Yu Yamada
Yu
Futenou
Geneki Rikishi “Futenoh” Dosukoi Oozumo Nikki
RAGFAIR (Hikichi)
Kinenbidarake no Calendar
Urawa Reds/Takahito Soma
Vida Del Futbol
Iyo Matsumoto
Tenshi no Baka
Made into TV series “Oniyome Nikki” in October 2005
(Fuji Television network)
Oki Matsumoto
Matsumoto Oki no Tsubuyaki
Moe Oshikiri
Moe mode
Kazuma
“Jitsuroku Oniyome Nikki”
To be made into TV series “Kirakira Kenshui”
in January 2007 (TBS network)
Usako Oda
Kenshui Usako no Dotabata Funtoki
41
44
Medium- to Long-Term
Outlook
Mobile Function Expansion
“Ameba Blog”
Mobile Top Image
Mobile Service PV
Unit: thousand PV
180,000
Advertisement Frame
4Q, 2006
270 million PV
(increased by 149.6% over
the previous quarter)
150,000
Advertisement
Frame
【Initial Registration/Login Function】added
120,000
4Q, 2005
110 million PV
(increased by 27.1% over
the previous quarter)
113,116
96,463
【Reader Registration/Comment Function】added
Advertisement Frame
Login Function
Comment Function
70,281
60,000
Initial Registration
38,118 39,660
28,003 28,230
Reader Registration
Function
21,269
0
Oct
31,975
34,343
23,851 24,704
Nov
Dec
Jan
Feb
Mar
Apr
May
Yr to Sep 2006
Aim for an increase of PV by adding PC-like functions.
Jun
Jul
Aug
Sep
Oct
Yr to Sep
2007
42
44
Medium- to Long-Term
Outlook
Install Unique Functions
PC
Mid-Nov
Mobile
“Peta” (footmark) Function
Mid-Nov
Make the profile function into a PC-like service.
Blog Entry Import Function
Messaging Function; Send/Receive
Continue adding affiliate partners.
“Peta” (footmark) Function
End of Nov Ameba’s Own RSS-Capable Top Page
After Dec
Beginning of Dec Video Posting/Browsing
Start exchanging Ameba
points with premium services.
“Peta” (footmark) Function
Everyone’s Profile Function
Everyone’s Theme Function
Function that allows viewing of visitor record.
※キャプチャはイメージです。
43
44
Medium- to Long-Term
Outlook
The Road to Overwhelming Top Domestic Blog Media
Yr to Sep 2006
By positioning this term as a time for investing,
expand services focusing on the user viewpoint.
September 2005
Number of Blog Owners
Number of Monthly PV
October 2006
510,000
1,340,000
Increased by 163%
260 million PV
650 million PV
Increased by 150%
Yr to Sep 2007
Aim to acquire revenues by considering the single-month net sales of
200 million yen (December 2006) as the break-even point.
44
Medium- to Long-Term
Outlook
General Overview of the Year Ending September 2006
Media Business: PV increase due to
“Ameba Blog” service expansion.
Advertising Agency Business:
Strong showing in a slowing market.
Investment Development Business:
Actual investment performance in Web2.0 companies.
45
44
Medium- to Long-Term
Outlook
Year Ending September 2008 Aiming for Consolidated Net Sales of 10 Billion Yen
Establish a High Revenue Business Model
through the Growth of “Ameba Blog”
46
44
Medium- to Long-Term
Outlook
VISION
To become a company that is the hallmark
of the 21st Century.
47
Medium- to Long-Term
Outlook
To become a company that is the hallmark of the 21st Century.
We must not allow ourselves to slip away from the growing internet industry.
Conversely, we must continue to actively participate in a variety of related fields.
We must not forget the “Team CyberAgent” spirit.
We must commit ourselves fully to recruitment.
We must create an environment where our valuable employees can stay with us throughout the years.
We must promote the rise of the young. Promotion by seniority is forbidden.
We must be a rule abiding and moralistic company. Never forget the Livedoor scandal.
We must become a global company by developing the best globally compatible internet services.
48
Reference Material (1)
Reference Material(1)
Overview of Consolidated Financial Results
49
Reference Material (1)
Fourth Quarter of the Year Ending September 2006: PL (over the previous quarter)
Unit: million yen
Jul – Sep 2006
Apr – Jun 2006
Change
18,402
14,580
26.2%
Gross Income from Sales
7,776
5,504
41.3%
Gross Margin
42.3 %
37.8 %
4.5points
SG&A
5,265
4,889
7.7%
SG&A Ratio
28.6 %
33.5 %
-4.9points
Operating Income
2,510
615
Operating Profit Margin
13.6 %
4.2 %
308.1%
9.4points
Ordinary Income
2,010
427
370.7%
Current Net Income Before
Tax and Other Adjustments
661
186
255.4%
Net Income
-242
- 239
-1.3%
Net Sales
Investment loss due to the equity method: 222 million yen.
Loss due to applying the accounting for
impaired assets: 1,191 million yen.
50
Reference Material (1)
Fourth Quarter of the Year Ending September 2006: BS (over the previous quarter)
Sep 30, 2006
Current Assets
50,483
34,448
46.5 %
(cash + marketable securities, etc.)
20,170
18,713
7.8 %
Fixed Assets
8,928
10,327
-13.5 %
Total Assets
59,411
44,776
32.7 %
Current Liabilities
20,451
13,839
47.8 %
351
295
19.0 %
38,608
30,640
26.0 %
Fixed Liabilities
＊
Shareholders' Equity
Jun 30, 2006
Change
Unit: million yen
Increase of unrealized capital gains in operational
investment securities: 13,703 million yen
Consolidated subsidiaries’ increase of capital: 5,335 million yen
Deferred tax liabilities due to unrealized capital gains of
equity shares: 5,426 million yen.
＊Due to enforcement of the Company Law, the June 30, 2006 shareholders' equity is the total of the total capital
from the third quarter of the year ending September 2006 financial statements and minority interests.
51
Reference Material (2)
Reference Material(2)
CAJJ Program
Company Overview
Business Model
52
Reference Material (2)
CAJJ Program Model Diagram
CyberAgent Business and Personnel Development Program
CAJJ Program Model Diagram
(CyberAgent Business and Personnel Development Program)
As of June 2006
J2
J1
Promotion Standard
(Period: 3 to 6 months)
⇒Gross profit of 15 million yen/month
Lower limit on losses:
60 million yen/6 months
Promotion Standard
(Period: 3 to 6 months)
⇒Gross profit of 5 million yen/month
Lower limit on losses:
30 million yen/6 months
J3
New Businesses (Groups)
Exploration of business models
J2
Business (Projects) Undergoing Anticipatory Investment
Continued commercialization
J1
Core Businesses (Companies)
Continued business growth
J1 Restructuring Considerations
⇒Three consecutive quarters of unachieved
operating income budget
Three consecutive quarters of lower operating income
J2 Restructuring Considerations
⇒Three consecutive quarters of unachieved operating income budget
Three consecutive quarters of lower operating income
53
Reference Material (2)
CAJJ Businesses
Name of Business or Affiliated Company
Focused
Business
J1
1
2
3
4
5
6
7
8
9
10
11
12
13
Service Contents
Ameba Headquarters
Web2.0 Media – Using Blogs as Platforms, where Users Play the Leading Part
Internet Advertising Headquarters
MicroAd Company
All Navi Company
CA Guide Company
CA MOBILE, Ltd.
EC Navi Company
netprice, ltd.
CA Search, Ltd.
GCREST, Inc.
CyberAgent FX, Inc.[CA Capital, Ltd.]
International Sports & Marketing Co., Ltd.
WeddingPark, Ltd.
Fraudia Communications, Inc.
Internet advertising business
Blog network advertising distribution services
Information comparison websites
Guide-recommended, carefully selected websites
Mobile marketing
Price/information comparison website
Online shopping service websites
Planning, execution and operation of search engine marketing strategies
Online games
Financial services
Sports contents
Wedding information website
Suggestion-type media agency specialized for women (promoted to J1 7/1)
J2
1
2
3
4
CyberBuzz, Inc.
cybozu.net, Inc.
Crown Jewel, Inc.
Media Business Headquarters
Word-of-mouth marketing business (promoted to J2 7/1)
Business portal website
Carefully selected apparel brand auction website (promoted to J2 10/1)
Net media for total information provision and point services
J3
1
Blog Accessory Group
Adplayin’, Inc.
StoreFactory, Inc.
CyberAgent Investment, Inc.
CA/H, Inc.
Financial Plus, Inc.
Ameba Books, Ltd.
LX, Inc.
Business Development Group, New Business Division
Media Alliance Group
Blog accessory portal website
In-game advertising business
Drop shipping business
Venture capital business
Advertising business focused on internet marketing
Stock information software service
Publishing services
Personal stylist website for women
Administration, etc., of the training course for Internet advertising staff
Businesses centered on partnering with other companies
2
3
4
5
6
7
8
9
10
As of October 31, 2006
54
Reference Material (2)
Example of Blog Media Service (1)
Video Sharing Service with 250,000 PV/Day
Ameba Headquarters
AmebaVision Group
Service Start: July 13, 2005.
Users can paste videos to their blogs with ease, and these can be played directly on the blog articles.
http://vision.ameba.jp/
Unit: thousand
4,000
37,000 Videos Posted (as of October 31)
Average of 150,000 Videos Distributed Daily
Number of “AmebaVision” Video Distribution
3,784
Increased by 451.6%
3,000
2,000
1,774
1,000
686
0
July 2006
August 2006
September 2006
TOPICS: Partnering with Television Tokyo,
“WEB Tama” to start as new program from October.
Ever since its start, the number of posting increased
rapidly and is revitalizing by closely operating with blogs.
55
Reference Material (2)
Example of Blog Media Service (2)
Word-of-Mouth Marketing Support Business
Consolidated Subsidiary: CyberBuzz, Inc.
http://www.cyberbuzz.co.jp/
Established on April 3, 2006
By grouping carefully selected popular bloggers who are influential,
word-of-mouth information of products/services requested from advertisers is spread and its effectiveness is measured.
Blogger’s Word-of-Mouth Entry (advertiser’ s video)
Products can be introduced although
there are only 550 carefully selected members.
Website Introducing Word-of-Mouth Products to Bloggers
Example of Advertiser’ s
Product Utilization
Example of Advertiser’s Posting (video sharing service)
Advertiser’s PR
Word-of-Mouth Marketing Business Using Blogs
Turned Profitable within 3 Months
56
Reference Material (2)
Company Overview
Company Name
Head Office
CyberAgent, Inc. (securities code: 4751)
Shibuya Mark City West 21F, 1-12-1 Dogenzaka, Shibuya-ku, Tokyo
West Japan Division
Osaka Office
Meiji Yasuda Life Osaka Umeda Bldg. 14F, 3-3-20 Umeda, Kita-ku, Osaka
West Japan Division
Nagoya Office
Nishiki Park Bldg. 12F, 2-4-3 Nishiki, Naka-ku, Nagoya, Aichi
West Japan Division
Fukuoka Office
Fukuoka Kogin Bldg. 9F, 1-13-2 Tenjin, Chuo-ku, Fukuoka
Established
Capital
Number of Employees
March 18, 1998
6,722,866,584 yen (as of September 30, 2006)
1,561 / CyberAgent Group Overall (as of September 30, 2006)
Average Age
28.0 / CyberAgent alone (as of September 30, 2006)
Annual Sales
Approx.60.1 billion yen (year ending Sep. 2006)
Memberships
Member of Japan Advertising Review Organization, Inc.
Member of Japan Internet Advertising Association
Member of Advertising Cooperative Association
Member of Japan Advertising Agencies Association
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Reference Material (2)
Business Model
Client
Internet Media
Internet Media
Business
●Internet Advertisement Planning,
Proposal and Effectiveness Verification
● Information Provision
through Internet Media
● Charged Services/Product Sales
● Subscription
③ Investment
Development
Business
● Product Purchase/Usage Fees
②
Internet Advertising
Business
Internet
Advertising Agency
User
● Advertising Cost
Clients (Advertisers)
Users (Individuals/Consumers)
①
(1) Internet Media Business
Advertising: Advertisement using Web2.0 Media centered on "Ameba Blog." Mobile advertising, etc.
(2) Internet Advertising Business
Conduct direct sales of Internet media ad spots to advertisers.
(3) Investment Development Business
Utilize our wide business experience to discover, invest in and foster promising businesses and to obtain profits through their sales, IPO, etc.
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Reference Material (2)
Internet Advertising Industry Map
Reps
Ad Agencies
Yahoo(4689)
CCI(4788)
Dentsu (4324)
Google
DAC(4281)
Hakuhodo DY Holdings (2433)
Overture
Opt(2389)
Rakuten(4755)
Septeni (4293)
Clients (Advertisers)
Users (Individuals/Consumers)
Media
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