Relo Holdings, Inc. Security Code: 8876 Company Profile Fiscal Year 2015/3 (Ending March 31, 2015)
Company profile Company name Company profile Relo Holdings, Inc. History 1967 March Be established Security code 8876 Listed market Location (Headquarter) Management Year established 1967 First Section of the Tokyo Stock Exchange 4-3-23 Shinjuku, Shinjuku-ku, Tokyo 160-0022 Kenichi Nakamura President & Representative Director Employees 1,268 (as of March 2015) Core business domain Corporate fringe benefit management outsourcing service 1984 May 1993 September Launches relocation house rental management service Launches Relo Club fringe benefit membership club 1999 September Goes public (JASDAQ) 2001 March 2001 August 2002 April 2005 June Begins Point Vacation Relo timeshare resort business Launches Club-Off Alliance CRM outsourcing service Launches Reliance leased corporate housing management outsourcing service Launches global relocation support service Mission To help corporations and their employees be free from care and anxiety, and enable them to perform to their full potential though our products and services. Accordingly, we will contribute to grow Japan. 2009 September Begins hotel management business 2010 January 2011 November Begins residential property management service Listed on the First Section of the Tokyo Stock Exchange 2
Historical financials Most of our revenue comes from stable businesses that have recurring revenue streams, including Reliance leased corporate housing management outsourcing service, Relo Club fringe benefit management outsourcing service and our original business, the relocation house rental management service, which we launched in 1984. By creating new outsourcing services to resolve various challenges to corporate fringe benefits that human resources departments face, and building on these stable business foundations, we have achieved 15 consecutive years of record revenues. Billion yen Billion yen 180 160 140 120 100 80 Consolidated income FY2015/3 (Compared to FY1999/3) Operating Revenue Recurring Profit Operating Revenue (Left) 160 billion yen (11 times) 9.8 billion yen (18 times) Financial crisis 12 10 8 6 60 Recurring Profit (Right) 4 40 20 0 FY1999/3 FY2001/3 FY2003/3 FY2005/3 FY2007/3 FY2009/3 FY2011/3 FY2013/3 FY2015/3 (Estimate) 2 0 Profit has gone up more than tenfold 3
Market Average spending for corporate benefits has been increasing, even during recessions. Corporate fringe benefit has become one of the essential factors in Japan to recruit and retain employees. After the Japanese financial reforms of the 1990s, corporations promoted the disposal of idle assets, increasing demand for outsourcing. Recent intense global competition has forced Japanese companies to be leaner, further accelerating the outsourcing of non-core operations. Average spending on non-mandatory benefits FY2013: 25,007 Thousand yen % 25,007 per month, per employee <Average spending on non-mandatory benefits> Leisure & Living support 12,781 Housing 12,225 Booming Economy Heisei Recession Financial Crisis * FY2013 58 th Corporate benefit research (Research: Nippon Keidanren) Corporate fringe benefits have become one of the key factors in Japan to recruit and retain employees. 4
Business segments and services We provide comprehensive outsourcing services for corporate fringe benefits How can I make good use of my vacant house, while temporarily transferred? In 1984, we have launched the first relocation house rental management service in Japan to solve this issue, which a large number of Japanese transferees were facing. In the process of expanding the business of helping transferred employees, we built a broad network with HR and Admin departments. Over the years, we have learned about the challenges, gaps and inefficiencies in corporate fringe benefits that companies face. Since then, Relo has expanded its businesses as a solution provider for Corporate Japan. Domestic Business (Fringe Benefit) Relo Club Fringe benefit membership club Club-Off Alliance CRM outsourcing Smile Ranger RELO24 Hotel management Point Vacation Relo Timeshare resorts Leisure & Living support Housing Domestic Business (Relocation) Reliance Leased corporate housing management Corporate housing property management Residential property management Relocation house rental management Global relocation support Serviced apartments Other Global Business 5
Business segments Domestic Business (Relocation) The Domestic Business Segment provides outsourcing services specializing in the housing field of corporate fringe benefits, e.g. corporate housing and dormitories. Offering corporate houses to employees has been common among Japanese corporations and considered a necessary ingredient of employee benefits today for tax and other reasons. However, time-consuming operation of corporate housing is a heavy burden for these companies. Reliance, a full-service outsourcing service that helps to manage corporate housing leases, and Relo-Net, an employee transfer support system that helps clients save time and money in finding their residences and moving, are just two examples of our popular solutions that lighten the burden and increase productivity. We also provide property management and brokerage service in areas where demand for corporate housing is high. This broad array of services meets various needs and helps clients optimize their operations. (Million ) (Million ) 6
Business segments Domestic Business (Fringe Benefit) The Domestic Business Segment also provides outsourcing service specializing in the leisure and living support categories of corporate fringe benefits. Demand for offering living support menus, including child care, medical checkup, gym, education etc. as a part of fringe benefit is becoming quite high as well as leisure houses and facilities which large corporations in Japan has been offering to employees traditionally for decades. Fringe benefit has been an essential part of compensation system, while it is expected to be more cost effective. A fringe benefit membership club, Relo Club provides various fringe benefits (resort hotels, gyms, leisure facilities, child care services, etc.) and services (booking, customer care, etc.), helping member companies to increase employee satisfaction and also save time and money. Using the extensive network with the service providers that Relo Club has accumulated over the years. We also provide a loyalty program, Club Off Alliance, to client companies that enables individual members to enjoy discounts on more than 200,000 qualified leisure and living support menus. (Million ) (Million ) 7
Business segments Global Business The Global Business Segment provides broad relocation services assisting both companies and employees with overseas assignments and transfers. The Relo Group started the relocation house rental management service, a specialized rental property management service for vacated houses which transferred employees leave, in 1984 as our first business in the relocation business field. In the decades since then, it has grown into an integrated relocation service. Our integrated solutions include relocation policy development and review, web-based implementation processes management, visa application and international moving arrangement. Our overseas operations, including serviced apartments, brokerage services and more, also ensure smooth transitions. The Relo Group is a leader in providing a seamless service from preparation to return home, designed to maximize efficiency for both companies and employees throughout the process. (Million ) (Million ) 8
Our services Reliance (Leased corporate housing management) One of our core services, Reliance is a leased corporate housing management outsourcing service launched in 2002. The financial crisis of the 1990s drove a large number of Japanese corporations to sell off corporate owned housing & dormitories and replace them with a new system called kariage-shataku, in which companies rent apartments for their employees under the company name. Managing these rental apartments entails considerable cost and effort for the company (examples of what is involved are listed below). Reliance eliminates the burden of managing rented corporate housings. Outsourcing the operation and replacing the contracts allow companies to minimize the workload and focus on their core businesses. Review & sign contracts Pay deposits and rents Deal with complains Corporation When vacating Assess & judge if normal wearand-tear or damage Evaluate reasonable deposit refund, and negotiate Review & sign contracts Pay deposits and rents Dealing with complains Corporation Single contract When vacating Assess & judge if normal wearand-tear or damage Evaluate reasonable deposit refunds, and negotiate 9
Our services Relo Club (Fringe benefit membership club) One of our core services called Relo Club is a fringe benefit management outsourcing service launched in 1993. Large companies used to have their own resort houses and facilities as one of their employee benefits. However, the majority of small & midsize companies were not able to afford them. To fill the gap, Relo launched Relo Club, helping small & midsize companies enrich their benefits for an affordable price. Relo Club provides various fringe benefits (resort hotels, gyms, leisure facilities, child care services, etc.) and services (bookings, customer care, etc.). Member companies can increase employee satisfaction and save costs. Large Companies Afford to buy, build, and operate leisure facilities Gap Small & Midsize Poor fringe benefits Client companies 8,400 organizations 4.6 million members Alliance Partners 50,000 menu items Resort houses Leisure facilities 10
Contact For more information: Relo Holdings, Inc. Planning & IR Group email: ir@relo.jp URL: http://www.relo.jp/ This document is prepared for the purpose of providing a company profile and operating results as of fiscal year 2015/3 (ending March 31, 2015). This is not a solicitation to purchase securities issued by the company. All information is based on data that were current as of May 15, 2015. Opinions and forecast statements are based on the judgment of management in accordance with information current at the time. The company makes no guarantees that this information is accurate or complete. The contents of this document may be changed at any time without prior notice. Updated 2015/05/15 11