Comture (3844) investor relations material

Executive summary

• Net sales rose 6.7% year-over-year to ¥9,553 million, driven by the consolidation of Human Interactive Technology Inc. (HIT), growth in Data & AI, and expanded projects with financial and public sector clients.

• Operating profit declined 13.7% year-over-year to ¥747 million due to increased expenses from new core IT systems, despite higher gross profit.

• Ordinary profit fell 12.1% to ¥759 million.

• A one-time impairment loss of ¥1,434 million from discontinuing part of the core IT systems led to a net loss attributable to owners of parent of ¥516 million, compared to a profit of ¥571 million in the prior year.

Financial highlights

• Gross profit increased 2.7% year-over-year to ¥1,912 million, with a gross margin of 20.0%.

• EBITDA was ¥989 million, down 0.7% year-over-year.

• Depreciation and goodwill amortization rose significantly, reflecting investments in IT systems and acquisitions.

• Selling, general and administrative expenses increased to ¥1,164 million from ¥995 million.

• Extraordinary losses of ¥1,434 million, mainly due to impairment losses, drove the net loss.

• Net income per share dropped from ¥17.91 to -¥16.21 year-over-year.

Outlook and guidance

• FY3/27 full-year sales forecast remains at ¥42,000 million (+10.2% YoY), with operating profit forecast at ¥4,700 million (+0.8% YoY) and ordinary profit at ¥4,730 million (+0.4% YoY).

• Profit attributable to owners of parent revised down to ¥2,250 million (-31.5% YoY) due to the impairment loss.

• No change in dividend forecast (¥52 per share) as the impairment is non-cash; annual dividend up from ¥50.00 in the previous year.

• Medium-term plan targets FY3/29 net sales of ¥53,000 million and operating profit of ¥6,300 million.