CNS Co (4076) Q1 2025 earnings summary

Executive summary

• Revenue for Q1 FY2025 was ¥1,644.6 million, a 0.1% decrease year-over-year.

• Operating profit declined 43.6% year-over-year to ¥79.7 million, and net profit attributable to shareholders fell 38.4% to ¥55.0 million.

• The company implemented an 11% wage increase at the start of the period, impacting labor costs.

• The business environment remains favorable for DX investments, but IT/digital talent shortages persist.

Financial highlights

• Gross profit margin decreased due to higher labor and SG&A costs, with SG&A ratio up 2.2 points year-over-year.

• Net assets at quarter-end were ¥3,587.2 million, down ¥84.5 million from the previous year-end, mainly due to dividend payments.

• Total assets decreased to ¥4,732.3 million, primarily from a reduction in cash and deposits.

• EPS for Q1 was ¥18.92, down from ¥30.73 in the prior year.

Outlook and guidance

• Full-year guidance remains unchanged: revenue ¥7,562 million (+13.6% YoY), operating profit ¥660 million (+6.6%), net profit ¥489 million (+6.2%), EPS ¥168.56.

• The company expects a back-end loaded year due to its business cycle and is working to offset wage increases through higher pricing and service expansion.