CREEK & RIVER (4763) Q1 2024 earnings summary

Executive summary

• Q1 FY25 sales rose 1% year-over-year to ¥12,854 million, while operating profit fell 20.2% to ¥1,261 million, reflecting upfront investments and a record number of new graduate hires.

• Profit attributable to owners of parent decreased 17.7% year-over-year to ¥860 million.

• Creative (Japan) and Medical segments saw sales and profits slightly below plan, but project acquisition is increasing for the second half.

• Earnings per share for the quarter were ¥39.67, down from ¥47.42 in the prior year.

Financial highlights

• Gross profit margin declined to 39.3% from 40.6% year-over-year, with gross profit at ¥5,056 million, slightly down from ¥5,177 million.

• SG&A expenses increased 5% year-over-year to ¥3,794 million, raising the SG&A rate to 29.5%.

• Ordinary profit fell to ¥1,277 million, a 19.9% decrease year-over-year.

• Comprehensive income for the quarter was ¥885 million, down from ¥1,033 million year-over-year.

• Cash and deposits increased by ¥247 million to ¥11,716 million.

Outlook and guidance

• Full-year sales guidance is ¥55 billion (+10.4% YoY), with operating profit targeted at ¥4.8 billion (+17% YoY).

• Profit attributable to owners of parent for the full year is forecast at ¥3,100 million, up 16.6% year-over-year.

• Full-year earnings per share forecast is ¥140.93.

• Creative (Japan) and Medical segments expected to recover in the second half as project acquisition rises.

• Dividend forecast raised to ¥43 per share.