Cresco (4674) Q1 2025 earnings summary

Executive summary

• Achieved strong growth in net sales and profits, driven by robust IT investment demand, new subsidiary consolidation, and operational improvements.

• Net sales rose 15.8% year-over-year to ¥13,758 million for the quarter ended June 30, 2024.

• Operating profit increased 85.0% year-over-year to ¥870 million, and ordinary profit grew 23.8% to ¥1,027 million.

• Major organizational restructuring implemented to enhance nearshore development, digital modernization, and global expansion.

• Launched new cloud and DevOps services and expanded partnerships in the IBM OS market.

Financial highlights

• Gross profit improved to ¥2,497 million from ¥1,926 million year-over-year.

• Net sales rose 15.8% year-over-year, mainly from major customers and new consolidations.

• Operating profit surged 85.0% year-over-year due to fewer unprofitable projects.

• Ordinary profit increased 23.8% year-over-year, aided by a 30 million yen gain on derivatives.

• Comprehensive income for the quarter was ¥1,391 million, up from ¥1,246 million year-over-year.

Outlook and guidance

• No change in full-year and half-year earnings forecasts for FY ending March 2025.

• Full-year net sales forecasted at ¥58,500 million, up 10.9% year-over-year.

• Operating profit projected at ¥5,900 million (up 15.2%), ordinary profit at ¥6,000 million (up 6.0%), and profit attributable to owners of parent at ¥4,000 million (up 7.3%).

• Net sales forecast for FY2025 is 27,800 million yen, up 8.5% year-over-year.

• Dividend forecast remains at 38 yen per share post-share split.