Densan System Holdings Co (4072) Q3 2025 earnings summary

Executive summary

• Net sales for the first nine months of FY2025 rose 11.2% year-over-year to ¥50,180 million, driven by strong growth in the Google business and GIGA School projects.

• Operating profit for the first nine months increased 83.2% year-over-year to ¥2,677 million; net income surged 163.8% to ¥2,235 million.

• Comprehensive income increased 162.2% year-over-year to ¥2,306 million for the nine-month period.

• All profit stages saw significant increases compared to the same period last year, which was impacted by unprofitable projects.

• The company is progressing in line with its full-year plan and has maintained its fiscal year forecast.

Financial highlights

• Gross profit increased from ¥6,713 million to ¥8,182 million year-over-year, while operating profit rose from ¥1,461 million to ¥2,677 million.

• Ordinary profit grew 74.5% year-over-year to ¥2,830 million.

• Basic earnings per share for the nine months ended September 30, 2025, was ¥209.31, up from ¥79.66 in the prior year.

• Total assets at the end of 3Q FY2025 increased to ¥73,351 million, mainly due to higher cash, deposits, and accounts receivable.

• Equity ratio decreased to 32.2% (down from 35.8%), reflecting increased liabilities from payment agency deposits and short-term borrowings.

Outlook and guidance

• FY2025 net sales are projected at ¥67,500 million (up 10.2%), with operating profit expected to rise 51.4% year-over-year to ¥3,500 million.

• Profit attributable to owners of parent is forecast at ¥2,530 million (up 36.7%).

• Annual dividend forecast is ¥80.00 per share, up from ¥60 in FY2024.

• Ordinary and net profit growth rates are lower due to reduced dividend income and gains on investment securities compared to FY2024.

• Continued robust demand is anticipated in cloud, AI, and BPO services, with significant sales growth expected from NEXT GIGA projects.