Fuji Soft Incorporated (9749) Q2 2024 earnings summary

Executive summary

• Net sales for H1 FY2024 rose 5.0% year-over-year to ¥159.0 billion, driven by strong system construction and embedded software, despite weakness in products and services.

• Operating profit increased 9.3% to ¥10.7 billion, with profitability improvements offsetting higher SG&A and unprofitable projects.

• Profit attributable to owners of parent more than doubled to ¥12.2 billion, aided by an ¥8.0 billion gain on real estate sales.

• Comprehensive income increased 65.1% to ¥13.9 billion.

• The board supports a tender offer by FK Co., Ltd., with plans for delisting and going private.

Financial highlights

• Gross profit grew 11.3% year-over-year to ¥36.7 billion; gross margin improved to 23.1%.

• Net profit per share was ¥193.96, compared to ¥96.44 in H1 FY2023.

• Total assets at June 30, 2024, were ¥253.9 billion; net assets at ¥134.8 billion.

• Equity ratio improved to 52.1% from 48.1% at the previous fiscal year-end.

• Cash and cash equivalents at end of period increased to ¥39.4 billion.

Outlook and guidance

• Full-year FY2024 guidance maintained: net sales ¥315.0 billion, operating profit ¥22.0 billion, ordinary profit ¥21.8 billion, profit attributable to owners of parent ¥21.0 billion, EPS ¥333.80.

• 1H results achieved 100.3% of H1 net sales forecast and 103.9% of H1 operating profit forecast.

• Interim dividend set at ¥42 per share, payout ratio 21.7% excluding real estate gains.

• Dividend forecast revised to no dividend for FY2024; shareholder benefit program abolished.