Global Security Experts (4417) Q2 2025 earnings summary

Executive summary

• Achieved record highs in net sales and profit for the quarter and first half, with all services and business domains experiencing significant year-on-year growth due to strong cybersecurity demand and targeted strategies.

• Transitioned to consolidated accounting, including the spin-off of the SES business and application of the equity method for certain affiliates.

• One-time headquarter relocation expenses and investment in human capital impacted operating income growth, but these costs are now fully recognized and will not recur in the second half.

• Business growth was supported by increased demand for security services and training, despite higher personnel expenses.

Financial highlights

• Net sales for 1H FYE3/2025 rose 24.8% year-over-year to ¥4,007 million; operating income increased 33.1% to ¥709 million; net income grew 19.9% to ¥422 million.

• Gross profit for the period was ¥1,400 million, with a gross margin of 35.0%.

• Operating income margin rose by 1.1 points to 17.7%.

• Basic earnings per share were ¥56.19.

• Comprehensive income totaled ¥578 million, including ¥156 million in valuation gains on available-for-sale securities.

Outlook and guidance

• Full-year FYE3/2025 forecast: net sales of ¥8,800 million (+25.7% YoY), operating income of ¥1,584 million (+42.3% YoY), net income of ¥1,039 million (+32.6% YoY), and EPS of ¥138.34.

• Operating income margin expected to rise to 18.0% for the year.

• No revisions to previously announced performance or dividend forecasts.

• Profit contribution from equity-method affiliates, especially BBSec, is expected to increase in the second half.