Plus Alpha Consulting (4071) Q3 2024 earnings summary

Executive summary

• Net sales rose 22.6% year-over-year to 9,869 million yen for the nine months ended June 30, 2024, with operating profit up 21.1% to 3,106 million yen and profit attributable to owners of parent up 17.5% to 2,106 million yen.

• HR Solutions, especially Talent Palette, drove growth, accounting for 72% of both net sales and profit.

• Comprehensive income for the period reached 2,106 million yen, up from 1,792 million yen in the prior year period.

• Company performance was in line with plans, supported by increases in customer numbers and ARPU, and low revenue churn rates.

Financial highlights

• Ordinary profit increased 21.1% year-over-year to 3,109 million yen; net profit rose 17.5% to 2,106 million yen.

• Gross profit increased to 7,168 million yen from 5,891 million yen year-over-year, with a gross margin of 72.7%.

• Monthly Recurring Revenue (MRR) grew 23.5% year-over-year to 973 million yen; ARPU increased 4.9% to 387 thousand yen.

• Number of customers rose by 421 to 2,552; companywide recurring revenue ratio reached 92.8%.

• Equity ratio improved to 80.9% as of June 30, 2024.

Outlook and guidance

• Full-year forecast for FY2024: net sales of 13,800 million yen (+23.5% YoY), operating profit of 4,800 million yen (margin 34.8%), and profit attributable to owners of parent of 3,250 million yen (+24.0%).

• Basic EPS is expected to reach 76.98 yen; annual dividend per share is forecast to rise to 16.00 yen from 13.00 yen.

• HR Solutions expected to continue driving companywide growth in both sales and profit.

• Medium-term target: sales of 23.3 billion yen and operating profit of 10 billion yen with a margin of 40%+ by FY2027.