SAKURA Internet (3778) Q2 2024 earnings summary

Executive summary

• Net sales increased by 3.5% year-over-year to ¥10,343 million, driven by steady growth in cloud-services.

• Operating profit declined 42.8% year-over-year to ¥249 million due to higher investments in human resources, marketing, and increased electricity and domain acquisition costs.

• Ordinary profit dropped 54.3% year-over-year to ¥173 million, mainly reflecting the decrease in operating profit.

• Profit attributable to owners of parent fell 29.1% year-over-year to ¥175 million, despite a gain on sale of investment securities.

Financial highlights

• Gross profit for the period was ¥2,639 million, up from ¥2,500 million in the prior year.

• Comprehensive income rose 30.7% year-over-year to ¥337 million.

• Net income per share was ¥4.91, down from ¥6.76 in the previous year.

• Total assets increased 3.8% year-over-year to ¥27,249 million, mainly due to higher property, plant, and equipment and investment securities.

• Net assets rose 4.8% year-over-year to ¥8,890 million, reflecting higher valuation of available-for-sale securities and retained earnings.

Outlook and guidance

• Full-year net sales forecast is ¥22,800 million, up 10.6% year-over-year.

• Operating profit is projected at ¥1,450 million (up 32.7%), ordinary profit at ¥1,300 million (up 34.6%), and profit attributable to owners of parent at ¥850 million (up 27.5%).

• Net income per share for the full year is forecast at ¥23.81.

• Dividend forecast remains unchanged at ¥3.50 per share for the year.