TechnoPro Holdings (6028) Q1 2025 earnings summary

Executive summary

• Q1 FY25.6 revenue rose 9.4% year-over-year to ¥57.8B, with core operating profit up 21.8% and net profit up 18.6%.

• Results slightly exceeded initial plans, with strong demand for engineer dispatching, especially IT engineers, despite global economic uncertainty and rising costs.

• Utilization rate remained high at 95.1%, and average monthly sales per engineer increased by 2.5% year-over-year.

• Initiatives to raise unit sales prices and improve technical skills are underway to address margin and turnover challenges.

• Domestic business represents about 90% of total revenue and profit, facing challenges of slowing top-line growth, GP margin pressure from rising wages, and higher SG&A ratio due to recruitment costs.

Financial highlights

• Revenue: ¥57.8B (+9.4% YoY); Core operating profit: ¥6.95B (+21.8% YoY); Net profit: ¥4.78B (+18.6% YoY); EPS: ¥45.35 (+20.4% YoY).

• Gross profit margin improved to 26.8% (up 0.2 pts YoY); core OP margin rose to 12.0%.

• SG&A expenses rose to ¥8.5B (+2.3% YoY), mainly from hiring and training; SG&A ratio fell below 15%.

• Achieved 50% of first half operating profit guidance in Q1, with more working days expected in Q2.

• Comprehensive income fell to ¥2.36B due to negative foreign currency translation adjustments.

Outlook and guidance

• FY25.6 full-year revenue guidance is ¥237B (+8.1% YoY); operating profit forecast at ¥27B (+23.2%); net profit expected at ¥18.5B (+26.0%); EPS forecast at ¥175.52 (+27.6%).

• Dividend forecast for FY25.6 is ¥90 per share (payout ratio 51.3%).

• No changes to previously announced full-year guidance; only domestic KPIs for the first half were partially revised upward.

• Utilization ratio expected to remain around 95% for the first half, in line with guidance.

• Revenue and profit growth expected in China and from offshore projects; cautious outlook for Southeast Asia and UK due to market conditions.