Steady growth in the Distribution segment, increased sales due to the government and the mobile segments M&A contributions last year, progress as planned.

For the second quarter of the fiscal year ending December 2023, the company reported sales of 7.6 billion yen (23.1% increase compared to the same period last year) and an ordinary profit of 580 million yen (19.4% decrease compared to the same period last year).

The sales were attributed to steady growth in the Distribution segment, as well as the contributions from last year’s the Government Cloud Business and the Mobile Network Business M&A.

Furthermore, sales increased due to the expansion of the Trust Business’ services. While slightly below the planned* targets, it was mostly in line with the forecast. On the one hand, regarding the ordinary profit, the Distribution segment performed well but it decreased due to the impact of changes in the business environment in the mobile segment, and the amortization of goodwill, etc. related to government M&A.However, we exceeded the planned* target by over 17%.
*Planned values after revising the performance forecast on May 15, 2023.

Segment-wise, in the Distribution Cloud Business, revenue and profit increased with steady growth in regular income, achieving an ordinary profit margin of 20.4%.The Government Cloud Business experienced a significant increase in sales due to the commencement of consolidation of Synergy’s earnings, but it incurred a decrease in profit due to factors such as goodwill amortization.The Trust Business began operating large projects with “CloudCerts”.It’s actively preparing for the release of electronic contract services, aiming to transition to the investment recovery phase. The Mobile Network Business is expected to face ongoing challenging conditions persist due to changes in incentive systems and other factors.

Recent initiatives include the announcement of a current analysis of management focusing on capital costs and stock prices, as well as efforts to align with the revised Corporate Governance Code as part of sustainability initiatives.