DENTSU SOKEN INC. Note: This English translation is solely for reference purposes and not a legally definitive translation of the original Japanese text.
In the event a difference arises regarding the meaning herein, the original Japanese version will prevail as the official authoritative version.
July 28, 2022
Consolidated Financial Results for the Second Quarter of Fiscal Year Ending December 31, 2022 (Japanese GAAP)
Name of Listed Company: | Information Services International-Dentsu, Ltd. |
Listed Exchange: | Tokyo |
Code Number: | 4812 |
URL: | https://www.isid.co.jp/english |
Representative: | Ryoichi Nawa, President, CEO and COO |
Contact for Inquiries: | Naoto Momiki, General Manager, Corporate Planning Office |
Tel: (03) 6713-6160 |
Date of scheduled filing of securities report: | August 5, 2022 | ||||||||||
Date of scheduled payment of dividends: | September 1,2022 | ||||||||||
Quarterly earnings supplementary explanatory documents: | Yes | ||||||||||
Quarterly earnings presentation: | Yes | ||||||||||
(Amounts less than one million yen are rounded down.) | |||||||||||
1. Consolidated Business Performance for the Second Quarter of FY2022 (from January 1, 2022 to June 30, 2022) | |||||||||||
(1) Consolidated Operating Results (Cumulative) | Percentages indicate year-on-year increase/(decrease) | ||||||||||
Net sales | Operating profit (loss) | Ordinary profit (loss) | Net profit (loss)* | ||||||||
(million yen) | (%) | (million yen) | (%) | (million yen) | (%) | (million yen) | (%) | ||||
Second Quarter of FY2022 | 61,458 | 13.2 | 9,634 | 47.6 | 9,645 | 49.7 | 7,028 | 60.0 | |||
Second Quarter of FY2021 | 54,293 | (1.3) | 6,525 | (6.4) | 6,443 | (6.1) | 4,392 | (2.7) | |||
* Profit attributable to owners of parent
Note: Comprehensive profit: Second Quarter of FY2022: 7,483million yen (up63.8%); Second Quarter of FY2021: 4,567million yen (up2.3%)
Net profit (loss) | Net profit per share | |
per share | after dilution | |
(yen) | (yen) | |
Second Quarter of FY2022 | 107.90 | - |
Second Quarter of FY2021 | 67.40 | - |
(2) Consolidated Financial Position | |||
Total assets | Net assets | Equity ratio | |
(million yen) | (million yen) | (%) | |
As of June 30, 2022 | 114,390 | 70,679 | 61.8 |
As of December 31, 2021 | 108,188 | 65,471 | 60.5 |
Reference: Total shareholders' equity: As of June 30, 2022: 70,644 million yen; As of December 31, 2021: 65,452 million yen | |||
2. Dividends |
Dividends per share | |||||
Record date | End of first | End of second | End of third | Fiscal year-end | Full year |
quarter | quarter | quarter | |||
(yen) | (yen) | (yen) | (yen) | (yen) | |
FY2021 | - | 26.00 | - | 30.00 | 56.00 |
FY2022 | - | 33.00 | |||
FY2022(forecast) | - | 45.00 | 78.00 | ||
Note: Revision to the dividend forecasts from the latest announcement: Yes |
3. Consolidated Forecasts for FY2022(from January 1, 2022 to December 31, 2022)
Percentages indicate year-on-year increase/(decrease)
Net sales | Operating profit | Ordinary profit | Net profit * | EPS | |||||
(million yen) | (%) | (million yen) | (%) | (million yen) | (%) | (million yen) | (%) | (yen) | |
FY2022 | 123,000 | 9.7 | 17,500 | 27.4 | 17,500 | 32.3 | 12,500 | 39.8 | 191.90 |
*Profit attributable to owners of parent
Note: Revision to the consolidated forecasts from the latest announcement: Yes
4. Other Items
- Changes in the scope of consolidation for significant subsidiaries during three months (Changes in specified subsidiaries resulting in change in the scope of consolidation): None
- Application of special accounting practices in the preparation of the quarterly consolidated financial statements: None
- Changes in accounting policies, changes in accounting estimates and restatements:
- Changes in accounting policies in accordance with revision of accounting standards: Yes
- Changes in accounting policies other than 1) above: None
- Changes in accounting estimate: None
- Restatements: None
Note: For details, please refer to "II. Consolidated Financial Statement 3. Notes on Quarterly Consolidated Financial Statement (Changes in Accounting Policies)."
- Issued and outstanding common stock
- Number of shares issued and outstanding at the end of the period, including treasury stock
- Number of treasury stock at the end of the period
- Average number of shares outstanding for each period
June 30, 2022: | 65,182,480 shares | December 31, 2021: | 65,182,480 shares |
June 30, 2022: | 114,664 shares | December 31, 2021: | 17,984 shares |
Six months ended | 65,138,180 shares | Six months ended | 65,164,599 shares |
June 30, 2022: | June 30, 2021: | ||
This quarterly financial report is outside the scope of quarterly review procedures under the Financial Instruments and Exchange Act.
Explanation regarding the appropriate use of forecasts of business results
Forecast figures are projections based on information available at the time of release, and are not intended as a guarantee that the Company will achieve these targets. Actual results may differ significantly from the above forecasts as a result of changes in the business environment and other factors.
Index of the Attachment | ||
I. Qualitative Information on the Consolidated Financial Results for the Subject Period | ||
1. | Explanation of Operating Results ……………. …………………………….………………………………. | 2 |
2. | Explanation of Financial Position …………………………………………...……………….……………… | 4 |
3. | Explanation of Consolidated Financial Results Forecasts ……………..…..…………………….…..………. | 5 |
II. Consolidated Financial Statements | ||
1. | Consolidated Balance Sheets………………………………………………………………………………... | 6 |
2. | Consolidated Statements of Income and Consolidated Statements of Comprehensive Income | |
[Consolidated Statements of Income] ………………………………………………………………….……. | 8 | |
[Consolidated Statements of Comprehensive Income] ……………………………………………………… | 8 | |
3. | Notes on Quarterly Consolidated Financial Statement……………………………………………………… | 9 |
Segment Information…………………………………………………………………………..……..….….… | 11 |
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- Qualitative Information on the Consolidated Financial Results for the Subject Period
1. Explanation of Business Results
Effective from the beginning of the first quarter of the current consolidated fiscal year, we have adopted the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020). For details, please refer to "II. Consolidated Financial Statement 3. Notes on Quarterly Consolidated Financial Statement (Changes in Accounting Policies)."
(Millions of yen) | ||||||
Second quarter of | Second quarter of | YoY | ||||
FY2021 | FY2022 | Variance | % change | |||
(cumulative) | (cumulative) | |||||
Net sales | 54,293 | 61,458 | 7,165 | 13.2 | ||
Operating profit | 6,525 | 9,634 | 3,109 | 47.6 | ||
Operating profit margin | 12.0% | 15.7% | 3.7p | - | ||
Ordinary profit | 6,443 | 9,645 | 3,202 | 49.7 | ||
Profit attributable to owners of parent | 4,392 | 7,028 | 2,636 | 60.0 | ||
During second quarter of the current consolidated fiscal year under review (from January 1, 2022 to June 30, 2022), the Japanese economy continued to recover, although the outlook remained uncertain due to concerns about the re-expansion of COVID-19 and the worsening situation in Ukraine. Also, the business environment surrounding the ISID Group remained firm, as companies remained strongly motivated to utilize digital technology for operational and business innovation, although some conservative trends among some customers against the backdrop of rising raw material prices and stagnant parts supply.
Amid these circumstances, the ISID Group launched long-term management vision, "Vision 2030," and started our three-yearmedium-term management plan, "ISID X(Cross) Innovation 2024," from the current consolidated fiscal year. In 2030, we aim to achieve net sales in the ¥300 billion range as a Group with diverse human resources, an abundance of technologies, and the various solutions. In the medium-term management plan, which is the first step toward achieving this goal, we are promoting business activities to achieve our quantitative targets(Net sales of ¥150 billion , operating profit of ¥18 billion, operating margin of 12%, and ROE of 15%) for the fiscal year ending December 31, 2024, by accelerating business growth and implementing to transform ourselves based on four action policies: "Business domain expansion," "New capability acquisition," "Earnings model innovation," and "Management foundation innovation."
In the second quarter of the current consolidated fiscal year, net sales was ¥61,458 million (up 13.2% year on year), operating profit was ¥9,634 million (up 47.6% year on year), ordinary profit was ¥9,645 million (up 49.7% year on year) and profit attributable to owners of parent was ¥7,028 million (up 60.0% year on year).
Net sales increased in all four business segments. Profits also increased at each stage, reflecting the effect of higher sales and an improvement in the gross profit margin, mainly for in-house software and system development.
The impact of the adoption of the accounting standard for revenue recognition in the second quarter was an increase of ¥1,954 million in net sales and an increase of ¥1,030 million in operating profit.
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Net sales and operating profit (loss) by reportable segment
(Millions of yen) | |||||||||
Second quarter of FY2021 | Second quarter of FY2022 | Variance | |||||||
(cumulative) | (cumulative) | ||||||||
Reportable segment | |||||||||
Net sales | Operating | Operating | Net sales | Operating | Operating | Net sales | Operating | ||
profit | margin | profit | margin | profit | |||||
Financial Solutions | 11,804 | 520 | 4.4% | 13,635 | 1,069 | 7.8% | 1,831 | 549 | |
Business Solutions | 7,718 | 1,231 | 15.9% | 8,723 | 2,277 | 26.1% | 1,005 | 1,046 | |
Manufacturing Solutions | 15,637 | 1,511 | 9.7% | 17,339 | 2,045 | 11.8% | 1,702 | 534 | |
Communication IT | 19,132 | 3,261 | 17.0% | 21,759 | 4,242 | 19.5% | 2,627 | 981 | |
Total | 54,293 | 6,525 | 12.0% | 61,458 | 9,634 | 15.7% | 7,165 | 3,109 | |
Status of business operations by reportable segment Financial Solutions
The main business of this segment is providing IT solutions that support various financial operations at financial institutions and other companies.
Net sales and operating profit increased due to the strong performance of DX support projects for the banking industry, mainly in the area of customer contact reform, and the expansion of system development projects for the credit card and leasing industries.
Business Solutions
The main business of this segment is providing IT solutions for business management operations, centered on accounting and human resources. Net sales and operating profit increased due to the expansion of sales and introduction of our four key solutions, the POSITIVE, human resource management solution, the STRAVIS, consolidated accounting solution, the Ci*X, accounting solution and the CCH Tagetik,
a business management solution, mainly in the transportation equipment and service industries.
Manufacturing Solutions
The main business of this segment is providing IT solutions for the entire product lifecycle, from product development and production, to sales and maintenance in the manufacturing industry.
Net sales and operating profit increased due to the expansion of projects for the introduction of the Teamcenter, a PLM solution that supports the digitization of engineering chains, mainly in the transportation equipment industry and the electric and precision industries, as well as steady growth in projects for the process manufacturing industry, which is developing as a new market.
Communication IT
The main business of this segment is providing IT solutions that support companies optimize their value chains and business processes, from marketing to core business areas.
Net sales and operating profit increased due to an expansion of customer DX support projects in the marketing and core business areas to the service and pharmaceutical industries, as well as an expansion of projects for the implementation of SAP solutions to the service industry against the backdrop of replacement demand for ERP systems.
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ISID - Information Services International - Dentsu Ltd. published this content on 28 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 July 2022 06:37:03 UTC.
