Simplex (4373) investor relations material

Executive summary

• Revenue, operating profit, gross profit margin, and operating profit margin all reached record highs for FY3/26, driven by strong recruitment, investments in generative AI and web3, and robust sales in System Integration, Operation Service, and Strategy/DX Consulting.

• Operating profit rose 33.5% to ¥14,420 million, with profit attributable to owners of parent up 35.4% to ¥10,538 million.

• A special bonus of ¥1.0 billion was paid to all officers and employees due to three upward earnings revisions during the year.

• ROE rose to 21%, surpassing the MTBP 2027 target of 17%, aided by a ¥5.0bn share buyback.

• MTBP 2027 targets were achieved one year ahead of schedule; a new four-year plan, MTBP 2030 – Vision1000, was launched aiming for ¥100bn revenue by FY3/30.

Financial highlights

• FY3/26 revenue: ¥58.7bn (+23.8% YoY); operating profit: ¥14.4bn (+33.5% YoY); profit attributable to owners: ¥10.5bn (+35.4% YoY); gross profit: ¥25.6bn (+30.5% YoY); gross margin: 43.7%.

• Operating profit margin rose to 24.6% (+1.8p YoY).

• Cash and cash equivalents at year-end: ¥14.4bn (up ¥1.0bn YoY); net cash from operating activities: ¥10.7bn.

• Tax credits contributed ¥0.73bn to profit.

• Record order backlog at ¥24.9bn (+15.7% YoY).

Outlook and guidance

• FY3/27 revenue forecast: ¥70.0bn (+19.3% YoY); operating profit: ¥17.2bn (+19.3% YoY); profit attributable to owners: ¥12.4bn (+17.9% YoY).

• Gross profit margin expected at 45.0%; ROE forecast at 22.3%.

• Dividend per share planned to increase from ¥18 (FY2026) to ¥24 (FY2027).

• R&D and related expenses to double to ¥3.5bn (approx. 5% of sales), focusing on generative AI and web3.

• H2 expected to outperform H1 due to new graduate assignments and lower SG&A.