ASIRO (7378) Q3 2024 earnings summary

Executive summary

• Media business, especially legal and derivative media, drove strong performance with over 40% YoY sales growth, surpassing the 30% target.

• Profitability improved as investments were restrained and impairment losses ceased in 3Q, but cumulative operating income declined 12.8% YoY due to earlier impairments.

• All business segments achieved YoY revenue growth, with 3Q marking a return to profitability after prior impairment losses.

• Full-year consolidated earnings forecast was revised upward due to better-than-expected media business progress and investment adjustments.

• The company is in a planned investment phase, prioritizing long-term growth over short-term profitability.

Financial highlights

• 3Q revenue: ¥1,230 million (+44.4% YoY, +6.0% QoQ); 3Q cumulative revenue: ¥3,357 million (+43.5% YoY).

• 3Q operating profit: ¥172 million (+491.5% YoY, +175.9% QoQ); 3Q cumulative operating profit: ¥130 million (-12.8% YoY, due to impairment losses).

• 3Q net income attributable to owners: ¥102 million (+798.1% YoY); cumulative net loss for the period was ¥22.7 million due to impairments.

• EBITDA increased 74.4% YoY to ¥426.2 million; adjusted EBITDA rose 88.2% to ¥359.7 million.

• Gross profit margin for 3Q: 37.6% (+0.8pt YoY); cumulative gross profit: ¥1,216 million.

Outlook and guidance

• Full-year revenue forecast revised to ¥4,523 million (41.4% growth); operating profit forecast (excluding impairment) at ¥244 million (up 358.3%).

• Net income forecast is ¥31 million, with basic EPS of ¥5.88.

• Progress rates: revenue 74.2%, operating profit (excluding impairment) 136.7%, net income 53.3%.

• Continued investment planned in 4Q, but results expected to exceed initial forecasts.

• Upward revision reflects stronger-than-expected media segment performance and adjusted investment plans.