Avant Group (3836) Q4 2024 earnings summary

Executive summary

• Net sales rose 14.0% year-over-year to ¥24,419m, marking the 14th consecutive year of revenue growth, driven by strong DX Promotion and outsourcing businesses, and recovery in Management Solutions.

• Operating income increased 24.6% year-over-year to ¥4,099m, with profit growth for nine consecutive terms, aided by higher revenues and reduced one-off restructuring costs.

• Net income surged 36.1% year-over-year to ¥2,850m, exceeding the CAGR target, supported by operating profit growth and tax benefits from wage increases.

• All KPIs for the first year of the BE GLOBAL 2028 plan were achieved, with strong performance across all business segments.

Financial highlights

• Gross profit margin improved to 44.8% (up 0.9pt year-over-year); operating margin rose to 16.8% (up 1.4pt); net profit margin reached 11.7% (up 1.9pt).

• EBITDA increased 24.2% year-over-year to ¥4,642m, with an EBITDA margin of 19.0%.

• Recurring sales ratio remained stable, with absolute recurring sales value steady.

• ROE improved to 22.3%, up 4.0pts year-over-year.

• Total assets rose to ¥21,896m, net assets to ¥13,293m, and capital adequacy ratio stayed high at 60.7%.

Outlook and guidance

• FY2025 sales forecast: ¥28,800m (+17.9% year-over-year); operating income: ¥4,900m (+19.5%); net income: ¥3,350m (+17.5%).

• Year-end dividend forecast: ¥25 per share, aiming for an 8% DOE within the medium-term plan period.

• BG28 second-year targets exceed original plan, with continued focus on growth and profitability.