Densan System Holdings Co (4072) Q1 2025 earnings summary

Executive summary

• Net sales for 1Q FY2025 rose 6.0% year-over-year to ¥15,538 million, driven by growth in the Google business.

• Operating profit declined 3.2% year-over-year to ¥1,084 million due to higher procurement and labor costs, and new investments.

• Ordinary profit increased 8.5% year-over-year to ¥1,242 million, and net income rose 4.3% year-over-year to ¥820 million.

• The full-year forecast remains unchanged, with management expecting trends to align with previous years.

Financial highlights

• Net sales: ¥15,538 million (+6.0% YoY); Operating profit: ¥1,084 million (−3.2% YoY); Ordinary profit: ¥1,242 million (+8.5% YoY); Net income: ¥820 million (+4.3% YoY).

• Gross profit improved to ¥2,829 million from ¥2,744 million year-over-year.

• Basic earnings per share increased to ¥76.88 from ¥74.01 year-over-year.

• Total assets increased by ¥7,008 million to ¥68,755 million, mainly due to higher deposits in Payment Agency Services.

• Equity ratio declined to 32.7% from 35.8% at the previous fiscal year-end.

Outlook and guidance

• Net sales for FY2025 are projected at ¥67,500 million, up 10.2% year-over-year, led by growth in information services.

• Operating profit is expected to rise 51.4% year-over-year to ¥3,500 million, with ordinary profit and net profit also projected to grow.

• Profit attributable to owners of parent expected to increase 36.7% to ¥2,530 million.

• Investments will increase in new service platforms utilizing Web3, NFT, and blockchain.

• Annual dividend forecast maintained at ¥80.00 per share.