OBIC Business Consultants (4733) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 FY2025 rose 22.8% year-over-year to ¥11,226 million, driven by strong cloud solution demand and a shift from on-premises to cloud offerings.

• Operating profit increased 38.5% year-over-year to ¥5,181 million, with gross profit margin improving by 0.7 percentage points due to higher-margin solution sales.

• Profit attributable to owners of parent grew 42.8% year-over-year to ¥3,957 million.

• Earnings per share increased to ¥52.65 from ¥36.86 year-over-year.

Financial highlights

• Gross profit rose 23.7% year-over-year to ¥9,345 million, with the gross profit ratio up to 83.3%.

• Ordinary profit rose 36.7% to ¥5,508 million, and profit before income taxes reached ¥5,722 million.

• SGA expenses increased 9.3% year-over-year, mainly from higher personnel and R&D costs due to new hires and salary revisions.

• Recurring revenue accounted for 81.0% of total sales, up from 78.5% a year earlier.

• Annual Recurring Revenue (ARR) reached ¥36.7 billion, up 26.3% year-over-year.

Outlook and guidance

• Full-year net sales forecasted at ¥48,000 million, up 14.4% year-over-year, with operating profit expected to reach ¥21,500 million, up 14.7%.

• First-half FY2025 net sales forecast at ¥22,390 million, with operating profit projected at ¥9,580 million.

• Full-year EPS projected at ¥206.72, up 12.3% year-over-year.

• Interim and year-end dividends forecasted at ¥45.00 per share each, totaling ¥90.00 for the year.

• Continued focus on expanding cloud solutions and supporting customer transitions from on-premises systems.