System D (3804) Q2 2024 earnings summary

Executive summary

• Revenue for the six months ended April 2024 was ¥2,386 million, 96.4% of plan and down 1.7% year-over-year, mainly due to a significant decline in merchandise sales.

• Core business in proprietary package software showed steady growth, surpassing 10,000 cumulative users, with business operations proceeding as planned.

• Operating profit and net income fell short of plan and prior year, but the company continues to target solid full-year growth.

• Key business segments, including educational, wellness, public sector, and compliance solutions, maintained or expanded market share, with new user acquisitions and ongoing system implementations.

Financial highlights

• Revenue: ¥2,386 million, down ¥41 million year-over-year and ¥90 million below plan.

• Operating profit: ¥512.7 million, 94.5% of plan and down 7.0% year-over-year.

• Ordinary profit: ¥513.2 million, 94.9% of plan and down 6.9% year-over-year.

• Net income: ¥342.5 million, 94.5% of plan and down 9.1% year-over-year.

• Total assets at period-end were ¥6,714 million, up ¥469 million from the previous fiscal year-end.

Outlook and guidance

• No changes to the full-year earnings forecast announced on December 11, 2023.

• Despite a slight year-over-year decline in Q2, the company aims for continued solid growth for the full year.