ZIGExN (3679) Q2 2025 earnings summary

Executive summary

• Q2 FY2025/3 revenue reached ¥12,272M, up 9.5–10% year-over-year, with EBITDA at ¥3,469M (+10.8–11%) and operating income at ¥2,790M (+11%).

• Net income attributable to owners was ¥1,886M, up 5.1% year-over-year; EPS was ¥18.37 (+6% YoY).

• Progress rates for revenue and profits are around 44–45% of full-year forecasts, with steady core business performance and challenges in non-core segments due to client budget cuts.

• PMI initiatives, especially in Ties, are advancing, and organizational restructuring in travel and HR is underway to drive synergies.

• Apple World Inc. and TSD Inc. merged on October 1, 2024, with Apple World as the surviving company.

Financial highlights

• Q2 revenue: ¥12,272M (+9.5–10% YoY); EBITDA: ¥3,469M (+10.8–11% YoY); operating income: ¥2,790M (+11% YoY); net income: ¥1,886M (+5–5.1% YoY); EPS: ¥18.37 (+6% YoY).

• Quarterly revenue and profit indicators hit record highs, though profit margins slightly decreased due to macroeconomic impacts and weaker non-core business performance.

• Number of corporate clients grew 2.7% YoY to 22,606, with unit price per client up 10.2% YoY to ¥1.08M.

• Revenue 1 (client-focused): ¥3,545M (+9.4% YoY); Revenue 2 (large company/unit price-focused): ¥2,553M (+2.0% YoY).

• Total assets: ¥35,722M (up ¥1,187M from March 31, 2024); total equity: ¥18,087M (down ¥1,362M from March 31, 2024).

Outlook and guidance

• On track to achieve FY2025/3 forecasts, with 45% of revenue and EBITDA targets met by Q2; full-year revenue forecast: ¥27,500M (+18.3% YoY), net income forecast: ¥4,300M (+13.2% YoY).

• No revision to previously announced earnings or dividend forecasts.

• Dividend forecast raised to ¥7.5 per share, and a new shareholder benefit program is planned to enhance total yield above 3%.

• Some downside risk remains due to macroeconomic headwinds and client budget reductions, but initiatives and M&A are expected to support performance.