■Growth Strategy of Japan Information Create <4054>

1. New Mid-term Management Plan (Fiscal year June 2025-June 2027)

The company formulated a new mid-term management plan (fiscal year June 2025-June 2027) in August 2024, with performance targets for the final fiscal year June 2027 of revenue of 7500 million yen, operating profit of 2000 million yen, and operating margin of 26.6%. The previous mid-term management plan period from June 2022 to June 2024 was positioned as a growth investment period, promoting initiatives such as strengthening sales personnel, expanding bases, investing in product development, and integrating operations with RealNetPro, achieving record high performance in the final fiscal year June 2024. The new mid-term management plan period is positioned as a growth promotion period, focusing on key strategies such as expanding market share in the brokerage solution area through the new service "LearPro BB" (scheduled for release in autumn 2024) and deepening services and increasing customer unit prices through the successor version of the "Rental Revolution 10" in the management solution area (under development, scheduled for release in June 2026). It aims to connect to the next mid-term management plan period of growth expansion (June 2028-June 2030). Furthermore, it aims to transition to the Tokyo Stock Exchange Prime Market by achieving performance targets.

In the growth theme by market segment, in the brokerage solution for real estate brokerage firms, the company focuses on accelerating new customer acquisition in the large market size brokerage market with new services such as "LearPro BB". In the management solution for rental management companies, while maintaining competitive advantage with the current "Rental Revolution 10", it focuses on expanding market share and increasing customer unit prices through deepening existing paid services and providing new value. It also plans to strengthen the service lineup that integrates brokerage and management, and as a third arrow for medium to long-term growth, it will continue to invest in new businesses utilizing data obtained in the brokerage and management markets, and will utilize M&A and alliances to strengthen development and sales.

The business strategy aims to achieve continuous growth in revenue and operating profit and an increase in operating margin through expansion of stock sales revenue and increase in stock sales ratio. Regarding major KPIs, while initial sales are expected to grow steadily at a level of around 1000 million yen, stock sales will be expanded from the actual 3257 million yen in June 2024 to 6500 million yen by June 2027 (about twice the amount in June 2024), and the stock sales ratio is planned to increase from 73.4% to 86.7%. The end-of-period MRR is planned to increase from 296,184 thousand yen in June 2024, consisting of 138,840 thousand yen for brokerage solutions and 157,344 thousand yen for management solutions, to 599,606 thousand yen in June 2027, consisting of 378,262 thousand yen for brokerage solutions and 221,344 thousand yen for management solutions. It aims to promote MRR growth through expanded sales of the brokerage solution centered around the new service "LearPro BB". The churn rate is assumed to be around 0.5%.

Shareholder returns are implemented steadily and continuously through dividends.

2. Shareholder return plan

Regarding shareholder profit returns, the company recognizes the importance of expanding corporate value continuously and returning profits to shareholders, and as an important management issue, it aims to distribute dividends that match the growth of performance while securing internal reserves for strengthening corporate resilience and future business development. Based on this basic policy, a dividend of 5.00 yen per share was implemented in the June 2024 period, the same as the previous period. The dividend for June 2025 is planned to be the same as the previous period at 5.00 yen (end of period lump sum), with an expected dividend payout ratio of 11.3%. As part of shareholder returns, on June 10, 2024, it announced the repurchase of treasury stock (up to 200,000 shares or 150 million yen, acquisition period from June 12, 2024 to September 20, 2024).

Contribute to solving social issues through business.

3. Sustainability Management

While the company has not set specific goals or initiatives regarding sustainability management at the moment, it aims to contribute to solving social issues through business, as indicated by its mission to make everyone involved HAPPY and its vision to create an innovative platform in the real estate field with technology. In September 2023, in order to achieve sustainable growth, enhance corporate value, and further strengthen corporate governance, the company increased the number of directors by one to establish a two-person representative system.

Evaluate the entry into a new growth stage.

From the Analyst's Perspective.

The company's profit growth trend had faltered from the fiscal year ending June 2022 to the fiscal year ending June 2023. However, in the fiscal year ending June 2024, it experienced a significant increase in revenue and profit, achieving its highest performance to date. Additionally, the forecast for the fiscal year ending June 2025 also predicts a significant increase in revenue and profit, aiming for consecutive record-breaking results. This is believed to be the result of the positive effects of proactive investments made until the end of June 2023, indicating a high likelihood that the company has entered a new growth stage. Moving forward, the progress of the business strategy set out in the new medium-term management plan and the achievement of performance targets will be key points of interest. In particular, the new service in the brokerage solution domain, "Lear Pro BB", is worth monitoring for its impact on acquiring new customers and expanding existing sales.

(Authored by FISCO guest analyst Masanobu Mizuta)