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ネットイヤー Research Memo(5):2025年3月期は新規大型案件の寄与もあり期初計画どおり増収増益を見込む

Net-year Research Memo (5): The fiscal year ending March 2025 is expected to achieve an increase in revenue and profit as planned, with contributions from new large-scale projects.

Fisco Japan ·  Dec 4 11:05

■Netyear Group <3622>'s future outlook

1. Earnings forecast for the fiscal year ending March 31, 2025

Financial results for the fiscal year ending 2025/3 are expected to increase sales and profit of 4100 million yen, up 12.9% from the previous fiscal year in sales, 300 million yen, up 107.0% from the same period in operating income, 299 million yen, up 107.5% from the same period, and 115 million yen, up 8.4% in net income. Although the progress rate up to the 2nd quarter was at a slightly low level, there are seasonal factors where sales are concentrated in the 4th quarter of every year, sales contributions to new large-scale projects for major retail chains can be expected in the second half, and improvements in order acceptance rates and operating rates due to reviews of the sales system, etc., the company believes that it is generally an attainable level at the moment. For new large-scale projects, the plan is to provide planning, development, and operation support for the entire promotion policy, including SNS, etc. Also, since the 2025/3 fiscal year, we have been strengthening the collaboration system to acquire collaborative projects with 3 group companies, including NTT DATA, and project creation is expected.

On the profit side, gross profit margin is expected to rise from 22.5% in the previous fiscal year to 23.8% due to improvements in personnel utilization rates and suppression of outsourcing costs associated with sales expansion. SG&A expenses are expected to increase by 13 million yen from the previous fiscal year due to an increase in development costs for new products, etc., but the ratio to sales is expected to drop from 18.5% in the previous fiscal year to 16.7% due to the increase in sales, and the operating profit margin is expected to rise from 4.0% to 7.3%. The number of mid-career hires will continue to be controlled while monitoring the order status.

Furthermore, in 2024/6, Mr. Ryuzo Hironaka took office as the new president and representative director. After graduating from college, Mr. Hironaka was enrolled in research institutes at major banks for 11 years and has been involved in consulting work in the information field for a long time. I joined the company in 2001 when I received an invitation from the company, which was one of the research partners, and after being enrolled until 2009, I started an independent business. Since then, it looks like they were singled out because they had extensive experience working on many projects, such as digital marketing policies for large companies, and their familiarity with the company's strengths.

As an internal impression that the new president felt after returning for the first time in 15 years, it seems that although there are excellent employees, they felt that the previous corporate culture had changed from a high-energy and aggressive corporate culture to a slightly conservative corporate culture. For this reason, the president himself first aims to reform employee awareness by taking the initiative and acting aggressively, and aims to change the corporate culture that tends to be conservative. Also, on the business side, in addition to further strengthening the collaboration system with the NTT DATA Group, we aim to differentiate ourselves from other companies by actively incorporating advanced technology that continues to evolve day by day, such as generative AI and blockchain, into our services. Previously, the target area was also involved in the production of many corporate sites, but once these were developed and delivered, the need for subsequent operation support was small, and since they tended to remain one-off profit contributions, the idea is to focus on major business systems (sales systems, etc.) where continuous sales can be expected in the future. We will continuously increase the number of projects where profits can be expected by going through the PDCA cycle from planning and drafting of policies to operation, evaluation, and proposal of improvement measures. For this reason, we will also strengthen the SES business, which dispatches engineers to the site for each project.

Through these efforts, we will create about 10 customers with annual sales of around 0.5 billion yen in the medium term, and aim for an operating profit margin of 10% or more. In order to advance business expansion, it is important to strengthen recruitment and development of human resources, but we will promote strengthening career recruitment not only by importing them from LULL Co., Ltd., which is our partner temporary staffing company, but also by appealing to human resources service companies that it is a company that will lead to an improvement in one's own skills if they join the company. Specific measures and numerical management targets are planned to be compiled in the medium-term management plan currently being formulated, and the details are attracting attention.

(Author: FISCO Visiting Analyst Joe Sato)

The translation is provided by third-party software.


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