During the consolidated fiscal year under review, the Japanese economy began to show some positive signs, notably brisk economic activity as social activities gained momentum. At the same time, risks to economic recovery still exist, as prices of commodities continue to rise worldwide due to soaring raw material prices, worsening geopolitical risks in Ukraine and Palestine, and the appreciation of the U.S. dollar, among other factors.
In the information services industry, to which the Group (comprising the Company, its consolidated subsidiaries, and equity-method affiliates) belongs, the Company continues to work toward digital transformation (DX), including non-contact and non-face-to-face services in the new normal era, the widespread use of cloud computing, the expanded use of big data and Al (artificial intelligence), the promotion of IoT, and the improvement of business efficiency. In particular, generative Al is increasingly being used and has a significant impact on the state of society as a whole.
In these circumstances, the Group has made concerted efforts to expand its business to achieve its numerical targets of 40,000 million yen in net sales, 3,200 million yen in operating profit, 8.0% in operating profit rate, and 10% or more in ROE, for the fiscal year ending March 31, 2025, which is the final year of its Medium-Term Management Plan from April 2022 through March 2025.
For the consolidated fiscal year under review, net sales amounted to 37,763 million yen (up 7.9% year on year), operating profit was 2,887 million yen (up 35.6% year on year), ordinary profit was 2,935 million yen (up 34.9% year on year), and net profit attributable to owners of the parent was 2,197 million yen (up 63.6% year on year).
Net sales increased from the previous fiscal year as a result of strong sales of the information processing services, for which we provide data centers, cloud services, and commissioned calculation services for service stations (SS), as well as steady sales of the system development services, mainly for systems development in the financial sector.
Operating profit achieved an increase from the previous fiscal year. This was due to efforts to reduce costs by introducing electricity derived from renewable energy sources independent of fossil fuels for its own data centers, which consume large amounts of electricity, in order to mitigate the impact of high costs resulting from soaring electricity prices, and by making capital investments for energy conservation and other purposes. The increase also resulted from our focus on selling at an appropriate level, mainly by revising unit prices.
The Company was able to secure a significant increase in net profit attributable to owners of the parent compared to the previous fiscal year, due in part to an extraordinary gain on a partial sale of our securities holdings.
(Source: Summary of Consolidated Financial Results for the Year Ended March 31, 2024)