Achieved increase in the sales of Q1 FY2020, even with the influence of COVID-19 infections. By the Enterprise Business getting into the black, we plan to increase both sales and profit as full-year FY2020
In the first quarter of FY2020, with the spread of the COVID-19 infections, we have prevented its infection to our employees by several measures such as promotion of teleworking/Work-from-home or preparation of alcohol disinfestation solution and enough number of masks, and our group has maintained the system to ensure the quality of our stable service. At the same time, we have taken new initiatives by considering “After COVID-19” era. The Company launched new service of “Remote Debugging” by improving the quality of information security aspects, which previously considered hard to overcome under the condition at home, and to react to the expanding needs by promoting of Work-from-home in Japan we have started to establish the system to provide diverse security services.
Under such a circumstance, we have seen some delays and postpones in certain projects of software development of our client companies, and it has made a temporary declined in orders from our clients mainly for our debugging service in the Entertainment Business. On the other hand, we could see the stable sales growth of the Enterprise Business by getting new projects, and the consolidated net sales of Q1 FY2020 increased to 5,093 million yen (YoY +2.1%). Due to the decrease in the sales of the Entertainment Business and the impact of larger amortization, the consolidated operating income of Q1 FY2020 decreased to 158 million yen (YoY -16.4%), however the consolidated EBITDA increased to 283 million yen (YoY +2.9%).
As the forecast of the full-year FY2020, nowadays there has seen some signs of a gradual recovery in the market demand and we will have the peak time of the debugging service ahead of the year-end sales season, and the Enterprise Business is expected to continue to grow upward against the backdrop of increasing corporate IT investment and rising demand for security. So, the full-year sales of the Company are expected to be 23,080 million yen (YoY +9.2%), showing almost double-digit growth. And the Enterprise Business, which focused on investing with loss in the previous year, is expected to get into black as the full-year base with the sales growth, and it is expected to see the operating income of 1,600 million yen (YoY +14.8%) and EBITDA of 1,927 million yen (YoY +11.2%), both significantly improving compared to the previous year.
As the “Second Founding” period, to be the Asia’s No.1 Comprehensive Testing Solution Provider, the Company has taken various initiatives mainly in the newly developing Enterprise Business. We believe that this FY2020 should be the period to show the visible business results to the market.
We look forward to your continued understanding and support.
President and CEO