Summary of Financial Results for Second Quarter of the Year Ending December 2021
[Japanese GAAP] (Consolidated)
August 6, 2021 | |||||||||||||
Name of Company: | LTS, Inc. | Stock Exchange Listing: | Tokyo | ||||||||||
Stock Code: | 6560 | URL https://lt-s.jp/ | |||||||||||
Representative: | Title: President and CEO | Name: Hiroaki Kabashima | |||||||||||
Contact Person: | Executive Vice President and Manager of Group | Name: Sungil Lee | Phone: +81-3-5919-0512 | ||||||||||
Management Office | |||||||||||||
Date of filing of quarterly report: | August 13, 2021 | ||||||||||||
Date of commencement of dividend payment: | − | ||||||||||||
Preparation of quarterly supplementary materials: | Yes | ||||||||||||
Convening of a quarterly results meeting: | Yes | ||||||||||||
(Amounts less than one million are rounded down) | |||||||||||||
1. Financial results for second quarter of fiscal year ending December 2021 (January 1, 2021 - June 30 , 2021) | |||||||||||||
(1) Operating results (consolidated) | (Percentage figures represent year-on-year change) | ||||||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | ||||||||||
owners of parent | |||||||||||||
million yen | % | million yen | % | million yen | % | million yen | % | ||||||
Q2 FY2021 | 3,474 | 29.8 | 274 | 7.2 | 258 | 11.8 | 166 | 11.4 | |||||
Q2 FY2020 | 2,676 | 64.1 | 255 | 85.8 | 231 | 68.4 | 149 | 68.3 |
(Note) Comprehensive income | Q2 FY2021: 164 million yen (12.9%) | Q2 FY2020: 145 million yen (63.7%) | |||
Profit per share | Profit per share fully | ||||
diluted | |||||
yen | yen | ||||
Q2 FY2021 | 40.37 | 37.51 | |||
Q2 FY2020 | 36.96 | 34.30 | |||
(2) Financial position (consolidated) | |||||
Total assets | Net assets | Capital adequacy ratio | |||
million yen | million yen | % | |||
Q2 FY2021 | 4,491 | 1,801 | 40.1 | ||
FY2020 | 4,290 | 1,732 | 40.3 | ||
(Reference) | Shareholders' equity | Q2 FY2021: 1,801 million yen | FY2020: 1,729 million yen | |||||||||||||||
(Note) | During the first three months of the fiscal year ending December 2021, provisional accounting associated with business combination was | |||||||||||||||||
finalized, and the figures for the fiscal year ended December 2020 have been restated to reflect this. | ||||||||||||||||||
2. Dividends | ||||||||||||||||||
Dividend per share | ||||||||||||||||||
End of Q1 | End of Q2 | End of Q3 | End of FY | Total | ||||||||||||||
yen | yen | yen | yen | yen | ||||||||||||||
FY2020 | − | 0.00 | − | 0.00 | 0.00 | |||||||||||||
FY2021 | − | 0.00 | ||||||||||||||||
FY2021 (forecast) | − | 0.00 | 0.00 | |||||||||||||||
(Note) | Revision to the most recently announced dividend forecast: No | |||||||||||||||||
3. Forecast for the fiscal year ending December 2021 (January 1, 2021 - December 31, 2021) | ||||||||||||||||||
(Percentage figures represent year-on-year change) | ||||||||||||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | Profit per share | ||||||||||||||
owners of parent | ||||||||||||||||||
million yen | % | million yen | % | million yen | % | million yen | % | yen | ||||||||||
Full year | 7,000 | 26.0 | 580 | 21.2 | 530 | 18.5 | 341 | 26.1 | 82.97 | |||||||||
(Note) | Revision to the most recently announced earnings forecast: No | |||||||||||||||||
(Note) | There is no first half forecast. |
―1―
*Notice:
- Changes in main subsidiaries during year to quarter end (Changes in specific subsidiaries accompanied by changes in the scope of consolidation): No
New consolidations: | company(ies) (Company name(s)); Exclusions: | company(ies) (Company name(s)) |
- Application of accounting treatment specific to the preparation of the consolidated quarterly financial statements: No
- Changes in accounting policies, accounting estimates, and restatements
- Changes in accounting policies due to revision of accounting standards: No
- Changes in accounting policies other than those in (a): No
- Changes in accounting estimates: No
- Restatements: No
- Number of shares outstanding (common shares)
(a) Shares outstanding (including treasury shares) at | Q2 of year ending | 4,271,400 shares | Year ended | 4,197,400 shares |
end of period | December 2021 | December 2020 | ||
(b) Treasury shares at end of period | Q2 of year ending | 127,765 shares | Year ended | 87,658 shares |
December 2021 | December 2020 | |||
(c) Average number of shares during period | Q2 of year ending | 4,133,410 shares | Q2 of year ended | 4,053,392 shares |
December 2021 | December 2020 | |||
*Quarterly financial results summaries are not subject to audit.
*Cautionary statement regarding business results forecasts and special notes
The financial forecasts and other forward-looking statements herein are based on currently available information and assumptions considered by the Company to be reasonable and do not represent a commitment from the Company that they will be achieved. Actual results may differ substantially due to various factors.
―2―
- Contents of Accompanying Materials
1. Quantitative Information related to the Consolidated Business Results................................................................................................. | 4 | |
(1) | Explanation of Operating Results..................................................................................................................................................... | 4 |
(2) | Explanation of Financial Position .................................................................................................................................................... | 5 |
(3) | Explanation of Consolidated Earnings Forecasts and Other Future Projections............................................................................... | 5 |
2. Quarterly Consolidated Financial Statements and Main Notes.............................................................................................................. | 6 | |
(1) | Quarterly Consolidated Balance Sheet ............................................................................................................................................. | 6 |
(2) | Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive Income .......................... | 8 |
(3) | Notes to the Quarterly Consolidated Financial Statements ............................................................................................................ | 10 |
(Notes Related to Going Assumptions)............................................................................................................................................ | 10 | |
(Notes on Significant Changes in Shareholders' Equity) ................................................................................................................. | 10 | |
(Segment Information)..................................................................................................................................................................... | 10 | |
(Notes - Business Combinations)..................................................................................................................................................... | 11 | |
(Additional Information).................................................................................................................................................................. | 11 |
―3―
1. Quantitative Information related to the Consolidated Business Results
(1) Explanation of Operating Results
During the first six months of the fiscal year (January 1 to June 30, 2021), the Japanese economy continued to struggle due to COVID-19. Although there were some sign of a recovery in imports and experts and in production activities, COVID-19 variants have emerged, so the future of the economy remains uncertain.
In the information services industry, which is the main business domain of our Group, COVID-19 has had a prolonged impact on corporate management. Digital transformation (DX) continues to attract a high level of attention for addressing changes in the social environment during and after the COVID-19 pandemic. As such, demand remains strong for providing support for such internal reform activities as work style reform, including introducing task performing robots such as AI and RPA (robotic process automation) and promoting telecommuting.
Under these circumstances, the Group has established a medium-term business plan with this year as the first year of the plan and has been developing a professional services business and a platform business as a company that supports and promotes corporate transformation and work style reform. In our professional services business, we enter our customers' work sites and deliver expected solutions, utilizing robotics, AI, and business process management to provide one-stop support catered to the customer's unique challenges and reform objectives. We promoted partnerships with outside companies and new projects via telecommuting while also actively hiring and training human resources. In our platform business, we solve IT personnel shortages and, in addition to actively rolling out existing Assign Navi and Consultant Job services, we promoted development of our new CS Clip service that matches operating companies with DX companies.
As a result of the above, during the first six months of the fiscal year, we achieved net sales of ¥3,474.748 million (up 29.8% year on year), operating profit of ¥274.234 million (up 7.2% year on year), ordinary profit of ¥258.972 million (up 11.8% year on year), and profit attributable to owners of parent of ¥166.861 million (up 11.4% year on year).
A summary of financial results by segment (net sales includes internal sales) is provided below.
(Professional Services Business)
In our professional services business, the environment surrounding our IT division is undergoing drastic changes due to various restrictions on corporate activities. In the midst of these circumstances, we steadily acquired traditional consulting projects (operational analysis/design, IT introduction support, on-site deployment) based on our strength of visualizing and improving operations utilizing business process management. This was a result of actively promoting business development amid favorable conditions created by robust demand for DX. We also promoted closer collaboration with technology companies and other outside companies. In addition to expanding our business in the Shizuoka and Tokai area by making SOFTEC Co., Ltd. a consolidated subsidiary, we promoted digital transformation in the administrative domain by entering a business alliance with Loglass Inc and Outlook Consulting Co., Ltd. Furthermore, we actively communicated information on our services by publishing books, holding seminars, and more.
As a result, net sales in the professional services business came to ¥3,359.184 million (up 29.7% year on year) and segment profit (operating profit) came to ¥250.047 million (up 11.1% year on year).
(Platform Business)
In the platform business, the number of members in the Assign Navi platform, which provides business matching and a learning forum specialized for the IT industry, grew to 10,955 including both corporate and individual members as of June 30, 2021. This steady growth represents a 749-member increase over the end of the previous year. Our track record with Assign Navi and Consultant Job matching and member services has also expanded in conjunction with growth of our member base, and sales were strong. At the same time, we continued to invest in the development of our new CS Clip service and actively invested in expanding the profitability of existing services, including enhancement of our organizational structure and promotion of marketing activities.
As a result, net sales in the platform business came to ¥144.494 million (up 30.3% year on year), and the segment profit (operating profit) came to ¥24.186 million (down 21.5% year on year).
―4―
(2) Explanation of Financial Position
Total assets at the end of the first six months of the fiscal year were ¥4,491.421 million, up ¥201.143 million from the end of the previous fiscal year. This was primarily due to a ¥171.072 million decrease in cash and deposits, a ¥121.741 million increase in accounts receivable - trade, and a ¥112.650 mill ion increase in investment securities.
Liabilities amounted to ¥2,690.094 million, up ¥132.363 million from the end of the previous fiscal year. This was primarily due to a ¥173.560 million decrease in long-term borrowings, and a ¥387.838 million increase in other (suspense receipts).
Net assets amounted to ¥1,801.326 million, up ¥68.779 million from the end of the previous fiscal year. This was primarily due to a ¥166.861 million increase in retained earnings and a ¥141.546 million increase in treasury shares. The equity ratio was 40.1%. The business combination with SOFTEC Co., Ltd., which was conducted on December 3, 2020, was provisionally accounted
for in the previous fiscal year, but the accounting was finalized during the first quarter of the fiscal year. In conjunction with the finalization of this provisional accounting treatment, the revision of the allocation of acquisition costs has been reflected in the comparative information contained in the quarterly consolidated financial statements for the second quarter under review. Additionally, for comparison and analysis with the end of the previous fiscal year, the amounts reflect the revision of the initially allocated acquisition cost made when finalizing the provisional accounting treatment.
(3) Explanation of Consolidated Earnings Forecasts and Other Future Projections
In regard to the consolidated earnings forecast for the fiscal year ending December 2021, no changes have been made to the full-year consolidated earnings forecast announced on February 12, 2021.
The impact of COVID-19 on the Group's business results is currently limited, but we will continue to monitor any changes in the situation and will engage in prompt disclosure in the event that there is a need to revise the earnings forecast.
―5―
This is an excerpt of the original content. To continue reading it, access the original document here.
Attachments
- Original document
- Permalink
Disclaimer
LTS Inc. published this content on 30 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 August 2021 09:31:08 UTC.