Internet Initiative Japan Inc. · TSE:3774
Internet Initiative Japan — FY2004 Earnings Presentation
18 slides from Internet Initiative Japan's earnings presentation, May 13, 2005
Slide 1: Fourth Quarter Results for the Year Ending March 31, 2005
Internet Initiative Japan Inc. Fourth Quarter Results for the Year Ending March 31, 2005 May 13, 2005 Statements made in this material regarding IIJ's or management's intentions, beliefs, expectations, or predictions for the future are forward-looking statements that are based on IIJ's and managemen
Slide 2: Summary of Full Year and Fourth Quarter FY2004 Results
Summary of Full Year and Fourth Quarter FY2004 Results z Revenue: JPY 41.7 billion (an increase of 7.5% from FY2003) z Operating income: JPY 1.2 billion (compared to operating loss of JPY 1.4 billion in FY2003) Full FY2004 z Net income: JPY 2.9 billion (compared to a net loss of JPY 2.3 billion in F
Slide 3: Summary of Business in FY2004
Summary of Business in FY2004 Network Solution Business Showing Progress Upturn in Market Environment z Obtaining high number of multi-site connectivity cases (about 4,000 per year) z Increase and wider bandwidth of company traffic z Increase in large outsourcing mandates z Growth in need for highly
Slide 4: Results for Fiscal Year 2004
Results for Fiscal Year 2004 FY2003 FY2004 YoY Change % of Total % of Total JPY Revenues JPY Revenues % • Higher-margin outsourcing revenues such as revenues from VAS and Revenues 38.8 billion 100.0% 41.7 billion 100.0% 7.5% operational outsourcing of Systems Integration (SI) substantially increased
Slide 5: Trend of Yearly Revenues and Gross Margin
Trend of Yearly Revenues and Gross Margin (JPY million) (%) 50,000 Gross Margin 16.6% 44,018 % of total revenues 41,703 39,905 15 40,000 38,779 8.1% Equipment Sales 31,876 13.2% 30,000 11.7% 38.0% SI 10 9.4% 21.6% 30.0% 39.4% 20,000 7.8% 19.6% VAS and others Outsourcing related 5 revenues’ % to tota
Slide 6: Trend of Yearly Gross Margin and SG&A Expenses
Trend of Yearly Gross Margin and SG&A Expenses Gross (JPY Million) Equipment Sales 6,907 7 ,0 0 0 Systems Integration Margin： 6 ,0 0 0 Internet Connectivity and VAS 5,251 + JPY1,658 5 ,0 0 0 4,534 3,654 million 4,124 Profits 4 ,0 0 0 2,041 increased both 3 , 0 0 0 1,996 2,486 1,922 in Internet conne
Slide 7: Trend of Yearly Operating and Net Income (Loss)
Trend of Yearly Operating and Net Income (Loss) (JPY million) (%) 4,000 4 Operating Income (Loss) 2,906 3,000 3.0% Net Income (Loss) 2,000 Operating Margin 2 1,248 1,000 54 0.1% 0 0 -1,000 -1,450 -2,000 -1,671 -2 -2,271 -3,000 -2,670 -4,000 -3.8% -3.7% -4 -5,000 -6,000 -5,665 -6 -6,365 -7,000 -8.4%
Slide 8: Results for Fourth Quarter FY2004
Results for Fourth Quarter FY2004 4Q03（2004/1-3） 4Q04（2005/1-3） YoY Change % of Total % of Total JPY Revenues JPY Revenues % • Higher-margin outsourcing 11,617 12,254 revenues such as revenues from Revenues 100.0% 100.0% 5.5% VAS and operational outsourcing of million million SI substantially increa
Slide 9: Trend of Quarterly Revenues and Gross Margin
Trend of Quarterly Revenues and Gross Margin (JPY million) 15,000 30% Connectivity and VAS Gross Margin SI Gross Margin 24.7% 23.9% 23.7% 23.7% 22.3% 12,254 Equipment Sales 11,617 20.0% 10,261 10,000 9,633 10,512 20% 9,185 8,344 8,675 9.4% SI 14.0% 14.4% 10.7% 13.4% 13.2% 12.5% 5,000 11.7% 10% 9.1%
Slide 10: Trend of Quarterly Operating and Net Income (Loss)
Trend of Quarterly Operating and Net Income (Loss) (JPY million) (%) 2,000 2,256 10 Operating Income 1,693 Net Income 8 1,500 Operating margin 5.4% 6 1,000 4.0% 3.0% 2.7% 660 656 4 2.4% 410 500 350 282 236 229 2 0 0 -100 -236 -238 -2 -500 -1.2% -4 -1,000 -830 -856 -6 -1,206 -1,500 -9.0% -8 -14.4% -2
Slide 11: Outlook for FY2005
Outlook for FY2005 [Market Environment] [Strategy for FY2005] z Corporate business traffic will continue to increase z Turn new technologies into products, bring new products to market, and promote new products z Internet Technology will increasingly spread to corporate networks and business systems
Slide 12: Target for FY2005
Target for FY2005 In FY2005, we aim to surpass our achievement in 2004 where we earned the highest revenues and profits since our NASDAQ listing Operating income: Approximately 85% Revenue: Approximately 10% increase from FY2004 increase from FY2004 Net income: Approximately 25% increase from FY2004
Slide 13: Summary by Service
Summary by Service (JPY million) (Gbps) 4500 121.2 4000 4,089 4,020 3,984 3,858 120 Internet Connectivity Service 3,670 3,572 3,559 3500 767 784 780 3,508 100 z First increase in 12 quarters (+51 million from 3Q04) 758 752 718 3000 740 727 80 z Total contracted bandwidth: 121.2Gbps 3,321 3,236 2500
Slide 14: Summary by Service
Summary by Service (JPY million) 6000 Revenues from operational outsourcing services 5,352 System Integration (SI) 5000 Revenues from services other than operational z Revenue from systems integration (excluding operational outsourcing outsourcing) substantially increased from 3Q04 due to the 4,001
Slide 15: Restatement of Financial Statements
Restatement of Topics Financial Statements Scope: Audited U.S. GAAP consolidated financial statements for the three years ended March 31, 2004, and unaudited financial information for the three quarters of the year ended March 31, 2005 Details: Before the restatement, we recorded the income tax effe
Slide 16: Restatement of Financial Statements
Restatement of Topics Financial Statements Audited U.S. GAAP consolidated financial statements for the three years ended March 31, 2004 (JPY Thousand) 2002 2003 2004 As previously As Difference As previously As Difference As previously As Difference Reported Restated Reported Restated Reported Resta
Slide 17: Development of Mail Solutions
Topics Development of Mail Solutions Spam damage is expanding It is reported that 70% of emails is spam in the USA and it creates a IIJ’s Efforts great burden for mail servers as they have to invest extra Started service to grasp companies’ resources to tackle this. It can also be a source of infect
Slide 18: IIJ's Mail Solutions
Topics IIJ’s Mail Solutions Anti-spam Anti-virus The Internet Sender Authentication Virus protection (Service Planned) IIJ Edge Filter Blocks or limits emails massively coming Against Information Leakage Sender Authentication into mail servers and emails including Mail Auditing those with malicious
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