Nec Corporation · TSE:6701

Nec — Nec Corp Unsp/Adr New — FY2025 Earnings Presentation

33 slides from Nec's earnings presentation, Apr 28, 2025

  1. Slide 1: Financial Results for the Fiscal Year Ended March 31, 2025

    6701.T Financial Results for the Fiscal Year Ended March 31, 2025 April 28, 2025 NEC Corporation (https://www.nec.com/en/global/ir/)

  2. Slide 2: Index

    Index I. Financial Results for FY25/3 II. Financial Forecasts for FY26/3 and Progress of the Mid-term Management Plan 2025 III. Financial Results for FY25/3 (Appendix) IV. Historical Data (Appendix) * Net profit refers to net profit attributable to owners of the parent for the same period © NEC Corp

  3. Slide 3: I. Financial Results for FY25/3

    I. Financial Results for FY25/3 © NEC Corporation 2025 3

  4. Slide 4: Key Takeaways

    Key Takeaways Achieved the Non-GAAP OP target of the Mid-term Management Plan 2025 one year early FY25/3 Revenue FY25/3 Non-GAAP OP 3,423.4 bil 311.3 bil <YoY*> +5.3% <YoY*> +98.9 bil Raise the FY26/3 target from the Mid-term Management Plan 2025 Non-GAAP OP 320.0 bil (Compared to the Mid-term Manag

  5. Slide 5: Summary of Financial Results for FY25/3

    FY25/3 Results Summary of Financial Results for FY25/3 9 months Q4 Full Year FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 Compared to (Billions of Yen) YoY YoY YoY forecasts as Results Results Results Results Results Results of Jan. 30 Revenue 2,393.3 2,321.8 -3.0% 1,084.0 1,101.6 +1.6% 3,477.3 3,423.4

  6. Slide 6: YoY Change in Adjusted/Non-GAAP Operating Profit

    FY25/3 Results YoY Change in Adjusted/Non-GAAP Operating Profit Improved marginal profit, （ Billions of Yen ） profitability change, etc. +98.9 +31.8 +6.3 -15.2 -24.1 Others +60.8 Deconsolidation impact of JAE Social Non-GAAP Infrastructure Adjusted Items 311.3 Structural 287.2 4.0 Reform Expenses, I

  7. Slide 7: Financial Results for FY25/3 (By Segment)

    FY25/3 Results Financial Results for FY25/3 (By Segment) Revenue and Adj. OP increased in both IT Services and Social Infrastructure 9 months Q4 Full Year FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 Change from (Billions of Yen ) YoY YoY YoY forecasts as Results Results Results Results Results Results

  8. Slide 8: IT Services

    FY25/3 Results IT Services Revenue and Adjusted Operating Profit -Adj. OP significantly increased due to Adj. OP Margin increased revenue in domestic IT business and improved Revenue Adj. OP profitability exceeding +2% (Billions of Yen ) 2,033.2 (+9% revenue in Domestic IT excluding NEC Facilities L

  9. Slide 9: Domestic IT Services Booking Status (YoY)

    FY25/3 Results Domestic IT Services Booking Status (YoY) Robust demand continued mainly in Public Excluding NEC Facilities Ltd. Q1 Q2 Q3 Q4 Full Year Notes Domestic IT Services +15% +18% +9% +7% +12% Increased projects for municipal government platform Public +32% +38% +36% +18% +31% standardization

  10. Slide 10: Social Infrastructure

    FY25/3 Results Social Infrastructure -Adj. OP improved YoY due to cost reductions, including Revenue and Adjusted Operating Profit development expenses despite one-off gains/losses and Revenue Adj. OP Adj. OP Margin investment restraint by telecom operators in Telecom Services (Billions of Yen) 1,14

  11. Slide 11: Supplemental Information on Telecom Services: Factors of variance in adjusted OP

    FY25/3 Results Supplemental Information on Telecom Services : Factors of variance in adjusted OP (Billions of Yen) 9months Q4 Full Year Notes FY24/3 results 4.2 23.0 27.3 Marginal Profit, +9.1 -4.5 +4.6 Improved mainly in IT business Profitability Change, etc. Cost Reductions, +13.0 - +13.0 Cost red

  12. Slide 12: Free Cash Flows

    FY25/3 Results Free Cash Flows Significant improvement in working capital due to establishment of CCC* improvement activities 70 Days 67 Days CCC* Days YoY Improved by 8 Days 60 Days (Billions of Yen) Cash flow from operating activities 344.4 YoY +73.2 271.2 ・Increase in Adj. OP +63.6 ・Improvement o

  13. Slide 13: Status on the Sale of Investment Securities

    FY25/3 Results Status on the Sale of Investment Securities -Activities to reduce the number of shares held have been accelerated based on the zero cross-shareholdings policy effective from April 2020 -Cumulative sales amounted to 159.0 billion yen, greatly contributing to free cash flows -The number

  14. Slide 14: II. Financial Forecasts for FY26/3 and Progress of the Mid-term Management Plan 2025

    II. Financial Forecasts for FY26/3 and Progress of the Mid-term Management Plan 2025 © NEC Corporation 2025 14

  15. Slide 15: Summary of Financial Forecasts

    FY26/3 Forecasts/ Mid-term Management Summary of Financial Forecasts Plan 2025 Raise the FY26/3 profit targets from the Mid-term Management Plan 2025 * Updated on IR day Oct. 2024 FY24/3 FY25/3 FY26/3 Compared to (Billions of Yen) YoY YoY targets of the Mid- Results Results Forecasts Term Plan 2025

  16. Slide 16: Financial Forecast (By Segment)

    FY26/3 Forecasts/ Mid-term Management Financial Forecast (By Segment) Plan 2025 Full Year * Updated on the IR day in Oct. 2024 Compared to targets FY25/3 FY26/3 (Billions of Yen) YoY of the Mid-Term Results Forecasts Plan 2025 Revenue 2,033.2 2,015.0 -0.9% +0.8% IT Services Adjusted Operating Profit

  17. Slide 17: IT Services

    FY26/3 Forecasts/ Mid-term Management IT Services Plan 2025 Revenue and Adjusted Operating Profit -In Domestic IT business, Adj. OP is expected to increase Adj. OP Margin through continuous improvements in profitability, although Revenue Adj. OP (Billions of Yen) revenue is expected to decrease due

  18. Slide 18: Social Infrastructure

    FY26/3 Forecasts/ Mid-term Management Social Infrastructure Plan 2025 Revenue and Adjusted Operating Profit -Adj. OP of Telecom Services is expected to increase Revenue Adj. OP Adj. OP Margin due to a rebound from one-off factors in FY25/3 (Billions of Yen) 1,160.0 1,141.7 1,077.3 -Both Adj. OP and

  19. Slide 19: BluStellar

    BluStellar FY25/3 Results: Revenue exceeded MTP target a year ahead of the plan, profit margin significantly increased FY26/3 Forecasts: Year on year, revenue is forecast to continue growing by double digits as profit margins improve and investment increases for expanding products and resources. FY2

  20. Slide 20: Low-profit Businesses

    Low-profit Businesses • 12 out of 16 low-profit businesses improved profitability/were divested by the end of FY25/3 • Determine the directions of all remaining low-profit businesses by the end of FY26/3 4 businesses (FY23/3) 5 businesses (FY24/3) 3 businesses (FY25/3) Measures To Be 16 9 Determined

  21. Slide 21: Capital Allocation

    Capital Allocation No Changes to the Current Policy 1. Investment in growth business areas to be a top priority, while maintaining financial soundness 2. Maintain a stable dividend increase 3. Share buybacks considered depending on the level of excess cash (New) Applying Cash ROIC Evaluation to M&A

  22. Slide 22: Changes to Segments

    Changes to Segments FY25/3 From Q1, FY26/3 IT Services IT Services Public Public Cross-Industry Enterprise Domestic NEC Facilities Ltd. Domestic Enterprise Digital Platform Services Digital Platform Digital Delivery Services International DGDF International DGDF Social Infrastructure NEC Networks &

  23. Slide 23: NEC Orchestrating a brighter world

    NEC \ Orchestrating a brighter world

  24. Slide 24: III. Financial Results for FY25/3 (Appendix)

    III. Financial Results for FY25/3 (Appendix) © NEC Corporation 2025 24

  25. Slide 25: Breakdown of IT Services

    Breakdown of IT Services 9 months Q4 Full Year (Billions of Yen) FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 YoY YoY YoY Results Results Results Results Results Results Revenue 1,098.0 1,141.4 +4.0% 514.5 571.1 +11.0% 1,612.5 1,712.5 +6.2% Domestic IT Adj. OP 80.5 98.0 +17.5 84.7 117.4 +32.8 165.1 215

  26. Slide 26: Breakdown of Social Infrastructure

    Breakdown of Social Infrastructure 9 months Q4 Full Year (Billions of Yen) FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 YoY YoY YoY Results Results Results Results Results Results Revenue 555.7 534.4 -3.8% 245.5 237.3 -3.4% 801.3 771.7 -3.7% Telecom Services Adj. OP 4.2 29.3 +25.0 23.0 14.6 - 8.4 27.3

  27. Slide 27: Non-GAAP Operating Profit Adjustment Items

    Non-GAAP Operating Profit Adjustment Items 9 months Q4 Full Year FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 (Billions of Yen) YoY YoY YoY Results Results Results Results Results Results Operating Profit 69.8 126.2 +56.4 118.2 130.3 +12.1 188.0 256.5 +68.5 M&A Related Amortization of Adjusted 26.9 24.

  28. Slide 28: Non-GAAP Net Profit Adjustment Items

    Non-GAAP Net Profit Adjustment Items 9 months Q4 Full Year (Billions of Yen) FY24/3 FY25/3 FY24/3 FY25/3 FY24/3 FY25/3 YoY YoY YoY Results Results Results Results Results Results Net Profit 34.0 71.6 +37.5 115.5 103.6 - 11.9 149.5 175.2 +25.7 M&A related Amortization of 19.0 17.4 - 1.6 5.8 4.8 - 1.0

  29. Slide 29: Financial Position Data

    Financial Position Data Full Year As of As of Change from (Billions of Yen) March 31, March 31, March 31, 2024 2025 2024 Total Assets 4,227.5 4,315.4 +87.9 Total Equity 2,089.5 2,071.5 - 18.0 Interest-bearing Debt 548.6 666.4 +117.8 Equity Attributable to Owners of the Parent 1,915.6 1,952.0 +36.4 %

  30. Slide 30: IV. Historical Data (Appendix)

    IV. Historical Data (Appendix) © NEC Corporation 2025 30

  31. Slide 31: Revenue Breakdown

    Revenue Breakdown FY24/3 Results FY25/3 Results （ Billions of Yen ） Q1 1H Q3 2H Full Year Q1 1H Q3 2H Full Year Public 73.3 179.2 101.4 256.5 435.7 75.6 184.5 109.0 309.4 493.9 Enterprise 157.1 327.1 177.5 376.8 704.0 164.1 331.9 169.3 359.1 690.9 Cross-Industry 20.7 50.2 31.6 91.2 141.3 25.9 59.6 3

  32. Slide 32: Adjusted OP Breakdown

    Adjusted OP Breakdown （ Billions of Yen ） FY24/3 Results FY25/3 Results Q1 1H Q3 2H Full Year Q1 1H Q3 2H Full Year Domestic Adjusted Operating Profit 10.9 42.6 37.9 122.6 165.1 10.2 48.4 49.6 167.0 215.4 % of revenue 3.4% 6.0% 9.7% 13.5% 10.2% 3.0% 6.6% 12.2% 17.1% 12.6% International (DGDF) Adjust

  33. Slide 33: Cautionary Statement with Respect to Forward-Looking Statements

    Cautionary Statement with Respect to Forward-Looking Statements This material contains forward-looking statements regarding estimations, forecasts, targets and plans in relation to the results of operations, financial conditions and other overall management of the NEC Group (the "forward-looking sta

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