Slide 1: Financial Results Presentation for the Fiscal Year Ended March 31, 2020
Financial Results Presentation for the Fiscal Year Ended at March 31, 2020 May 22, 2020 TDC SOFT Inc. © 2020 TDC SOFT Inc. 1
Slide 2: Key Points in the Fiscal Year Ended March 31, 2020
Key Points in the Fiscal Year Ended March 31, 2020 Consolidated Financial Results for this Period ・Increased earnings and profit, driven by strong sales in the financial field ・Advanced progress with respect to the mid-term management plan (April, 2019 - March, 2022) in the area of next-generation s
Slide 3: Contents
Contents ● Overview of Consolidated Financial Results for the Fiscal Year Ended March 31, 2020 ● Status of Major Measures for the Fiscal Year Ended March 31, 2020 ● Business Outlook for the Fiscal Year Ending March 31, 2021. © 2020 TDC SOFT Inc. 3
Slide 4: Financial Results Overview for the Fiscal Year Ended March 31, 2020
Financial Results Overview for the Fiscal Year Ended March 31, 2020 © 2020 TDC SOFT Inc. 4
Slide 5: Financial Results Overview: Highlights
Financial Results Overview for the Fiscal Year Ended March 31, 2020 Profit Rate of (Unit: \ millions) FY2019 FY2018 ratio change Net sales 27,795 - +4.5% 26,590 gross profit 5,277 19.0% +4.0% 5,076 Operating profit 2,206 7.9% +2.3% 2,157 Ordinary profit 2,265 8.1% +0.8% 2,248 Profit attributable to
Slide 6: Overview of Net Sales by Field
Overview of Net Sales by Field FY2018 FY2019 ¥26,590 million ¥27,795 million 2,361 2,521 （8.9％） （9.1％） 3,786 3,572 （14.2％） （12.9％） 14,356 15,405 （54.0％） （55.4％） 6,086 6,295 （22.9％） （22.6％） Financial IT solutions field Infrastructure and network solutions field Public corporation IT solutions field P
Slide 7: Highlights by Field
Highlights by Field Financial IT solutions field Public corporation IT solutions field （Unit: ¥ millions） （Unit: ¥ millions） 13,286 14,356 15,405 Large-scale system 4,955 6,086 6,295 Development projects 16000 development projects 7000 for the manufacturing 15000 6000 and logistics industries for th
Slide 8: Status of Major Measures for the Fiscal Year Ended March 31, 2020
Status of Major Measures for the Fiscal Year Ended March 31, 2020 © 2020 TDC SOFT Inc. 8
Slide 9: Medium-Term Management Plan
Management Plan Evolve into a next-generation system integration business that responds to digital Vision technologies and new trends by catching the potential needs of the market Medium-Term Management Plan Aim to become a Next-Generation System Integrator Pursue high-value-added Advance transforma
Slide 10: Overview of Next-Generation SI Business
Measures for Next-Generation System Integrator Overview of Next-Generation SI Business ⚫ High-value-added SI services increased to 6.8% of the net sales (126% of the plan) ⚫ Target to expand the net sales of high-value-added SI services to about 20% in the fiscal year ending March 31, 2022 Plan for
Slide 11: Overview of Strategic Fields
Measures for Next-Generation System Integrator Overview of Strategic Fields Agile-related business Achieved 41% progress of the sales target (¥2 billion), ahead of schedule, in the first year of the mid-term plan from April, 2019 to March, 2022 as a result of the company-wide promotion of every meas
Slide 12: Establish Structures to Become a Next-Generation System Integrator
Measures for Next-Generation System Integrator TOPICS: Establish Structures to Become a Next-Generation System Integrator Newly establish an organization to build a foundation for sustained growth Each organization functions effectively to drive the next generation of SI business Digital Technology
Slide 13: Focused Strategic Field - Agile-related Business
Measures for Next-Generation System Integrator TOPICS: Focused Strategic Field - Agile-related Business Strengthening our service capabilities to lead the domestic enterprise agile market Consulting Capability Uplift Providing one-stop agile solutions covering from upstream, such as organizational t
Slide 14: Focused Strategic Field - Security-related Business
Measures for Next-Generation System Integrator TOPICS: Focused Strategic Field - Security-related Business Started to offer with a security service menu targeting especially at consulting, system integration, operational management and education Total security solution considering system life cycles
Slide 15: Business and Capital Alliance with LTE-X Inc.
Measures for Next-Generation System Integrator TOPICS: Focused Strategic Field - Security-related Business Concluded the business and capital alliance contract with LTE-X Inc., which has a competitive edge in the network security field Started a business and capital alliance with LTE-X Inc., which h
Slide 16: M&A to Strengthen the Solutions Business
Measures for Next-Generation System Integrator TOPICS: Proceeded with M&A to Strengthen the Solutions Business Acquired YBC Inc., a company with a wealth of expertise including SAP S/4HANA through M&A by considering the expected system migration demand increase due to coming SAP Business Suite 7 mai
Slide 17: Update of the Company's Management Process
Measures for Next-Generation System Integrator TOPICS: Update of the Company’s Management Process Revamped the traditional bottom-up investment process to a top-down approach. Developed the investment plan, "TDC Technology Beyond 2020" by top experts in technologies, markets and customers. Foreseein
Slide 18: Business Outlook for the Fiscal Year Ending March 31, 2021
Business Outlook for the Fiscal Year Ending March 31, 2021 © 2020 TDC SOFT Inc. 18
Slide 19: Trends in the Information Services Industry
Business Outlook for the Fiscal Year Ending March 31, 2021 Trends in the Information Services Industry ⚫ Domestic economic environment started to deteriorate rapidly April 23: Monthly Economic Report by the Cabinet Office Reported “getting worse” for the 1st time in 11 years by the statement that “t
Slide 20: Efforts to Prevent from COVID-19 Infection
Business Outlook for the Fiscal Year Ending March 31, 2021 Efforts to Prevent from COVID-19 Infection ⚫ February 14: “A special task force” was formed at TDC Soft headquarters. ⚫ April 8: In response to the government's declaration of a state of emergency, the Group shifted to working at home in pri
Slide 21: Efforts to Prevent from COVID-19 Infection
Business Outlook for the Fiscal Year Ending March 31, 2021 Efforts to Prevent from COVID-19 Infection Infection prevention measures ⚫ Installed alcohol disinfectants and other hygiene products at offices and project sites. Promoted the activities to inform employees on cough etiquette and other infe
Slide 22: Current Business Situations
Business Outlook for the Fiscal Year Ending March 31, 2021 Current Business Situations ⚫ Insignificant impact on the current business As the capacity utilization in April was about 1.4% higher than that of the previous year, impact on the company's current performance is insignificant. ⚫ Difficult s
Slide 23: Business Risks
Business Outlook for the Fiscal Year Ending March 31, 2021 Business Risks ⚫ Risk of reduced utilization: In case of measures to suspend attendance to work in case of any infected project members (of suppliers , the Company and business partners) or of customers ⚫ Risk of reduced capacity to provide
Slide 24: Financial Forecast for the Fiscal Year Ending March 31, 2021
Business Outlook for the Fiscal Year Ending March 31, 2021 Financial forecast for the Fiscal Year Ending March 31, 2021 ⚫ Since there are various uncertainties about the impact of COVID-19 and with its difficulty to rationally calculate at this time, the financial forecast for the fiscal year ending
Slide 25: Going Forward
Business Outlook for the Fiscal Year Ending March 31, 2021 Going Forward ⚫ Continue to promote the next-generation SI business, for which demand is expected to increase Maintain the policies of the medium-term management plan and the technical capabilities to respond to market needs in a timely and
Slide 26: Pursuing High-value-added SI Services
Focused Policies for the Fiscal Year Ending March 31, 2021 Promote initiatives in each field based on the key strategies set in the mid-term management plan Pursuing High-value-added SI Services Agile-related business Security-related business Scaling the business with increase number of Future tren
Slide 27: Promote Transformation of the System Integration Model
Focused Policies for the Fiscal Year Ending March 31, 2021 Promote initiatives in each field based on the key strategies set in the mid-term management plan Promote Transformation of the System Integration Model Improve profitability by securing service providing resources from efficiency improved q
Slide 28: Details of Financial Results
Fiscal Ended March 31, 2020 Details of Financial Results © 2020 TDC SOFT Inc. 28
Slide 29: Contents
Contents ● Financial Statements ● Analysis of Net Sales ● Orders Received/Unfilled Orders ● Analysis of Operating Profit © 2020 TDC SOFT Inc. 29
Slide 30: Statements of Income
Financial Statements Statements of Income （Unit:\ millions） FY2019 FY2018 change Net Sales 27,795 26,590 +4.5% Labor costs 10,228 9,806 +4.3% Subcontract expenses 11,458 10,784 +6.3% Other expenses 845 787 +11.4% Work in progress change △14 135 △110.4% Cost of sales 22,518 21,513 +4.7% Gross profit
Slide 31: Balance Sheet
Financial Statements Balance Sheet （Unit:\ millions） 31-Mar-20 31-Mar-19 change Total assets 16,652 16,353 +1.8% Current assets 13,463 12,930 +4.1% Non-current assets 3,188 3,422 -6.8% Total liabilities 4,544 4,887 -7.0% Current liabilities 4,347 4,717 -7.8% Non-current liabilities 197 169 +16.6% To
Slide 32: Statements of Cash Flows
Financial Statements Statements of Cash Flows Cash and cash equivalents at beginning of period Profit before income taxes 7,816 2,265 Depreciation and amortization 88 1,299 △218 Notes and accounts receivable 138 △518 Notes and accounts payable 39 8,379 Inventories △14 Accounts payable △119 7,816 Acc
Slide 33: Overview of Net Sales by Customer Industry
Overview of Net Sales by Customer Industry （Unit:¥ millions） FY2017 FY2018 FY2019 6,234 6,362 6,123 5,127 5,494 5,372 5,161 4,794 4,805 4,760 4,446 3,991 2,907 2,683 2,883 2,659 2,553 1,977 Banking Credit Insurance Manufacturing non-manufacturing Government ministries, agencies and organizations Fin
Slide 34: State of Orders Received/Unfilled Orders
State of Orders Received/Unfilled Orders （Unit:¥ millions） 14,575 13,622 13,796 12,937 Orders received 12,365 12,280 12,247 14,343 13,128 14,667 11,334 12,612 Net sales 6,269 6,498 6,551 6,380 5,804 5,835 Unfilled orders First Half Second Half First Half Second Half First Half Second Half FY2017 FY2
Slide 35: Analysis of Operating Profit
Analysis of Operating Profit （Unit:¥ millions） Gross profit up SG&A up -152 2,157 +201 2,206 ＜Gross profit＞ Increased in line with net sales growth. ＜SG&A＞ Increased in conjunction with investments to build a foundation for sustainable growth and to create high-value-added system integration service
Slide 36: TDC SOFT Inc.
TDC SOFT Inc. https://www.tdc.co.jp / *Cautionary note about these materials This report contains forward-looking statements such as forecasts for the TDC SOFT Group that are based on information available to the Company at this point in time. Actual results may differ significantly from these forec