Slide 1: FY 2024/9 Financial Results Briefing
November 18, 2024 FY 2024/9 Financial Results RECOMM Co., Ltd. Briefing TSE Standard (3323) © 2024 RECOMM Co., Ltd. All rights reserved. 1
Slide 2: Contents
Contents 1 FY 2024/9 financial results summary p. 3 2 FY 2025/9 full-year plans and dividends forecasts p. 18 3 Medium-Term management plan p. 27 4 Appendix p. 39 © 2024 RECOMM Co., Ltd. All rights reserved. 2
Slide 3: FY 2024/9 financial results summary
FY 2024/9 financial results summary 3
Slide 4: FY 2024/9 financial results summary (main results)
FY 2024/9 financial results summary (main results) (Unit： million yen FY 2024/9 FY 2023/９ revised FY 2024/9 vs. Plans YoY plans Net sales 9,510 12,000 11,687 97.4% 122.9% Operating income 450 460 269 58.6% 59.8% Income before tax 490 460 307 66.8% 62.6% Net income attributable to 314 300 83 27.7% 26
Slide 5: Differences from performance forecasts in FY 2024/9
Differences from performance forecasts in FY 2024/9 Differences from performance forecasts are shown below. (Unit: million yen) (Unit: million yen) Previous forecast Actual result Difference (%) Net sales 12,000 11,687 ▲2.6% Operating income 460 269 ▲41.4% Main causes of differences from performance
Slide 6: Causes of changes in operating income
FY 2024/9 financial results summary (causes of changes in operating income) 1,000 (Unit: million yen) 900 800 Investment for the future 700 +52 600 +74 500 450 400 △111 269 △68 300 △74 Operating income △54 200 100 (△181) - SLWE operating income Remuneration system reforms M&A FY 2024/9 operating inc
Slide 7: Financial results summary (results by segment)
Financial results summary (results by segment) (Unit: million yen) FY 2023/9 results FY 2024/9 results Change YoY Net sales 9,510 11,687 +2,177 122.9% Overseas solutions business 4,633 6,618 +1,985 142.8% Domestic solutions business 4,314 4,471 +157 103.6% BPR business 562 599 +37 106.5% Segment inc
Slide 8: Financial results summary (overseas solutions business)
Financial results summary (overseas solutions business) Sales up for fourth consecutive period (Unit: million yen) FY 2023/9 FY 2024/9 Change YoY Results Results Net sales 4,633 6,618 +1,985 142.8% Segment income 388 342 △46 88.2% Net sales Segment income • Higher income from acquisition of subsidia
Slide 9: Financial results summary (domestic solutions business)
Financial results summary (domestic solutions business) (Unit: million yen) FY 2023/9 FY 2024/9 Change YoY Results Results Net sales 4,314 4,471 +157 103.6% Segment income 188 423 +235 225.2% Net sales Segment income • Sales of cyber-security solutions were up sharply by 150.6% YoY 4,471 4,314 • Sal
Slide 10: Financial results summary (BPR business)
Financial results summary (BPR business) (Unit: million yen) FY 2023/9 FY 2024/9 Change YoY Results Results Net sales 562 599 +37 106.5% Segment income 85 30 △55 35.6% Net sales Segment income • Sales were up for the first time in two periods 599 • Profits were down because of a YoY increase of 562
Slide 11: Balance Sheet
Balance Sheet Previous Current consolidated consolidated fiscal fiscal year year Change September 30, September 30, Total assets: 12,645 million yen Up 1,802 million yen 2023 2024 Cash and cash equivalents were up 349 million yen, Current assets 7,957 8,364 +407 inventories were up 104 million yen d
Slide 12: Financial standing: Equity capital ratio, Statement of Cash Flows
Financial standing (Companywide)： Equity capital ratio, Statement of Cash Flows Cash flow from operating activities was 841 million yen, cash flow used in investing activities was 1,348 million yen due to M&A activities, and Equity capital ratio： 39.3% cash flow from financing activities was 816 mil
Slide 13: Topics: Investment in human resources through remuneration system reforms
Topics： Greatly expanding investment in human resources through remuneration system reforms 2025 tentative hiring ceremony for new graduates Goals of remuneration system reforms 1. Increasing employee motivation 2. Securing even more outstanding human resources 3. Promoting growth of existing busine
Slide 14: Topics: SPACECOOL radiative cooling material goes on sale
Topics: SPACECOOL, the world's highest-level radiative cooling material, goes on sale Main features of SPACECOOL 1. Reduces temperature by as much as 6°C from the × outside air temperature in direct sunlight 2. Enables zero-energy cooling 3. High solar reflectivity (95% or higher) and emissivity (95
Slide 15: Topics: Market introduction of Robo Worker AI-Agent RPA software
Topics: Market introduction of Robo Worker® AI-Agent RPA software The world's first RPA solution using generative AI to automate operations Japanese version went on sale in June 2024 English version went on sale in Malaysia in September 2024 Before Requirem Process Scenario Automation ent analysis b
Slide 16: Topics: Cross-border M&A (making TAKNET SYSTEMS a subsidiary)
Topics： Cross-border M&A (making TAKNET SYSTEMS a subsidiary) Aims of this M&A: • Growing the IT solutions business by entering the AI server sales business and expanding internationally • Entering the Singapore market TAKNET： The top dealer of Supermicro products in Singapore with a 50% to 60% shar
Slide 17: TAKNET SYSTEMS' position in the RECOMM Group and solutions provided
TAKNET SYSTEMS' position in the RECOMM Group and solutions provided (Before M&A) (After M&A) IT solutions Carbon-neutral Digital AI servers ＡＩ servers solutions transformation solutions Supermicro, ASUS RECOMM Group IT solutions + AI servers Carbon-neutral solutions Digital transformation solutions
Slide 18: FY 2025/9 full-year plans and dividends forecasts
FY 2025/9 full-year plans and dividends forecasts 18
Slide 19: FY 2025/9 plans: New record highs on all indicators
FY 2025/9 plans New record highs on all indicators (Unit: million yen) FY 2025/9 FY 2024/9 FY 2025/9 FY 2025/9 (full-year YoY (Actual) (1H plans) (2H plans) Net sales Operating plans) income Net sales 11,687 6,800 8,000 14,800 126.6% Operating income 269 220 480 700 259.8% Income before tax 307 220
Slide 20: FY 2025/9 plans (causes of changes in operating income)
FY 2025/9 plans (causes of changes in operating income) 1,000 (Unit: million yen) 900 800 +68 700 +100 700 600 +200 500 400 +69 269 300 200 Operating income 100 (+431) - FY 2024/9 Change in operation M&A Reduction in expenses Profit improvements FY 2025/9 operating income income of in new businesses
Slide 21: FY 2025/9 plans (by segment)
FY 2025/9 plans (by segment) (Unit: million yen) FY 2024/9 FY 2025/9 FY 2025/9 FY 2025/9 (1H plans) (2H plans) YoY (Actual) (full-year plans) Net sales 11,687 6,800 8,000 14,800 126.6% Overseas solutions business 6,618 4,000 5,000 9,000 136.0% Domestic solutions business 4,471 2,400 2,600 5,000 111.
Slide 22: FY 2025/9 plans (overseas solutions business)
FY 2025/9 plans (overseas solutions business) (Unit: million yen) FY 2024/9 FY 2025/9 FY 2025/9 FY 2025/9 (1H plans) (2H plans) YoY (Actual) (full-year plans) Net sales 6,618 4,000 5,000 9,000 136.0% Segment income 342 250 375 625 182.7% 800 <Main measures> Net sales Segment income 700 • Strengtheni
Slide 23: FY 2025/9 plans (domestic solutions business)
FY 2025/9 plans (domestic solutions business) (Unit: million yen) FY 2024/9 FY 2025/9 FY 2025/9 FY 2025/9 (1H plans) (2H plans) YoY (Actual) (full-year plans) Net sales 4,471 2,400 2,600 5,000 111.8% Segment income 423 107 188 295 69.7% 700 Net sales Segment income <Main measures> 600 6,000 111.8% •
Slide 24: FY 2025/9 plans (BPR business)
FY 2025/9 plans (BPR business) (Unit: million FY 2024/9 FY 2025/9 FY 2025/9 FY 2025/9 yen) (1H plans) (2H plans) YoY (Actual) (full-year plans) Net sales 599 400 400 800 133.6% Segment income 30 30 40 70 233.3% Segment Income <Main measures> Net Sales 140 • Growing unit prices per existing 120 custo
Slide 25: FY 2025/9 key points
FY 2025/9 key points 1. Promoting Group management Enhancing sales of global strategic products worldwide (Robo Worker & SPACECOOL) 2. Improving sales productivity Thoroughly saving time not devoted to business discussions and improving contract rates through internal digital transformation activiti
Slide 26: Dividends
Dividends Dividend： 1.6 yen 1.6 yen/share 1.6 yen/share 1.6 yen/share Commemorated dividend 0.5 yen/share 1.0 yen/share 1.1 yen/share 0.0 yen/share FY 2021/9 FY 2022/9 FY 2023/9 FY 2024/9 FY 2025/9 projected © 2024 RECOMM Co., Ltd. All rights reserved. 26
Slide 27: 2025-2027 Medium-Term Management Plan
2025-2027 Medium-Term Management Plan 27
Slide 28: Basic strategy: Global specialized trading company vision
2025-2027 Medium-Term Management Plan Basic strategy Basic strategy: Global specialized trading company vision Global specialized trading company vision: Accelerating global business growth by proposing solutions to global customers based on state-of-the-art profits and services and our strengths in
Slide 29: Goals
2025-2027 Medium-Term Management Plan Goals ⚫ We will do business aiming to achieve the following three targets by FY 2027/9. Net sales Ratio of operating income to net sales ROE CAGR 20% 10% 20% or higher or higher or higher © 2024 RECOMM Co., Ltd. All rights reserved.
Slide 30: Issues and policies for new Medium-Term Management Plan targets
2025-2027 Medium-Term Management Plan Issues and policies in working to achieve the new Medium-Term Management Plan targets ⚫ We will address delays in product and service development and customer development, the main reasons we failed to achieve the previous Medium-Term Management Plan's target ne
Slide 31: Sales productivity: Sales DX and M&A
2025-2027 Medium-Term Management Plan Efforts to achieve the new Medium-Term Management Plan targets ⚫ We will build a structure able to achieve efficient sales activities even with limited staff, through sales DX. We also will transplant this system to M&As to increase their value. (* The aim is to
Slide 32: Sales DX overview
2025-2027 Medium-Term Management Plan Sales DX overview ⚫ We will link data to the CRM system in a short timeframe and thoroughly implement sales based on the system. ⚫ The aim is to improve all three aspects of sales, customer development, and product development through sales activities based on c
Slide 33: Priority measures in domestic businesses
2025-2027 Medium-Term Management Plan Priority measures in domestic businesses ⚫ In domestic businesses, we will develop new businesses, increase the percentage of stock business sales, and increase customer satisfaction. ⚫ We will establish target sales for each measure and shift toward business mo
Slide 34: Priority measures in overseas businesses
2025-2027 Medium-Term Management Plan Priority measures in overseas businesses ⚫ We will target firms in each market through development of national human resources and more precise marketing. ⚫ We will accelerate strategies by developing human resources able to communicate to firms in each market t
Slide 35: Priority measures at overseas M&As
2025-2027 Medium-Term Management Plan Priority measures at overseas M&As ⚫ We will aim to improve business results further through synergies leveraging the advantages of M&As and RECOMM. ⚫ The RECOMM Group will promote development of customer firms in each market via local Japan-affiliated firms and
Slide 36: Priority measures in the DX business
2025-2027 Medium-Term Management Plan Priority measures in the DX business ⚫ We will promote solutions matched to industry needs through both RPA and BPO based on more precise targeting. ⚫ We also will promote market development leveraging BPR proposals combining both BPO and RPA. Main strategic pol
Slide 37: Priority measures in administrative sections
2025-2027 Medium-Term Management Plan Priority measures in administrative sections ⚫ We will improve productivity by revising workflows in existing businesses and eliminating waste in operations. ⚫ We will shift toward administrative sections that generate profits by promoting management through opt
Slide 38: Becoming a global leading B2B solutions provider group
Management goal Becoming a global leading B2B solutions provider group © 2024 RECOMM Co., Ltd. All rights reserved. 38
Slide 39: APPENDIX
RECOM APPENDIX © 2024 RECOMM Co., Ltd. All rights reserved.
Slide 40: Management Philosophy
Management Philosophy Management Philosophy R ・・・ Real Power Rule Focusing on real abilities E ・・・ Enterprising Enterprising thinking C ・・・ Challenge Taking on challenges O ・・・ Open Open management M ・・・ Management Management by all personnel M ・・・ Mind The RECOMM spirit © 2024 RECOMM Co., Ltd. All
Slide 41: Group Management Vision
Group Management Vision Group Management Vision A&A111+ (Action & Achievement) • The highest returns on investment for our shareholders (No. 1) • The only choice for our customers (Only 1) • The world leader in both quality and quantity (No. 1) + The most attractive group to employees (Best 1) © 202
Slide 42: Company overview
Company overview Name RECOMM CO., LTD. Employees Established September 30, 1994 Gender Shares listed May 26, 2004 TSE Standard: Securities code 3323 Female: 54.7% Address 25-3 Yoyogi 3-chome, Shibuya-ku, Tokyo Representat Male: 45.3% Hidehiro Ito, President and Group CEO ive Lines of Overseas soluti
Slide 43: Operating companies in individual businesses
Operating companies in individual businesses The Group consists of seven operating companies in Japan and 16 overseas in three businesses (as of September 30, 2024) Overseas: 16 facilities in nine countries BPR business Overseas solutions RECOMM Business Solutions (Dalian) *1 businesses RECOMM Tengy
Slide 44: Company History
Company History Date Date Sept. 1994 RECOMM Japan Co., Ltd., (now RECOMM Co., Ltd.) established to sell and maintain Oct. 2018 Dalian RECOMM shares listed on the OTC market in China telecommunications devices and office equipment Nov. 2018 Dalian RECOMM acquired 100% of shares of stock in Masterpiec
Slide 45: Business domains: Five B2B Solutions
Business domains: Five B2B Solutions Five B2B Solutions Results Controlling CO2 emissions Solution 1 Carbon-neutral LED lighting; commercial air conditioners with consideration for environmental impact; solutions Products space and power saving using digital multifunction printers that combine fax,
Slide 46: Evolution from a sales company to a B2B solutions provider
Evolution from a sales company to a B2B solutions provider PART 1 2 3 4 5 1994-2004 2005-2009 2010-2014 2015-2019 2020- From founding Diversification Business reorganization Renewed growth New growth to IPO Net sales surpass 10 billion yen FY 2007/9: recorded record- Launched global specialized trad
Slide 47: Overview of overseas solutions businesses
Overview of overseas solutions businesses ◼ Customers are major firms, since we target sales to the overseas plants of Japan-affiliated firms ◼ Began offering carbon-neutral solutions with the sales of LED lighting in Dalian, China, in October 事業スタート First launched 2015 and in Shanghai in April 2016
Slide 48: Overview of domestic solutions businesses
Overview of domestic solutions businesses ◼ Founded as the first sales franchise business in the industry; listed on the TSE Standard Market nine First launched years and eight months later ◼ Began offering cost-saving solutions through ICT devices September 1994 ◼ In February 2014, began offering c
Slide 49: Overview of the BPR business
Overview of the BPR business First launched ◼ Opened our own outsourcing center in Dalian in October 2003 and began accepting orders from outside customers in October 2009 November 2009 ◼ Expanded in October 2019 from BPO contracting business for back-office operations to BPR business to support bus
Slide 50: One-stop solutions from cost cutting through carbon neutrality, DX, and cybersecurity
Providing one-stop solutions from cost cutting through carbon neutrality, digital transformation, and cybersecurity Cost cutting Carbon neutrality Business telephones LED lighting Carbon Cost neutrality cutting Digital Commercial air multipurpose conditioners printers Infectious diseases Security ca