Intelligent Wave Inc. · TSE:4847

Intelligent Wave — Q3 FY06/23 Earnings Presentation

32 slides from Intelligent Wave's earnings presentation, May 12, 2023

  1. Slide 1: Financial Results for Q3 FY06/23

    Financial Results for Q3 FY06/23 (July 1 to March 31, 2023) [Non-Consolidated] Intelligent Wave Inc. Announced on May 12, 2023 Copyright © 2023, INTELLIGENT WAVE INC. All rights reserved.

  2. Slide 2: Financial Results Q3 FY06/23

    Financial Results Q3 FY06/23 Key initiatives in Q3 FY06/23 Forecast for FY06/23 Reference Copyright © 2023, INTELLIGENT WAVE INC. All rights reserved. 2

  3. Slide 3: Overview (1/2)

    Overview (1/2) In the last 20 years, both sales and profits reached record highs. Orders on hand increased, particularly for Cloud services, exceeding a record high of 10 billion. Million yen Q3 FY06/22 Q3 FY06/23 Change（YoY） Net sales 7,834 9,896 ＋2,062 ＋26.3% Operating income 943 1,136 ＋193 ＋20.5%

  4. Slide 4: Overview (2/2)

    Overview (2/2) In this fiscal year, there were FEP renewal projects in 1Q, and both sales and income grew. Cumulative 3Q sales and profits increased year on year. In 4Q, we expect further increases in net sales from System Development, Cloud services, etc. Million yen Net Sales Operating income ■…FY

  5. Slide 5: Sales by categories

    Sales by categories (＋) “Hardware” increased due to FEP system* renewal for existing customers, “cloud services” increased, “system development” increased due to large projects for a credit card company. (△) “In-house products & Services” decreased mainly due to several license sales of in-house pro

  6. Slide 6: Sales by Business Domain

    Sales by Business Domain (＋) Sales increased due to FEP system renewal projects, an increase in the number of users of cloud services and a large-scale project for a credit card company. Million yen Q3 FY06/22 Q3 FY06/23 Change（YoY） Net Sales 7,834 9,896 ＋2,062 ＋26.3% Payment & Finance 6,284 7,743 ＋

  7. Slide 7: Top Three Clients by Sales

    Top Three Clients by Sales Million yen Q3 FY06/22 Q3 FY06/23 Change Main projects Hardware sales and system System 1. 696 1,403 ＋707 development due to FEP system Integrator renewal Tokenization Service system (for Smartphone payment 2. D N P 1,080 1,248 ＋168 transaction ) , Payment Platform*, Syste

  8. Slide 8: Sales by "Stock" and "Flow"

    Sales by “Stock” and “Flow” Sales of “Stock” is steadily increasing due to higher sales of cloud services and maintenance. Million yen ■…Flow ■…Stock 2,216 2,175 1,517 1,442 1,634 1,382 1,055 1,470 1,625 1,664 1,252 1,312 1,442 1,196 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY06/22 FY06/23 Stock: categories with contra

  9. Slide 9: Operating income

    Operating income (+) Increase in sales due to hardware sales and system development. (△) Increase expenses for Cloud services, and increase in SG&A expenses due to investment in human capital, etc. ■…Operating income ●…Operating margin 576 Million yen 464 483 451 352 332 15.7% 15.7% 319 273 14.5% 27

  10. Slide 10: Amount of Orders

    Amount of Orders ■… Payment & Finance (System Development ) ■… Payment & Finance (Maintenance,Hardware, etc) ■… Cloud Services ■… Security 5,421 286 Million yen 4,686 228 4,252 299 3,954 273 339 2,794 1,876 3,329 311 3,056 3,130 132 2,829 214 2,660 2,612 322 133 2,562 86 1,929 822 112 336 243 507 73

  11. Slide 11: Orders on Hand

    Orders on Hand ■… Payment & Finance (System Development ) ■… Payment & Finance (Maintenance,Hardware, etc) ■… Cloud Services ■… Security Million yen 11,548 605 9,268 9,563 9,233 9,047 666 7,963 660 749 606 639 6,913 6,075 5,912 4,141 5,688 5,530 4,210 4,214 4,589 681 5,022 693 606 689 4,236 423 1,93

  12. Slide 12: Orders on Hand by "Stock" and "Flow"

    Orders on Hand by “Stock” and “Flow” ■…Flow ■…Stock Million yen 11,548 9,563 1,597 9,268 1,873 9,047 9,233 7,963 2,895 1,874 1,814 2,647 5,912 1,587 1,370 9,951 6,668 7,173 7,419 6,376 6,621 4,542 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY06/22 FY06/23 * The classification of sales based on so-called "stock-type" and

  13. Slide 13: Cloud Service Business

    Cloud Service Business Net sales grew significantly year on year with an increase in the number of users of nine companies. Gross profit declined due to an increase in costs for strengthening the operation system in line with an increase in the number of users in some service, but full year profit i

  14. Slide 14: Orders for Cloud Services

    Orders for Cloud Services IOASIS received several large orders in the previous fiscal year. Orders and inquiries for IFINDS were strong due to increased damage from card-fraud. IGATES has expanded its customer base from new payment service providers to ｍid-size payment providers. Million yen FY06/22

  15. Slide 15: Key initiatives in Q3 FY06/23

    Financial Results Q3 FY06/23 Key initiatives in Q3 FY06/23 Forecast for FY06/23 Reference Copyright © 2023, INTELLIGENT WAVE INC. All rights reserved. 15

  16. Slide 16: Evolution of next-generation card fraud prevention

    Evolution of next-generation card fraud prevention The amount of damage caused by card fraud in 2021 was 43.6 billion yen*, the worst ever, and as the top vendor of card fraud management solutions, we began tackling co-creation resonance across industries. Rule ＆ Monitoring Scoring Fraud Sharing All

  17. Slide 17: Evolution of IGATES

    Evolution of IGATES Demand for the use of IGATES, a payment network connection and switching service, increased. With the trend of change in the payment industry, we are expanding our customer base and developing a multi-user platform. 【Transition of IGATES】 Currently, 10 companies have introduced I

  18. Slide 18: Expansion of payment domains

    Expansion of payment domains Demand for modernization of systems (Utilization of new technologies) is growing in the payment industry. We will cultivate new domains of payment industry and develop new products by co-creating with customers from upstream processes. and co-creating with customers from

  19. Slide 19: Establishment of Human Capital Management Promotion Office

    Establishment of Human Capital Management Promotion Office Established the Human Capital Management Promotion Office to examine human resources and organization from the perspective of business divisions. Began examining human resource strategies linked to business strategies and examining organizat

  20. Slide 20: Identification of Material Issues

    Identification of Material Issues Four material issues and seven related key themes have been identified as important issues to be tackled through our business activities. Specific initiatives and progress on material issues will be announced on the corporate website in phases. Enhance the reliabili

  21. Slide 21: First to be recognized as one of the "White 500"

    First to be recognized as one of the "White 500 " Promoting health management to strengthen our human resources, our most important management resource. First to be recognized as one of the "White 500," which honors the top 500 corporations in the health and productivity management 2023. Purpose of

  22. Slide 22: Forecast for FY06/23

    Financial Results Q3 FY06/23 Key initiatives in Q3 FY06/23 Forecast for FY06/23 Reference Copyright © 2023, INTELLIGENT WAVE INC. All rights reserved. 22

  23. Slide 23: FY06/23 Forecasts

    FY06/23 Forecasts Million yen FY06/22 FY06/23 Change Actual forecast （full year) １H ２H １H ２H(Full year- Full year （actual） Full year YoY 1H actual) Net sales 4,887 6,606 11,493 6,789 6,711 13,500 ＋17.5% Payment & Finance 3,915 5,313 9,229 5,393 4,757 10,150 ＋10.0% Cloud Services 493 680 1,173 881 1,

  24. Slide 24: FY06/23 Forecasts

    FY06/23 Forecasts Million yen FY06/22 FY06/23 (actual) (forecast) １H ２H(Full year- YoY １H ２H Full year Full year （actual） 1H actual) (2H) Net sales 4,887 6,606 11,493 6,789 6,711 13,500 ＋1.6% Payment & Finance 3,915 5,313 9,229 5,393 4,757 10,150 △10.5% System Development 2,369 2,720 5,089 2,840 2,9

  25. Slide 25: Reference

    Financial Results Q3 FY06/23 Key initiatives in Q3 FY06/23 Forecast for FY06/23 Reference Copyright © 2023, INTELLIGENT WAVE INC. All rights reserved. 25

  26. Slide 26: Cost of manufacturing

    Cost of manufacturing Thousand yen FY06/22 FY06/23 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Materials cost 7,194 8,162 11,264 10,943 21,857 6,582 13,961 Labor cost 718,848 734,397 714,332 724,102 731,531 737,858 696,398 Expenses 431,898 413,397 403,356 501,360 486,571 517,615 512,983 Subcontracting cost 603,162 668,

  27. Slide 27: SG&A expenses

    SG&A expenses Thousand yen FY06/22 FY06/23 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Salaries 290,810 310,527 335,648 361,087 384,909 388,481 372,704 Training and 10,332 13,989 24,046 24,878 14,951 22,121 18,514 recruiting Rent 18,793 18,328 16,822 17,320 24,509 25,362 24,550 Advertising 12,691 11,432 12,179 9,110 9,

  28. Slide 28: Cash Flows

    Cash Flows ＋1,589 Million yen △1,381 △448 Income before taxes ＋1,157 Purchase of PP&E △370 D&A ＋703 Purchase of △984 A/R decrease ＋898 intangible assets A/P decrease △656 Inventory increase △96 3,692 Dividends △446 3,932 Income taxes paid △530 JPY 240mil decrease 30-Jun-22 Operating activities Inves

  29. Slide 29: Historical performance

    Historical performance ■… Net sales ■ … Operating income 11,187 11,493 Million yen 10,920 10,603 10,443 8,469 7,137 7,205 6,695 6,558 6,367 6,160 5,891 5,870 5,505 5,527 5,257 5,241 4,844 5,174 4,956 4,762 1,854 1,528 1,482 1,519 1,177 1,036 1,130 731 921 678 702 547 371 389 417 358 321 484 228 131

  30. Slide 30: Reference) Our Cloud Services

    Reference) Our Cloud Services ・SaaS product for providing operation system and supporting customers to launch acquiring business ■IOASIS ・ Offer 24/7 system operation ■IPRETS ・Point management system that grants points at the time of payment, etc. ■IGATES ・Provides 24/7 non-stop switching operation

  31. Slide 31: Company overview

    Company overview As of December 31,2022 Established December 27, 1984 Location Kayabacho Tower, 1-21-2 Shinkawa, Chuo-ku, Tokyo Employees 449 Parent company Dai Nippon Printing Co., Ltd. (50.71%) Capital stock JPY843.75k Shares 26,340,000 Shareholders 9,525 outstanding Ownership (%) % of shareholder

  32. Slide 32: Intelligent Wave Inc.

    These materials were produced to provide information concerning the company and its businesses. They are not intended as a solicitation for investment in securities issued by Intelligent Wave Inc. The opinions, forecasts, and other forward-looking statements in these materials are based on the compa

Intelligent Wave — Q3 FY06/23 Earnings Presentation on 6ix