Nec Corporation · TSE:6701

Nec — Nec Corp Unsp/Adr New — Q1 2025 Earnings Presentation

26 slides from Nec's earnings presentation, Jul 30, 2024

  1. Slide 1: Financial Results for Q1 Fiscal Year Ending March 31, 2025

    6701.T Financial Results for Q1 Fiscal Year Ending March 31, 2025 July 30, 2024 NEC Corporation (https://www.nec.com/en/global/ir/) © NEC Corporation 2024

  2. Slide 2: Index

    Index I. Financial Results for Q1, FY25/3 II. Financial Forecasts for FY25/3 III. Topics IV. Financial Results (Appendix) V. Historical Data (Appendix) * Net profit refers to net profit attributable to owners of the parent for the same period. * As stated in the July 23, 2024 announcement, “NEC Revi

  3. Slide 3: I. Financial Results for Q1, FY25/3

    I. Financial Results for Q1, FY25/3 © NEC Corporation 2024

  4. Slide 4: Summary of Financial Results for Q1, FY25/3

    Q1 Results Summary of Financial Results for Q1, FY25/3 Revenue and Adj. OP increased in both IT Services and Social Infrastructure Q1 Q1 FY24/3 FY25/3 FY24/3 FY25/3 （Billions of Yen） YoY （Billions of Yen） YoY Results Results Results Results Revenue 385.7 418.3 +8.4% Revenue 706.5 690.3 -2.3% IT Serv

  5. Slide 5: YoY Change in Adjusted/Non-GAAP Operating Profit

    Q1 Results YoY Change in Adjusted/Non-GAAP Operating Profit Improved marginal profit, profitability change, etc. +17.2 （Billions of Yen） Social Infrastructure +10.4 +0.8 -1.5 Others Deconsolidation impact of JAE -3.6 Non-GAAP Adjusted IT Services 16.3 Items +6.0 Structural Reform Expenses, etc. 12.7

  6. Slide 6: IT Services

    Q1 Results IT Services -Revenue increased for domestic IT and Revenue and Adjusted Operating Profit International (DGDF) Revenue Adj. OP Adj. OP Margin （Billions of Yen） -Adj. OP increased due to improved profitability in international (DGDF) mainly in Avaloq, which 418.3 more than offset a one-time

  7. Slide 7: Domestic IT Services Booking Status (YoY)

    Q1 Results Domestic IT Services Booking Status (YoY) Significantly increased due to robust demand Q1 Q2 Q3 Q4 Q1 FY24/3 FY24/3 FY24/3 FY24/3 FY25/3 Notes Domectic IT Services +2% -12% +4% +2% +13% Excluding NEC Facilities Ltd. +3% -4% +5% -1% +15% Significant increase due to large projects and Publi

  8. Slide 8: Social Infrastructure

    Q1 Results Social Infrastructure Revenue and Adjusted Operating Profit -Adj. OP improved YoY due to cost reduction Revenue Adj. OP Adj. OP Margin including development expenses in Telecom Services （Billions of Yen） -Increased revenue and adj. OP in ANS* led by 213.2 219.2 steady project deliveries 1

  9. Slide 9: II. Financial Forecasts for FY25/3

    II. Financial Forecasts for FY25/3 © NEC Corporation 2024

  10. Slide 10: FY25/3 Financial Forecasts

    FY25/3 Forecasts FY25/3 Financial Forecasts No changes to FY25/3 forecasts from April 26, 2024 FY21/3 FY22/3 FY23/3 FY24/3 FY25/3 FY26/3 （Billions of Yen） Results Results Results Results Forecasts Targets Revenue 2,994.0 3,014.1 3,313.0 3,477.3 3,370.0 3,500.0 Adjusted Operating Profit 178.2 171.0 2

  11. Slide 11: Financial Forecast (By Segment)

    FY25/3 Forecasts Financial Forecast (By Segment) FY23/3 FY24/3 FY25/3 YoY （Billions of Yen） Results Results Forecasts Revenue 1,754.3 1,914.0 1,950.0 +1.9% IT Services Adjusted Operating Profit 141.3 184.1 192.0 +7.9 % of revenue 8.1% 9.6% 9.8% +0.2% Revenue 1,044.8 1,077.3 1,170.0 +8.6% Social Adju

  12. Slide 12: IT Services

    FY2025/3 Forecast IT Services Revenue and Adjusted Operating Profit -Steady growth of domestic business is anticipated Revenue Adj. OP Adj. OP Margin following a strong FY24/3 （ Billions of Yen ） -Adjusted OP growth from Avaloq anticipated in 1,914.0 1,950.0 international IT Services 1,754.3 Full Ye

  13. Slide 13: Social Infrastructure

    FY25/3 Forecast Social Infrastructure Revenue and Adjusted Operating Profit -Revenue expected to increase from steady delivery Revenue Adj. OP Adj. OP Margin of projects through ANS （Billions of Yen） 1,250.0 1,170.0 1,180.0 1,077.3 1,084.0 1,044.8 -Adj. OP to increase due to an improvement of global

  14. Slide 14: III. Topics

    III. Topics © NEC Corporation 2024

  15. Slide 15: NEC BluStellar value creation model

    Launched the value creation model “NEC BluStellar" to guide customers to the future and strengthen DX business AI for all Processes 01 Fully utilize AI in all business processes from consulting to operation and maintenance Business model AI & Security 02 Consolidate cutting-edge technology Focus on

  16. Slide 16: Evolve from a traditional system integrator to drive customer value and accelerate DX business

    Evolve from a traditional system integrator to drive customer value and accelerate DX business • Started a demonstration of design enhancement using "PLM Software + Generative AI" with Toray Engineering Co., Ltd. • Agreed on a strategic partnership focusing on biometric authentication with SoftBank

  17. Slide 17: NEC IR Day 2024

    NEC IR Day 2024 Mon., October 7th Online webinar DAY P ROGRAM SP EAKER Corporate Executive Vice President Opening and CFO Osamu Fujikawa Corporate Senior Executive Vice President and Co-COO Kazuhiro Sakai Oct. IT Services Corporate Senior Executive Vice President and CDO Toshifumi Yoshizaki 7th Corp

  18. Slide 18: Orchestrating a brighter world

    \ Orchestrating a brighter world NEC

  19. Slide 19: IV. Financial Results (Appendix)

    IV. Financial Results (Appendix) © NEC Corporation 2024

  20. Slide 20: Non-GAAP Operating Profit Adjustment Items

    Q1 Results Non-GAAP Operating Profit Adjustment Items Q1 (Billions of Yen) FY24/3 FY25/3 YoY Results Results Adjusted Operating Profit -8.1 4.5 +12.7 M&A Related Amortization of Adjusted 8.5 8.1 - 0.3 Intangible Assets Items M&A Related Expenses 0.1 - - 0.1 Adjusted Operating Profit 0.5 12.7 +12.2 S

  21. Slide 21: Non-GAAP Net Profit Adjustment Items

    Q1 Results Non-GAAP Net Profit Adjustment Items Q1 (Billions of Yen) FY24/3 FY25/3 YoY Results Results Net Profit -7.4 -5.8 +1.6 M&A Related Amortization of 6.0 5.9 - 0.1 Intangible Assets and M&A Related Expenses Structural Reform Expenses Adjusted - 2.5 +2.5 and Impairment Losses Items Stock Compe

  22. Slide 22: Financial Position Data

    Q1 Results Financial Position Data 1Q As of As of Change from (Billions of Yen) March 31, June 30, March 31, 2024 2024 2024 Total Assets 4,227.5 4,124.3 - 103.2 Total Equity 2,089.5 2,115.6 +26.1 Interest-bearing Debt 548.6 582.7 +34.0 Equity Attributable to Owners of the Parent 1,915.6 1,940.4 +24.

  23. Slide 23: V. Historical Data (Appendix)

    V. Historical Data (Appendix) © NEC Corporation 2024

  24. Slide 24: Revenue Breakdown

    Revenue Breakdown FY23/3 FY24/3 FY25/3 (Billions of Yen) Results Results Results Q1 1H Q3 2H Full Year Q1 1H Q3 2H Full Year Q1 Public 67.4 156.7 94.2 246.9 403.5 73.3 179.2 101.4 256.5 435.7 75.6 Enterprise 137.3 283.2 140.2 320.0 603.2 157.1 327.1 177.5 376.8 704.0 164.1 Cross-Industry 20.2 49.7 2

  25. Slide 25: Adjusted OP Breakdown

    Adjusted OP Breakdown FY23/3 FY24/3 FY25/3 (Billions of Yen) Results Results Results Q1 1H Q3 2H Full Year Q1 1H Q3 2H Full Year Q1 Domestic Adjusted Operating Profit -6.4 25.7 26.0 97.2 122.9 10.9 42.6 37.9 122.6 165.1 10.2 % of revenue -2.2% 4.0% 7.7% 11.7% 8.4% 3.4% 6.0% 9.7% 13.5% 10.2% 3.0% Int

  26. Slide 26: 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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