Id Holdings CorporationTSE: 4709

Financial Results Presentations 2Q(23/4/1-23/9/30)

· MarketScreener

ID Holdings Corporation

April 1, 2023 - September 30, 2023

Financial Results Presentations

President, Representative Director

Code 4709

TSE Prime Market

and Group CEO

Masaki Funakoshi

* Our website can be accessed from the QR Code.

November 21, 2023

©2023 ID Holdings Corporation. All Rights Reserved.

1

Change or Die!

1

Performance Overview for Q2

2

Mid-Term Management Plan

Next 50 Episode Ⅱ: Ride on Time

©2023 ID Holdings Corporation. All Rights Reserved.

2

Overview of Financial Results for Q2

Change or Die!

Net Sales

¥15,938 million（+7.2% YoY）

  • System management; cybersecurity; consulting and training; and IT infrastructure all trended favorably.

Operating Income

¥1,421 million（+23.0% YoY）

  • High-marginDX-related business expanded
  • Rising sales drove up earnings
  • Returning value to employees

©2023 ID Holdings Corporation. All Rights Reserved.

3

Financial Results (Consolidated)

2022.92023.9

（ million）

Results (% of net sales) Results (% of net sales)

Diff.

YoY

Change or Die!

Net sales

Cost of sales

Gross profit

SG&A expenses

EBITDA1

Operating income

Ordinary income

Net income attributable to owners of parent

Earnings per share (EPS) ()

EPS before amortization of goodwill2()

14,861

-

15,938

-

1,076

+7.2%

11,536

77.6%

12,354

77.5%

817

+7.1%

3,324

22.4%

3,583

22.5%

258

+7.8%

2,169

14.6%

2,162

13.6%

-7

-0.3%

1,454

9.8%

1,722

10.8%

267

+18.4%

1,155

7.8%

1,421

8.9%

266

+23.0%

1,209

8.1%

1,504

9.4%

295

+24.5%

680

4.6%

844

5.3%

163

+24.0%

41.04

-

50.76

-

9.72

-

54.43

-

64.12

-

9.69

-

Note:

  1. EBITDA = Operating income + Depreciation + Amortization of goodwill
  2. EPS before amortization of goodwill = (Net income attributable to owners of parent + Amortization of goodwill) ÷ Interim average number of shares

©2023 ID Holdings Corporation. All Rights Reserved.

4

Change or Die!

Financial Results by Services

Net Sales

Gross Profit

（¥ million）

14,861

15,938

3,324

＋43

3,583

166

10

54

212

-45

＋398.7%

(1.0%)

(1.5%)

(1.4%)

-21.5%

1,502

(0.3%)

+172

488

1,130

+371

(9.4%)

315

+54.6%

(13.6%)

(9.5%)

(7.6%)

+32.9%

1,396

+110

420

1,228

(8.8%)

310

+167

(9.3%)

+35.5%

(11.7%)

(8.3%)

+13.6%

5,647

5,659

1,210

-181

1,028

+0.2%+11

(35.5%)

(38.0%)

(36.4%)

-15.0%

(28.7%)

6,641

+571

7,213

1,476

+114

1,591

+7.8%

+8.6%

(45.3%)

(44.4%)

(44.7%)

(44.4%)

2022.9

2023.9

2022.9

2023.9

■ System Management

■ Software Development ■ IT Infrastructure

■ Cybersecurity, Consulting and Training ■ Others

Net Sales by Services

■ System

⊕ New orders were received due to redoubling of sales efforts aimed at major IT vendors, while orders accepted from

Management

existing clients swelled

■ Software

⊕ Reinforced sales efforts aimed at major IT vendors led to expansion in transactions, while orders accepted from

Development

clients related to the financial fields swelled

  • Some projects with public-sector-related clients drew to a close

■ IT Infrastructure

⊕ The Group enjoyed increases in orders accepted for major projects with finance-related clients and in transactions

with major IT vendors and manufacturing-related clients

■ Cybersecurity,

⊕ Orders accepted in consulting and cybersecurity swelled

Consulting and

Training

©2023 ID Holdings Corporation. All Rights Reserved.

5

Change or Die!

Net Sales of DX-related Business

DX-related business

Promoting customer's DX by combining existing IT services with cutting-edge technologies such as cloud, AI and IoT.

DX-related sales & sales ratio

（¥ million）

52.9%

10,000

46.8%

✔Expanding focus on

8,438

advanced development &

149

42.2%

system management,

8,000

6,951

902

5,629

136

1,262

IT infrastructure,

721

consulting.

6,000

145

1,221

539

835

3,546

【 Gross profit margin 】

4,000

1,874

2,597

25.7% (YoY+0.6P）

2,000

2,234 2,274 2,577

0

2021.9

2022.9

2023.9

About 6 points higher than non-DX-related business

Automation and Optimization

Consulting and Training

Cloud

Remote Support, Advanced Development & System Management*

Security and IT Infrastructure

Sales ratio

*"Advanced System Management" has been added from the beginning of FY2023.

6

©2023 ID Holdings Corporation. All Rights Reserved.

Major Customers（Non-Finance） ⊕ Rising orders from customers related
to manufacturing, public-sector,transportation, and broadcasting
⊝ Wrap-upof some projects with public- sector customers
Major Customers（Finance）
⊕ Orders accepted for major projects in IT infrastructure
⊕ Expansion of orders received in software development
Hitachi Group
⊝ Rebound decline due to wrap-upof major projects in software development in the previous fiscal year
IBM Group
⊕ Receipt of new orders and expansion of existing transactions
【Reference】
Strategic Partners
⊝ Completion of some projects in system management

Net Sales by Strategic Alliances

Transactions with major, high-value customers that are actively investing in IT account for over 80% of net sales.

Change or Die!

(¥ million) Figures in brackets indicate % of net sales

14,861

2,949

(19.8%)

1,975

(13.3%)

2,537

(17.1%)

3,866

(26.0%)

1,521

(10.2%)

2,010

(13.5%)

+96

(+3.3%)

-119(-6.1%)

+187

(+7.4%)

+256

(+6.6%)

-30(-2.0%)

+686

(+34.1%)

15,938

3,045

(19.1%)

1,856

(11.6%)

2,725

(17.1%)

4,123

(25.9%)

1,490

(9.4%)

2,696

(16.9%)

2022.9

2023.9

■ IBM Group

■ Hitachi Group

■ Major Customers （ Finance ）

■ Major Customers （ Non-Finance）■ Strategic Partners ■ Others

2023.9

Kyndryl

MI Digital

IBM Japan

Japan

Services

1,319

922

454

(8.3%)

(5.8%)

(2.9%)

©2023 ID Holdings Corporation. All Rights Reserved.

7

Net Sales Composition by End-user Industry

Transactions with the financial and public sectors account for over 60% of net sales.

Change or Die!

(¥ million)

2023.9

(% of net sales)

YoY

Finance

7,051

44.2%

+276

+4.1%

Public

2,870

18.0%

+244

+9.3%

Information &

1,793

11.3%

+161

+9.9%

Communication

Manufacturing

1,480

9.3%

+166

+12.7%

Transportation

858

5.4%

+124

+16.9%

Others*

1,883

11.8%

+103

+5.8%

(¥ million) Figures in brackets indicate % of net sales

1,883

858 (11.8%)

(5.4%)

1,480

(9.3%)

1,793

(11.3%)

2,870

(18.0%)

7,051

(44.2%)

Total

15,938

100.0% +1,076 +7.2%

*"Media", "Healthcare", "Construction, Real estate", "Wholesale, Retail, Restaurants", etc.

**From FY2023, we have changed the accounting classification for some customers. The figures of previous fiscal year have been adjusted based on changes

  • Finance
  • Public
  • Information & Communication
  • Manufacturing
  • Transportation
  • Others

©2023 ID Holdings Corporation. All Rights Reserved.

8

Operating Income Analysis（YoY）

Change or Die!

2022.9

2023.9

Main Reasons in Changes

（ million）

Results

Results

Diff.

Gross profit

3,324

3,583

+258

・Increase in net sales

+1,076

・Increase in cost of sales

+817

-Labor cost

+302

-Subcontract expenses

+503

-Manufacturing expenses

+10

-Purchases

+5

SG&A

2,169

2,162

-7

・Decrease in personnel cost

-50

expenses

-Reassignment of personnel from SG&A

divisions to business divisions

etc.

・Increase in other expenses

+42

Operating

1,155

1,421

+266

income

9

©2023 ID Holdings Corporation. All Rights Reserved.

Net Income Attributable to Owners of Parent Analysis（YoY）

Change or Die!

（ million）

Ordinary income

Extraordinary income

Extraordinary losses

Total income taxes

Net income

attributable to owners of parent

2022.9

2023.9

Main Reasons in Changes

Results

Results

Diff.

1,209

1,504

+295 ・Increase in operating income

+266

・Increase in non-operating income

+25

・Decrease in non-operating expenses

-3

0 0 -

3 0 -3 ・Decrease in reaction to loss on retirement of

non-current assets in the previous fiscal year -3

524 660 +136

680 844 +163

©2023 ID Holdings Corporation. All Rights Reserved.

10