Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.
Consolidated Financial Results for the
First Three Months of the Fiscal Year Ending March 31, 2021
(Japanese Accounting Standards)
August 3, 2020 | |||
Company name: | SIGMAXYZ Inc. | Stock listing: Tokyo Stock Exchange | |
Stock code: | 6088 | URL: https://www.sigmaxyz.com/ | |
Representative: | Ryuichi Tomimura, Representative Director and President | ||
Inquiries: | Shinya Tabata, CFO | Telephone: +81-3-6430-3400 |
Scheduled date of quarterly securities report filing: August 5, 2020
Scheduled date of dividend payment: -
Preparation of supplementary materials on quarterly financial results: Yes
Schedule of quarterly financial results presentation meeting: None
(Amounts of less than ¥1 million are rounded down)
1. Consolidated Financial Results for the Three Months Ended June 30, 2020 (from April 1, 2020 to June 30, 2020)
(1) Consolidated Operating Results (Cumulative) | (% figures indicate year-on-year changes) | |||||||||
Revenue | Operating Profit | Ordinary Profit | Profit Attributable to | |||||||
Owners of Parent | ||||||||||
Three months ended | Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | ||
June 30, 2020 | 3,366 | (11.5) | 152 | (50.6) | 163 | (45.1) | 87 | (46.0) | ||
June 30, 2019 | 3,804 | 29.1 | 309 | 141.9 | 297 | 66.2 | 161 | 60.7 | ||
Note: Comprehensive Income | Three | months ended June 30, 2020: ¥87 million [(46.0)%] | ||||||||
Three months ended June 30, 2019: ¥161 million [60.7%] | ||||||||||
Profit per Share | Profit per Share | |||||||||
(Diluted) | ||||||||||
Three months ended | Yen | Yen | ||||||||
June 30, 2020 | 4.53 | 4.53 | ||||||||
June 30, 2019 | 8.33 | 8.29 |
Reference: Profit before income taxes | Three months ended June 30, 2020: ¥309 million (4.1%) | ||||
Three months ended June 30, 2019: ¥297 million (80.2%) | |||||
(2) Consolidated Financial Position | |||||
Total Assets | Net Assets | Equity Ratio | Net Assets per Share | ||
As of | Millions of yen | Millions of yen | % | Yen | |
June 30, 2020 | 9,253 | 4,732 | 51.1 | 246.45 | |
March 31, 2020 | 9,669 | 5,036 | 52.1 | 263.82 |
Reference: Equity | As of June 30, 2020: | ¥4,732 million | |||||
As of March 31, 2020: | ¥5,036 million | ||||||
2. Dividends | |||||||
Annual Dividend | |||||||
First Quarter-End | Second Quarter-End | Third Quarter-End | Fiscal Year-End | Total | |||
Fiscal year ended | Yen | Yen | Yen | Yen | Yen | ||
March 31, 2020 | － | 0.00 | － | 22.00 | 22.00 | ||
Fiscal year ending | － | ||||||
March 31, 2021 | |||||||
Fiscal year ending | |||||||
March 31, 2021 | 0.00 | － | 22.00 | 22.00 | |||
(Forecast) | |||||||
Note: Revisions to the most recently announced dividend forecast: None
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3. Consolidated Earnings Forecasts for the Fiscal Year Ending March 31, 2021 (from April 1, 2020 to March 31, 2021)
(Percentage figures indicate year-on-year changes)
Revenue | Ordinary Profit | Profit before Income | Profit Attributable to | Profit per Share | |||||||||
Taxes | Owners of Parent | ||||||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | Yen | |||||
Fiscal year ending | 14,500 | (9.4) | 1,750 | (19.6) | 1,050 | (25.4) | 54.68 | ||||||
－ | － | ||||||||||||
March 31, 2021 | |||||||||||||
- 15,500 | - (3.1) | - 2,350 | - 8.0 | - 1,520 | - 8.0 | - 79.16 | |||||||
Notes: 1 | Revisions to the most recently announced earnings forecasts: Yes |
2 For details on the consolidated earnings forecasts, please refer to the "Notice Concerning Earnings Forecasts" announced on August 3, 2020 (Japanese Only), and the English translation of "Consolidated Financial Results Supplementary Document Q1 FY20."
- Notes
- Changes in significant subsidiaries during the period (changes in specified subsidiaries affecting the scope of consolidation): None
- Adoption of special accounting methods for preparation of quarterly consolidated financial statements: None
- Changes in accounting policies, changes in accounting estimates, and retrospective restatements
- Changes in accounting policies associated with revisions to accounting standards: None
- Changes in accounting policies other than those in item 1) above: None
- Changes in accounting estimates: None
- Retrospective restatements: None
- Number of shares issued (common stock)
- The number of shares issued as of the end of the period (including treasury shares)
As of June 30, 2020 | 21,068,300 shares | |
As of March 31, 2020 | 21,068,300 shares | |
2) | The number of treasury shares as of the end of the period | |
As of June 30, 2020 | 1,865,734 shares | |
As of March 31, 2020 | 1,977,334 shares | |
3) | Average number of shares outstanding during the period (cumulative from the start of the fiscal year) | |
Three months ended June 30, 2020 | 19,197,967 shares | |
Three months ended June 30, 2019 | 19,360,167 shares |
Note: The number of treasury shares excluded from the calculation of the number of treasury shares as of the end of the period and average number of shares outstanding during the period (cumulative from the start of the fiscal year) include the Company's shares held by Trust & Custody Services Bank, Ltd. (Trust Account E) as trust assets for the Employee Stock Ownership Plan (J-ESOP), and the Company's shares held by Japan Trustee Services Bank, Ltd. (Trust Account) as trust assets for a performance-linked stock compensation program. Following the absorption-type merger carried out on July 27, 2020 among Trust & Custody Services Bank, Ltd., Japan Trustee Services Bank, Ltd. (hereinafter "JTSB") and JTC Holdings, Ltd., with JTSB being a surviving company, the integrated company has been named as "Custody Bank of Japan, Ltd."
- These quarterly financial statements are outside the scope of quarterly review procedures by certified public accountants or audit corporations.
-
Explanation regarding proper use of financial forecasts, and other special matters
The earnings forecasts and other forward-looking statements presented in these materials reflect information currently available to the Company and assumptions that are deemed to be reasonable, but the Company does not guarantee the achievement of these targets. Actual results may differ significantly as a consequence of various factors. For more information on the Company's earnings forecasts and underlying assumptions, please refer to "Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements" on page 3 of the attached materials.
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
Contents of the attached materials
1. Qualitative Information on Quarterly Financial Results | 2 | |
(1) | Explanation of Operating Results | 2 |
(2) | Explanation of Financial Position | 2 |
(3) | Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements | 3 |
2. Quarterly Consolidated Financial Statements and Important Notes | 4 | |
(1) | Quarterly Consolidated Balance Sheet | 4 |
(2) | Quarterly Consolidated Statements of Income and Comprehensive Income | 5 |
Quarterly Consolidated Statement of Income | ||
Three months ended June 30, 2019 and 2020 | 5 | |
Quarterly Consolidated Statement of Comprehensive Income | ||
Three months ended June 30, 2019 and 2020 | 6 | |
(3) | Notes to Quarterly Consolidated Financial Statements | 7 |
(Notes Regarding Assumption of a Going Concern) | 7 | |
(Notes on Significant Changes in the Amount of Shareholders' Equity) | 7 | |
(Segment Information, etc.) | 7 |
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
1. Qualitative Information on Quarterly Financial Results
(1) Explanation of Operating Results
The Japanese economy is facing challenging times due to the novel coronavirus disease (hereinafter "COVID-19"), and we need to continue to pay close attention to its impacts on domestic and global economies. Companies are being strongly urged to review how their businesses are managed in a rapidly changing social and economic environment, while ensuring business continuation and employees' safety under the crisis.
In such environment, the Group promotes businesses to support client companies in their digital transformations and create innovations. During the three months ended June 30, 2020, despite some delays in receiving orders due to self- restraint from face-to-face customer visiting and delayed launch of new projects by our client companies caused by the spread of COVID-19, we were able to maintain stable delivery through remote work by making the best use of our digital workplace environment under the strict Security Policy.
The consolidated financial results and key business indicators for the three months ended June 30, 2020 are as follows.
Revenue decreased to ¥3,366 million (down 11.5% year on year) due to declines in revenue from the consulting services for the aviation industry that is severely affected by the COVID-19 pandemic and from product sales, which involved the procurement of hardware and software products for call center projects in the retail industry, despite growth in the ERP cloud migration services.
Selling, general and administrative expenses came to ¥1,147 million (up 9.1% year on year), reflecting increases in costs incurred for measures against COVID-19 and personnel costs associated with recruitment, as well as investment in solutions development and productivity improvement.
Operating profit and ordinary profit decreased to ¥152 million (down 50.6% year on year) and ¥163 million (down 45.1% year on year), respectively.
Extraordinary income came to ¥146 million due to the sale of the Company's entire stake in Lawson Digital Innovation Inc. to Lawson, Inc. in April 2020. Lawson Digital Innovation is a joint venture established in 2016 primarily for the purpose of promoting the digitalization of the Lawson business. We sold our stake in the company as we achieved the intended purpose.
Total income taxes stood at ¥222 million, marking a 63.4% increase from the same period of the previous fiscal year, due to an increase in valuation allowance.
Profit before income taxes came to ¥309 million (up 4.1% year on year) whereas profit attributable to owners of parent came to ¥87 million, marking a 46.0% decrease from the same period of the previous fiscal year. In addition, profit attributable to owners of parent before tax effects came to ¥179 million, marking a 0.5% decrease from the same period of the previous fiscal year.
On the hiring front, the Company added 13 mid-career recruits and 48 new graduates in the three months ended June 30, 2020. This brought its total workforce up to 564 people (up 25 year on year). The training for new graduates is going well in the fully remote work environment. They will start working on their job from the coming October.
We achieved to maintain a high level of project satisfaction with a score of 94 points (down 1 point year on year).
(Measures to Prevent Spread of COVID-19)
-
Utilization of remote work
We are maintaining stable business operations by utilizing remote work. - Safety and health management
We are taking strict measures including a general ban on domestic and international business trips, voluntary restraint from private trips in and outside Japan, regular sterilization of our office and thorough implementation of measures such as having the employees check their temperature and wear a face mask. - Compliance with the guidelines issued by the national and local governments
We are working to ensure thorough compliance with the guidelines issued by the national and local governments such as those for employees working outside the office.
- Explanation of Financial Position
(Assets)
Total assets as of June 30, 2020 stood at ¥9,253 million (down ¥415 million from the end of the previous fiscal year). This mainly reflected an increase in cash and deposits (up ¥376 million from the end of the previous fiscal year), a decrease in accounts receivable-trade (down ¥520 million from the end of the previous fiscal year) and a decrease in investment securities (down ¥262 million from the end of the previous fiscal year).
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
(Liabilities)
Liabilities as of June 30, 2020 totaled ¥4,520 million (down ¥111 million from the end of the previous fiscal year). This mainly reflected an increase in short-term borrowings (up ¥600 million from the end of the previous fiscal year) and a decrease in income taxes payable (down ¥515 million from the end of the previous fiscal year).
(Net assets)
Net assets as of June 30, 2020 came to ¥4,732 million (down ¥304 million from the end of the previous fiscal year). This mainly reflected a decline in retained earnings (down ¥366 million from the end of the previous fiscal year) due to impact of ¥453 million in dividends paid (compared to ¥374 million in the same period of the previous fiscal year).
(3) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements
Due to the impact of the COVID-19 pandemic, the Company found it difficult to prepare reasonable forecasts for the fiscal year ending March 31, 2021 and therefore left them undecided. However, we have now decided to release the consolidated earnings forecasts, which are based on information and estimates available as of the filing date of this report.
For details, please refer to the "Notice Concerning Earnings Forecasts" announced on August 3, 2020 (Japanese Only), and the English translation of "Consolidated Financial Results Supplementary Document Q1 FY20."
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
2. Quarterly Consolidated Financial Statements and Important Notes
- Quarterly Consolidated Balance Sheet
(Thousands of yen) | |||
Fiscal year ended March 31, 2020 | Three months ended June 30, 2020 | ||
(As of March 31, 2020) | (As of June 30, 2020) | ||
Assets | |||
Current assets | |||
Cash and deposits | 4,175,567 | 4,552,322 | |
Accounts receivable-trade | 1,912,122 | 1,391,636 | |
Operational investment securities | 648,433 | 707,488 | |
Other | 233,718 | 262,977 | |
Allowance for doubtful accounts | (26,400) | - | |
Total current assets | 6,943,442 | 6,914,424 | |
Non-current assets | |||
Property, plant and equipment | 251,110 | 229,383 | |
Intangible assets | |||
Software | 251,150 | 248,197 | |
Software in progress | 167,389 | 182,572 | |
Other | 6,729 | 6,537 | |
Total intangible assets | 425,268 | 437,307 | |
Investments and other assets | |||
Investment securities | 1,346,620 | 1,084,549 | |
Deferred tax assets | 245,443 | 152,564 | |
Other | 457,486 | 435,202 | |
Total investments and other assets | 2,049,550 | 1,672,316 | |
Total non-current assets | 2,725,930 | 2,339,007 | |
Total assets | 9,669,373 | 9,253,432 | |
Liabilities | |||
Current liabilities | |||
Accounts payable-trade | 356,138 | 291,105 | |
Short-term borrowings | 1,200,000 | 1,800,000 | |
Accounts payable-other | 899,514 | 572,252 | |
Income taxes payable | 660,596 | 145,426 | |
Provision for share-based remuneration | 193,393 | 175,763 | |
Other | 115,128 | 142,317 | |
Total current liabilities | 3,424,770 | 3,126,865 | |
Non-current liabilities | |||
Long-term borrowings | 300,000 | 300,000 | |
Lease obligations | 16,375 | 14,893 | |
Provision for share-based remuneration | 248,312 | 67,206 | |
Provision for share-based remuneration for | 556,888 | 925,517 | |
directors (and other officers) | |||
Asset retirement obligations | 86,444 | 86,444 | |
Total non-current liabilities | 1,208,021 | 1,394,061 | |
Total liabilities | 4,632,791 | 4,520,927 | |
Net assets | |||
Shareholders' equity | |||
Share capital | 2,842,098 | 2,842,098 | |
Capital surplus | 1,108,045 | 1,125,751 | |
Retained earnings | 3,181,923 | 2,815,646 | |
Treasury shares | (2,095,486) | (2,050,992) | |
Total shareholders' equity | 5,036,581 | 4,732,505 | |
Total net assets | 5,036,581 | 4,732,505 | |
Total liabilities and net assets | 9,669,373 | 9,253,432 |
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
-
Quarterly Consolidated Statements of Income and Comprehensive Income (Quarterly Consolidated Statement of Income)
(Three months ended June 30, 2019 and 2020)
(Thousands of yen)
Three months ended June 30, 2019 (From April 1, 2019 to June 30, 2019)
Three months ended June 30, 2020 (From April 1, 2020 to June 30, 2020)
Revenue | 3,804,470 | 3,366,133 |
Cost of revenue | 2,443,442 | 2,065,452 |
Gross profit | 1,361,027 | 1,300,681 |
Selling, general and administrative expenses | 1,051,686 | 1,147,794 |
Operating profit | 309,340 | 152,886 |
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity method
Gain on investments in securities
Other
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity method
Other
1,194 | 1,623 |
15,674 | - |
2,655 | |
- | |
3,281 | 4,837 |
2,570 | 2,323 |
22,721 | 11,440 |
137 | 889 |
- | |
32,202 | |
2,241 | 39 |
Total non-operating expenses | 34,580 | 929 | |
Ordinary profit | 297,481 | 163,397 | |
Extraordinary income | |||
Gain on sales of shares of subsidiaries and associates | - | 146,373 | |
Total extraordinary income | - | 146,373 | |
Profit before income taxes | 297,481 | 309,771 | |
Income taxes-current | 116,715 | 129,849 | |
Income taxes-deferred | 19,576 | 92,879 | |
Total income taxes | 136,292 | 222,728 | |
Profit | 161,188 | 87,042 | |
Profit attributable to owners of parent | 161,188 | 87,042 |
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
(Quarterly Consolidated Statement of Comprehensive Income) (Three months ended June 30, 2019 and 2020)
(Thousands of yen)
Three months ended June 30, 2019 (From April 1, 2019 to June 30, 2019)
Three months ended June 30, 2020 (From April 1, 2020 to June 30, 2020)
Profit | 161,188 | 87,042 |
Comprehensive income | 161,188 | 87,042 |
Comprehensive income attributable to: | ||
Owners of parent | 161,188 | 87,042 |
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SIGMAXYZ Inc. (6088) Financial Results for the Three Months Ended June 30, 2020
-
Notes to Quarterly Consolidated Financial Statements (Notes Regarding Assumption of a Going Concern)
No applicable matters to report.
(Notes on Significant Changes in the Amount of Shareholders' Equity)
I. Three months ended June 30, 2019 (From April 1, 2019 to June 30, 2019) 1. Dividends paid
Resolution | Type of shares | Total amount of | Dividend per | Record date | Effective date | Appropriated |
dividends | share | |||||
from | ||||||
(Thousands of yen) | (yen) | |||||
May 7, 2019 | Common | March 31, | June 10, | Retained | ||
board | 374,397 | 18 | ||||
stock | 2019 | 2019 | earnings | |||
resolution | ||||||
Note: Total amount of dividends includes ¥27 million of dividends for shares held in trust accounts for the Employee Stock Ownership Plan (J-ESOP) and performance-linked stock compensation program.
- Dividends whose record date falls in the three months ended June 30, 2019, but whose effective date comes after June 30, 2019.
No applicable matters to report.
II. Three months ended June 30, 2020 (From April 1, 2020 to June 30, 2020)
- Dividends paid
Resolution | Type of shares | Total amount of | Dividend per | Record date | Effective date | Appropriated |
dividends | share | |||||
from | ||||||
(Thousands of yen) | (yen) | |||||
May 7, 2020 | Common | March 31, | June 8, | Retained | ||
board | 453,318 | 22 | ||||
stock | 2020 | 2020 | earnings | |||
resolution | ||||||
Note: Total amount of dividends includes ¥33 million of dividends for shares held in trust accounts for the Employee Stock Ownership Plan (J-ESOP) and performance-linked stock compensation program.
2. Dividends whose record date falls in the three months ended June 30, 2020, but whose effective date comes after June 30, 2020.
No applicable matters to report.
(Segment Information, etc.) [Segment information]
This information has been omitted as the SIGMAXYZ Group mainly operates in the consulting business, and other operations are not significant.
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