■Future Outlook LeTech <3497> expects an increase in sales and ordinary income of more than 20%, with sales of 2.14 billion yen (+33.8% YoY), operating income of 150 million yen (+7.7% YoY), ordinary income of 100 million yen (+21.7% YoY), and net income of 1.03 billion yen (-11.4% YoY) for the July 2024 term, and has maintained its initial forecast (announced in September 2023).

1. Performance Outlook for March 2025

Career Link's consolidated performance for the fiscal year ending March 2025 is expected to result in increased sales and profits, with sales revenue of 48 billion yen, a 9.6% increase from the previous year, operating profit of 3.495 billion yen, a 6.6% increase from the previous year, ordinary profit of 3.49 billion yen, a 6.4% increase from the previous year, and net income attributable to parent company shareholders of 2.389 billion yen, an 8.5% increase from the previous year. In terms of sales, the administrative personnel services business, mainly the BPO-related business division, is expected to increase by 6.7% due to new clients and expanding business areas. Additionally, the manufacturing personnel services business will continue to experience high growth, up 25.5% due to strong demand.

Regarding profits, the gross profit margin is expected to remain stable, but the operating profit margin is expected to decrease by 0.2 points from the previous year due to an increase in selling, general and administrative expenses. The main reasons for the increase in SG&A expenses are increased costs related to recruiting staff and hiring specialized employees such as digital personnel, as well as increased system development costs for promoting DX. However, it is expected that an increase in gross profit and improved operational efficiency will secure an increase in profit.

It is expected that the first quarter results will show a decrease in revenue and profit compared to the same period last year. This is due to a large and highly profitable BPO project that was still outstanding from the previous fiscal year ending March 2023. Therefore, it is expected that there will be a turn towards increased sales and profits from the second quarter on a quarterly basis.

The sales revenue for each business is expected to be 39.154 billion yen, a 6.7% increase from the previous year, for the administrative personnel services business. Our policy is to develop long-term deals for about three to five years, place personnel with high profitability, and expand business areas (such as window management and general affairs) with newly acquired customers for both government agencies and private enterprises. With regard to local governments, we aim to expand shares and increase the volume of orders through both new acquisitions and existing business partners. Although there were only 3 more core personnel employed on average during the fiscal year ending March 2025 compared to the previous year, we are planning for an increase of 45 contracts, totaling 226 BPO-related projects.

The manufacturing personnel services business is expected to continue high growth, with revenues of 856 million yen, a 25.5% increase from the previous year. In addition to an expansion in orders from existing customers in the food processing department, we will actively promote new customer acquisitions in the manufacturing and processing department, not only in the field of residential equipment manufacturing and mechanical manufacturing but also in other industries, aiming for high growth.

(Written by FISCO guest analyst, Jo Sato)