■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).
3. Growth Strategy
System Dic <3804> positions the period until October 2025 as a period of building stamina for a leap forward in the medium-term plan "First System Dic Strengthening Plan" (October 2023 to October 2025). It aims to achieve sustainable sales growth through expanding market share and accumulating stock income while strengthening investment in employees and equipment, building a highly organized system vendor and forming a strong technical group, building a robust management foundation that can withstand changes in the market environment. It also aims to improve corporate value and challenge listing on the main board market as an extension of that. The three key themes are as follows:
(1) "Expand market share and further strengthen each business"
We will expand our industry share in each business, achieve further accumulation of stock income, and form a strong technical group through the strengthening of engineer hiring. We also aim for steady sales growth and stock income ratio of 50%, operating margin of 20%, and self-capital ratio of 60% or more by thoroughly reducing unnecessary costs. Regarding expanding the market share, we plan to achieve this by releasing new products that will lead to future growth in each business one after another over the past few years, expanding sales of these products, developing new features utilizing generated AI technology, and enhancing product competitiveness through high added value. For generated AI functions, we are progressing with the development of functions based on knowledge gained from Nakamura Ranch Co., Ltd. and plan to utilize them in each product. In addition, in the administrative sector (public education & public accounting solutions), it is expected that digitization and system standardization will progress as government cloud movements accelerate, providing a good opportunity for the company, which has a wealth of delivery results, to further expand its sales.
(2) "Become an exciting company"
Under the recognition that human resources are the source of corporate growth, the company aims to strengthen human capital management. In order to strengthen human resources, it is necessary to become an attractive company that makes people want to join, and for this purpose, we consider it important to gain overwhelming market share and improve name recognition through existing businesses, and to launch attractive new businesses that make people want to participate. In addition, we will actively work on social contribution and regional promotion. Although there are no specific projects that can be announced at this point for new businesses, the grouping of Nakamura Ranch Co., Ltd. is expected to create new solutions in the AI field.
(3) "Grow with employees and stakeholders"
As one of the KPIs of the medium-term plan, the company aims to exceed a 90% retention rate for employees 3 years after joining. The company is working to improve retention rates by improving personnel systems, improving benefits, and improving the work environment. In addition, we have started efforts to obtain certification as a corporation with excellent health management. The company has actively promoted initiatives related to employee health maintenance and promotion so far, but announced the "health management declaration" in April 2024 to strengthen those initiatives further. Rather than seeing the cost of employee health maintenance and promotion as "costs," we view it as an "investment" for improving employee performance and engagement and will actively promote "health management." We plan to strengthen IR activities more than ever before, disclosing information proactively to properly evaluate corporate value and to grow together with stakeholders.
※A company with excellent health management is a corporation certified by the Japan Health Council as having practiced excellent health management. One of the main evaluation items for certification is to meet the criteria of multiple evaluation items such as the rate of regular medical checkups and implementation of stress checks for employees.
※A "Healthy Management Excellence Corporation" refers to a corporation recognized by the Japan Health Council as "practicing excellent health management." The main evaluation criteria for recognition include meeting multiple criteria such as a periodic health examination rates and conducting stress checks for employees.
(Written by FISCO guest analyst, Jo Sato)