Summary of Consolidated Financial Results
for the Nine Months Ended December 31, 2021 (J-GAAP)
February 10, 2022 | |||
Listed Company Name: IR Japan Holdings, Ltd. | |||
Securities Code: | 6035 | ||
Listing: | Tokyo Stock Exchange | URL: | https://www.irjapan.jp/ |
Representative: | Shirou Terashita, President and Chief Executive Officer | ||
Contact: | Atsuko Furuta, General Manager, Corporate Planning Department Tel.: +81-3-3519-6750 | ||
Scheduled Date to Submit Quarterly Securities Report: | February 10, 2022 | ||
Scheduled Date to Start Dividend Payment: | ― | ||
Preparation of Results Briefing Materials: | Yes | ||
Holding of Financial Results Briefing: | Yes (for institutional investors and analysts) |
(Amounts of less than one million yen have been truncated)
1. Consolidated Financial Results for the Nine Months Ended December 31, 2021
(from April 1, 2021 to December 31, 2021)
- Consolidated Operating Results
(Percentages indicate year-on-year changes)
Net sales | Operating profit | Ordinary profit | Profit attributable to | ||||||||
owners of parent | |||||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | ||||
Nine months ended | 6,116 | 1.8 | 2,464 | -13.9 | 2,459 | -13.9 | 1,710 | -10.8 | |||
December 31, 2021 | |||||||||||
Nine months ended | 6,008 | 17.9 | 2,861 | 23.4 | 2,855 | 23.3 | 1,916 | 20.3 | |||
December 31, 2020 | |||||||||||
Note: Comprehensive income | Nine months ended December 31, 2021: 1,711 million yen (-10.7%) | ||||||||||
Nine months ended December 31, 2020: 1,917 million yen (20.3%) | |||||||||||
Profit per | Profit per | ||||||||||
share-basic | share-diluted | ||||||||||
Yen | Yen | ||||||||||
Nine months ended | 96.28 | ― | |||||||||
December 31, 2021 | |||||||||||
Nine months ended | 107.90 | ― | |||||||||
December 31, 2020 | |||||||||||
Note: The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc., from the beginning of the first quarter of the fiscal year ending March 31, 2022.
(2) Consolidated Financial Position
Total assets | Net assets | Equity ratio | ||
Millions of yen | Millions of yen | % | ||
As of December 31, 2021 | 8,063 | 6,689 | 83.0 | |
As of March 31, 2021 | 8,410 | 6,647 | 79.0 | |
Reference: Shareholders' equity | As of December 31, 2021: 6,689 million yen | |||
As of March 31, 2021: 6,647 million yen |
Note: The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc., from the beginning of the first quarter of the fiscal year ending March 31, 2022.
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2. Dividends
Full-year dividend | |||||||
First | Second | Third | Year-end | Total | |||
quarter-end | quarter-end | quarter-end | |||||
Yen | Yen | Yen | Yen | Yen | |||
Fiscal year ended | ― | 35.00 | ― | 50.00 | 85.00 | ||
March 31, 2021 | |||||||
Fiscal year ending | ― | 45.00 | ― | ||||
March 31, 2022 | |||||||
Fiscal year ending | 68.00 | 113.00 | |||||
March 31, 2022 (Forecast) | |||||||
Note: Revision of dividends forecast since last announcement: None |
3. Consolidated Results Forecast for the Fiscal Year Ending March 31, 2022 (from April 1, 2021 to March 31, 2022)
(Percentages indicate year-on-year changes)
Net sales | Operating profit | Ordinary profit | Profit attributable | Profit per | |||||
to owners of parent | share | ||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | Yen | |
Full year | 12,000 | 44.8 | 6,000 | 47.0 | 5,990 | 47.1 | 4,050 | 44.5 | 228.00 |
Note: Revision of consolidated results forecast since last announcement: None
Notes:
- Changes in significant subsidiaries during the period: None
-
Application of special accounting treatments in preparing quarterly consolidated financial statements: Yes Note: For details, please refer to "2. Consolidated Financial Statements and Primary Notes (3) Notes Relating to
the Consolidated Financial Statements" on page 13. - Change in accounting policies, accounting estimates, and retrospective restatements
- Change in accounting policies in accordance with revision of accounting standards: Yes
- Change in accounting policies other than item 1) above: None
- Change in accounting estimates: None
- Retrospective restatements: None
Note: For details, please refer to "2. Consolidated Financial Statements and Primary Notes (3) Notes Relating to the Consolidated Financial Statements" on page 13.
- Number of shares issued (common stock)
- Number of shares issued at the end of the period (including treasury shares)
As of December 31, 2021 | 17,839,710 shares | |
As of March 31, 2021 | 17,838,310 shares | |
2) | Number of treasury shares at the end of the period | |
As of December 31, 2021 | 76,283 shares | |
As of March 31, 2021 | 76,083 shares | |
3) | Average number of shares during the period | |
April - December 2021 | 17,763,066 shares | |
April - December 2020 | 17,760,542 shares |
The quarterly review procedure by a certified public accountant or an auditing firm does not apply to this Summary of Consolidated Financial Results.
Explanation regarding appropriate use of results forecast and additional notes
Forward-looking statements, including the results forecast, contained in this document are based on information available to the Company and on certain assumptions deemed to be reasonable as of the date of release of this document. Actual business results may differ substantially due to a number of factors. For conditions prerequisite to the results forecast, and the points to be noted in the use thereof, please refer to "1. Qualitative Information on Financial Results for the Nine Months Ended December 31, 2021 (3) Forward-looking Statements Including Consolidated Results Forecast" on page 8.
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Contents of the Attachment | ||
1. Qualitative Information on Financial Results for the Nine Months Ended December 31, 2021 | .............. 4 | |
(1) | Operating Results .......................................................................................................................................... | 4 |
(2) | Financial Position .......................................................................................................................................... | 7 |
(3) | Forward-looking Statements Including Consolidated Results Forecast ........................................................ | 8 |
2. Consolidated Financial Statements and Primary Notes .............................................................................. | 9 | |
(1) | Consolidated Balance Sheets......................................................................................................................... | 9 |
(2) | Consolidated Statements of Income and Comprehensive Income............................................................... | 11 |
(3) | Notes Relating to the Consolidated Financial Statements ........................................................................... | 13 |
Notes Relating to the Going Concern Assumption...................................................................................... | 13 | |
Notes Regarding Significant Changes in the Amount of Shareholders' Equity .......................................... | 13 | |
Changes in Accounting Policies .................................................................................................................. | 13 | |
Application of Special Accounting Treatments in Preparing Consolidated Financial Statements .............. | 13 | |
Segment Information and Others................................................................................................................. | 13 |
Note: The Company held a briefing for investors (online meeting), as indicated below. Materials distributed at this briefing are set to be posted on the Company's website immediately after the briefing.
Financial results briefing for institutional investors and analysts: Thursday, February 10, 2022
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1. Qualitative Information on Financial Results for the Nine Months Ended December 31, 2021
(1) Operating Results
- General overview
(Millions of yen) | ||||||||||||
Nine months ended | Nine months ended | |||||||||||
December 31, 2021 | December 31, 2020 | |||||||||||
(April to December 2021) | (April to December 2020) | |||||||||||
Amount | Amount | Percentage | Amount | Percentage | ||||||||
change (YoY) | change (YoY) | change (YoY) | ||||||||||
Net sales | 6,116 | 107 | 1.8 | 6,008 | 17.9 | |||||||
Operating profit | 2,464 | −397 | −13.9 | 2,861 | 23.4 | |||||||
Ordinary profit | 2,459 | −396 | −13.9 | 2,855 | 23.3 | |||||||
Profit attributable to | 1,710 | −206 | −10.8 | 1,916 | 20.3 | |||||||
owners of parent | ||||||||||||
(Reference) EBITDA | 2,646 | −382 | −12.6 | 3,029 | 21.9 | |||||||
Note: EBITDA= Ordinary profit + Interest expenses + Depreciation |
During the nine months ended December 31, 2021 (from April 1, 2021 to December 31, 2021), net sales increased 1.8% year on year, to ¥6,116 million, achieving record high. Operating profit decreased 13.9% year on year, to ¥2,464 million, ordinary profit decreased 13.9% year on year, to ¥2,459 million and profit attributable to owners of parent decreased 10.8% year on year, to ¥1,710 million. EBITDA decreased 12.6% year on year, to ¥2,646 million.
In terms of net sales, we steadily increased the number of entrustments of normal projects (amounting to less than ¥50 million) in equity consulting services. However, in addition to delays in the completion of some large-scale projects (amounting to ¥50 million or more) such as PA services*1 and FA services*2 including ownership battles until the fourth quarter, large-scale projects involving activist responses remained on levels comparable to the previous year, amidst the relaxed atmosphere under the new coronavirus outbreak. As a result, despite achieving record-high net sales, our sales growth remained low. In addition, profits ended up decreasing year on year, due to an increase in selling, general and administrative expenses as a result of reinforcements in the human resources system of Japan Originated Investment Bank, Inc., the Group's consolidated subsidiary, and system investments in the stock transfer agency business, among others.
In the third quarter, a symbolic event in which a strategic buyer (business company) waged an ownership battle on a listed company broke out in Japan, which was concluded successfully. The Group's track record as an unparalleled PA/FA, which was instrumental in the victorious outcome in this incident garnered wide attention, imparting additional momentum to entrustments of large-scale projects from both the offensive and defensive sides. However, due to our meticulous process in the progression and completion of these large-scale projects, the completion of some large-scale projects that should have been completed by the third quarter has been delayed.
With regard to institutional reforms, including the reorganization of TSE's listing classifications and revisions to the Corporate Governance Code, the number of entrustments increased steadily for advisory services to support companies in the selection procedures of the new listing classifications and the submission of plans for satisfying the listing criteria by December 31, 2021. Although some companies decided to work on their own without external support, there has been a resurgence in inquiries by some of these companies, after realizing that they had not met the listing criteria, indicating a continuing rise in demand for advisory services to enhance corporate value.
*1 PA services: Proxy Advisory services (Proxy fight services, in which the Company boasts an overwhelmingly successful track record)
*2 FA services: Financial Advisory services (Responses to activists, hostile TOBs, advanced MBOs, and M&As, to which Japan's largest and most cutting-edge group of experts is deployed)
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2) Net sales by type of service
The Group is engaged in the consulting business specializing in IR/SR activities, which constitutes a single business segment. An overview of net sales by service type is as follows.
(Millions of yen) | ||||||||||||
Nine months ended | Nine months ended | |||||||||||
December 31, 2021 | December 31, 2020 | |||||||||||
Service | (April to December 2021) | (April to December 2020) | ||||||||||
Net sales | Percentage of | Percentage | Net sales | Percentage | ||||||||
net sales | change (YoY) | change (YoY) | ||||||||||
IR/SR Consulting | 5,662 | 92.6 | 2.1 | 5,543 | 22.8 | |||||||
Disclosure Consulting | 314 | 5.1 | −7.7 | 341 | −23.0 | |||||||
Databases and Other | 138 | 2.3 | 12.1 | 123 | −11.1 | |||||||
Total | 6,116 | 100.0 | 1.8 | 6,008 | 17.9 | |||||||
IR/SR Consulting
IR/SR Consulting is the Group's core lineup of services. These include SR advisory (shareholder identification surveys, proxy voting simulation, corporate governance improvement, evaluation of the effectiveness of boards of directors, capital policies including shareholder returns, etc.), proxy advisory (PA: comprehensive strategy planning and execution of proxy fights, convocation of and responses to extraordinary general meeting of shareholders, collection and tabulation of proxies, etc.), financial advisory (FA: responses to hostile TOBs, treasury shares TOBs, acceptance simulation of TOBs, placement agents (in capital increases through third-party allotment), comprehensive strategy planning and execution of M&As and MBO, etc.), and the stock transfer agency business. During the period under review, net sales from IR/SR Consulting increased 2.1% year on year, to ¥5,662 million.
- Breakdown of large-scale projects (amounting to ¥50 million or more) and normal projects (amounting to less than ¥50 million) during the nine months ended December 31, 2021
(Millions of yen) | ||
Large-scale projects | Normal projects | |
(¥50 million or more) | (less than ¥50 million) | |
Nine months ended December 31, 2021 | 2,652 | 3,463 |
Nine months ended December 31, 2020 | 2,876 | 3,131 |
Change | −224 | 331 |
- Number and sales amount (forecast) of large-scale projects already contracted (amounting to ¥50 million or more)
(Millions of yen) | ||||||||||||
First half | Second half | Full year | ||||||||||
Number of | Amount | Number of | Amount | Number of | Amount | |||||||
Projects | Projects | Projects | ||||||||||
Fiscal year ending | ||||||||||||
March 31, 2022 | 13 | 1,692 | 14 | 1,681 | 27 | 3,373 | ||||||
(As of February 10, | ||||||||||||
2022) | ||||||||||||
Fiscal year ended | ||||||||||||
March 31, 2021 | 13 | 1,694 | 12 | 1,751 | 25 | 3,446 | ||||||
(Actual) | ||||||||||||
Change | - | −2 | 2 | −69 | 2 | −72 | ||||||
The total number of entrustments of normal projects (amounting to less than ¥50 million) for the period under review increased 10.6% year on year, to ¥3,463 million. In addition to our traditional shareholder identification surveys and SR advisory services which aim to secure stable voting rights, we expanded entrustments of the Group's unique and high-level equity consulting services, including advisory services to enhance corporate value, which respond to TSE's revised listing classifications, B/S management, and Strategic Review.
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IR Japan Holdings Ltd. published this content on 17 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 February 2022 06:53:05 UTC.