Risk of declining profit margins due to soaring electricity charges and input prices
First written in FY2023-Q3. 4 of 9 entries say "Worsened", first in FY2025-H1. Latest entry: 2026-10-30.
Ags moved to the "Worse" side of this theme in 2025, 2 years after the typical company in this theme (2023).
0 other companies' latest entry also says "Worsened".
- FY2026-H1RestatedAnnual report
「During the interim consolidated accounting period, there were no occurrences of matters that could materially affect investors' decisions and no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」
The Company states that there have been no material changes regarding the risk of margin deterioration due to soaring electricity and procurement costs. - FY2025WorsenedAnnual report
「Revenue was ¥11,982 million, up 3.3% from the previous fiscal year, due to increased orders for operations services for financial institutions and projects addressing the standardization of local-government information systems. Segment profit, however, fell 0.5% to ¥1,924 million due to increases in data center personnel, machinery and repair costs.」
Although higher orders resulted in increased revenue, profit from information processing services declined year on year due to increases in data-center personnel expenses, equipment costs, and repair expenses. - FY2025-H1WorsenedAnnual report
「Revenue was ¥5,978 million, up 1.9% year on year, mainly due to an increase in orders for operations services for financial institutions. Segment profit, however, fell 1.7% to ¥987 million due to increases in data center personnel, machinery and repair costs.」
Increases in personnel expenses, equipment costs, and repair expenses related to the data center reduced profit, and segment profit from information processing services declined 1.7% year on year. Margin pressure from rising costs continues. - FY2024MitigatedAnnual report
「Driven by new business from counter services for local governments and cloud services, as well as increased orders for operations services for financial institutions, revenue was ¥11,602 million, up 2.3% from the previous fiscal year, and segment profit was ¥1,935 million, up 17.4%.」
While taking measures including reviewing prices for IDC services, segment profit from information processing services increased 17.4% year on year. The Company is making progress in addressing margin pressure from rising costs. - FY2024-Q2MitigatedAnnual report
「Revenue was ¥5,868 million, up 2.3% year on year, and segment profit was ¥1,004 million, up 8.2%, mainly due to an increase in orders for counter services for local governments and operations services for financial institutions, as well as revisions to the prices of various IDC services in response to higher raw material and labor costs, including electricity costs.」
In response to increases in electricity costs, raw-material costs, and personnel expenses, the Company reviewed prices for its IDC services, and segment profit from information processing services increased 8.2% year on year. - FY2024-Q1MitigatedAnnual report
「Revenue was ¥2,896 million, up 3.3% year on year, and segment profit was ¥504 million, up 5.8%, mainly due to an increase in orders for counter services for local governments and operations services for financial institutions, as well as revisions to the prices of various IDC services in response to surging electricity costs.」
In response to soaring electricity costs and other factors, the Company reviewed prices for its IDC services, and revenue and segment profit from information processing services exceeded the year-earlier period. - FY2023-Q3First statedAnnual report
「Meanwhile, the impact of soaring electricity rates and higher procurement prices on earnings has been significant. To address this, the entire company is working to improve margins by reviewing prices for services centered on information processing services such as IDC services and intensifying cost reductions, including by curbing electricity consumption at business locations.」
The Company stated that increases in electricity and procurement costs are having a significant impact on profit, and identified reviews of prices for information processing services, restrictions on electricity consumption, and intensified cost reductions as countermeasures.