Focus on the Growing 5G/IoT Market and Establishment of a Stable Revenue Base

「The Group has positioned this area as the core of growth under Medium-Term Management Plan 2030.」

「In IoT Engineering Services, projects involving the installation and replacement of core smart meters, as well as network cameras, sensors, tenant meters, and solar power generation equipment, expanded steadily, resulting in record-high second-quarter revenue. This was driven by the growth of the business through efficient on-site operations enabled by BLAS, our internally developed cloud platform for digital transformation of field operations, and the establishment of a broad service delivery network covering all of Japan.」

「In the IoT Engineering Services and IT Engineering Services fields, the stock-based business of stationing engineers at customer sites to provide monitoring, maintenance, and other services expanded, in addition to solid performance in smart meter installation and replacement. The number of companies adopting BLAS, a SaaS product launched in September 2023, also increased steadily, and sales activities are progressing steadily.」

「In the IoT Engineering field, our continued proposals for stock-based monitoring and maintenance projects, in addition to flow-based projects such as smart meter installation, have paid off and led to the acquisition of higher-margin stock-based projects. We had announced a business strategy of shifting management resources toward IoT Engineering Services, where growth has been expected since the previous fiscal year, and the results are gradually beginning to emerge. Sales by service were ¥1,759,733 thousand for Mobile Engineering Services, down 1.2% year on year, ¥1,527,345 thousand for IoT Engineering Services, up 51.4%, and ¥633,412 thousand for Other, up 572.5%.」

「We will expand the business from flow-based equipment installation projects into stock-based monitoring and maintenance projects. In addition to providing BLAS as SaaS, we aim to expand the business by combining it with BPO (Business Process Outsourcing) services and providing it as BPaaS.」

「In addition to IoT equipment installation, stock-based projects in which engineers are stationed at customer sites to provide monitoring and maintenance services are increasing steadily. Services such as sales of BLAS, a SaaS offering launched for general commercial use in September 2023, and kitting operations for initial equipment configuration are being expanded, and the number of new customers is also increasing steadily. We will promote long-term business growth by shifting management resources toward IoT Engineering Services, where growth is expected. Sales by service were ¥2,653,317 thousand for Mobile Engineering Services, ¥1,657,918 thousand for IoT Engineering Services, and ¥383,907 thousand for Other.」

「Outside the telecommunications operator sector, smart meter installations in the living-infrastructure industry have progressed through smart meter installation services provided by IoT Engineering Services, and performance has remained firm. Beginning in September 2023, we monetized BLAS, a SaaS platform for efficiently managing work progress, workers, and IoT equipment installation, and began offering it to the general market. We will promote long-term business growth by shifting management resources toward IoT Engineering Services, where growth is expected.」

「Beginning in September 2023, we monetized BLAS, a SaaS platform for efficiently managing work progress, workers, and IoT equipment installation, and began offering it to the general market. Sales by service were ¥905,303 thousand for Mobile Engineering Services, down 20.2% year on year, ¥448,623 thousand for IoT Engineering Services, up 14.5%, and ¥43,226 thousand for Other, down 10.7%.」

「We will expand the business from flow-based equipment installation projects into stock-based monitoring and maintenance projects. We will also monetize BLAS and provide it as a SaaS offering. These initiatives will support the development of new customers and deeper engagement with existing customers, enabling us to expand IoT Engineering Services into our second core business. We will also actively consider M&A involving companies with products and services that could generate upselling and cross-selling opportunities for IoT customers.」

「Outside the telecommunications operator sector, smart meter installation services provided through IoT Engineering Services have remained firm as smart meter installations have progressed in the gas industry. Although the smart meter installation plan in the power industry was nearly completed in fiscal 2020, additional orders have arisen for replacement work due to equipment defects, and this business has also remained firm, continuing from the previous fiscal year. IoT equipment installations are progressing above the previous fiscal year's level, with cumulative installations exceeding 550,000 devices as of the third quarter. In addition to equipment installation, business discussions concerning stock-based services such as operations and maintenance are increasing, and the number of stock-based projects is expected to increase from the fourth quarter onward.」

「Outside the telecommunications operator sector, smart meter installation services provided through IoT Engineering Services have remained firm as smart meter installations have progressed in the gas industry. Although the smart meter installation plan in the power industry was nearly completed in fiscal 2020, additional orders have arisen for replacement work due to equipment defects, and this business has also remained firm, continuing from the previous fiscal year. We also joined the “Kukan Jizai Project” consortium led by JR East (9020) and KDDI (9433). By applying our IT infrastructure construction expertise to the “new decentralized urban development” initiative aimed at creating a rich lifestyle unconstrained by time or place, we are expanding IoT equipment installation beyond the living-infrastructure field.」

「We joined the “Kukan Jizai Project” consortium led by JR East (9020) and KDDI (9433). By applying our IT infrastructure construction expertise to the “new decentralized urban development” initiative aimed at creating a rich lifestyle unconstrained by time or place, we are expanding IoT equipment installation beyond the living-infrastructure field. Sales by service were ¥1,133,845 thousand for Mobile Engineering Services, down 6.5% year on year, ¥391,741 thousand for IoT Engineering Services, up 66.1%, and ¥48,417 thousand for Other, down 9.2%.」

「Mobile Engineering Services aims to expand its share of the existing market by increasing customer-site projects related to 5G. IoT Engineering Services will achieve sustainable growth by installing large volumes of small devices as the market expands and then acquiring projects requiring ongoing operational monitoring and maintenance, which are expected to increase thereafter.」

「Outside the telecommunications operator sector, smart meter installation services provided through IoT Engineering Services have generated sales above plan as smart meter installations have progressed in the gas industry. Although the smart meter installation plan in the power industry was nearly completed two fiscal years ago, additional orders have arisen for replacement work due to equipment defects, also resulting in sales above plan. As a result, the target of installing 350,000 devices for IoT Engineering Services was achieved ahead of schedule, with 390,000 devices installed as of the end of the third quarter accounting period. We also began installing IoT equipment for remote monitoring of the ultra-low-temperature storage of new coronavirus vaccines, expanding IoT equipment installation beyond the living-infrastructure field.」

「Outside the telecommunications operator sector, smart meter installation services provided through IoT Engineering Services have generated sales above plan as smart meter installations have progressed in the gas industry. Although the smart meter installation plan in the power industry was nearly completed two fiscal years ago, additional orders have arisen for replacement work due to equipment defects, also resulting in sales above plan.」

「Outside the telecommunications operator sector, smart meter installation services provided through IoT Engineering Services have generated sales above plan as smart meter installations have progressed in the gas industry. Although the smart meter installation plan in the power industry was nearly completed two fiscal years ago, requests have arisen to replace defective equipment, also resulting in sales above plan.」

「Mobile Engineering Services aims to expand its share of the existing market by increasing customer-site projects related to 5G. IoT Engineering Services will achieve sustainable growth by installing large volumes of small devices as the market expands and then acquiring projects requiring ongoing operational monitoring and maintenance, which are expected to increase thereafter.」