Expanding adoption of security products for local governments

「Sales of product-related orders, centered on products from Check Point and Menlo (formerly Votiro), remained firm throughout the year. In particular, we successfully secured large projects, including new deployments of high-end models for large-scale networks, which drove sales growth. As a result, sales were ¥3,434 million, up 15.5% year on year, and the recovery in sales gained further momentum as improving business conditions were steadily reflected in performance.」

「As a topic, Votiro's (now Menlo Security Inc.) file sanitization solution ranked No. 1 in vendor sales-value share in the email and file sanitization market for the eighth consecutive year.」

「As a topic, the local-government file sanitization solution VOTIRO Disarmer, which we handle, ranked No. 1 in domestic market share in the email and file sanitization market for the sixth consecutive year. More recently, VOTIRO Disarmer was adopted for the file sanitization function of LGTalk, a communication tool for local governments compatible with LGWAN operated by シフトプラス株式会社, demonstrating further implementation results.」

「As a topic, at Interop Tokyo 2023 held in June, the file sanitization solution VOTIRO Secure File Gateway, which we handle, received the runner-up grand prize in the Security category of the Best of Show Award. VOTIRO's sanitization technology can sanitize files with greater accuracy than competing products, providing security, and can recursively sanitize embedded files, providing practical utility. It can therefore be used in IT services beyond email and protect files from threats such as ransomware. It has also been widely adopted for important services such as municipal information security clouds, LGWAN-ASP, and electronic application systems, and has gained support from both operators and users.」

「In addition to replacement demand for VOTIRO for local governments having run its course, large projects in both product-related and service-related business have become concentrated in the fourth quarter and later.」

「As a topic, the local-government file sanitization solution VOTIRO Disarmer, which we handle, ranked No. 1 in domestic market share in the email and file sanitization market for the fifth consecutive year.」

「Regarding business performance, orders for large projects involving Check Point and VOTIRO and the capture of replacement projects remained firm in product-related business. As a result, sales were ¥870 million, up 22.5% year on year.」

「Replacement demand for the local-government file sanitization solution VOTIRO Disarmer, which we sold in the past and which became the de facto standard, remained firm. As a result, sales were ¥2,275 million, compared with ¥2,107 million in the same period of the previous year.」

「The local-government file sanitization solution VOTIRO Disarmer, which we handle, ranked No. 1 in domestic market share in the email and file sanitization market for the fourth consecutive year.」

「We also worked to expand sales of the local-government file sanitization solution VOTIRO Disarmer by strengthening integration with other products and holding seminars.」

「The local-government file sanitization solution VOTIRO Disarmer, which we sold in the past and which became the de facto standard, is approaching its replacement cycle. We therefore need not only to capture replacement demand but also to expand the solution beyond local governments.」

「We held an online seminar for security officers at local governments and SIers involved in implementation, inviting representatives from Shimane Prefecture, whose officials are using our products, to introduce a case study for considering the next-generation security cloud.」

「Procurement for large projects, including those involving the Ministry of Health, Labour and Welfare, was delayed and resulted in only partial orders being received, while projects scheduled for the end of the fiscal year were pushed into the following fiscal year.」

「Regarding business performance, procurement began for some large projects in the public sector, including the Ministry of Health, Labour and Welfare, in the product-related business. In the services-related business, the stock base also increased steadily as a result of the effects of ongoing initiatives to improve quality and strengthen the organisational structure, resulting in revenue of ¥2,376 million, up 5.4% year on year.」

「Although we expected procurement to gather momentum from this fiscal year in the public sector, including the Ministry of Health, Labour and Welfare, it has been pushed back to the second half of the next fiscal year or later. We will continue to follow these opportunities so that we can capture them reliably when they are disclosed as projects.」

「Regarding business performance, we expected to capture replacement demand for security equipment sold in the past as large-scale demand to replace the security measures implemented at local governments through the first quarter of the previous year, but the result has fallen below expectations as of now. In addition, government-related procurement expected in the first half was pushed back to the fourth quarter or later, and the launch of new products whose handling began in the previous fiscal year has remained delayed into the second half and beyond. As a result, sales were ¥2,255 million, down 19.0% year on year.」

「Regarding business performance, we expected to capture replacement demand for security equipment sold in the past as large-scale demand to replace the security measures implemented at local governments through the first quarter of the previous year, but the result has fallen below expectations as of now. In addition, government-related procurement expected in the first half was pushed back to the second half, and the launch of new products whose handling began in the previous fiscal year has been delayed. As a result, sales were ¥1,533 million, down 27.9% year on year.」

「Regarding business performance, large-scale demand to replace the security measures implemented at local governments through the same quarter of the previous year was expected in the second half of the fiscal year, and sales were ¥750 million, down 42.8% year on year.」

「In addition to demand for security measures, including those at local governments, having run its course, the shift from single-year to multi-year security measures for incorporated administrative agencies, partly due to the government's preliminary security budget request, also affected performance. As a result, sales were ¥3,513 million, down 27.4% year on year.」

「Regarding business performance, demand for security measures, including security measures at local governments, settled down from the previous fiscal year, while product-related business lacked growth. As a result, sales were ¥2,785 million, down 14.0% year on year.」

「Regarding business performance, VOTIRO's Secure Data Sanitization, which had become the de facto standard for municipal information security cloud construction and the strengthening of municipal information system resilience, continued to perform steadily in product-related business, as it had in the previous fiscal year.」

「VOTIRO's Secure Data Sanitization, a file sanitization solution for local governments, had been adopted by 43 of Japan's 47 prefectures or by municipalities within those prefectures as of 31 March 2017, becoming the de facto standard, and product-related business grew substantially.」

「Regarding business performance, product-related operations remained firm. In addition to receiving orders for large projects, the adoption of VOTIRO's Secure Data Sanitization as a file sanitization solution at local governments progressed, resulting in sales of ¥3,237 million, up 50.0% year on year.」

「Efforts to build municipal information security clouds and strengthen the resilience of municipal information systems, both of which were included in a supplementary budget by the Ministry of Internal Affairs and Communications as measures to strengthen information security at local governments, are also gathering momentum.」

「Cybersecurity measures have become a social issue, as efforts are also gathering momentum to build municipal information security clouds and strengthen the resilience of municipal information systems, both of which were included in a supplementary budget by the Ministry of Internal Affairs and Communications as measures to strengthen information security at local governments.」

「To translate this into improved business performance, we will promote activities aimed at having our products adopted.」