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Financial results presentation4345CTS Co.,Ltd.Information and Communications, Services and Others

Fiscal Year Ending March 2026 Full-Year Results Presentation

For the fiscal year ended March 2026, revenue, operating profit and net income exceeded the previous fiscal year, driven by increased orders from existing customers and growth in SAP-related services. For the fiscal year ending March 2027, the company expects higher revenue and profit, centered on SAP, and also presented new medium-term management targets through the fiscal year ending March 2029.

Worth reading
66In focus
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Improvement
Direction inferred from the company’s description.
Scale
291
¥ million (year-on-year increase in operating income)
Wording
Conditional
How definitive the wording is.

Contents of this document

Financial results presentationFiscal year ending March 2026, full year12 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales¥12,747 million+107.8%
Operating profit¥3,369 million+109.5%
Ordinary income¥3,734 million+118.1%
Net income¥2,686 million+122.7%
Gross Profit Margin51.4%
Operating profit margin26.4%
Selling, general and administrative expenses¥3,179 million
Results for the three months of the current quarter
Net Sales
¥3,128 million
Year on year against the same period last year108.5%
Operating profit
¥855 million
Year on year against the same period last year113.0%
Operating profit margin
27.3%
Year on year against the same period last year1.1pt
Full-year earnings forecast
Net Sales
¥13,500 million
Operating profit
¥3,530 million
Operating profit margin
26.1%
DDS business net sales
¥8,370 million
SMS business net sales
¥3,750 million
Other net sales
¥1,380 million
SAP revenue
¥3,470 million
Annual Dividend
¥30
What the company explained in this material
Self-assessment against the planThe company's self-assessment against its own plan.
Revenue fell short of the target in the previous medium-term management plan, while operating profit and the operating margin met their targets
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
Consolidated operating profit
Revenue increase472
Decline in gross margin0
Increase in SG&A expenses (personnel costs)-109
Increase in SG&A expenses (other)-71
DDS business operating profit
Revenue increase351
Gross margin improvement26
Increase in SG&A expenses-119
SMS business operating profit
Revenue increase157
Gross margin improvement5
Increase in SG&A expenses-68
Operating profit by segment
DDS259
SMS95
Other-62
New initiatives
  • Promoting SAP adoption and implementing AI in Fileforce
  • Replacing and expanding simple river-monitoring cameras in the government market and rolling them out to other departments
  • Strategic investment to accelerate the evolution of SAP content
  • Continuing progressive dividends
  • Resuming the recruitment of digital talent among new graduates
  • Strategic partnership with Wakita
  • Integrating a business chat service for field operations through a business partnership with LisB
Key KPIsA metric the company considers important as a management benchmark.
  • Number of customer sites (versus Q1 of the fiscal year ended March 2020)170 %
  • Repeat-purchase rate70.0%
    Year on year against the same period last year△0.1pt
  • ROA19.8%
    Year on year against the same period last year+1.1pt
  • ROE18.8%
    Year on year against the same period last year+1.3pt
  • Net income per share¥65.06
  • Equity ratio76.2%
    Year on year against the same period last year+0.8pt
Segment results
DDS
Net Sales
¥7,510 million+108.9%
Operating profit
¥2,403 million+112.1%
SMS
Net Sales
¥3,870 million+110.4%
Operating profit
¥751 million+114.5%
Other
Net Sales
¥1,367 million+96.3%
Operating profit
¥214 million+77.4%
Medium-term management plan targets
Target fiscal yearFiscal year ending March 2029
Company-wide revenue
¥16,000 million
Operating profit
¥4,400 million
Operating profit margin27.5%
ROEMore than 20%
DDS business net sales
¥10,600 million
SAP revenue
¥5,500 million
Financial targets
ROE
TargetMore than 20%
Actual results18.8%
Equity ratio
Actual results76.2%
Market Size / Share
Number of companies targetedApproximately 2,600 local general contractors and approximately 100 wide-area general contractors
Cumulative units delivered to government agenciesMore than 1,100 units
Number of subscription service contractsMore than 600 licenses
Number of stores and locations
End of period32 branches
Number of store openings and closures during the periodOpened the Takamatsu branch
Capital expenditures
¥432 million ¥284 million spent on the acquisition of tangible fixed assets and ¥148 million on intangible fixed assets
Annual Dividend
Annual dividend per share¥30.00 (forecast)
Interim¥15.00
End of period¥15.00
Acquisition of treasury shares
Acquisition amount¥46 million (as stated in the statement of cash flows)
Contents of this document
ItemDetails
Document typeFinancial results presentation
Fiscal Period CoveredFiscal year ending March 2026, full year
Net Sales¥12,747 million (YoY +107.8%)
Operating profit¥3,369 million (YoY +109.5%)
Ordinary income¥3,734 million (YoY +118.1%)
Net income¥2,686 million (YoY +122.7%)
Gross Profit Margin51.4%
Operating profit margin26.4%
Selling, general and administrative expenses¥3,179 million
Results for the three months of the current quarterNet Sales ¥3,128 million / Operating profit ¥855 million / Operating profit margin 27.3%
Full-year earnings forecastNet Sales ¥13,500 million / Operating profit ¥3,530 million / Operating profit margin 26.1% / DDS business net sales ¥8,370 million / SMS business net sales ¥3,750 million / Other net sales ¥1,380 million / SAP revenue ¥3,470 million / Annual Dividend ¥30
Self-assessment against the planRevenue fell short of the target in the previous medium-term management plan, while operating profit and the operating margin met their targets
Segment resultsDDS Net Sales ¥7,510 million (YoY +108.9%) / Operating profit ¥2,403 million (YoY +112.1%) / SMS Net Sales ¥3,870 million (YoY +110.4%) / Operating profit ¥751 million (YoY +114.5%) / Other Net Sales ¥1,367 million (YoY +96.3%) / Operating profit ¥214 million (YoY +77.4%)
Breakdown of Factors Affecting the ChangeConsolidated operating profit Revenue increase 472 / Decline in gross margin 0 / Increase in SG&A expenses (personnel costs) -109 / Increase in SG&A expenses (other) -71 / DDS business operating profit Revenue increase 351 / Gross margin improvement 26 / Increase in SG&A expenses -119 / SMS business operating profit Revenue increase 157 / Gross margin improvement 5 / Increase in SG&A expenses -68 / Operating profit by segment DDS 259 / SMS 95 / Other -62
Key KPIsIndicator name Number of customer sites (versus Q1 of the fiscal year ended March 2020) / Value 170 % / Year on year against the same period last year Not disclosed, Indicator name Repeat-purchase rate / Value 70.0% / Year on year against the same period last year △0.1pt, Indicator name ROA / Value 19.8% / Year on year against the same period last year +1.1pt, Indicator name ROE / Value 18.8% / Year on year against the same period last year +1.3pt, Indicator name Net income per share / Value ¥65.06 / Year on year against the same period last year Not disclosed, Indicator name Equity ratio / Value 76.2% / Year on year against the same period last year +0.8pt
Number of stores and locationsEnd of period 32 branches / Number of store openings and closures during the period Opened the Takamatsu branch
Medium-term management plan targetsTarget fiscal year Fiscal year ending March 2029 / Company-wide revenue ¥16,000 million / Operating profit ¥4,400 million / Operating profit margin 27.5% / ROE More than 20% / DDS business net sales ¥10,600 million / SAP revenue ¥5,500 million
Financial targetsROE Target More than 20% / Actual results 18.8% / Equity ratio Actual results 76.2%
Annual DividendAnnual dividend per share ¥30.00 (forecast) / Interim ¥15.00 / End of period ¥15.00
Acquisition of treasury sharesAcquisition amount ¥46 million (as stated in the statement of cash flows) / Buyback limit Not disclosed / Number of shares acquired Not disclosed / Period Not disclosed
Capital expenditures¥432 million (¥284 million spent on the acquisition of tangible fixed assets and ¥148 million on intangible fixed assets)
Market Size / ShareNumber of companies targeted Approximately 2,600 local general contractors and approximately 100 wide-area general contractors / Cumulative units delivered to government agencies More than 1,100 units / Number of subscription service contracts More than 600 licenses
New initiativesPromoting SAP adoption and implementing AI in Fileforce, Replacing and expanding simple river-monitoring cameras in the government market and rolling them out to other departments, Strategic investment to accelerate the evolution of SAP content, Continuing progressive dividends, Resuming the recruitment of digital talent among new graduates, Strategic partnership with Wakita, Integrating a business chat service for field operations through a business partnership with LisB
Items this document does not state (8)
Progress against full-year forecastUnit price and quantity metricsNumber of employeesAssumptions Underlying the Business OutlookRisk amount incorporated into the outlookPayout ratioOrders received and order backlogKey points of the Q&A

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

The increase in revenue and profit was driven by higher orders, primarily from existing customers, following the company’s focus on its DDS business, as well as increased revenue from rental and subscription services centered on high-value-added SAP offerings. Selling, general and administrative expenses, including personnel and sales-related costs, increased, but the impact of higher revenue more than offset the increase. Ordinary profit also benefited from higher dividend income and the recognition of equity-method investment gains following Fileforce株式会社’s return to profitability.

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Fiscal Year Ending March 2026 Full-Year Results Presentation | CTS Co.,Ltd. (4345) timely disclosure | Komori