Launch of a systems and services business for electricity retailers

「The liquidation of AES was completed on 29 July 2022, and going forward we will pursue the business independently. The nature of the business remains unchanged.」

「Sales of "Enefaros," the electricity risk management system developed by NS Solutions Corporation with our involvement as a consultant, began during the first three months under review.」

「In the business process outsourcing service, we are continuing to propose detailed services tailored to customer needs, adding new offerings such as electricity trading risk management consulting while providing stable services to existing customers and seeking to increase the number of new business partners. In January 2022, we announced that we had joined as a consultant in the development of the electricity risk management system "Enefaros," which NS Solutions Corporation plans to begin selling, and that we would also be involved in sales from fiscal 2022 onward.」

「The partnership agreement led by AES for system sales with US-based ESG ended during the third quarter upon expiration of its 5-year contract term.」

「As a result, as described above, the decline in electricity sales caused operating revenue in the electricity trading-related business for the nine months under review to fall to ¥4,683 million, a decrease of ¥2,060 million, or 30.6%, from the same period a year earlier, while segment profit was ¥99 million, an increase of ¥38 million, or 62.1%, from the same period a year earlier.」

「As a result, as described above, the decline in electricity sales caused operating revenue in the electricity trading-related business for the six months under review to fall to ¥2,951 million, a decrease of ¥1,333 million, or 31.1%, from the same period a year earlier, resulting in a segment loss of ¥3 million, compared with segment profit of ¥25 million in the same period a year earlier.」

「In the business process outsourcing and system support operations, we are continuing to propose detailed services tailored to customer needs in order to increase the number of new business partners, while securing revenue by providing services to existing customers.」

「During the nine months under review, 3 new contracts were secured. As a result of continued customer development following the previous fiscal year, a total of 15 new business partners were acquired during the nine months under review, and winter electricity hedging transactions also became more active, causing both operating revenue and operating expenses to increase substantially.」

「During the six months under review, 2 new contracts were secured. As a result of continued customer development following the previous fiscal year, a total of 9 new business partners were acquired during the six months under review, and transaction activity also increased, causing both operating revenue and operating expenses to rise.」

「As a result of continued customer development following the previous fiscal year, 6 new business partners were acquired, and transaction activity also increased, causing both operating revenue and operating expenses to rise.」

「The business became profitable on a monthly basis from December 2018, but this was insufficient to offset the losses incurred up to that point, resulting in a segment loss of ¥14 million, compared with a segment loss of ¥60 million in the same period a year earlier.」

「<Gas business> In September 2018, we announced the planned launch of the gas retail business. Subsequently, in October, registration as a gas retailer with the Ministry of Economy, Trade and Industry was completed, and we entered into an agreement with 東京エナジーアライアンス株式会社, which will outsource the wholesale supply of city gas and maintenance services such as periodic inspections of gas-consuming equipment.」

「During the third quarter, ASTRA completed its registration with the Minister of Economy, Trade and Industry as a gas retailer and is preparing to commence the gas retail business.」

「During the six months under review, the diversification of electricity procurement and sales undertaken to meet customers' diverse electricity procurement needs was favourably received, resulting in several electricity trading transactions. As a result, operating revenue was ¥3,635 million, an increase of ¥3,085 million, or 561.6%, from the same period a year earlier, while the segment loss was ¥51 million, compared with a segment loss of ¥61 million in the same period a year earlier.」

「During the three months under review, the diversification of electricity procurement and sales undertaken to meet customers' diverse electricity procurement needs was favourably received, resulting in several electricity trading transactions.」

「During the nine months under review, management support service agreements and system provision agreements were signed in the first half, and system delivery was completed during the third quarter.」

「During the six months under review, sales efforts to expand business led to the signing of several management support service agreements and system provision agreements. System delivery is scheduled for the second half of the fiscal year, and revenue will be recognised upon delivery.」

「Costs preceded revenue because completion of the Japanese version of the ESG system was delayed beyond the original plan, resulting in the plan not being met during the fiscal year. However, we believe that a framework for expanding sales has been established through measures including strengthening the cooperative relationship with ESG.」

「During the second quarter, we newly secured a contract with an electricity retailer on the assumption that the system would be delivered during the third quarter. However, mainly due to circumstances on the electricity retailer's side, delivery is expected to be delayed until the fourth quarter.」

「During the six months under review, we newly secured a contract to provide the ESG system to an electricity retailer. Delivery of the system is scheduled for the third quarter of the fiscal year.」

「During the first three months of the fiscal year, we received orders for supply-and-demand management and other support services for electricity retailers and, in cooperation with ASTRA, began actual operations in June. ASTRA also established an electricity trading department in May and is developing its supply-and-demand management operations, including demand forecasting, while securing electricity procurement methods for customers.」

「To provide systems and services supporting companies engaged in the electricity retail business in Japan's electricity retail market, which was liberalised from April 2016, アストマックス・エナジー・サービス株式会社 (AES) was established in November 2015.」