Segue Group raised its full-year profit forecast, citing revenue from a large self-developed “RevoWorks” project and growth in support services.
Segue Group raised its full-year earnings forecast. The revenue forecast is unchanged, while the operating profit forecast was increased by ¥300 million, ordinary profit by ¥301 million, and profit attributable to owners of the parent by ¥197 million. The main reasons for the upward revision are revenue recognition from a large project involving the self-developed “RevoWorks” series and higher support-services revenue. The dividend policy remains unchanged at this time. The company plans to set the dividend based on full-year net profit, targeting a payout ratio of 50%.
For the cumulative second quarter, revenue was ¥15.9 billion, up approximately 59.1% year on year. Gross profit was ¥4.24 billion, operating profit was ¥2.19 billion, ordinary profit was ¥2.19 billion, and net profit was ¥1.361 billion. Orders and the order backlog remained at high levels, and results were in line with the plan, supported by large government-related projects and projects for private-sector and university customers. Segue Group expects to benefit from its strong order base and growth in recurring revenue.
By business, the VAD business accounts for the majority of revenue and gross profit. The self-developed business represents a smaller share but tends to have a higher gross margin. In the self-developed “RevoWorks” area, the company expects to win large projects from government ministries and agencies and is strengthening its sales efforts ahead of the replacement cycle for local-government information systems. The overseas business is also continuing to grow, with initiatives advancing at local bases including First One Systems and ISS Resolution.