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I am Yoshihisa, Ozasa, and I'm Chairman and Representative Director of the Board of Link and Motivation. Let's begin the financial results briefing for the first quarter of the fiscal year ending December 2024.
Here is today's agenda, which includes 6 topics. First, we will cover the company overview. Second, the business report, focusing on business results for 2024 first quarter, consolidated. Third, we'll discuss the report on the growth strategy centered on Consulting & Cloud business. Fourth, we'll delve into the new capital and business alliance with FCE Inc. Fifth, we'll make an announcement on dividend increase. Lastly, we'll cover the announcement of share buyback.
Now the first topic, the company overview. Our mission is through motivation engineering, we provide opportunities to transform organizations and individuals and create a more meaningful society. We practice our business based on this mission. This page shows our business content. Based on the core technology of motivation engineering that I mentioned earlier, we have 3 divisions.
On the top left is Organizational Development Division. This is Consulting & Cloud business. This is a business that primarily supports corporations for improving their employee engagement. The second is the IR Support business, which helps companies to improve their engagement with investors. These 2 businesses make up the Organizational Development Division.
And in the middle, it's upper right corner, we have Individual Development Division. This division supports to create individual organization to choose to support the creation of [ high ] companies. This division is also made up of 2 businesses, Career School business and Cram School business.
In the bottom center of the diagram, in the bottom row, we have Matching Division. This division provides an opportunity to link organizations and individuals. There are 2 businesses here as well. The first is ALT Placement business, and the second is Personnel Placement business.
Now for the second topic, business report, report on consolidated business results for the first quarter 2024. This page shows our consolidated statements of operations. First, revenue increased year-on-year due to growth centered on Consulting & Cloud, ALT Placement and Personal Placement business, up 3.7% year-on-year. Generally, the revenue progressed as expected.
Gross profit increased year-on-year as high-margin Consulting & Cloud business and Personal Placement business, including OpenWork, grew as expected. It was up 7.3% year-on-year. Operating income decreased slightly year-on-year as a result of increased advertisement [ ump ] and promotion expense at OpenWork as planned at the beginning of the year, but progressed as expected. It was down 7.5% year-on-year.
Net income increased year-on-year, resulting from a decrease in income taxes, up 7.8% year-on-year. And net income attributable to owners of the parent increased significantly year-on-year, up to 24.3% year-on-year. Both progressed as planned.
This page shows revenues and gross profit by segment. First, Organizational Development Division's revenue increased Y-o-Y with the growth in the Cloud category of the Consulting & Cloud business. It was up 4.6% Y-o-Y, and its gross profit was up 6.2% Y-o-Y. Further growth is expected starting in the second quarter with a new contract increasing as we focus on sales to major companies.
Individual Development Division in the middle, its revenues decreased slightly as the Cram School business grew. And the new enrollers -- but new enrollers in the Career School business slumped. Revenue slightly down 2.7% Y-o-Y. However, gross profit increased slightly as a result of restructuring. Recovery is expected in second quarter and beyond when there are more new enrollees. Its gross profit increased 1.8% Y-o-Y.
Matching Division at the bottom increased Y-o-Y, driven by strong growth in Personal Placement business, centered on OpenWork. The revenue was up 4.0% Y-o-Y. And in the ALT Placement business, new contract orders starting in April made steady progress. The division's gross profit was up 7.9% year-on-year.
Now on to the summary of each division. First, Organizational Development Division. Monthly fee revenue of the Motivation Cloud series grew more than 25% year-on-year. This led to a Y-o-Y increase in revenue and gross profit. Revenue was up 4.2% Y-o-Y. Gross profit was up 3.7% Y-o-Y. The graph on the right shows the progress of Motivation Cloud series monthly fee revenue, up 25.2% compared with the previous year.
In IR Support business, revenue increased year-on-year, led by the growth in the core service of integrated report production in line with expectation. The revenue was up 7.7%, while gross profit increased substantially, up 48.4% year-on-year due to improved productivity.
Next, summary of Individual Development Division. In Career School business, new enrollments were sluggish in the first half of first quarter and the recovery in the second half of the first quarter did not fully make up for the decrease, resulting in a year-on-year decrease in revenues. Its revenue was down 4.2%. Meanwhile, gross profit improved as a result of restructuring, up 0.9% Y-o-Y. Gross profit margin also improved to 45.1% from 42.9% a year ago.
For Cram School business, because of improved continuation rate after during high school entrance exam, revenue increased significantly. It was up 10.3% Y-o-Y. Its gross profit was up 9.4% Y-o-Y.
And this page shows a summary of the Matching Division. First, in the ALT Placement business, the number of ALT dispatch increased in line with expectations, resulting in a slight increase in revenues, up 2.0% Y-o-Y. Gross profit was up 4.6% Y-o-Y. Meanwhile, in the Personal Placement business, due to growth in OpenWork Recruiting in line with our expectation, its revenue was up 10.7% Y-o-Y and the gross profit was up 11.0% Y-o-Y. Both revenue and gross profit increased substantially.
The graph on the right-hand side shows OpenWork Recruiting sales trend. Its growth is brisk. The first quarter revenue was up 29.2% compared with previous year.
Now consolidated SG&A expense. The total SG&A expense increased 10.1% Y-o-Y. Number 4, sales-related expense increased substantially Y-o-Y as a result of increased advertising and promotional expense to expand recognition of OpenWork, as planned at the beginning of the year.
Regarding this number 4, sales related expense increased significantly, up 34.7% Y-o-Y. We anticipate receiving the returns from this additional investment after the second or third quarters.
This is a consolidated statement of financial position. Assets and liability increased slightly. In liabilities, current liability decreased, noncurrent liabilities increased because of the change in the balance of long- and short-term borrowing. Although the group recorded net income, total equity decreased slightly due to share buybacks. The difference in total equity from previous year was a decrease of JPY 188 million.
Now report on growth strategy centered on Consulting & Cloud business. Our environment and growth strategies. As you know, there is a growing momentum for human capital management since 2020. For the time being, our company will focus on the Consulting & Cloud business in Organizational Development Division, which has high growth potential.
Organizational issues for the company going forward is, first, improving human resource capabilities. Acquiring human resources is also a very important thing for companies.
And in the bottom row in the middle, after improving human resources, companies need to improve organizational capabilities. Organizational capabilities mean improving employee engagement. Our company will support our customers, companies from both sides by focusing on Organizational Development Division.
Our first and foremost competitive advantage in the human capital management area is our diagnosis capability. Our Motivation Cloud series is one of the largest databases in Japan in diagnosing employee engagement. This alone is a product that boasts the #1 market share.
But we do not stop here. We can provide one-stop consulting in [ organizational ] HR based on the diagnosis results, consulting and recruitment, training and development of human resources as well as organization and compensation [ system as well ], even to support transforming corporate culture. Every year, we support approximately 900 companies in their transformation efforts.
Furthermore, we can support not only diagnostic reform, but also support on disclosure. Rather than simply announcing information, we support in-house disclosure based on diagnosis and transformation. Currently, there are 121 companies that have disclosed their diagnosis results, improving engagement scores or rating using Motivation Cloud.
I'll now like to talk about 3 future growth potentials. First, there are approximately 100,000 companies in Japan that can become our customer. These are the companies with approximately 50 or more employees. But currently providing -- we provide only support to approximately 1,500 companies in Japan.
And furthermore, not mentioned here, we have been receiving many requests from local government, such as prefectures and cities, for their organizational diagnosis and even seeking support for transformation.
The third growth potential is overseas expansion. We are also introducing Motivation Cloud at overseas subsidiaries of Japanese companies in Thailand and Vietnam. As you can see on the right, the progress of overseas expansion is that we currently have approximately 30 companies under contract.
Monthly fee revenue per customer was up 160% from the same period of previous year. Average monthly fee revenue per customer was up more than 60% from the same period of the previous year due to progress in orders for larger projects. So there is still substantial room for development overseas. It's a big market.
This page shows our key indicators on Consulting & Cloud business, Motivation Cloud series monthly fee revenue. Monthly fee revenue decrease compared with the end of the previous year due to the withdrawal of 1 large order.
But orders in the second quarter, particularly to major companies, are progressing steadily. We are moving as expected toward a target of JPY 530 million in monthly fee revenue at the end of 2024. We estimate JPY 450 million in revenue by the end of second quarter.
Another key indicator of Consulting & Cloud business is order backlog. The total orders for the project as of March 31, 2024, was JPY 13.2 billion, which was up 16.1% Y-o-Y. This was in line with our original plan.
Meanwhile, we are accelerating human resource investment. To support business expansion through human resource investment, we have continued to implement pay raises across the company since 2020, since COVID-19. For example, in our Consulting & Cloud business, we raised base pay 5x since 2020.
Furthermore, we are planning our 6th sixth raise in the pay in July. Compared to 2019, starting salary for new graduates from undergraduate university increased by 28%. For managers, we are significantly increasing the base pay by 25% from 2019. So we are making upfront investment in human resources to further increase productivity.
Next, I'd like to inform you of capital and business alliance with FCE Inc. FCE Inc. has unique strength in enhancing human resource capability, particularly through education and training. Today, we signed a basic agreement on our capital and business alliance with FCE Inc. The business corporation will begin after we sign the capital and the business alliance agreement. And we plan to acquire a 20% stake in FCE and making an equity method affiliate.
FCE's business purpose is to create a world in which everyone can approach and solve challenges with all their might. It is a listed company, and their business includes education and training, DX promotion and publishing. The background of this alliance was to make proactive investment in our growth driver. In line with our synergy of accelerating M&As and business alliance to further create energy, we decided to proactively invest in this alliance with FCE Inc.
This is the vision for alliance with FCE. On the left-hand side, the Motivation Cloud series, an employee engagement platform, which has one of the largest database in Japan of 11,590 companies and approximately 4.22 million people. In addition to organizational diagnosis, we can alongside support organizational transformation. Our company provides consulting on recruiting, training, systems and corporate culture as well.
Meanwhile, FCE has Smart Boarding, which includes some Seven Habits. Smart Boarding is their online education training program with rich content and boasts 40,000 accounts. They have many existing customers who use their online education and training programs already.
In addition to expanding the Motivation Cloud series, transformation services centered on human resource development to FCE's existing customers, we will accelerate introduction of Motivation Cloud series for small- and medium-sized company by leveraging FCE's sales capabilities.
In terms of diagnosis, FCE's customers will become our very important assets. And in terms of transformation, as I mentioned earlier, we will be offering Smart Boarding including Seven Habits training, to our customers. We believe that this is really a great alliance that can generate significant synergies.
In addition to synergy with Organizational Development Division, we also expect this alliance will bring synergy with Individual Development Division and Matching Division, specifically in the Career School business and Cram School business of the Individual Development Division and also in the ALT Placement division of the Matching division. This is for public schools.
As I mentioned earlier, FCE offers Smart Boarding and Foresight Handbook, which are business notebooks for junior high and high school students that have been rolled out to approximately 340,000 students in 1,100 schools. Meanwhile, our Interac ALT Placement business has #1 private sector share and already has businesses with 440 local governments and 6,440 schools. So we are now [ starting ] growth opportunities.
We are also looking at synergies for the Individual Development Division, which supports creation of individuals who are chosen by organization from elementary school students to working adults. I believe that we can expect significant synergies by providing education and training content such as FCE's Smart Boarding to our customers.
The fifth topic is announcement of dividend increase. For the first quarter, a dividend of JPY 2.9 per share is scheduled to be paid on Tuesday, June 25. And this kind of payout is planned quarterly. From the second quarter onwards, we will increase the dividend by JPY 0.1 and plan pay annual dividends of JPY 11.9. We continue to view shareholder returns as an important management issue, with a policy of paying dividends based on our performance.
Last but not least, the sixth topic is announcement of share buyback. With our belief that the group's future profitability is not fully reflected in the current stock price, we have decided to implement share buyback of up to JPY 1 billion and 1.7 million shares.
Because we have sufficient cash necessary to fund growth investments such as M&A, capital business alliance that I mentioned earlier, we decided to balance by implementing a share buyback while keeping a close eye on the situation around us.
That concludes our explanation of the business results for the first quarter of FY 2024. I want to emphasize that among the 3 divisions, the human capital management is currently a strong positive force. So we will be increasing our focus on Consulting & Cloud business in the Organizational Development Division.
In this regard, we have established a promising partnership with FCE Inc., and we look very much forward to leveraging this capital and business alliance to drive growth of the Organizational Development Division. Please continue to follow our future developments and progress. Thank you for your attention.