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I am Hideki Sakashita, President and Representative Director of the Board of Link and Motivation. Today, I'm going to present our Q2 results on behalf of Mr. Ozasa, Chairman of Link and Motivation, who has been hospitalized for a leg injury.
So let's get started with our second quarter earnings briefing. Here is today's agenda. First, I'm going to give you an overview of our company. Second, I'm going to report on the consolidated financial results for our second quarter. Third, I'll touch upon the dividend payout and revisions to our financial forecast. Fourth, our officers will make a report on the business conditions of their divisions. And finally, I will briefly talk about the engagement ratings within our group.
So let's begin with the company overview. This diagram shows the operating structure of our group. There are 3 circles. The left one is Organizational Development Division, which supports creating organizations that individuals choose. The right one is Individual Development Division, which supports creating individuals that organizations choose. And the one below them is Matching Division, which provides opportunities to link organizations and individuals. And at the bottom, you see Venture Incubation business. As shown in this slide, we changed the name for a couple of businesses within our divisions during the first quarter.
Next, I'd like to move on to agenda item 2 to talk about our consolidated financial results for the second quarter of 2020. The Q2 revenues came in at 90.9% of a year earlier. Operating income and net income also dropped to 52.1% and 50.4% of what it was a year earlier, respectively. We have changed the way we do business in each of our divisions, such as providing online solutions since the first quarter due to the COVID-19 pandemic. But the economic impact of the pandemic has been huge, particularly for our Individual Development Division, leading to these disappointing results that fell below the previous year's figures.
This is total SG&A expenses on a consolidated basis, which were up 5.7% from a year earlier. The acquisition of OpenWork and the reporting of their expenses for our consolidated financial statement is in large part responsible for this increase in SG&A expenses. But at the same time, we slashed advertising expenses for Motivation Cloud series, and we also cut costs for sales, recruiting and training through shifting to working from home.
This slide is showing revenues and gross profit by segment and how they changed from a year earlier. The Organizational Development Division saw their revenues down 16.3% and gross profit down 13% from a year earlier. The Individual Development Division's revenues fell 21.6% and its gross profit was down 40.9% from the same quarter of a year before. The Matching Division, on the other hand, got better results with its revenues, edging up 0.8% and gross profit soaring 26.1% from a year earlier.
This is our balance sheet on a consolidated basis. Total assets increased JPY 1.813 billion because of valuation of OpenWork's goodwill and an increase in cash in hand from borrowings. Total liabilities also increased JPY 1.621 billion, in large part due to borrowings. And total equity increased JPY 191 million because of the acquisition of OpenWork and the posting of net income for the quarter.
Let's move to item 3 of the agenda, and I will talk about revisions to our performance forecast and our dividend payout. Let me start with our forecast. We decided not to announce our forecast at the earnings briefing on May 14 because of uncertainty caused by the coronavirus pandemic, which made it too difficult to present a reasonable forecast at that time. Today, we can present our forecast based on currently available data and information. Revenues for 2020 are now expected to be JPY 34 billion. And we expect to have operating losses of JPY 2.7 billion and net losses of JPY 3.650 billion for this year. However, the operating income adjusted for the impairment of goodwill and other items, that is profit earned from our business activities, is expected to be JPY 1 billion.
This pandemic has drastically changed the way we live and work, and we believe that these changes will only make the need for employee engagement and individual learning more important. That is why each of our divisions needs to be more nimble in adapting to a rapidly changing world and do everything it can to earn sustainable profit by making sure to capture these rising needs. Having said that, however, concerns about a second or third wave of the virus persist and uncertainty is likely to stay for foreseeable future.
Our Individual Development Division was particularly hit hard during the 2 months of state of emergency where we had to close our Career Schools and Cram Schools across the nation. That is why we are, at this moment, anticipating impairment losses in goodwill, right-of-use assets and fixed assets that are related to Individual Development Division in particular, and we continue to run our business by predicting and managing all kinds of potential risk.
With respect to dividend payout, we are going to continue to pay quarterly dividends, and we will pay JPY 1.8 a share on September 25.
Next is item 4 of the agenda, business conditions report by division. Let's start with Organizational Development Division. I will give you an update on what's been going on in this division. We are showing our division's product revenues by business and compare them with the figures of last year. Consulting & Cloud Business saw revenues down 11.9% and gross profit down 12.2% from a year earlier. For Event & Media Business, its revenues fell 25.5% and its gross profit dropped 14.7% from a year earlier. The results of Consulting & Cloud Business fell far below the last year's levels, mainly because of postponements and cancellations of new employee trainings at our clients. In contrast, revenue from Motivation Cloud series rose 19.6% from a year earlier. With respect to Event & Media Business, event production business saw its revenue plummet 52.5% from a year earlier. And the result of media production business as well fell below the year earlier level, driven by the shrink in demand for what we call customer internal use media products.
This slide describes what Organizational Development Division has been focused to do for the second quarter, which we talked about at the last earnings briefing as well. We have cut costs wherever possible and have built on the structure that helps our corporate clients to achieve greater and a deeper engagement of their employees by providing more online contents of trainings and events on our powerful support for Motivation Cloud series users.
This slide is showing average gross profit per customer over the past 12 months, which is one of our business KPIs. The number of our customers has been decreasing amid the uncertainty from the coronavirus pandemic, but the average gross profit per customer in Q2 edged up 1% from the previous quarter, driven by our sales activities targeted at major corporations. Another KPI is monthly fee revenue of Motivation Cloud series. The monthly fee revenue at the end of the second quarter of 2020 was JPY 183,600,000, down 9.9% from the previous quarter and up 16% from the same quarter of a year earlier. The temporary suspension of memberships in Motivation Cloud series during the state of emergency is in large part responsible for the quarterly decline in monthly fee revenue. But we are gaining more subscriptions from large corporations, and the average monthly fee revenue is on the rise. And so we expect that the monthly fee revenue will start to grow again from the third quarter.
This slide shows that more and more large corporations are subscribed into Motivation Cloud series. Despite the pandemic, we have been making progress in increasing membership among large corporations with the percentage of big companies rising, both in terms of monthly fee revenue and new memberships. We will continue to work to retain these existing clients, but also will target Japan's leading companies going forward.
The last piece of our division's update is our future direction. A good deal of companies have halted investment in human resources temporarily, citing concerns of a deep economic recession from the COVID-19 pandemic. But we believe that it remains highly inevitable for companies to adapt to a rapidly changing labor market in addition to the product market. In fact, the pandemic has made companies more acutely aware of the need to transform and transform more quickly. And that is exactly the context where Organizational Development Division is working to build an even stronger foundation to provide our customers with essential value such as diagnostics and transformation. To be more specific, our consulting business will focus on motivation engineering to provide our core values more effectively online, that is high-quality online trainings in our development support and solutions and online internship programs in our Recruitment Support services.
With respect to our Cloud Business, we are going to work even harder to bring back those suspended subscriptions as quickly as possible and increase new subscriptions among big companies. Our sales team will further analyze the correlation between engagement score and business performance to encourage our existing customers to subscribe to our cloud service. While our development team will continue to enhance the quality of our services and solutions, such as improving the processing speed to accommodate large-scale subscriptions. So stay tuned.
And that's all the update on Organizational Development Division. Thank you.
Hello. I am Takashi Oguri, Director of the Board of Link and Motivation. I will share with you a business update on Individual Development Division.
This is the breakdown of our division's revenues by product and by business type and how they changed year-over-year. Our Career School Business was particularly hit hard by the coronavirus pandemic, with revenue down 23% and gross profit falling 45.5% from a year earlier. Our Cram School Business, on the other hand, saw its Q2 revenue dropping 5.9%, but its gross profit rising 13% from the same quarter of a year earlier.
Let me give you a little bit more details on Career School Business first. There was a big drop in new enrollments because we have to close our schools for 2 months or so during the state of emergency in April and May. That's the biggest reason why the result fell far below that of a year earlier. New enrollments for our Cram Schools as well dropped during the second quarter, and we have a disappointing result, although more students were taking classes online.
This slide describes what Individual Development Division has focused to do for the second quarter which we talked about at the last earnings briefing as well. We have cut cost wherever possible and we have made the entire learning experience available online as well from trial courses, enrollment to course attendance. And this slide is show you one of our business KPIs, that is average number of enrollees on a quarterly basis over the past year and the actual number of enrollees for each month from March to June this year, for your reference. We saw a huge drop in new enrollments in April and May this year because we had to close all of our schools out of the state of emergency. Usually, the months of April and May are when we see a big jump in the number of new enrollments. The number of enrollees for the month of June is 16,888. And as the graph shows, the number of new enrollments has been on track for recovery since June when we reopened all our schools.
The other KPI is average revenues per enrollee over the past 12 months, and we are also showing, for your reference, monthly revenue per enrollee for each month from March to June this year. The revenue per enrollee dropped significantly during the school closure because our students were unable to take classes. But since June, we have made available both online courses and in-person classes, so the average revenue per enrollee jumped back to JPY 27,880 for the month of June. It is clear now that the schools business hit the bottom at the end of April and since then has been on a steady recovery.
Finally, our division's future direction. Today, the monthly revenue has recovered to almost 90% of what it was last year. In addition to that, we believe that the need for individual learning is only rising in a world where we all are urged to change the way we live and work. So we will continue to look for opportunities to slash operational costs, such as rent or the number of instructors, and we'll make more courses available online. So please stay tuned to what we are up to.
And that's it for the update on Individual Development Division. Thank you.
Hello. I am Hiroyuki Kitsu, Director of the Board of Link and Motivation. I'm going to share with you a business update on Matching Division.
This table shows our divisions revenues by product and by business type and how they changed year-on-year. Our Global Personnel Placement & Temp Staff business saw its revenue slightly down 1.2% and its gross profit up by 1.4% from a year earlier. Domestic Personnel Placement & Temp Staff business had better results than a year earlier with its revenue and gross profit up by 4.6% and 85.4%, respectively. Revenue from Global Personnel Placement & Temp Staff business fell below that of a year earlier, thanks in large part to the decline in global personnel placement demand, although demand for ALT Placement has been consistent in the meantime. With respect to Domestic Personnel Placement & Temp Staff business, the fact that OpenWork joined our group has pushed our gross profit significantly higher than a year earlier, thanks to its high gross margin rate.
This slide describes what Matching Division was focused to do for the second quarter, which we announced at the last earnings briefing. We have cut costs wherever possible, and we have recruited more ALTs and worked to get more clients in need of temporary workers. And this slide is showing one of our business KPIs, that is average ALT placements on a quarterly basis over the past 12 months and the actual number of ALT placements for each month from March to June this year, just for your reference. The nationwide school closures during the state of emergency had only limited impact on our ALT Placement business, and the demand for ALTs remains robust in the mid to long term. In fact, the number of ALT placements for the month of June was 3,285, up 1.8% from a year earlier.
The other KPI is average domestic temp staff placements on a quarterly basis over the past year, and we're also showing, for your reference, the actual number of domestic temp staff placements for each month from March to June this year. The temporary closures and the need to cut back on hiring on the part of our clients, are in large part responsible for this huge drop in the number of domestic temp staff placements for the month of June. It was a drop of 35.5% from a year earlier. That said, however, the pace of decline has since moderated and is likely to bottom out in the near future.
Finally, our division's future direction. Our Global Personnel Placement & Temp Staff business can expect that the demand continues to grow as local municipalities across Japan are trying to increase the number of classes at public schools from July and beyond to make up for their earlier closures. And we are going to recruit more non-Japanese instructors who live in Japan in anticipation of a rising demand for online classes and seek to extend the ALT contract for a longer period. Domestic Personnel Placement & Temp Staff business meanwhile has shifted towards supermarkets and call centers from apparel in our client portfolio and has successfully slowed the pace of decline in the number of temp staff placements. We will continue to review our client portfolio for the optimal mix in order to put this business on a more sustainable footing. So stay tuned.
And that's it for the update on Matching Division. Thank you.
Next, I will talk about the engagement ratings within our group.
It is imperative for companies today to adapt not only to the product market, but also to the labor market. That is why our management indicators include both financial information, which measure how fit we are for the product market; and engagement score, which measures how fit we are for the labor market. The engagement score is proved to correlate with financial results and deemed to be one of the extremely important metrics for management. The engagement score or employee engagement is an indicator that quantifies the degree of mutual understanding and empathy and commitment between companies and their employees. And we calculate engagement score based on the results of our proprietary organizational diagnostic survey. We identified elements that affect employee engagement and classified them into 16 areas based on social psychology. And we ask 132 questions in our organizational diagnostic survey to measure expectations and satisfaction of employees and how these 2 are matched. And based on our database of 1.57 million past survey respondents across 6,620 companies and organizations, the engagement score will be calculated as a standard deviation value. These engagement scores will be ranked in 11 levels as engagement rating, and we disclose our engagement ratings of our group companies.
This slide shows our engagement ratings for each of Link and Motivation Group companies as of February this year. Out of the 14 group companies, we've got 11 AAAs and 3 AAs. Our employees were very highly engaged.
This table summarizes each division's focused areas. Our highly engaged employees are eagerly committed to transforming the way they do business despite the pandemic. As a group, we are promoting working from home as well as online recruiting, and we also held an online town hall meeting for all of our employees. And we are extremely proud that each and every division has been successfully providing our stakeholders with high-quality services and solutions in a timely fashion through online means.
These are the results of our August engagement ratings. For August as well, out of the 14 group companies, we've got 11 AAAs, 2 AAs and 1 BB, and our employees remain highly engaged. For OpenWork, the only BB in our group, we know that its rating declined because of the changes in the organization and the business structure. So we are going to put in place effective measures to improve the rating.
This is the diagram I showed you earlier representing our business structure. Every business in all of our divisions was impacted by the COVID-19 pandemic in the second quarter. There is still much uncertainty from the pandemic and a looming second wave, but we remain united and committed to doing everything we can to transform the way we do business fast and effectively. So please stay tuned to what we are up to, and we kindly ask for your support and understanding.
And that brings to an end our earnings briefing for the second quarter. Thank you very much for watching.