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Hello, everyone. Thank you very much for joining the financial results briefing of the First Quarter of Fiscal 2023 of GMO Internet Group. Let me introduce the presenters today. Group Executive Vice President and Group CFO, Masashi Yasuda; and Group Executive Officer, General Manager of Group Financial Department, Noriko Inagaki. The outline of the results will be explained followed by the Q&A session. We are planning to finish at 16.30. You will be able to find the financial results presentation materials on our website. We would appreciate very much if you could respond to the survey through the link that will appear on the screen after the results briefing. Now Mr. Yasuda, Executive Vice President, will explain.
Hello, I am Yasuda, CFO of GMO Internet Group. Thank you very much for attending GMO Internet Group's Q1 Results Briefing. For the fiscal year ending in December 2023. Our fiscal year ends in December. Thus, I will be explaining about the results of January to March. These are the agenda for today. Please, allow me to start. This is the executive summary. Net sales were JPY 65.5 billion. Operating profit was JPY 10.9 billion. Ordinary profit, JPY 11.9 billion. Net profit was JPY 3.9 billion. Compared to the same period last year, it is an increase in sales but decrease in profits. As for sales, we grew significantly, such as Internet Infrastructure and Internet Finance achieving record highs.
On the other hand, when we turned our eyes to profits, profits decreased due to additional provisioning of allowance for debt full accounts, retirements, Internet securities business and others. Net profit declined significantly, but this is due to backlash from last year when we sold investment securities. This is a summary of each segment. On the very right, we have a qualitative evaluation by the management. Infrastructure is double circle, meaning excellent. We achieved increase in both, sales and profits, and we reached a record high. This business embodies the strength of the group, such as collection of overwhelming #1 services with solid recurring revenue. We have strong numbers such as sales growth exceeding 20%.
This is thanks to Cybersecurity business, which joined the group in Q2 last year, enjoyed high demand this quarter. And also, we were able to acquire a large account in face-to-face payment business. Next is Online Advertisement & Media, evaluation is a circle, meaning good. Sales grew but profits declined. Leveraging the expansion of advertisement business, in-house products, media performed strongly, leading to increased sales. On the other hand, in line with an increase in transactions, there was an increase in outsourcing costs and increase in headcounts as we made investments in personnel last year, leading to an increase in operating expenses.
Furthermore, we had one-off upfront costs, which we initially did not expect. Next is Internet finance, evaluation is circle, with sales and profits increase. We are continuing to renew record high sales on a quarter basis. Let's take a look one by one, FX is a circle. Profitability was the issue, but we are now achieving results of initiatives we took to improve margins since Q4 last year. CFD is also a circle. Sales renewed its record high. It has grown to be a major product following FX. Overseas is X, which means poor. As I mentioned earlier, we posted additional JPY 1.5 billion of allowance for natural accounts for Thailand's Internet Securities business. We are enhancing measures to bolster risk management structure. At the same time, we will strive to recover such as by filing suit for closure on collateral segue of assets and others.
Next, Cryptoassets is a triangle. Sales declined and we posted a loss. Number of accounts that exchanged business by GMO Coin in steadily -- is steadily growing. On the other hand, market environment was sluggish and transactions volume had decreased for the industry overall. Also, the operating rate of mining business is continuing to be low. Despite this trend, we have not changed our view that Cryptoassets is an area that has potential. We will calmly continue to build a structure to be able to generate profits. This is the analysis of sales and operating profit trends by segment. Left side shows sales, right side shows operating profit. While Infrastructure performed strongly, Internet Finance suffered from posting additional allowance for doubtful accounts.
On top of that, Cryptoassets was bearish. Consolidated sales increased JPY 9.5 billion, but OP decreased by JPY 100 million year-on-year. Next is shareholder returns. The basic policy we employ total shareholder return ratio of 50%. Out of this, 33% or more will be allocated for dividends and the remaining 17% will be allocated to share buyback and retirement of shares. This is a trend of dividend per share. Again, for this fiscal year, we do not disclose the business performance forecast nor dividend forecast. As such, dividends will be announced every quarter. Dividend for Q1 will be JPY 12.2. Before going into the details of our performance, I would like to reemphasize the strengths of GMO Internet Group.
There are 2 main points. The first strength we have is that we stick to operation and in-house development of our own technology. In order to survive in a rapidly changing Internet market and also to offer #1 services, we strongly believe we need to be a monozukuri or manufacturing company that operates and develops our own technology. The key would be engineers, creators and directors who are engaged in monozukuri. A number of partners as of the end of March 2023 exceeded 7,300. But out of this, 50.3% are engaged in monozukuri. We first set a target ratio partners engaged in monozukuri back in 2011. Back then, the target was 50%.
We first shared this target with investors in February 2014. 37.1% was the actual ratio at the time. As we saw the possibility to be able to achieve the target, we raised it to 60% in February this year. And for the first time ever, we exceeded the initial target of 50% this time. The era of the Internet is an era of sensitiveness. We plan to increase talented creators to improve UI/UX. We need to be recognized as a creative company. We will continue to grow as a monozukuri company. In April this year, we had 58 new graduates join us. Some people may feel it is less than usual, but we have 7.1 million programs and #1 hiring locally. So we changed our policy to hire only the brightest to join our group.
So this is the first year since this policy has been adopted, we intend to support Japan's Internet together with these new colleagues. And last year, since Q2, we have been explaining this GMO terminology, solid recurring revenue. This is our second strength. This is our revenue model. We believe we have been able to achieve 14 consecutive years of increase in both, sales and profit, until last fiscal year, because of the accumulation of solid recurring revenues since the founding of this business. We believe this as we realized because of indispensable products that we have that will not disappear as long as the Internet exists in a recurring revenue business model realized by our products. This is the trend of consolidated net sales.
As you can see, since the founding, we have achieved sustainable growth. This is a breakdown of sales into solid recurring revenue and other revenue. The red line at the top shows the ratio of solid recurring revenue out of total sales. Solid return revenue includes Internet Infrastructure businesses recurring revenue as well as transaction revenue, which is solid recurring revenue that is like recurring revenue. As you can see, it is the solid recurring revenues that is supporting our sustainable growth. This is solid recurring revenue divided into unit price and number of contracts. We have been continuing to scale up in both, unit price and number of contracts.
The latest solid recurring revenue of JPY 130.1 billion is made up of annual unit price of around JPY 10,000 times about 13 million contracts. Looking at the latest situation, we are receiving about 10,000 new contract applications every day. There are some terms as well, so net increase would be a bit less than this. But as the volume of information on the Internet and the volume of transaction expense, we believe it will continue to grow also. This is an update on Internet Infrastructure number of contracts. We can say that this is a solid revenue base that's supports solid recurring revenue. As of the end of March, we had 13.52 million customers. If you look at the trend at the end of each year, there is an increase of circa 810,000 per year. Taking into consideration that unit price is on upward trend, it would be slightly over JPY 10,000. And if you do the multiplication, there will be an accumulation of almost JPY 10 billion of revenue every year. Isn't it exciting? Next is overview. From this part on, Ms. Inagaki, Group Executive Officer, General Manager of Group Financial Department will be presenting.
Hello. I am Inagaki, GMO Internet Group, Group Executive Officer, General Manager of Group Financial Department. I will explain about the Group Overview. This is a bird's eye view of our business segments. The size of each segment is shown by sales. As was introduced by Mr. Yasuda earlier, on top of 13.52 million customers of Internet Infrastructure, making up a solid revenue base. Total number of accounts of FX, securities, trading and cryptoassets will add up to 16.03 million customer base. This is the market cap of 10 listed group companies and the amount of our equity share. The total market cap of group companies is circa JPY 1.4 trillion, and our equity share is close to JPY 450 billion.
This is quarterly sales by segment. The rule on how we post sales has changed since the same year -- same quarter last year. But as you can see, looking at the very bottom in dark blue, growth trend has been continuing, centering around Internet Infrastructure. This is quarterly operating profit by segment. In Internet Finance, there is a provisioning of allowance for a debtful accounts in Thai Internet securities business, causing profit to drop 1.2% year-on-year. There is some [indiscernible] in the short run. But based on solid recurring revenue of Internet Infrastructure, there's no change at all. That sustainable growth will continue.
Next, I'd like to talk about Internet Infrastructure. This is the composition of Internet Infrastructure. We have domain, hosting and cloud, ISP, [indiscernible], security, esignature, cybersecurity, payment, provider, all of which are indispensable products that will not disappear in the Internet society and a collection of #1 services. This is quarterly sales trend and its breakdown. As you can see, we renewed our record high and the growth rate of sales for the whole segment is again accelerating. Against such a backdrop, we achieved sales increase of over 21%, which is a very strong growth this quarter. There are 2 major reasons. The first is the payment business shown in light blue.
In face-to-face payment area, the GMO Financial Gate offers, we got a large project and sales of [indiscernible] terminals accelerated. And the second reason is security business shown in green. GMO Cybersecurity by Ierae, which joined the group in Q2 last year, we're significantly triggered by an increase in demand. This is quarterly operating profit trend. Due to the accumulation of solid recurring revenue, we renewed a record high. Also because of the high season for Ierae, it turned profitable this quarter on. I would like to update you on crypto security business. GMO Sign, which GMO Group is deploying as a strategic business.
As has been communicated so far, not only the number of e-contract accounts, but also in terms of number of contracts sent, we are the #1. First, I'd like to talk about the number of e-contract accounts. In May 2020, amidst pandemic, the group launched [indiscernible] campaign. And since then, through the so-called network effect in group synergies, customer base is continuing to expand. And as of the end of March, we acquired a total of 1.25 million accounts. As you can see, we are smoothly expanding into large enterprises as well. In April this year, we signed a business alliance with Business UFJ Bank, targeting customers who newly opened online corporate account of Mitsubishi UFJ Bank.
We are currently running a campaign to offer GMO Sign a discount. Next, I'd like to talk about the number of contracts sent. The number of contracts sent is the most important KPI for us as it represents the activity level of our accounts. As you can see, it is steadily growing. And together with a number of accounts, we have double crowns. For GMO Sign, we are enhancing our efforts, targeting digital government. We are aiming to become #1 in terms of the number of adoptions of local governments. More than 30 public organizations have already decided to introduce GMO Sign, together with the number of accounts, number of contracts sent, we are aiming to become #1 in this area as well to lead to further growth. This shows the transaction value of the EC support business. The business consists of EC platforms such as [indiscernible] Shop and MakeShop and services such as [indiscernible] and FREENANCE. The e-commerce industry is experiencing a reactionary decline from the [indiscernible] consumption. And although our group's high-price MakeShop business remained strong, the number of customers remain low. Although the market remains to be weak, in terms of the EC market, the size of the transaction itself is much larger than that -- it was before the pandemic. Although there will be a temporary decline due to changes in consumption trends as a result of the end of COVID pandemic. We believe that this is an area in which growth can be expected in the future.
About 40% of the total amount was exited by GMO Payment Gateway. So we consider this value to be indicative of the strong synergy between the EC platform and Payment. Now finally, let's look at the price revisions and their impact. GMO Internet Group's motto is to provide the #1 service in all specifications and prices. However, with the recent surge in electricity prices, the ongoing depreciation of the yen and the global shortage of semiconductors, the impact could not be absorbed by self-help efforts alone, such as cost reductions. Therefore, we have decided to revise the prices as shown on the slide. The service maintenance and adjustment fee will not be a constant price increase but will be like a surcharge and will be reviewed according to the market trend.
Now as for the response from customers so far, we have not seen any particular impact on the continuation rate on new applications. As for the [indiscernible] impact, since both sales and expenses are prorated over the period, the effect will be seen gradually, and the performance impact is expected to be negligible. Next is advertising and media. Here is the breakdown of quarterly sales and the breakdown. Internet advertising continued to trend favorably as we capture the recovery demand for advertising and also expanded the handling of our own commercial products. Media also continued to see strong growth in the number of PBs for its own media. The slide shows the quarterly operating profit. As you can see, the V-shaped recovery trend continues with the year 2022 at the bottom. The trend continues when it comes to the expansion of own media research platforms, another high-margin in-house commercial products. On the other hand, the increase in outsourcing expenses due to increased transactions and an increase in sales-related expenses due to an increase in headcounts as well as a onetime increase in advertising distribution expenses, resulting in a year-on-year decline in earnings. Now the Internet Finance. Quarterly performance trend is as shown.
In the first quarter, sales reached a record high due to active FX trading and improved profitability from strengthened internal initiatives. Profit increased 3.1% year-on-year despite a JPY 1.5 billion provision in the Thai Securities business as in the fourth quarter of the previous year. Here are the sales trends by product. Profitability improved in double FX, passing the fourth quarter of 2021, which was [indiscernible] due to the COVID disaster. CFD, in pale blue, also posted record sales, reflecting risk trading in commodity-related indices. In addition, CFD on Gaika ex byGMO was launched on April 17. We will aggressively cross-sell by offering derivatives trading, which is one of our strengths. Now this chart shows the relationship between sales and trading volume in the FX business.
Last year, while transaction volume increased sharply with the ongoing depreciation of the yen, sales declined. In this regard, profitability has continued to improve since the fourth quarter of last year. Despite the decline in transaction volume due in part to profit improvement measures being taken, as a result, the share of transaction is declining. But by making the product better, we are working on each measures with the idea of building up market share from this point onward. Now over to the Cryptoasset business. Cryptoassets has 3 business areas. They are mining, exchange and payment. This is a breakdown of quarterly sales.
In the exchange business, the weak market environment led to a significant year-on-year decline in trading value, which in turn led to a decline in net sales. Despite global headwinds, the number of accounts is growing steadily as we work to add new issues and acquire customers. Here is the quarterly operating profit. Losses continued in this segment as sales declined. Transaction volume continues to decline, making it difficult to generate profits. Against this backdrop, we continue to manage our marketing investments in a restrained manner.
Although we expect the market environment to remain difficult for the foreseeable future, we will continue to implement internal measures in a steady manner, so that we can generate profit when the market is active again. So here are the status of each business and CFO, Yasuda, will cover the last topic.
Now, the topics will be covered by myself, Yasuda. First, I would like to talk about our efforts in the areas of security. Safe and secure Internet for all. Cyber attacks are becoming an urgent social issue and business risk. This is what we talked about in the last financial performance briefing session. We will contribute to the realization of a safe nation and society by adopting this as a slogan of our security business in order to meet the needs for security that we accelerate in the future due to the development of DX and online services. As for our security business, it is consisted of the 3 pillars shown on the slide. The first, SSL and other cryptographic security using authentication technology. Second, cybersecurity by Japan's strongest white hacker group. Third, brand security by domain and trademark professionals.
This time, we will provide an update on GMO Cybersecurity by Ierae, Japan's most powerful group of white hat hackers that joined our group last January. First, here are some of the examples of a cybersecurity implementation. The greatest strength of GMO cybersecurity by Ierae is its technological capabilities. As you can see, our vulnerability assessment conducted by white hackers with an attacker's perspective used by companies in a wide range of industries and sectors. And here are the achievements. In addition to being #1 in national and international contest as government, the National Policy Agency and the Ministry of Defense starting to take serious countermeasures, Ierae is assisting in the education and training of cyber units.
Thus, we received a certificate of appreciation for our technical support. And Ierae now offers a new service. The service is called GMO Cyber Attack Net de Diagnosis. This GMO Cyber Attack Net de Diagnosis is a SaaS-type product that automatically checks for loopholes in the site after entering the domain name, scoring the results and informing the user of the decision. Anyone can run a diagnosis easily with a high level of security. The monthly fee is JPY 980, but the service will be available free of charge until the end of December this year. Our Internet Infrastructures' 13.52 million customer base includes customers of all sizes. So we have a variety of customer segments.
So we are looking to cross-sell and cross-use Ierae services and products accordingly. For large customers, we are developing project-based services such as industry-specific GMO server Cybersecurity for banks. In other words, targeting at banks. And also GMO Cybersecurity for social infrastructure that targets a social infrastructure through project-type services that will be conducted on a push-type sales. For small and medium-sized companies, GMO Cyber Attack Net de Diagnosis, a SaaS-type product that incorporates the knowledge of white hat hackers is being developed through a pull-type sales approach. And here is a medium- to long-term growth image of our Cybersecurity businesses.
Ierae's existing business and industry-specific services are project-based and scales up according to the number of white hackers. We have received strong inquiries about this service. And we are continuing to recruit and train white hat hackers. So we expect steady growth in this area in the future. SaaS-type products are still needed to scale up the business. We will scale up our business by promoting cross-selling and cross-use of our infrastructure customer base led by Net de Diagnosis and by creating synergy between our #1 services. Second, and finally, our response to AI, artificial intelligence. Since OpenAI released a prototype version of ChatGPT last November, services using GenAI have spread rapidly.
For example, efficiency and accuracy are improving in many areas, including automated customer support, machine translation, speech recognition and [ center ] generation and others. The number of users continues to evolve at an overwhelming rapid pace with more than 100 million users in just 2 months. And you may know this already. And [indiscernible], here are some of the examples of CEO, Kumagai's AI and ChatGPT related tweets. I won't go into all of them, but I am highlighting some key points from these tweets. So related tweets of Kumagai can be found since February. Also, although not mentioned here, Kumagai himself has been talking about AI-related services and shared them with the group. We then decided to hold a business utilization contest in March.
Now regarding speed, which is the most important at the top right hand corner, Kumagai tweets "I have known the Internet for 30 years. I have been running an Internet company for 28 years. This industry has changed the most in the last 3 months." So that was Kumagai's tweet. And here is a tweet that I would like to share with you, in particular. So left-hand side column at the center. So he tweets, if I may, "I thought AI would reduce inequality and make people smile. But I realize the opposite is true. From now on, the gap between people and companies who can use it well and those who cannot, will widen further." So that's how he had treated. So you can see that our view of AI is changing over time.
So we mean -- so as you can see on the slide, in a simple context, our view has shifted from expectation to sense of prices. So of course, AI has its own challenges because of it being new fields such as the issue of fake news, ethical issues, cybersecurity and so on and so forth. Nevertheless, our view is that there is no other option but to respond to AI. That is our idea. And this is the group initiative to AI and ChatGPT. So IT was set to be dog years, 7x faster. But with the advent of AI, the impression is that it is 100x faster. In other words, a month delay is 100-months delay. Speed is the key. That's what I'm trying to communicate throughout the company.
Now in March, the group started to utilize ChatGPT in its business operations, we decided to hold the ChatGPT business utilization contest. With this active use of AI, the services you see here have already begun to offer AI functions. Now under the slogan of "Become the #1 AI Application Group", GMO Internet Group will proactively incorporate AI into its management. In the age of AI, we will continue to provide #1 services to our customers by improving productivity and reducing costs. Please stay tuned.
Now this concludes today's briefing session. Thank you for watching Internet for All. [Statements in English on this transcript were spoken by an interpreter present on the live call.]