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新加坡49选7开奖记录: System Integrator (JP-3826) Tokyo Stock Exchange First Section ( II )

2018-07-11  提供機構:FISCO  作者:FISCO  點閱次數:2

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十一选五玩法 www.yhyqa.cn ◆Outlook

Investments in FY2/19 will set the stage for further growth in future years

1. FY2/19 forecast

For FY2/19 the Company is forecasting higher sales and higher earnings, with full-year sales hitting ¥4,000mn (+6.2% YoY), operating profit ¥500mn (+1.0%), recurring profit ¥503mn (+1.3%), and net profit ¥348mn (+0.6%). The modest growth projected for earnings reflects the Company’s plan to boost strategic investment spending from ¥150mn last year to ¥430mn this year, with much of this going to develop new products that will drive growth in the future. On a half-year basis, the Company sees sales rising and earnings declining in the first half of FY2/19 followed by higher sales and higher earnings in the second half.

The strategic investment spending planned for FY2/19 breaks down as follows: ¥60mn for AI-related investments, ¥300mn for product development, and ¥70mn for investments aimed at increasing productivity. See the figure below for further details.

(1) AI-related investments

The Company is planning to make a total of ¥60mn in AI-related investment in FY2/19 as it continues develop­ment work on its new search and knowledge AI service, AISI∀ CompanyList, and its new anomaly detection service, AISI∀ AnomalyDetection. AISI∀ CompanyList, schedule for launch in the fall of 2018, is a service that automatically create a database with the latest company information broken down by industry and business line; it does this by using an AI search engine that automatically searches the web with a 24-7 web crawler and scraps (extracts) the latest information from the text on corporate webpages, and automatically tags that information based on the industry or type of business. As this will give companies a low-cost and labor-free way of finding and sizing up potential customers, suppliers, and competitors—especially compared with traditional, high-cost corporate database service providers like Tokyo Shoko Research, Ltd.—the Company believes there is a great deal of latent demand for this service. The Company is looking for AISI∀ CompanyList to generate roughly ¥500mn in revenues in the first five years after its launch.

The Company is looking to complete AISI∀ AnomalyDetection by the end of 2018 and launch the new service before the end of FY2/19. The AI image recognition technology being used in AISI∀ AnomalyDetection is the same as that used in AISI∀ FlowerName. The Company has not detailed exactly what the AISI∀ AnomalyDetection service will entail however, since there are a number of other companies that are also developing and offering anomaly detection services based on image recognition technology, it will be interesting to see just how the Company will try to differentiate its service from competitors.

(2) Investment spending on product development

Plans call for a total of ¥300mn in investment spending on product development in FY2/19, around ¥50mn the Company has typically been spending on product development in past years. About half of the spending this year will go towards enhancements of Production Management Add-on Modules for GRANDIT. Manufacturing companies have been the main market for these add-on modules thus far, but as additional functions have been added the Company has seen more inquiries from companies in construction and other areas in recent years, leading to increases in the number of custom orders. This prompted the Company to include the features that were in high demand as standard features and upgrade the packaged version to make it suitable for construction companies, thereby increasing both the product’s competitiveness and the productivity gains that could be realized.

Investments in product development in others areas include upgrades to existing products in the SI Object Browser series and the development of RPA-related services. The Company is looking at developing an educational support service for technicians working in RPA development. Towards this end, it plans to work with a partner company* that is already offering RPA services to provide solutions services for users of GRANDIT.

* On April 18, 2018, GRANDIT and Toshiba Information Systems (Japan) Corp. signed a business sales partnership agreement under which the two companies agreed to work together to develop a solutions service combining the Company’s GRANDIT with the RPA tool from Toshiba Information Systems.

(3) Productivity improvements

In FY2/19 the Company also plans to make ¥70mn in IT investments aimed at increasing productivity. The investments will be aimed at augmenting employee training, management functions, and sales functions, and will also make use of RPA to help increase operational efficiency.

Hiring plans call for increasing staffing levels by about 20 employees by the end of FY2/19. This includes seven new graduates came on board in April 2018 and mid-career hires.

OBPM and EC and Omni Channel business expected to drive growth in FY2/19

2. Outlook by business segment

(1) The Object Browser Business

At the Object Browser Business, the Company sees both sales and operating profit growing by roughly 10% YoY in FY2/19. Only a modest increase is expected in sales of the SI Object Browser series but sales of OBPM are expected to accelerate and advance by double-digits as the sales staff hired last year gets up to speed. The Company reports that contract numbers have recently picked up and additional demand is also expected for the limited-feature “light” version of OBPM.

OBDZ is in the process of being upgraded to address performance problems in the current version. The upgrade, which is expected to be completed by the end of FY2/19, is aimed at realizing a major improvement in perfor­mance over the current version and also making OBDZ more user-friendly. Accordingly, the Company anticipates almost no sales of OBDZ this year. Sales are expected to pick up again in earnest from FY2/20 as AISI∀ -DR will be out by then and the two products can be marketed together.

(2) The EC and Omni Channel Business

For the EC and Omni Channel Business, the Company is forecasting sales and operating profit growth of 7% to 8%. The Company has been seeing a lot of inquiries for constructing EC websites and orders have continued coming in at a steady pace. The growth reflects more than just demand from large companies. As dedicated online sellers and the value of goods sold through the internet has growth, constructing EC websites with a higher level of security and the ability to process even larger transactions has become necessary. By reliably addressing these needs, the Company is aiming for sales in this area of ¥1,000mn in the near future.

(3) The ERP Business

For the ERP business, the Company is forecasting a 3% rise in sales and flat operating profit. As discussed previously, the Company plans to invest heavily in product development during FY2/19 (including Production Management Add-on Modules). Because the in-house product development team will take priority in terms of human resources, sales growth is expected to slow temporarily. The Company also plans to continue expanding its development team and training employees at partner companies and, as product development is completed, expects to get back into double-digit growth territory starting in FY2/20.

(4) Other Business

As for new businesses, the Company says that since AISI∀ -CompanyList will not be on the market until in fall of 2018, that it has included almost no sales from it in its forecast for FY2/19. In contrast, the Company is expecting sales from TOPSIC of the tens of millions of yen. Neither of these new services is expected to be profitable, though, as the heavy upfront investment spending will keep both in the red. The Company reports that it has been receiving many inquiries about TOPSIC since it was launched in January this year, including some requests for trial-runs from companies where no interest had been expected, and by the end of April had already signed up 16 companies, a rate of a little over five per month. At this rate it looks like the Company will easily meet its target for TOPSIC of 60 companies by the end of FY2/19.

With respect to TOPSIC, it is important to note that the Company’s sales force has thus far not been involved in selling this new service, as users are able to complete the order process online through the Company’s website. Some sales promotion will be done going forward, though, including issuing press releases about the results that the companies have achieved by using TOPSIC as a means of increase name recognition. Starting in May 2018, TOPSIC will also get some support from the OBPM sales team, since there is a lot of overlap between the potential client base for OBPM and TOPSIC. A full-scale marketing campaign is also planned to help promote TOPSIC to existing users of SI Object Browser series products and OBPM.

The chronic shortage of systems engineers in the Japanese IT industry has made hiring highly qualified system developers (both Japanese and foreign) and in-house training of employees a pressing management issue. The move by the Japanese government to make programming classes mandatory at the elementary school level starting in FY2020 will add further to the demand for programming education in the years to come. As the current market environment suggests there is a great deal of latent demand for a service like TOPSIC, we believe this service may enjoy rapid growth going forward.

There is a competing programming skill evluation service from Givery, Inc. that goes by the name of Track. Track has been on the market for about two years but differs significantly from TOPSIC in that it covers a broader range of subjects, going all the way from upstream design work down to programming. At ¥600,000 a year, Track is also twice as expensive. This being the case, it fair to say that TOPSIC has the advantage of being both cheaper and more focused on programming skills.

Aiming for double-digit growth in sales and earnings from FY2/20 based on growth at existing businesses

3. The medium-term business plan

The Break 2018 medium-term business plan will take the Company through the next three years to the end of FY2/21. In its policy statement, the Company says it wants to make the people of the world happy through the power of software and, towards this end, has dedicated itself to “make software that saves you time” as its management mission. Looking ten years out, the Company says it wants to be creating software that is used not only in Japan but by users all around the world. The new medium-term business plan that covers the coming three years is aimed at helping the Company reach this goal, as it outlines a basic action plan with five specific steps that will help establish a solid foundation that will allow the Company’s business to continue growing over the long term.

(1) Increase market share of existing businesses

Of its three main current businesses, the Company is looking at the EC and Omni Channel business to increase its market share by using an EC ecosystem strategy that will put its SI Web Shopping software at the center as the core system. At its ERP business, this year the Company is aiming to increase its market share by enhancing the functionality of its add-on modules in FY2/19 and offering new value-added solutions services that make use of RPA tools, both of these moves being aimed primarily at manufacturing and construction companies. And at its Object Browser business, the Company will continue looking to its SI Object Browser product series as a steady source of revenues and earnings while working to increase OBPM’s market share in the IT industry, uncover latent demand for OBPM in manufacturing and other industries, and reinforce its market position and grow sales with other products such as OBDZ and AISI∀ -DR.

(2) Establish bases overseas

To help increase its development capabilities, the Company is actively looking make use of more overseas engineers. In 2017 it began working together with the University of Danang in Vietnam, and to hire two Vietnamese employees a year to train and work in Japan. And it also help develop partnerships with local Vietnamese companies. With this initiative, the Company said that it might be able to establish an offshore development base in Vietnam as early as 2019. The Company is also establishing a new business division that will be in charge of adapting current products to other languages and opening up sales channels overseas. In the past, the Company was looking to market its products in China and, towards this end, entered into partnership agreements with several local companies. The results of this effort have been disappointing, though, and so the Company is now also looking to grow sales in the rest of Asia.

(3) Establish AI business

Since 2017 System Integrator been doing AI R&D and working on developing AI technology-based services, and has already developed two such services. As discussed previously, the Company is preparing to launch new AI-based products in two different areas, one in “search and knowledge AI” and one in “image recognition AI.” It is looking to make these new AI businesses profitable in a relative short period of time.

(4) Raise skill level of employees

In keeping with its policy that all employees must be first-class engineers, the Company plans to invest more in various kinds of education and training that will increase employee skill levels. As part of this effort, the Company plans to use its new TOPSIC programming skill evaluation service in-house as well.

(5) A leading Japanese “streamlined company”

Going forward, the Company is looking to established itself an a leading “streamlined company” by further improving operational efficiency through the use of RPA and various system tools to better utilize data. In the process, the Company aims to establish itself as a model for what can be achieved through process streamlining and offer its expertise in this area to client companies.

With respect to performance targets under its medium-term business plan, the Company is targeting sales of ¥5,300mn and a recurring profit of ¥684mn in FY2/21, with sales and earnings both growth at a double-digit pace from FY2/20. After making ¥430mn worth of strategic investments in FY2/19, the Company plans to let investment spending return to the normal range of ¥100–¥150mn seen in past years, providing a substantial boost to earnings from FY2/20. With regard to new businesses, the Company said the sales generated by new business account of only a small percent of the sales targeted under the medium-term business plan and that the vast majority of the growth is expected to come from existing businesses.

◆Shareholder return policy

The policy is to pay dividends based on performance and its standard dividend payout ratio is 30%

In order to increase its enterprise value, the Company plans to take a more proactive approach towards returning profits to shareholders. Its current dividend policy ties dividends to earnings with a standard a dividend payout ratio of 30%. The ¥19.0 dividend it expects to pay in FY2/19 is unchanged from the previous year and represents a dividend payout ratio of 30.2%. However, investors can expect the dividend to increase in future years if sales and earnings continue to grow.

The Company has also introduced a shareholder rewards program with the objective of creating stable shareholders who hold their shares for the medium-to long-term. The program is for shareholders who hold at least 100 shares and who held the same share number listed in the current list of shareholders at the end of August as they did at the end of February in each year. The Company rewards newly harvested Koshihikari rice grown in Niigata, using reduced levels of fertilizers and agrochemicals. The Company announced a revision on November 16, 2017, and starting FY2/18, shareholders holding from 100 to 499 shares receive a 1kg bag, those holding 500 to 1,999 receive a 2kg bag, those holding 2,000 to 7,999 receive a 5kg bag, and those holding 8,000 shares or more receive a 10kg bag, with the gift being delivered each fall after the harvest.

◆Information security policy

Cybersecurity measures undertaken by the Company include the creation of an information security committee and a manual, constant monitoring of cybersecurity risks, and rapid response to any incidents.

 

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