Corporate Planning and Strategy

Management Policy

Based on our management philosophy of being an Engineer Support Company, we are committed to serving as a technical partner that contributes to the sustainable growth of our clients. This basic stance, developed over many years, has built up a lot of trust and achievements, establishing our firm position as a pioneer in the industry.
We will continue to expand our corporate value by promoting management that will win the support and approval of our clients, shareholders, employees, and all other members of society.

Objective Indicators for Assessing the Achievement Status of Management Goals, etc.

In the engineer dispatching business, the Company’s main business, the following indicators are used. Net sales: the amount calculated by the number of operative personnel (number of engineers × utilization rate) × unit price of engineers × total work person-hours; cost of sales: labor costs for engineers assigned to our clients; and selling, general and administrative expenses: labor costs for engineers undergoing in-house training (standby status) and labor costs for other staffers.
The Company considers the engineer count, utilization rate, and unit price of engineers as particularly important management indicators, and will focus on efforts to improve them further.

Business Environment

For this fiscal year, the Japanese economy has slowly picked up in the “living with COVID” world. Due to factors such as the COVID-19 pandemic, the situation in Russia and Ukraine, and fluctuations in resource prices and exchange rates, some of our clients’ business results made a slightly downward swing, but our business environment did not receive any major negative impact. Looking ahead, in relation to the market environment for the FY2024, we expect that manufacturers will stay active in their development projects.

Cost of Capital

The Company has identified its cost of capital as:
Fiscal year ended January 31, 2024 – WACC: 8.2%
Fiscal year ended January 31, 2024 – ROIC: 24.6%
The Company’s basic policies on earnings plans and capital policies are reflected in its Medium-Term Business Plan.

Action to Implement Management that is Conscious of Cost of Capital and Stock Price

In part because the Company does not have borrowings, it attaches importance to the cost of shareholders’ equity and recognizes it at approximately 8%. The ROE for the fiscal year ended January 31, 2024 exceeded the cost of shareholders’ equity at 25.3%. We are working to improve capital efficiency, setting the ROE target at 20% or higher in our Medium-Term Business Plan.

To raise the stock price, we intend to increase our profit every year and determine a dividend amount that will not fall below the previous year’s amount, based on a payout ratio of 50%. The Company’s PBR at the end of the fiscal year ended January 31, 2024 was 5.50 times. We will make continued efforts to enhance our IR activities with an aim of increasing the PBR.
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