DENTSU SOKEN INC., The Current Fiscal Year Ordinary Profit Revised Downward to an Unexpected 6% Decrease

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Thu Oct 31, 2024 3:00 pm JST Earnings

4812 DENTSU SOKEN INC. 【J-GAAP】

Earnings Report

DENTSU SOKEN INC. <4812> [TSE-P] announced its financial results after the market closed on October 31st (15:00). The consolidated ordinary profit for the cumulative third quarter of the fiscal year ending December 2024 (January to September) decreased by 8.2% from the same period last year to 14.4 billion yen.

In addition, the full-year consolidated ordinary profit has downwardly by 11.1%, from the previous forecast of 22.5 billion yen to 20 billion yen (compared to 21.2 billion yen in the previous period). This changes the outlook from an anticipated profit increase to a projection of a 5.9% decrease in profit.

Based on the full-year plan announced by the company after the downward revision, our estimate of the consolidated ordinary profit for the July to December period (second half) has downwardly by 20.4%, from the previous forecast of 12.2 billion yen to 9.73 billion yen (compared to 10.4 billion yen in the same period of the previous year). This changes the outlook from an anticipated profit increase to a projection of a 6.9% decrease in profit.

In the most recent three-month period, from July to September (3Q), the consolidated ordinary profit decreased to 4.15 billion yen, a 15.5% decrease compared to the same period last year. The operating profit margin decreased from 13.8% in the same period last year to 10.8%.

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Actual Results

Accumulated Results 3rd Quarter

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Progress Rate vs. First Half	Announce	Accounting Standards
Jan - Sep, 2022	93,808	14,186	14,184	9,574	147.1	77.3	Oct 31, 2022	J-GAAP
Jan - Sep, 2023	105,267	15,551	15,695	10,838	166.6	73.9	Oct 31, 2023	J-GAAP
Jan - Sep, 2024	112,231	14,463	14,413	10,074	154.8	72.1	Oct 31, 2024	J-GAAP
YoY	+6.6%	-7.0%	-8.2%	-7.0%	-7.0%

Guidance Update

Second Half Update

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Adj. Dividend	Announce	Accounting Standards
Jul - Dec, 2024 Prev	80,765	12,140	12,238	8,452	129.9	54	Jul 24, 2024	J-GAAP
Jul - Dec, 2024 New	77,765	9,640	9,738	6,752	103.8	54	Oct 31, 2024	J-GAAP
Revision Rate	-3.7%	-20.6%	-20.4%	-20.1%	-20.1%

Full Year Update

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Adj. Dividend	Announce	Accounting Standards
Dec, 2024 Prev	155,000	22,500	22,500	15,700	241.3	108	Jul 24, 2024	J-GAAP
Dec, 2024 New	152,000	20,000	20,000	14,000	215.1	108	Oct 31, 2024	J-GAAP
Revision Rate	-1.9%	-11.1%	-11.1%	-10.8%	-10.8%

Current Period Guidance

Second Half Results

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Adj. Dividend	Announce	Accounting Standards
Jul - Dec, 2023	72,759	10,376	10,459	7,217	110.9	56	Feb 14, 2024	J-GAAP
Jul - Dec, 2024 Guidance	77,765	9,640	9,738	6,752	103.8	54	Oct 31, 2024	J-GAAP
YoY	+6.9%	-7.1%	-6.9%	-6.4%	-6.5%

Current Period Guidance

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Adj. Dividend	Announce	Accounting Standards
Dec, 2022	129,054	18,590	18,354	12,598	193.5	78	Feb 10, 2023	J-GAAP
Dec, 2023	142,608	21,028	21,244	14,663	225.4	100	Feb 14, 2024	J-GAAP
Dec, 2024 Guidance	152,000	20,000	20,000	14,000	215.1	108	Oct 31, 2024	J-GAAP
YoY	+6.6%	-4.9%	-5.9%	-4.5%	-4.5%

Quarterly Results

Fiscal Year	Revenue	Operating Profit	Ordinary Profit	Net Profit	Adj. EPS	Operating Profit Margin	Announce	Accounting Standards
Jul - Sep, 2023	35,418	4,899	4,910	3,392	52.1	13.8	Oct 31, 2023	J-GAAP
Oct - Dec, 2023	37,341	5,477	5,549	3,825	58.8	14.7	Feb 14, 2024	J-GAAP
Jan - Mar, 2024	37,099	5,757	5,734	4,118	63.3	15.5	Apr 26, 2024	J-GAAP
Apr - Jun, 2024	37,136	4,603	4,528	3,130	48.1	12.4	Jul 31, 2024	J-GAAP
Jul - Sep, 2024	37,996	4,103	4,151	2,826	43.4	10.8	Oct 31, 2024	J-GAAP
YoY	+7.3%	-16.2%	-15.5%	-16.7%	-16.7%