QUICK CO.,LTD. Q4 FY2025 earnings call

• Overall Consolidated Performance • Consolidated revenue hit an all-time high of 32.501 billion yen, +10.2% YoY, exceeding management's revised plan. Net income attributable to parent shareholders hit an all-time high of 3.58 billion yen, +2.2% YoY, driven by gains from ongoing sales of policy-held cross-held shares. Operating profit was 4.53 billion yen (-8.7% YoY) and ordinary profit was 4.61 billion yen (-8.3% YoY), as higher promotional and staffing investment costs offset revenue growth, though both figures exceeded the revised plan. • The favorable operating environment was supported by a continued high effective job opening ratio of 1.29x in March 2025, broad post-COVID economic recovery, and growing inbound demand driving activity in regional markets.

• Operational Strategic Updates • Cross-segment collaboration was strengthened: the new nursing student job hunting service "Kango roo! Shukatsu" is operated by the Recruiting Business segment, working with the Human Resources Service segment's existing nurse recruitment business to expand reach across Japan, and has grown far beyond the size of the acquired predecessor business. • Ongoing investments include expansion of recruitment and training for internal staff, and enhanced targeted promotion and branding focused on core services such as "Kango roo! Tenshoku". • Geographic focus for overseas expansion is prioritized on North America and Europe, with no aggressive expansion planned in Asia. As of the end of the term, total global headcount reached 1,800, with an additional 160 new graduates joining in April 2025 bringing total headcount to 1,960.

• Capital and Shareholder Initiatives • The company has completed a 900,000 share off-floor block sale with an oversubscription rate of over 22x, improving share liquidity for TOPIX constituent rebalancing. It also canceled 247,900 treasury shares (1.3% of pre-cancellation outstanding shares). • The company prioritizes ROE for capital return and PBR for corporate value, and will allocate budget for IR, PR, and branding in the coming term to improve visibility and support share price gains for TOPIX inclusion. • A new 4 yen per share dividend increase was implemented, bringing the dividend to 100 yen per share, aligned with the 50% payout ratio target to prioritize shareholder returns.

• External Recognition • Selected for the JPX Nikkei Small-Mid Cap Index for 3 consecutive years, ranked 20th overall in OpenWork's 2025 "Companies with Meaningful Work" ranking, and 1st out of 5,687 companies in the overall human resources services industry ranking, attributed to the company's focus on flexible, worker-friendly work environments.

1. Human Resources Service: Revenue of 22.744 billion yen, +10.2% YoY; Operating profit of 3.924 billion yen, -11.5% YoY. Revenue contribution is ~70% of total consolidated revenue. The revenue growth was driven by strong expansion of specialized recruitment (construction, engineers) and nursing/childcare staffing, as well as fully occupied nursery operations; the profit decline came from higher planned promotional investment. 2. Recruiting Business: Revenue of 3.43 billion yen, +5.8% YoY; Operating profit of 884 million yen, +58.2% YoY. Revenue contribution is ~10.5% of total consolidated revenue. The strong profit growth came from the successful shift from traditional fixed-fee recruitment media to higher-margin aggregation services centered on Indeed, with Indeed/Indeed PLUS revenue growth offsetting declines in traditional advertising. 3. Regional Information Service: Revenue of 2.67 billion yen, +7.2% YoY; Operating profit of 362 million yen, +5.5% YoY. Revenue contribution is ~8.2% of total consolidated revenue. Growth was driven by strong inbound demand and robust hiring demand in the Hokuriku region, growth in concierge recruitment support, and strong posting service performance. 4. HR Platform Business: Revenue of 1.247 billion yen, -5.6% YoY; Operating profit of 588 million yen, -13.6% YoY. Revenue contribution is ~3.8% of total consolidated revenue. The decline stemmed from reduced ad spending by HR tech and recruitment service clients on the "Nihon no Jinji-bu" media, which was not offset by strong performance of HR events. 5. Overseas Business: Revenue of 2.408 billion yen, +33.7% YoY; Operating profit of 134 million yen, -20.9% YoY. Revenue contribution is ~7.4% of total consolidated revenue. Revenue growth came from expansion in North America and Europe (60% of overseas revenue from North/Central America, 33% from Europe), but higher expansion-related costs and post-US election hiring slowdown in H2 led to profit decline. Shanghai recruitment operations were fully exited this term.

• For FY2026 March Term, management guidance calls for consolidated revenue of 33.97 billion yen, +4.5% YoY; gross profit of 22.97 billion yen, +7.4% YoY; SG&A of 18.4 billion yen, +9.2% YoY; operating profit of 4.57 billion yen, +0.8% YoY; ordinary profit of 4.62 billion yen, +0.2% YoY; and net income attributable to parent shareholders of 3.7 billion yen, including expected gains from continued policy-held share sales. The near-flat profit forecast reflects continued investment in promotion and growth. • Human Resources Service: Revenue growth is expected driven by continued expansion of specialized recruitment, but operating profit is forecast to decline 1.5% YoY to 3.864 billion yen due to continued promotional investment in the nursing segment. • Recruiting Business: The shift to a client agency one-stop recruitment support model is expected to reach maturity, though the segment remains exposed to economic sensitivity for small business clients. It will continue expanding "Kango roo!" job hunting and direct matching fee-for-performance recruitment services. • Regional Information Service: Forecasting continued revenue and profit growth, driven by consulting services and expansion of high-margin web products and stabilized posting distribution. • HR Platform Business: Forecasting continued revenue and profit decline (operating profit -19.7% YoY to 472 million yen), with management prioritizing business structure reform over near-term revenue growth; HR events are expected to continue growing. • Overseas Business: Forecasting revenue growth, but the outlook remains uncertain due to unclear macro conditions in the US and Europe.
• Medium-term planning will be updated annually aligned with macro conditions and growth investment, with management expecting investment to peak and growth results to materialize by the FY2028 March Term.
• The company has earmarked a maximum of 6 billion yen for M&A, equity investments, and business alliances over the medium term, targeting five priority areas: strengthening specialized recruitment, expanding nurse recruitment support, improving client recruitment success outcomes, strengthening in-house development and marketing capabilities, and improving segment-level productivity.

• The HR Platform Business faces sustained pressure from reduced advertising spending by HR tech and recruitment service clients, requiring near-term business restructuring that will weigh on revenue and profit in the coming term.
• Overseas Business faces macro and policy uncertainty: the 2024 US presidential election led to greater-than-expected hiring slowdown in H2 FY2025, and continued US trade policy uncertainty may lead to hiring pullbacks in FY2026. The outlook for US and European markets remains unclear, making forecasting uncertain.
• The Recruiting Business is sensitive to broader economic conditions, particularly for small and medium business and service industry clients, so results may underperform expectations if economic conditions weaken.
• Continued heavy investment in promotion and branding for core human resources services will pressure near-term profit margins, with returns on investment expected to materialize over the medium term rather than the coming 12 months.

No substantive question and answer content was included in the provided earnings call transcript.