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Meitec Corporation of Japan has issued its Interim Results

Meitec Corporation of Japan has issued its Interim Results

Consolidated Operating Results

During the quarter under review (three months from April 1, 2012, to June 30, 2012), uncertainty about the future persisted due to the deceleration of overseas economies, the high appreciation of the yen, domestic power shortages and other concerns. Nevertheless, we see continued willingness to invest in technological development among Japan’s major manufacturers—a main customer group for the Company.

Under these circumstances, the utilization ratio improved in the Group’s core business—temporary engineer staffing. Primarily for this reason, consolidated net sales for the period under review increased &yen1,146 million compared with the same period in the previous fiscal year to &yen16,704 million. Consolidated cost of sales rose &yen514 million to &yen12,276 million, chiefly due to increased labor costs. Selling, general and administrative expenses went up &yen253 million to &yen3,083 million mainly because of a rise in strategic investments. As a result, consolidated operating income increased &yen377 million from a year earlier to &yen1,344 million. Consolidated ordinary income rose &yen371 million to &yen1,357 million, and consolidated net income advanced &yen277 million to &yen763 million.

Operating Results by Business Segment

Temporary Staffing Business

The Temporary Staffing Business accounts for more than 90% of consolidated net sales. Particularly in

temporary engineer staffing, the core business of this segment, uncertainty about the future persisted due to the deceleration of overseas economies, the high appreciation of the yen, domestic power shortages and other concerns. Nevertheless, many customers continued investments in technological development, and the Company was therefore able to continue to land new contracts steadily from the previous fiscal year, which helped significantly improve the Company’s non-consolidated average utilization ratio (overall) from 90.0% a year earlier to 92.9% in the period under review. Mainly for this reason, consolidated net sales in the Temporary Staffing Business segment for the period under review increased &yen1,146 million from a year earlier to &yen16,066 million, and operating income raised by &yen372 million to &yen1,306 million.

Although Meitec Fielders achieved revenue growth for the period under review, its profits decreased due to increased costs for recruiting and education and training.

Engineering Solutions Business

In the Engineering Solutions Business, the Company provides engineering services related to analytical technologies, prototype production, casting/metal mold production and technology support for printed-circuit boards. Consolidated net sales in the Engineering Solutions business segment for the period under review fell &yen14 million from a year earlier to &yen579 million, and an operating loss of &yen1 million was recorded, improving by &yen11 million year on year.

Meitec CAE posted profit growth of &yen22 million from a year earlier mainly due to the improvement in cost percentage. Apollo Giken Group recorded an operating loss mainly due to a decrease in orders from several customers.

Global Business

The Global Business engages in job placement and vocational training for students to supply human resources for Japanese manufacturers that operate in the coastal areas of China.

Consolidated net sales in the Global business segment for the period under review increased &yen6 million from a year earlier to &yen12 million, whereas an operating loss of &yen13 million was recorded, improving by &yen2 million year on year.

Recruiting & Placement Business

The Recruiting & Placement Business segment involves the job placement and an information portal sitebusiness intended for engineers.

Consolidated net sales of the Recruiting & Placement Business segment advanced &yen12 million from a year earlier to &yen165 million, and operating income declined &yen8 million to &yen51 million.

Although Meitec Next Corporation achieved revenue growth due to the increased number of referrals, operating income remained at the same level as a year earlier, affected by an increase in the promotion cost to expand the number of job seekers using its services.

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