3836 TSE Prime

Avant Group Corporation
Financial Results Briefing
for the third quarter of Fiscal Year June 2024
April 26,2024

This is an unofficial translation. In the event of any discrepancy between the original Japanese
text and this English translation, the Japanese text shall prevail.
©AVANT GROUP CORPORATION. All Rights Reserved.

Financial Highlights for the Q3/24
Net Sales

Operating Income¥17,806million¥ 3,075million(YoY＋10.0％）(YoY＋5.3％）

Increase due to strong growth in the Digital Transformation
Promotion Business (hereafter, DX Promotion Business) andcontinued high growth rate in the outsourcing business

Increase due to decrease in one-time expenses incurred in the previous
fiscal year as a result of group reorganization and the effect of higher
sales in the DX Promotion Business, despite increase in fixed personnel
expenses resulting from increase in headcount, outsourced processing
expenses to respond to increase in orders, and investment-related
expenses to realize future growth.

•

No changes are made to the forecast for the current financial year, which is expected to achieve sales of ¥ 24,000 million andoperating profit of ¥ 3,850 million.

•

The year-end dividend per share for FY2024 is expected to be 19 yen per share, with the aim of achieving the 8% ratio of dividends to
net assets, which is the target for the period of the new medium-term management plan.

▼BE GLOBAL 2028' Actions to realise• Avant Releases New Generation of AVANT Cruise• Avant Group forms capital and business alliance with Figurout Inc.
• Avant and Nomura Securities Co., Ltd. jointly develop corporate value enhancement support software.
• Integrated Report "CREATIVE DIALOG 2023" published.
• Avant Group establishes a joint venture (consolidated subsidiary) in India.
©AVANT GROUP CORPORATION. All Rights Reserved.

2

Acquisition of own shares◼ At a meeting of the Board of Directors held on April 26, 2024, the Company resolved on the following matterspertaining to the acquisition of own shares in accordance with Article 156 of the Companies Act as applied
pursuant to Article 165, Paragraph 3 of the said Act.
Reason for acquisition of own shares
As part of its shareholder return policy, we are acquiring own shares to increase the value per share.
Details of matters relating to the acquisition(1) Class of stocks to be purchased

Common stock(2) Total number of shares that may be acquired

1.2 million stocks (maximum)(3) Total amount for shares to be acquired

1 billion yen (maximum)(4) Acquisition Period

May 1, 2024 to November 30, 2024

©AVANT GROUP CORPORATION. All Rights Reserved.

3

【Reference】 Segment Reorganization
DX Promotion

Group GovernanceOutsourcing

BeforeDisclosure Net

Consolidated
Accounts
SoftwareConsolidated
Accounts Consulting& Operations

Disclosure Net

Consolidated
Accounts
SoftwareOutsourcing

Management Solutions
Business(Software & consulting)Consolidated
Accounts Consulting& Operations

CPM*

BI＆Data
Platforms

Outsourcing

Management Solutions
Business(Software & consulting)

CPM*

BI＆Data
Platforms

After
Consolidated Financial Disclosure Business

Management Solutions Business

DX Promotion
Business※CPM：Corporate Performance Management©AVANT GROUP CORPORATION. All Rights Reserved.

4

【Reference】 New business segments
Consolidated Financial Disclosure Business (M1)
In addition to the development and maintenance of our own packaged software "DivaSystem" for consolidated management
support and consolidated accounting, we also provide outsourcing of consolidated and non-consolidated financial statements
using this software, supporting value creation through corporate information disclosure. As for our position within our group, we
aim to establish a business model that combines the software business and outsourcing business.
The consolidated financial statement disclosure service also includes an information search service for disclosure documents
provided by Internet Disclosure Co., Ltd. primarily for auditing firms.

Digital Transformation Promotion Business (M2)
Through consulting and system development, we provide AI and BI solutions that analyze, predict, and visualize data from a data
platform that utilizes all kinds of data surrounding companies, and support companies in promoting digital transformation anddata-driven management. From major cloud vendors to multi-cloud compatible software, you will learn about the latest
information utilization methods and generation AI specializing in data utilization, as well as train engineers and develop your own
data utilization platform products. We also aim to expand our group's products.

Management Solutions Business (M3)
Focusing on group management, consolidated accounting, and business management, we aim to visualize and maximize acompany's "invisible value," and provide one-stop support from consulting to system planning, construction, implementation,
operation, and maintenance. In addition to in-house development, it is also possible to develop in combination with softwaredeveloped by other companies. In this segment, we will continue to create solutions that make the most of the group's assets
and provide solutions that provide management information that will improve corporate value.
©AVANT GROUP CORPORATION. All Rights Reserved.

5

INDEX
Ⅰ. Summary of financial results for the third quarter of FY June 2024
Ⅱ. Earnings and Dividend Forecast
Ⅲ. 'BE GLOBAL 2028' Actions to realise＊ Figures in this presentation are rounded down to the unit of display.

The information contained in this material regarding the business outlook and other forecasts and strategies etc. are forward-looking statements and are determined within
the range that could normally be predicted based on the information reasonably available to the Company at the time of preparation of this material. Investors should beaware of the risks, however, that actual results may differ from the business prospects described in the material due to the occurrence of extraordinary circumstances thatcannot usually be predicted or the occurrence of results that cannot usually be predicted. The Company will proactively disclose information that is considered material toinvestors, but investors should be advised not to make judgment based entirely on only the business prospects described in this material. This material should not be
copied or transferred for any purpose without permission of the Company.

©AVANT GROUP CORPORATION. All Rights Reserved.

6

I. Summary of financial results for the third quarter of FY June 2024

©AVANT GROUP CORPORATION. All Rights Reserved.

7

Results Highlights◼ Net sales increased by 10.0% year-on-year to 17,806 million yen due to significant growth in the DX promotion
business and continued to maintain a high growth rate in the outsourcing business.
◼ Operating income increased by 5.3% year-on-year to 3,075 million yen due to a decrease in one-time expenses
incurred in the previous fiscal year due to the restructuring of the Group and the effect of an increase in sales in the
DX promotion business, despite an increase in fixed personnel costs due to an increase in personnel and outsourcing
processing expenses to meet an increase in orders, as well as expenses for investment to achieve future growth.
YoY Variance

FY6/24(million of yen)

Q3

Yr earlier

FY6/24
Q3 Total% chg

YoY Variance
Yr earlier% chg

Net Sales

6,063

5,664

7.0%

17,806

16,188

10.0%

Cost of Sales

3,407

3,174

7.3%

9,976

8,855

12.7%

Gross Profit

2,656

2,489

6.7%

7,829

7,332

6.8%

GPM

43.8%

44.0%

-0.2pt

44.0%

45.3%

-1.3pt

SG&A

1,471

1,362

8.0%

4,753

4,412

7.8%

Operating Income

1,185

1,127

5.1%

3,075

2,921

5.3%

OPM

19.5%

19.9%

-0.4pt

17.3%

18.0%

-0.8pt

757

729

3.9%

1,974

1,871

5.5%

NPM

12.5%

12.9%

-0.4pt

11.1%

11.6%

-0.5ptEBITDA

1,344

1,255

7.1%

3,470

3,245

7.0%

EBITDA margin

22.2%

22.2%

0.0pt

19.5%

20.0%

-0.6ptNet Income©AVANT GROUP CORPORATION. All Rights Reserved.

8

Progress to Full-Year Sales Targets◼ FY24 3Q cumulative sales are progressing at 74.2% of full-year sales, on par with the past 4 years
Nat Sales¥15.6b

＋3.5%¥16.2b

＋15.2%¥18.7b

＋14.6%¥21.4b＋12.0%¥24.0b※Plan

100.0%¥17.8b

80.0%¥11.7b
25.8%

60.0%

¥11.9b

26.3%¥13.7b
26.9%¥16.1b
26.4%

Q3 Cum.

25.3%
Q2

40.0%

25.6%

24.9%

25.1%

25.7%

25.4%
Q1

20.0%

23.7%

22.2%

21.6%

23.5%

23.5%

2020年6月期

2021年6月期

2022年6月期

2023年6月期

2024年6月期

0.0%

Q1

Q2

©AVANT GROUP CORPORATION. All Rights Reserved.

Q3

Q4

9

FY6/24 Q3 Operating Income Bridge (YoY)
Personnel and recruiting expenses
FY6/23 Q3Operating Income

Aggressive recruiting activities for sustainable growth are underway, and personnel andrecruiting expenses increased at a level higher than the rate of revenue growth, but lessthan the amount of revenue growth.

2,920

Higher GP fromsales growth+1,636

Personnel andrecruiting expenses

▲921
▲18

Outsourcing
expenses▲263

IT expenses

+70

Other
expenses
FY24 Q3 Cumulative
Operating Income before
Allowance for Investment
Expenses

3,424
▲349
3,075
（ Millions of yen ）©AVANT GROUP CORPORATION. All Rights Reserved.

Although subcontracting expenses in the consolidated financial disclosure, which were
temporarily incurred as restructuring costs, decreased, subcontracting expenses increasedin DX in order to meet strong demand.

IT expenses
IT expenses increased due to an increase in headcount and cloud computing (for customers
and internal environment).

Other Expenses
Office expenses decreased due to the office review. Despite a decrease in restructuring
expenses, other expenses increased slightly due to expenses for the introduction of the RS

Trust and an increase in fees paid related to the Materiality Realization Office.
Investment cost: 349 million yen

Operating Income / YoY Growth

M3 (Business Management Solution) 210M

Investment
cost
FY24 Q2 Results
Cumulative Operating
IncomeOutsourcing expenses

M1 (Consolidated financial disclosure) 55M
M2 (DX propulsion)
52M
AVANT GROUP CORPORATION
31M
Software development and procurement, andmost occur in M3, which is undergoing abusiness model transformation.
The Materiality Realization (MI) Office, whichis responsible for the group-wide R&D function,is located at Avant Group Corporation and thus
incurs investment cost.

Before inclusion of
investment expenses＋¥500m / 17.3％UP
After inclusion of
investment expenses＋¥150m / 5.3％UP
10

Results by Business Segment◼

Sales of Business Management Solutions declined, but DX Promotion Business drove overall sales.

◼

Operating income increased in the DX Promotion Business and the Consolidated Financial Results Disclosure Business but decreased
Management Solutions Business.

◼

Orders received and backlog increased YoY in all segments.
YoY Variance

FY6/24(単位：百万円)(Millions of yen)

Promotion BusinessBusiness©AVANT GROUP CORPORATION. All Rights Reserved.

% chg

5,512

5,166

6.7%

579

414

39.9%

1,437

1,198

19.9%

OPM

30.4%

23.6%

6.8pt

26.1%

23.2%

2.9pt

Orders

1,836

1,689

8.7%

5,398

5,294

2.0%

Order Backlog

3,835

3,544

8.2%

3,835

3,544

8.2%

Net Sales

2,274

1,988

14.4%

6,640

5,376

23.5%

541

415

30.2%

1,300

973

33.6%

OPM

23.8%

20.9%

2.9pt

19.6%

18.1%

1.5pt

Orders

2,360

1,984

19.0%

6,466

5,472

18.1%

Order Backlog

1,531

1,154

32.6%

1,531

1,154

32.6%

Net Sales

2,030

2,104

▲3.5%

6,049

6,116

▲1.1%

269

400

▲32.7%

845

1,185▲28.7%

OPM

13.3%

19.0%

▲5.8pt

14.0%

19.4%

▲5.4ptOrders

1,991

1,753

13.6%

5,609

5,179

8.3%

Order Backlog

2,674

2,060

29.8%

2,674

2,060

29.8%

Operating Income
Management Solutions

Yr earlier

8.8%

Operating Income
Digital Transformation

Q3 Total

% chg

1,752

Operating Income
Disclosure BusinessYr earlier

YoY Variance

FY6/24

1,905

Net Sales

Consolidated Financial

Q3

in the Business11

Results by Business Segment (Factors)◼ The DX Promotion Business drove the increase in profit due to the effect of increased revenue. In the consolidated financial
disclosure business, revenue increased due to strong performance of the outsourcing business, and the growth of the outsourcing
business was the driving force in terms of revenue and profit. In the business management solutions business, the impact of a certain
period of restrictions on sales activities due to business restructuring was resolved, but sales declined due to a lack of pipeline, andincome decreased due to investments for a shift to the software business.
Operating Income Variance

Net Sales Variance（Millions of yen）

（ Millions of yen ）20,00018,00016,0006,049
14,000

6,116

12,00010,000

8,000

6,640
5,376

6,000
4,000
2,000

5,166

5,512

FY06/23 Q3

FY06/24 Q3

0Management Solutions Business
Digital Transformation Promotion Business
Consolidated Financial Disclosure Business©AVANT GROUP CORPORATION. All Rights Reserved.

▲66M YoY
Sales declined slightly due to a lack ofpipeline, although the impact of certain
periodic restrictions on sales activities
resulting from the reorganization was
resolved.
Software sales increased, but wereunable to offset the impact of the scaling
down of large projects, resulting in a
decline in service sales and a slightoverall decline in overall sales.

+1,263M YoY
Sales increased significantly due tostrong demand, an increase in largescale projects, and the continued
expansion of ongoing projects.
+345M YoY
The outsourcing business continued tomaintain a high growth rate.
Although the software business
improved and grew at a higher rate,
sales declined due to the impact ofstrategically downsized intra-groupcontracted development.

4,000
3,500

845

3,000

1,185

▲339M YoY
Decrease due to lower sales.
Profit decreased due to the reinforcementof the system to shift to the software
business and an increase in amortization
expenses from software procurement.

2,500

1,300

2,000

973
1,500

▲327M YoY
Despite higher personnel, outsourcing, andmarketing expenses due to businessexpansion, the company achieved asignificant increase in profit due to the effectof higher sales.

1,000
500

1,437

1,198

0

FY06/23 Q3

FY06/24 Q3

Management Solutions Business
Digital Transformation Promotion Business▲238M YoY
The increase in profit was driven by theeffect of higher revenue in the outsourcing
business. The effect of the pricing strategy
in the software business is also becoming
apparent, but profit growth was limited
due to the impact of strategicallydownsized intra-group outsourced
development.

Consolidated Financial Disclosure Business12

Results by Business Segment (Consolidated financial disclosure business )◼ Excluding the impact of Internet Disclosure, which is included in the consolidated financial disclosure segment, and the strategic
reduction of intra-group contract development, the company has achieved solid growth and improved profits.

3Q
Non-consolidated＋16.1％

Operating profit ratio

Stock sales ratio

Sales Growth Rate

3Q
Non-consolidated

91.4％

3Q
3Q

21.5％

Non-consolidated
Non-consolidated

30.1％＋4.6pts

3Q
Total＋11.1％

3Q
Total

91.8％

3Q
Total

21.3％

25.2％

＋1.4pts*All exclude the impact of ID sales.

©AVANT GROUP CORPORATION. All Rights Reserved.

13

Results by Business Segment (DX Promotion Business)◼
◼
◼
◼

It operates in the DX market, and its business domain covers not only the BI domain but also the entire data utilization for DX
realization (data platform). This is a particularly high-growth business area in the DX market.
The domestic cloud market is expected to continue to grow at a high rate.
Microsoft, Amazon, and Google hold the top market shares in the global cloud market.
The Company's strategic focus on Azure, AWS, and GCP, multi-vendor strategy (see below), and extensive award-winning and partner
recognition have enabled the Company to successfully realize business opportunities in these growing business areas.
As a result, net sales increased. Note that sales related to Azure, AWS, and GCP accounted for about 2/3 of cumulative sales throughQ3 FY6/2024.
Domestic Cloud Market Forecast(in terms of revenue)

CAGR

Global Cloud Infrastructure Services
Spending Market Share（ Period: April-June 2022 ）13,257

AWS, Azure, and GCP-related sales as apercentage of Zeal sales
100%
80%

+18%
37％

31％

60%

5,814

40%

8％ 24％

20%

66％

56％

0%
FY23 Q1-Q3

2022

Forecast
2027予測（billions of yen）
©AVANT GROUP CORPORATION. All Rights Reserved.

AWS

Microsoft Azure

Google Cloud

その他
Other

AWS、Azure、GCP関連

FY24 Q1-Q3
その他
Other

-related
Source: IDC Japan for domestic cloud market forecast (in terms of revenue); Canalys for global cloudinfrastructure services spending market share

14

Results by Business Segment (DX Promotion Business)◼ We have adopted a multi-vendor strategy and have established cooperative relationships with a variety of
manufacturers. As a result, we are able to adapt to our customers' needs and our business is growing.
◼ Our company has a strong track record of awards and partner accreditations. As a result, we often receive orders for
projects from each of our major partner companies, leading to the growth of our business.
Major Vendor Companies (selected)

Awards and Recognition from Partners
Awards：

BI/Statistic
al Analysis

Awarded Microsoft Japan Partner of the Year for three consecutive
years
2023: Business Intelligence category
2022: Power BI Awards
2021: Analytics Award

Our engineer won Microsoft Top Partner Award in Azure category andMicrosoft MVP Award in Data Platform category.
We won the "Best Solution Award" at the SAS Partner Award 2021.

Analysis
Basis©AVANT GROUP CORPORATION. All Rights Reserved.

Microsoft： We are the first company in Japan to receive the Advanced
Specialization for "Analysis using Microsoft Azure" in 2021.
Amazon：Promoted to AWS Advanced Tier Service Partner (2023) and obtained
SDP for AWS Glue. First in Japan to acquire SDP for Amazon Redshift,
Amazon QuickSight, and AWS Glue (2023).

Google：Acquire Google Cloud service partner certification (2021) and Looker
Sell partner certification under Google Cloud (2022)
15

Results by Business Segment (Business management solutions )◼ The impact of the business restructuring, which restricted sales activities for a certain period of time, has been
resolved, the pipeline has recovered, and the flow order backlog, excluding stock, has increased. Flow orders
increased YoY but decreased QoQ. However, the pipeline is steadily building up and is expected to turn to an upward
trend in FY24Q4.
（billions of yen）

3.00
2.50

（billions of yen）

Orders received and backlog

1.07

1.06

0.98

0.95

1.00

0.89

2.00

1.20

0.80

0.69

1.50

0.60

1.00

0.40
1.55

1.38

1.47

1.51

1.60

1.47

0.50

0.20

0.00

0.00
FY06/23 Q2

FY06/23 Q3

Orders received(Flow)©AVANT GROUP CORPORATION. All Rights Reserved.

FY06/23 Q4

FY06/24 Q1

Orders received(Stock)

FY06/24 Q2

FY06/24 Q3

Orders backlog(Flow)16

Group Cost Structure◼ Recruitment and personnel expenses increased due to active recruitment activities. Outsourcing costs also increased, but to a limited
extent.
◼ IT expenses increased due to increased headcount and cloud computing (for customers and internal environment)◼ Despite a decrease in restructuring costs, other expenses increased due to expenses for the introduction of the RS Trust and anincrease in fees paid related to the Materiality Realization Office.
YoY Variance

FY6/24(Millions of yen)

Q3

Yr earlier

FY6/24
Q3 Total% chg

YoY Variance
Yr earlier% chg

Net Sales

6,063

5,664

7.0%

17,806

16,18710.0%

Personnel expenses

2,785

2,488

11.9%

8,515

7,511

13.4%

Recruitment expenses

105

88

18.9%

338

298

13.4%

Outsourcing expenses

958

1,002

▲4.4%

2,965

2,794

6.1%

IT expenses

321

248

29.4%

944

681

38.7%

Office expenses

199

233

▲14.6%

627

689

▲9.0%

Other expenses

508

476

6.8%

1,341

1,293

3.7%

Total expenses

4,878

4,536

7.5%

14,73013,266

11.0%

Operating Income

1,185

1,127

5.1%

3,075

2,920

5.3%

OPM

19.5%

19.9%

▲0.4pt

17.3%

18.0%

▲0.8pt©AVANT GROUP CORPORATION. All Rights Reserved.

17

Quarterly GPP (Net Sales Growth + OPM) Trends◼ Although GPP had been on a downtrend since the 3Q of the previous fiscal year, it rose in the 1Q of the current fiscal year due to arecovery in sales growth and rose in the 2Q due to an improvement in the operating profit margin. 3Q saw a slowdown in sales growthin the business management solutions business due to a lack of pipeline, but the operating profit margin remained at a high level.

50.0%
45.0%
40.5%
38.3%

38.2%

40.0%

36.4%

35.0%

32.4%
30.7%

30.6%
30.0%

26.3%

25.0%

26.3%

25.8%

21.4%

25.3%

26.6%

26.3%
24.4%

23.8%

20.7%

20.0%
13.5%

10.2%

15.0%
10.0%
5.0%
0.0%
Q1

Q2

Q3

FY6/20

Q4

Q1

Q2

Q3

FY6/21

Q4

Q1

Q2

Q3

FY6/22Net Sales Growth Rate

Q4

Q1

Q2

Q3

FY6/23

Q4

Q1

Q2

Q3

FY6/24

OPM

Effective from the beginning of the first quarter of FY6/22, the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and others have been applied.
©AVANT GROUP CORPORATION. All Rights Reserved.

18

Quarterly Net Sales by Segment◼ Transient effects of business restructuring are seen in the figures of Business Management Solutions for the 4Q of the previous fiscal
year and the 1Q of the current fiscal year.
◼ As in previous years, profitability tends to increase in 2Q and 3Q, but business management solutions remain stagnant.

( Billions of yen )Net Sales

7.0

1.60

6.0

1.40

5.0

2.1

2.2
4.0

1.9

1.8

Operating Income( Billions of yen )

2.2

1.9

2.0

0.27

1.20
0.43
0.48

1.00

0.40

0.80
3.0
1.6

2.0

1.8

1.9

2.2

2.2

2.3

2.0
1.0

0.60
0.40

1.6

1.8

1.8

1.7

1.9

1.7

1.9

0.20

0.54

0.15

0.31
0.36

0.42

0.41
0.14
0.15

0.20

0.35

0.36

0.43

0.41

0.39

0.36

Q1

Q2

Q3

Q4

Q1

0.49

0.58

0.00

0.0
Q1

Q2

Q3

Q4

Q1

FY6/23

Q2
FY6/24

Management Solutions Business
Digital Transformation Promotion Busines
Consolidated Financial Disclosure Business©AVANT GROUP CORPORATION. All Rights Reserved.

Q3

FY6/23Q2

Q3

FY6/24

Management Solutions Business
Digital Transformation Promotion Busines
Consolidated Financial Disclosure Business19

Quarterly Margin Trends◼ In the 4Q of the previous fiscal year, gross profit margin declined due to a certain period of restrictions on sales activities related tobusiness management solutions as a result of business restructuring, but in the current fiscal year, sales grew and both gross profit
margin and operating profit margin were on a recovery trend, reaching the same level as the same period of the previous fiscal year.
(％)
60.0

47.8

50.0

47.6

47.3

45.1

48.3

49.5

47.9

50.5
45.4

44.9

44.5

47.2
44.8

45.9

44.0

42.1

42.0

43.8

39.4

40.0
33.0
30.8

30.0

32.2

33.4

31.2

28.3

27.4
20.3

20.0
13.8

14.3

14.8

15.1

33.5

27.9
20.4

32.7
27.8

27.8

21.7

22.7

14.5

13.3

32.4
30.0
25.7
21.4

12.7

11.4

32.5

26.1

24.1
19.9

12.2

24.3

19.8

19.5

Q2

Q3

12.1
7.0

10.0

0.0
Q1

Q2

Q3

FY6/20

Q4

Q1

Q2

Q3

Q4

FY6/21

Q1

Q2

Q3

Q4

FY6/22GPM

SG&A ratio

Q1

Q2

Q3

FY6/23

Q4

Q1

FY6/24

OPM

Effective from the beginning of the first quarter of FY6/22, the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and others have been applied.
©AVANT GROUP CORPORATION. All Rights Reserved.

20

Quarterly Recurring Sales and Recurring Sales Ratio◼ While the stock ratio has not changed its level significantly, the absolute value of stock sales hasremained steady.
(Millions of yen)
2,500

38.5%
38.6%

2,000

32.7%

33.4%

35.5%

34.5%

34.9%

35.7%

38.0%

36.9%

36.0%
33.1%

32.3%

45.0%
38.7%

35.5%
33.8%

32.9%

40.0%
36.5%

34.2%

35.0%

30.0%
1,500
25.0%
2,349
1,878

1,000

1,342
1,214

1,307

1,346

1,388

1,432

1,488

1,542

1,492

1,554

1,658

1,769

1,783

1,739

2,343

20.0%

2,062

1,816

15.0%

10.0%

500

5.0%

0

0.0%
Q1

Q2

Q3

FY6/20

Q4

Q1

Q2

Q3

Q4

Q1

FY6/21

Q2

Q3

Q4

Q1

FY6/22
Recurring Sales

Q2

Q3

FY6/23

Q4

Q1

Q2

Q3

FY6/24

Recurring Sales Ratio

Effective from the beginning of the first quarter of FY6/22, the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and others have been applied.
©AVANT GROUP CORPORATION. All Rights Reserved.

21

ROE Trends◼ ROE* has been on a downtrend recently, partly due to an increase in net assets, but improved in the 1Q due todividend payments and a share buyback. In 2Q and 3Q, it declined again due to the buildup of net assets.
◼ We aim to maintain an average of at least 20% through adherence to the Group's management principles, by further
enhancing profitability and managing assets more efficiently.
(millions of yen)

Net Asset

ROE ※14,000(%)

30%

12,00025%

10,000
20%

17.6%

8,000

15%
6,000
10%
4,000

5%

2,000
-

0%
Q1

Q2

Q3

FY06/20

Q4

Q1

Q2

Q3

FY06/21

Q4

Q1

Q2

Q3

FY06/22

Q4

Q1

Q2

Q3

FY06/23

Q4

Q1

Q2

Q3

FY06/24※Figures are calculated based on the past four quarters.
Effective from the beginning of the first quarter of FY6/22, the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and others have been applied.
©AVANT GROUP CORPORATION. All Rights Reserved.

22

Number of Group Employees◼ To achieve sustainable growth, headcount is increasing, but remained flat in 2Q and slightly declined in 3Q(person)1600

1,389 1,414

1,415 1,406

Q4

Q2

1400

1,226 1,240
1200

1,107 1,123 1,128

1,139

Q4

Q3

1,263 1,270

1,055 1,030 1,030 1,047
1000

950

965

963

Q1

Q2

Q3

800

600

400

200
FY06/20©AVANT GROUP CORPORATION. All Rights Reserved.

Q4

Q1

Q2

Q3

FY06/21Q1

Q2

FY06/22

Q4

Q1

Q2

Q3

FY06/23Q1

Q3

FY06/23

23

Financial Condition Trends◼ Despite a decrease of 843 million yen in cash and deposits, total assets increased due to a 1,082 million yen increase in notes andaccounts receivable, accounts receivable and contract assets, a 111 million yen increase in prepaid expenses, and a 213 million yen
increase in investment securities.
◼ Net assets increased 538 million yen from the end of the previous period to 12,867 million yen due to the posting of 1,974 million yen
in net income attributable to parent company shareholders, 918 million yen in acquisition of treasury stock, and 564 million yen in
dividend payments from retained earnings.
◼ The capital adequacy ratio has remained at a high level.
Total Assets(Millions of yen)

Net Assets and Equity Ratio(Millions of yen)

19,50018,981
19,00014,00063.8

18,70567.8

70.0

12,867

12,32812,000(％)

60.0

10,59718,50018,00017,50017,00065.9

16,617

10,000

50.0

8,000

40.0

6,000

30.0

4,000

20.0

2,000

10.0

16,50016,00015,50015,0000
FY6/22©AVANT GROUP CORPORATION. All Rights Reserved.

FY6/23

FY6/24 Q3

0.0
FY6/22

FY6/23

FY6/24 Q3

Effective from the beginning of the first quarter of FY6/22, the "Accounting Standard for Revenue Recognition"(ASBJ Statement No. 29, March 31, 2020) and others have been applied.

24

Cashflow Trends◼ Operating cash flow increased due to income before income taxes and minority interests of 3,091 million yen, income taxes refund of
565 million yen, etc., and decreased due to a decrease in notes and accounts receivable-trade and contract assets of 1,082 million yen,a decrease in contract liabilities of 542 million yen, a decrease in allowance for bonuses of 208 million yen, income taxes paid of 1,206
million yen etc.
◼ The main components of financial cash flow outflows were the purchase of treasury stock of 918 million yen following the introductionof the RS Trust as an incentive program for future stock price hikes, and dividend payments of 564 million yen, resulting in an increaseof 502 million yen used versus the same period last year.

YoY Variance

FY6/24(Millions of yen)

Q3

Yr earlier

YoY Variance

FY6/24 Q3
cumulative total% chg

Yr earlier% chg

Operating CF

910

624

286

1,260

△ 93

1,354

Investment CF

△ 365

△ 51

△ 313

△ 605

△ 674

69

545

572

△ 26

655

△ 767

1,423

△ 472

△3

△ 469

△ 1,498

△ 502

△ 995

Free CF
Financial CF©AVANT GROUP CORPORATION. All Rights Reserved.

25

Ⅱ. Earnings and Dividend Forecast©AVANT GROUP CORPORATION. All Rights Reserved.

26

Earnings forecast for the fiscal year ending June 30, 2024
◼ For the fiscal year ending June 2024, sales are expected to increase by 12% year-on-year to 24,000
million yen. Operating income and net income are expected to increase at a rate greater than the rate ofincrease in sales due to the effect of increased sales and the reduction of the burden of restructuringcosts incurred in the fiscal year ending June 2023.

(Millions of yen)

FY6/23

FY6/24（Actual）（Forecast）

Variance

Chg

Net Sales

21,42424,000

2,576

12.0%

Operating Income

3,289

3,850

561

17.1%

OPM

15.4%

16.0%

-

-

Net Income

2,094

2,500

406

19.4%

©AVANT GROUP CORPORATION. All Rights Reserved.

27

Shareholder Returns◼ In line with the policy of continuing to pay a stable dividend, the dividend per share for the year ending
30 June 2024 is expected to be 19 yen per share.
◼ DOE for the fiscal year ended June 30, 2023 was 4.9%, well above the TSE-listed company average (12months) of 3.1%.
Our shareholder return policy◼ Dividends are an important part of our shareholder return policy◼ Avant aims to maintain if not grow the dividend by focusing on
indicators such as dividend on equity (DoE) which is less
impacted by fluctuations in annual earnings.
◼ The Company’s DOE will always exceed the average of allcompanies listed on the Tokyo Stock Exchange and will aim toachieve 8% within the period of the new medium-term
management plan.

©AVANT GROUP CORPORATION. All Rights Reserved.

28

Ⅲ. 'BE GLOBAL 2028' Actions to realise©AVANT GROUP CORPORATION. All Rights Reserved.

29

BG28 Outlook◼ Increase corporate value by improving fundamentals through net income growth (3x) and byincreasing future cashflow through a shift to a software focus

Most important critical
success factor(CSF) for promotion ofgroup strategy©AVANT GROUP CORPORATION. All Rights Reserved.

30

BG28 Focus Markets◼ Position self in management DX market for companies where enhancing corporate value isa serious issue
New segment

TAM (Total Addressable Market) andpositioning of each market
Know-how
Service

High

name

Investor Perspective Next
Generation Management
Information Platform Market

M1
Deepen existing
marketFY6/23¥6.7bnLatent SAM

M3Service Available Market

M2
Consolidated
Financial Disclosure
Market¥112.3bn

M1

Capture growthmarketLow
Realization risk

High

Management DX market©AVANT GROUP CORPORATION. All Rights Reserved.

OPM

Digital Transformation Promotion Business

FY6/23

FY6/28CAGR

17.8％¥7.2bnNew segment
name

M3

）

¥14bn

¥16.3bn

OPM

15.0％→19.9%

Client base
SoftwareDeepen existing
marketLow

New segment
name

M2

Capture growth market

FY6/2819.5％→27.2%

Creation of new market¥690bn-¥720bn

（

CAGR

17.3％

¥272bnBI, Data Infrastructure& DX Market

Consolidated Financial
Disclosure Business

Creation of newmarketManagement Solutions Business

FY23

FY28
CAGR

¥7.9bn13.2％¥14.7bn

OPM

16.7％→28.7%
31

Capital Allocation• Assuming ¥20bn for growth investments and ¥5bn for shareholder returns (dividends) overthe 5-year period of the medium-term management plan.

First Growth Investment Direction
Internal investment = Human capital investment

¥1.0b
¥3.5b

¥0.5b

©AVANT GROUP CORPORATION. All Rights Reserved.

•

Conduct R&D that contributes to theachievement of the business plan•

Developing functions that produce economies ofscale

Business Growth Asset Procurement
Investment•

Minority-funded•

Software Purchase

Reserve Funds• VC investment, etc.

32

Avant Releases New Generation of AVANT Cruise
Functions and effects of this software
AVANT, a group company, has integrated Fluence
Technologies' innovative software technology into
AVANT Cruise in order to contribute to theenhancement of our customers' corporate value
through the provision of business management
systems.

◼

As part of efforts to continuously release new functions(expansion of business management contents, enhancement ofdata linkage functions, collection of ESG information, etc.) tostrengthen the functions of the "Group Business Management
System for Corporate Value Enhancement".

◼

We will continue to focus on dramatically accelerating andupgrading the development of "software that contributes to theenhancement of corporate value" for our Japanese customers.

©AVANT GROUP CORPORATION. All Rights Reserved.

This has enabled centralized management of dataprocessing processes such as collection, processing
and calculation, and visualization, as well as
business processes such as communication withbusinesses and subsidiaries, management, andinteractive analysis, and has evolved into softwarewith an intuitive interface that users can operate.

March 27, 2024 Release（Japanese）
https://www.avantcorp.com/news/2024/03/27/12761/
33

Avant Group forms capital and business alliance with Figurout Inc.
Background and Purpose of AllianceDeepen cooperation in terms of business andservices, as well as cooperation in development
systems.
By linking TRINITY BOARD, the Board of Directors
DX solution sold by Diva, with Figurout's Hooolders
Analytics, the company aims to make TRINITY
BOARD software even more useful than before in
improving the corporate value of its customers. The
collaboration is expected to be completed in thenear future.

◼ One of the investment measures for procuring
growth assets for the business◼ The direction of contributing to the visualizationof corporate value of listed companies and thepromotion of data-driven IR, and encouraging
stronger engagement with investors, aligned with
our strategic materiality.
©AVANT GROUP CORPORATION. All Rights Reserved.

Figurout will use the funds raised to accelerate
development and service improvements to further
enhance the customer experience of "Hooolders
Analytics" and to develop future products.

March 27, 2024 Release（Japanese）
https://www.avantgroup.com/ja/ir/irnews/auto_20240324558206/pdfFile.pdf
34

Avant and Nomura Securities Co., Ltd. jointly develop corporate value enhancement
support software
Functions and effects of this softwareThis software is a management support tool thatstreamlines the response to the request from the Tokyo
Stock Exchange ("TSE") in March 2023 for all listedcompanies to "respond toward the realization ofmanagement conscious of cost of capital and stock price"
and accelerates the management process necessary forsustainable value creation.
Combining Nomura Securities Co., Ltd.'s expertise in cost ofcapital analysis, corporate valuation, and scenario risk
analysis, which it has provided mainly to prime market
listed companies, with Avant's business management
software technology, the company will support its clients informulating and disclosing business strategies andengaging in constructive dialogue with investors.
◼ This software can be effectively used to understandinvestors' expectations and realize dialogue to enhance
corporate value and will promote the realization of ourstrategic materiality.
◼ This product is one of the initiatives to promote the"Software Driven Strategy" and contributes to the grossprofit of software, which is the most important CSF for
promoting the Group's strategy.
©AVANT GROUP CORPORATION. All Rights Reserved.

Avant will provide and market the software, while Nomura
will propose effective use of the software, provide advice
based on corporate finance theory on the calculated values,
and assist with ongoing monitoring after disclosure.
March 28, 2024 Release（Japanese）
https://www.avantcorp.com/news/2024/03/28/12778/
35

Avant Group publishes integrated report "CREATIVE DIALOG 2023”
CREATIVE DIALOG 2023 is published to inform
investors and other stakeholders of the Group's
approach, strategies, and achievements in value
creation and corporate value enhancement, and toinitiate dialogue with them.
Through the Group CEO message and value creation
process, we will communicate how our group istrying to create value for society.

◼ This is the fourth issue of the Integrated Report.
◼ Following the presentation of the issues to be solved by
the Group in the previous CREATIVE DIALOG 2022, thisIntegrated Report is intended to give readers an idea ofthe solutions offered by the Group.

From then on, based on the philosophy system, thethree parts will express how the Group will
implement and realize its corporate philosophy,
mission, and vision, consisting of growth strategies
to realize the vision, business strategies toimplement the mission, and ESG initiatives that
embody the corporate philosophy.

Integrated Report Page
https://www.avantgroup.com/en/ir/library/integratedreport.html©AVANT GROUP CORPORATION. All Rights Reserved.

36

Avant Group establishes a joint venture (consolidated subsidiary) in India.
Establishment Background
Cygnet Infotech Private Limited, a global softwaredevelopment company based in India, has joined
forces with us to develop software on a global level.
Discovering the growth potential of the Indian
software market and the sales potential of ourgroup's software products in India, we decided toestablish a joint venture company through joint
investment.

◼ Established a joint venture company in India with
Cygnet Infotech Private Limited◼ The joint venture company will become a consolidated
subsidiary of the Company©AVANT GROUP CORPORATION. All Rights Reserved.

Business Description and Objectives
Through the joint venture, we will strengthen the
Indian market by conducting research on theGroup's software sales and business development in
the Indian market.

37

Reference : Company overview©AVANT GROUP CORPORATION. All Rights Reserved.

38

Company Introduction
Name：AVANT GROUP CORPORATION
Inception：May 26, 1997
Representative：Tetsuji Morikawa, President and Group CEO
Market Cap： Approximately 55 billion yen （ TSE Prime, 3836 ）Main SoftwareGroup Companies

Segment Information

Percentage of sales for eachsegment FY23

【Consolidated Financial Disclosure Business】
In addition to developing the consolidated accounting system"DivaSystem LCA" and related products "DivaSystem Dx3-Advance"and "DivaSystem FBX", we are engaged in outsourcing business suchas consolidated and non-consolidated financial settlement operations
using "DivaSystem" to comprehensively support the corporate value
creation process through information disclosure.

【Management Solutions Business】

Third party

With group business management, consolidated accounting, andbusiness management as the pillars, we provide one-stop support forcustomers' "visualization and maximization of invisible corporate
value" from consulting to system planning and construction,
introduction support, operation and maintenance, and develop
software that will be the solution in-house. We also provide systemdevelopment and implementation support that combines softwaredeveloped by other companies with our own products.

Net sales¥21.4 bDigitalTransformation Promotion
Business

Consolidated
Financial
Disclosure
Business

33％

31％

Management
Solutions Business

36％【Digital Transformation Promotion Business】
We support the promotion of digital transformation and data-driven
management of companies by providing data platforms that organize
and integrate internal and external data and AI and BI solutions thatanalyze, predict, and visualize data through consulting and systemdevelopment.

©AVANT GROUP CORPORATION. All Rights Reserved.

39

Avant Group Philosophy©AVANT GROUP CORPORATION. All Rights Reserved.

40

The Avant Group Moves to the Next Five Years to Realize BE GLOBAL
Established the top share in Japan in the consolidated
accounting business

Introduction of holding company system andexpansion of group management■ Corporate■ Introduction of Internal Control
Governance Code
Reporting System (J-SOX)（Jun.
2015~）（Apr.2008~）■ Voluntary Applicationof Disclosure under IFRS（FY Mar. 2010~）■ Start of reporting inconsolidated accounting（FY Mar. 2000~）■Mandatory quarterly
reporting（FY Apr. 2003~）

Government-led
initiatives

BE GLOBAL(¥mn)■ Publication of Business Restructuring
Practice Guidelines（Jul. 2020～）

Dec. 2018■ DivaSystem clients baseexceeded 1,000 companies

Aug. 2007■ Users of DivaSystem reached 500

25,000■ Group Governance Practice
Guidelines■ Establishment of a study group on（Sep. 2019～）
fair acquisition （2022～）

Oct 2022■Reorganization

21,424Mar. 2018
Change the Market
Listing to the First
Section of the TSE（currently TSE Prime
Market)20,000Feb. 2007
Listed at OSE Hercules(currently TSE GrowthMarket)15,000

Oct.2013■Changed the trade name from DIVACORPORATION to AVANT CORPORATION■Established new DIVA CORPORATION as aresult of the Incorporation-type company split

10,000OI

May 1997
Founding of DIVA Inc.

5,000

Net Sales

12,110

3,289

1,631

0

（FY）

97

98

99

00

01

02

©AVANT GROUP CORPORATION. All Rights Reserved.

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

20

21

22

23
41

Segment Reorganization
DX Promotion

Group GovernanceOutsourcing

BeforeDisclosure Net

Consolidated
Accounts
SoftwareConsolidated
Accounts Consulting& Operations

Disclosure Net

Consolidated
Accounts
SoftwareOutsourcing

Management Solutions
Business(Software & consulting)Consolidated
Accounts Consulting& Operations

CPM*

BI＆Data
Platforms

Outsourcing

Management Solutions
Business(Software & consulting)

CPM*

BI＆Data
Platforms

After
Consolidated Financial Disclosure Business

Management Solutions Business

DX Promotion
Business※CPM：Corporate Performance Management©AVANT GROUP CORPORATION. All Rights Reserved.

42

Numerical Summary
Net Sales／Sales Growth Rate
25,00025.0%
21,42415,00020.0%

14,077

14.5%15.0%

15.2%
16.2%

11.5%
10.0%

5,000

5.0%
3.5%

0

0.0%

(百万円)

FY6/20FY6/21Net Sales

FY6/22

2,796

10.0%

600

5.0%

400

0.0%
FY6/20FY6/21

FY6/23

FY6/19

17.4%

30.0%

70
24.6%

25.0%

23.5%

23.6%

500

5.0%

0

0.0%
FY6/21

FY6/23

18.3%

20.0%

50.5

53.1

50
40

37.8

38.9

FY6/19FY6/20

15.0%

1,000

FY6/20FY6/22

61.8

60

21.1%

30

10.0%

FY6/19FY6/21Market Cap

15.4%15.0%

14.5%

FY6/20(Billions of yen)

30.0%

20.0%
17.2%

14.0%

FY6/22

0

25.0%

1,966
2,000

938

200
FY6/19

2,278

2,500

1,107

800

15.0%

GPP

3,289

1,226
1,055

1,000

ROE
3,247

1,389

1,400
1,200

20.7%

Sales Growth Rate

3,500

1,500

26.0%

25.0%

FY6/23Operating Income/OPM

3,000

29.9%

20.0%

10,000FY6/19

1,600

32.6%

30.2%

30.0%

16,236(person)

40.0%
35.0%

18,70320,00015,691

Number of employees

GPP（Sales Growth Rate＋OPM）(Millions of yen)

FY6/22

10.0%

20

5.0%

10

FY6/230

0.0%
Operating Income©AVANT GROUP CORPORATION. All Rights Reserved.

OPM

FY6/19FY6/20FY6/21

FY6/22

FY6/23

FY6/21

FY6/22

FY6/2343

Trends in companies that have introduced Avant Group Software Product◼ With the tightening of disclosure regulations, consolidated accounting system LCA leads the number of
introductions.

©AVANT GROUP CORPORATION. All Rights Reserved.

44

Customer base of consolidated accounting system “LCA”◼ More than 1,100 companies have sold ※１◼ FY2022 consolidated accounting software market share is 43.1% ※２◼ From institutional accounting to budget and management accounting, we support thestrengthening of corporate governance※１※２

As of the end of June 2023
Fuji Chimera Research Institute "Software Business New Market 2023 Edition" Consolidated Accounting Management Software Market Share©AVANT GROUP CORPORATION. All Rights Reserved.

45

Cautionary Statement Concerning Forward-Looking Statements
The information in this document regarding business forecasts and other future projections and strategies is based on
judgments made by the Company based on information reasonably available to it at the time this document was prepared
and within the scope of what is normally expected. However, actual results may differ materially from those discussed in
the forward-looking statements due to the occurrence of extraordinary circumstances or unforeseeable results that could
not be foreseen in the normal course of events. While we endeavor to actively disclose information that we believe isimportant to investors, we urge you not to base your decisions solely on the earnings forecasts contained in thisdocument. Please do not reproduce or transmit this material for any purpose without permission.

Contact
Avant Group Corporation, IR Office
ir@avantgroup.com©AVANT GROUP CORPORATION. All Rights Reserved.

46