3836 TSE Prime

Avant Group Corporation
Financial Results Briefing
for the Fiscal Year ended June 2024
August 2,2024

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 Q4/24
Net Sales¥

24,419m

Operating Income

4,099m¥Net Income¥

2,850m

(YoY＋14.0％）(YoY＋24.6％）(YoY＋36.1％）

14th consecutive year ofProfit growth for 9
consecutive terms

Growth rate above the CAGR*
target of 25%

revenue growth
Sales increased due to strong growth in the Digital
Transformation Promotion Business (hereafter DX
Promotion Business), continued high growth in theoutsourcing business, and a recovery in sales in theBusiness Management Solutions Business.

Although fixed personnel costs due to an increase in
the workforce, outsourced processing costs in
response to an increase in orders and investmentrelated costs to realise future growth increased, theincrease in profit was due to a decrease in one-off
costs from the previous year's group restructuring
and the effect of higher revenues.

In addition to the growth in operating profit, thesignificant increase in profit was due to the effectsof the wage tax system, which reduces corporation
tax for companies that raise wages above thethreshold.
※CAGR： Compound Average Growth Rate

All KPIs were achieved in the first year of the BE GLOBAL 2028 medium-term management plan.
▼Forecasts for the year ending 30 June 2025•

For FY2025, the company forecasts sales of 28,800 million yen and operating profit of 4,900 million yen.

•

The year-end dividend is forecast to be 25 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.

©AVANT GROUP CORPORATION. All Rights Reserved.

2

【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.

3

【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.

4

INDEX
Ⅰ. Summary of financial results for the FY ended 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.

5

I. Summary of financial results for the FY ended June 2024

©AVANT GROUP CORPORATION. All Rights Reserved.

6

Results Highlights◼ Net sales increased by 14.0% year-on-year to 24,419 million yen due to significant growth in the DX Promotion Business, theoutsourcing business also continuing to maintain a high growth rate and a recovery in sales in the Business Management Solutions
Business.
◼ Operating profit increased by 24.6% year-on-year to JPY 4,099 million, mainly due to a decrease in one-off costs incurred in theprevious year as a result of the Group's reorganisation and the effect of increased sales in the DX Promotion business, despite higher
fixed personnel costs due to an increase in headcount, outsourced processing costs to meet increased orders, and investment-related
costs to realise future growth.
YoY Variance

FY6/24(million of yen)

Q4

Yr earlier

FY6/24
Total

% chg

YoY Variance
Yr earlier% chg

Net Sales

6,613

5,236

26.3%

24,41921,425

14.0%

Cost of Sales

3,514

3,173

10.7%

13,491

12,02912.2%

Gross Profit

3,099

2,063

50.2%

10,928

9,396

16.3%

GPM

46.9%

39.4%

7.5pt

44.8%

43.9%

0.9pt

SG&A

2,075

1,694

22.5%

6,829

6,106

11.8%

Operating Income

1,023

368

177.7%

4,099

3,289

24.6%

OPM

15.5%

7.0%

8.4pt

16.8%

15.4%

1.4pt

876

223

292.8%

2,850

2,095

36.1%

NPM

13.3%

4.3%

9.0pt

11.7%

9.8%

1.9pt

EBITDA

1,171

493

137.6%

4,642

3,738

24.2%

EBITDA margin

17.7%

9.4%

8.3pt

19.0%

17.4%

1.6pt

Net Income©AVANT GROUP CORPORATION. All Rights Reserved.

7

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

Personnel and recruitment costs increased within the framework of increased revenues due
to active recruitment to achieve sustainable growth.

3,289

Outsourcing expenses

Higher GP fromsales growth+2,951

Personnel andrecruiting expenses-1,265

Outsourcing costs in the consolidated financial disclosure, which were temporarily incurred
as restructuring costs, decreased, but outsourcing costs increased in DX to meet strong
demand, resulting in a slight increase overall.

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

Outsourcing
expenses-27

Other Expenses

IT expenses-326

Trust and an increase in fees paid related to the Materiality Realization Office.

Otherexpenses
FY6/24
Operating Income before
Allowance for Investment
Expenses

-64
4,556

79M
M1 (Consolidated financial disclosure) 78M
AVANT GROUP CORPORATION
42M
M2 (DX propulsion)

-457
4,099
（ Millions of yen ）©AVANT GROUP CORPORATION. All Rights Reserved.

Investment cost: 457 million yen

Operating Income / YoY Growth

M3 (Business Management Solution) 262M

Investment
cost
FY6/24
Operating Income

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

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＋¥1,267m / 38.5％UP
After inclusion of
investment expenses＋¥810m / 24.6％UP
8

Results by Business Segment◼

Sales increased in all business segments. The DX promotion business in particular led the overall increase.

◼

Operating profit also increased in all business segments. The DX promotion business, which had a significant increase in revenue, led the overall increase.

◼

Orders and order backlogs increased year-on-year in all segments

YoY Variance

FY6/24(単位：百万円)(Millions of yen)
Net Sales

Disclosure Business

Promotion BusinessBusiness©AVANT GROUP CORPORATION. All Rights Reserved.

Yr earlier

% chg

16.7%

7,537

6,902

9.2%

403

387

4.1%

1,840

1,586

16.0%

OPM

19.9%

22.3%

▲2.4pt

24.4%

23.0%

1.4pt

Orders

2,871

2,141

34.1%

8,269

7,435

11.2%

Order Backlog

4,681

3,949

18.5%

4,681

3,949

18.5%

Net Sales

2,206

1,895

16.4%

8,846

7,272

21.7%

333

145

129.3%

1,633

1,118

46.1%

OPM

15.1%

7.7%

7.4pt

18.5%

15.4%

3.1pt

Orders

2,745

2,446

12.2%

9,211

7,919

16.3%

Order Backlog

2,069

1,705

21.4%

2,069

1,705

21.4%

Net Sales

2,468

1,767

39.7%

8,518

7,883

8.1%

562

135

314.8%

1,407

1,321

6.6%

OPM

22.8%

7.7%

15.1pt

16.5%

16.8%

▲0.2ptOrders

3,800

2,820

34.8%

9,410

7,999

17.6%

Order Backlog

4,006

3,113

28.7%

4,006

3,113

28.7%

Operating Income
Management Solutions

Total

% chg

1,735

Operating Income
Digital Transformation

Yr earlier
2,025

Operating Income
Consolidated Financial

Q4

YoY Variance

FY6/249

Results by Business Segment (Factors)◼ The DX promotion business drove the increase in profits due to the effect of increased revenues. The consolidated financial disclosurebusiness increased revenues due to the strong performance of the outsourcing business, and the growth of the outsourcing business
was also a driving force in terms of earnings. The Business Management Solutions business recorded higher revenues and profits due
to a recovery in sales, as the impact of certain restrictions on sales activities due to business restructuring and the lack of a pipeline
were resolved.
Operating Income Variance

Net Sales Variance（Millions of yen）

（ Millions of yen ）＋634M YoY
The impact of certain restrictions on sales
activities due to the reorganisation, as
well as pipeline shortages, have been
resolved and sales increased.Softwaresales and service sales both increased.

+1,574M YoY
Sales increased significantly due tostrong demand, the continuation of large
projects and the continued expansion of
ongoing projects.

+635M 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.

©AVANT GROUP CORPORATION. All Rights Reserved.

+86M YoY
Profit increased due to the effect ofincreased revenues.Amortisation costs
increased due to the strengthening of thestructure for the shift to the software
business and software procurement.
+515M YoY
Despite higher personnel and recruitment
costs and increased marketing costs due tobusiness expansion, the increase in revenue
led to a significant increase in profit.

+253M YoY
Increased revenues in the outsourcing
business drove profit growth. Profit growth
was also driven by the effects of thepricing strategy in the software business.

10Results by Business Segment (Consolidated financial disclosure business :M1 )◼ 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.

4Q
Non-consolidated＋22.2％

Operating profit ratio

Stock sales ratio

Sales Growth Rate

4Q
Non-consolidated

90.5％

3Q
4Q

20.0％

Non-consolidated
Non-consolidated

19.0％-1.0pts

Total＋13.9％

Total

91.4％

Total 21.0％

23.5％＋2.5pts*All exclude the impact of ID sales.

©AVANT GROUP CORPORATION. All Rights Reserved.

11

Results by Business Segment (DX Promotion Business : M2 )◼
◼
◼
◼

It operates in the DX market and its business domain covers not only BI, but also the entire use of data to realise DX (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 sharesin the global cloud market
Strategically focused on the Azure, AWS and GCP business areas and successfully realised business opportunities in these growthbusiness areas due to the multi-vendor strategy described below and extensive awards and partner accreditations
As a result, sales growth. Note that sales related to Azure, AWS and GCP accounted for approximately two-thirds of cumulative sales
in FY2024
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%
40%

5,814

20%

8％ 24％

58％

0%
FY23 Q1-Q4

2022

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

AWS

Microsoft Azure

Google Cloud

66％

その他
Other

AWS、Azure、GCP関連

FY24 Q1-Q4

Other
その他

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

12Results by Business Segment (DX Promotion Business : M2)◼ The company has adopted a multi-vendor strategy and collaborates with a wide range of manufacturers. As a result,the business is growing as it is able to adapt to the needs of its customers◼ The company has a wealth of awards and partner accreditations. As a result, we often receive orders for projects
from each of our major partner companies, leading to business growth.
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)
13

Results by Business Segment (Business management solutions : M3 )◼ The impact of certain restrictions on sales activities for a period of time due to business restructuring has been
resolved, pipeline build-up has recovered and the flow order backlog, excluding stock, has increased. Flow orderintake temporarily declined in FY24Q3 but increased significantly in FY24Q4 due to steady build-up（billions of yen）

（billions of yen）

Orders received and backlog

4.00

1.51

3.50

1.40

3.00
2.50

1.60

1.06
0.95

1.20

1.07
0.98

0.89

1.00

0.69

2.00

0.80

1.50

0.60
2.18

1.00
1.55

1.38

0.50

1.47

1.51

1.60

1.47

0.40
0.20

0.00

0.00
FY06/23 Q2

FY06/23 Q3

FY06/23 Q4

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

FY06/24 Q1

FY06/24 Q2

Orders received(Stock)

FY06/24 Q3

FY06/24 Q4

Orders backlog(Flow)
14

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)

Q4

Yr earlier

FY6/24
Total

% chg

YoY Variance
Yr earlier% chg

Net Sales

6,613

5,236

26.3%

24,41921,42414.0%

Personnel expenses

3,141

2,766

13.6%

11,657

10,277

13.4%

Recruitment expenses

150

134

11.8%

489

433

12.9%

Outsourcing expenses

1,038

984

5.5%

4,004

3,778

6.0%

IT expenses

376

313

20.3%

1,321

994

32.9%

Office expenses

255

216

18.4%

883

905

▲2.5%

Other expenses

626

453

38.0%

1,966

1,748

12.5%

Total expenses

5,589

4,868

14.8%

20,32018,135

12.1%

Operating Income

1,023

368

177.7%

4,099

3,289

24.6%

OPM

15.5%

7.0%

8.4pt

16.8%

15.4%

1.4pt

©AVANT GROUP CORPORATION. All Rights Reserved.

15

Quarterly GPP (Net Sales Growth + OPM) Trends◼ GPP had been on a downward trend since the 3Q of the previous year, but rose in the 1Q of the current year due to a recovery insales growth and an improvement in operating margin in the 2Q; in the 3Q, sales growth in the business management solutions
business slowed due to a lack of pipeline, but the operating margin remained high; in the 4Q, the DX promotion business performed
well and the business management solutions business grew due to the effect of increased sales. 4Q growth was driven by the strong
performance of the DX promotion business and the effect of increased revenues in the business management solutions business.

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.

16

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.
◼ Profitability tends to increase in 2Q and 3Q, while profitability tends to be lower in 4Q due to performance-linked bonuses and new
graduates joining the company, but in the 4Q of this fiscal year, sales grew in all business segments and profitability improved as aresult of this revenue growth.
( Billions of yen )( Billions of yen )©AVANT GROUP CORPORATION. All Rights Reserved.

17

Quarterly Margin Trends◼ Although the gross margin had declined in the previous year's 4Q due to a certain period of restrictions on sales activities related tobusiness management solutions as a result of business restructuring, sales grew and both the gross margin and operating margin
recovered in the current year.
(％)

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 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)

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.

19

ROE Trends◼ ROE* has recently been on a downward trend, partly due to the build-up of net assets, but improved in 1Q of thecurrent year due to dividend payments and share buy-backs; in 2Q and 3Q it declined again due to the build-up of net
assets, but improved in 4Q, partly due to share buy-backs; in 4Q it improved due to the increase in net assets.
◼ Aim to maintain an average of at least 20% through adherence to the Group's management principles, further
increasing profitability and managing assets more efficiently.

※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.

20

Number of Group Employees◼ The number of employees is increasing in order to achieve sustainable growth, with a large increase in 4Q due to thetiming of new graduates joining the company and a large number of mid-career recruits joining the company.

©AVANT GROUP CORPORATION. All Rights Reserved.

21

Financial Condition Trends◼ Total asset value increased due to a JPY 557 million increase in cash and deposits, a JPY 1,477 million increase in notes, accounts
receivable and contract assets, a JPY 296 million increase in prepaid expenses and a JPY 264 million increase in investment securities.
◼ Net assets increased by JPY 965 million from the end of the previous year to JPY 13,293 million due to net profit attributable to ownersof the parent company of JPY 2,850 million, the acquisition of treasury shares of JPY 1,396 million and the payment of dividends fromretained earnings of JPY 564 million.
◼ The capital adequacy ratio has remained at a high level.

(Millions of yen)

Total Assets

Net Assets and Equity Ratio(Millions of yen)(％)

©AVANT GROUP CORPORATION. All Rights Reserved.

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.

22

Cashflow Trends◼ Operating cash flow increased mainly due to income before income taxes and minority interests of JPY 4,131 million, depreciation andamortisation of JPY 543 million, increase/decrease in accounts payable and accrued expenses of JPY 519 million, refund of income
taxes of JPY 565 million and increase/decrease in allowance for bonuses of JPY 293 million, whereas it decreased mainly due todecrease in trade receivables and contract assets of and income taxes paid of JPY 1,273 million.
◼ The financial cash flow used increased by JPY 507 million year-on-year, mainly due to the acquisition of treasury shares of JPY 1,396
million following the introduction of the RS Trust as an incentive scheme for future share price increases, and the payment ofdividends of JPY 564 million.

YoY Variance

FY6/24(Millions of yen)

Q4

Yr earlier

YoY Variance

FY6/24
total

% chg

Yr earlier% chg

Operating CF

2,420

2,269

151

3,680

2,175

1,505

Investment CF

△ 25

△ 121

95

△ 630

△ 795

164

Free CF

2,394

2,147

246

3,049

1,379

1,669

Financial CF

△ 483

△4

△ 479

△ 1,981△ 507△ 1,474©AVANT GROUP CORPORATION. All Rights Reserved.

23

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

24

Earnings forecast for the fiscal year ending June 30, 2025
◼ For FY2025, sales are expected to increase by 17.9% year-on-year to JPY 28,800 million. Operating profit
and net profit are expected to increase due to the effect of higher sales.

(Millions of yen)

FY6/24

FY6/25（Actual）（Forecast）

Variance

Chg

Net Sales

24,41828,800

4,381

17.9%

Operating Income

4,099

4,900

800

19.5%

OPM

16.8%

17.0%

-

-

Net Income

2,850

3,350

499

17.5%

©AVANT GROUP CORPORATION. All Rights Reserved.

25

Shareholder Returns◼ In line with the policy of continuing to pay a stable dividend, the dividend per share for the year ending
30 June 2025 is expected to be 25 yen per share.
◼ DOE for the fiscal year ended June 30, 2024 was 5.5%, 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.

26

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

27

BG28 Review of first year results◼ BG28 The first year got off to a good start, with all figures exceeding the plan.
FY6/23

FY6/24
ActualRate to the plan

YoY

FY6/28Plan
40,000~45,000M
9,000~
11,000M

Net Sales

21,424M

24,419M+1.7%+14.0%

Operating Income (OI)

3,289M

4,099M+6.5%+24.6%

OPM

15.4%

16.8%

+0.7pts+1.4pts

20~24%Net Income

2,094M

2,850M+14.0%+36.1%

6,000~
7,000M

OI / person

2.5M

2.8M

+8.7%

+12.0%

3.9M

Software Gross Profit

2,367M

2,442M+26.6%+3.2%

5,500~
6,000M

ROE

18.3%

22.3%

+3.0pts+4.0pts

20% or more

DOE

4.9%

5.5%

+0.2pts+0.6pts

8.1% or more

Dividend

¥15

¥19

±0

+26.7%¥51 or more

©AVANT GROUP CORPORATION. All Rights Reserved.

Note 1: Operating profit per employee is calculated using the average number of employees during the period.
Note 2: Software gross profit is calculated using the Group's unified definition, which takes into account the calculation lead time.

28

BG28 Year second year of the plan
◼ Year BG28's second year plan exceeds the FY25 level in the BG28 original plan, but software grossprofit remains largely in line with the plan.
FY6/24

FY6/25
Plan

Rate to BG28

YoY

FY6/28Plan
40,000~45,000M
9,000~
11,000M

Net Sales

24,419M

28,800M+6.8%+17.9%

Operating Income (OI)

4,099M

4,900M+19.0%+19.5%

OPM

16.8%

17.0%

+1.8pts+0.2pts

20~24%Net Income

2,850M

3,350M+25.2%+17.5%

6,000~
7,000M

OI / person

2.8M

3.0M

+21.8%

＋5.6%

3.9M

Software Gross Profit

2,442M

2,474M

+0.7%

+1.3%

5,500~
6,000M

ROE

22.3%

22.4%

+4.0pts+0.1pts

20% or more

DOE

5.5%

6.2%

▲0.3pts+0.7pts

8.1% or more

Dividend

¥19

¥25

±0

+31.6%¥51 or more

©AVANT GROUP CORPORATION. All Rights Reserved.

Note 1: Operating profit per employee is calculated using the average number of employees during the period.
Note 2: Software gross profit is calculated using the Group's unified definition, which takes into account the calculation lead time.

29

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
marketFY6/24¥7.5bnLatent 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

FY6/24

FY6/28CAGR

16.7％¥8.8bnNew segment
name

M3

）

¥14.0bn¥16.3bn

OPM

18.5％→19.9%

Client base
SoftwareDeepen existing
marketLow

New segment
name

M2

Capture growth market

FY6/28

24.4％→27.2%

Creation of new market¥690bn-¥720bn

（

CAGR

16.9％

¥272bnBI, Data Infrastructure& DX Market

Consolidated Financial
Disclosure Business

Creation of newmarketFY6/24

Management Solutions Business

14.7％¥8.5bnFY6/28

CAGR¥14.7bn

OPM

16.5％→28.7%
30

Initial plan for capital allocation in BG28
• Assuming ¥20bn for growth investments and ¥5bn for shareholder returns (dividends) overthe 5-year period of the medium-term management plan.
FY6/24～FY/626
potion

（¥mn）
30000

-5,000First Growth Investment Direction

From FY6/27

Internal investment = Human capital investment

25000

¥1.0b

19,30020000-14,700

¥3.5b

15000

10,8005-year total

10000-5,0007,250←Surplus cash

3,550←Working capital¥0.5bWorking capital•

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.

5000

5,400

0

FY6/23 cash andequivalents

5-year total
FCF(F)*

Minority
investment R&D

M&A(incl. purchase ofsource code)

Shareholder
returns

FY6/28 cash andequivalents(F)*Growth investments*(F)：Forecast©AVANT GROUP CORPORATION. All Rights Reserved.

■Sources (procurement)

■Uses
31

Capital allocation results and plans◼

Internal investment is the highest priority and is planned to be increased within the first growth investment framework.

◼

No change in shareholder returns, as the company plans to use the shares gained from the 1 billion share buyback to return profits
to employees and through M&A, etc.

Cash out（ ¥20bn investment in growth, ¥5bn in shareholder returns ）Cash in
Surplus cash and cash equivalents
at end of FY6/23¥7.25bn
Free cash flow
Total cumulative forecast

Second Growth Investment（FY6/27～）¥5.0bn¥15.0bn¥2.0-3.0
bn

Internal investment =investment in human capital
FY6/24: ¥0.45bn¥1.5-2.5bnBusiness and capital alliances,etc.
FY6/24: ¥0.22bn

¥0.5
bn

Reserve funds

Internal investment =investment in humancapitalPriority

FY6/24: operating CF ¥3.68bn +investment CF -¥0.63bn =¥3.05bn.

Priority¥19.3bn

First Growth Investment（～FY6/26）

Business and capitalalliances, etc.
Source code purchase,
M&A

Shareholder Returns ¥5.0bn（5-year total）
FY6/24 Dividend: ¥0.71bn©AVANT GROUP CORPORATION. All Rights Reserved.

32

Avant rebrands ‘AVANT Compass’
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.
◼ Rebranding of the previously offered ‘AVANT Compass’as ‘AVANT Compass Powered by NOMURA’.
◼ 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.
June 29, 2024 Release（Japanese）
https://www.avantgroup.com/ja/ir/irnews/auto_20240619531978/pdfFile.pdf
33Reference : Company overview©AVANT GROUP CORPORATION. All Rights Reserved.

34

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 FY24

【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¥24.4 bDigitalTransformation Promotion
Business

Consolidated
Financial
Disclosure
Business

36％

30％

Management
Solutions Business

34％【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.

35

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

36

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■ Group Governance Practice■ Establishment of a study group on■ Introduction of Internal Control
Governance Code Guidelines
fair acquisition （2022～）
Reporting System (J-SOX)（Jun. 2015~）（Sep. 2019～）（Apr.2008~）■ Request from TSE for ‘action to■ Voluntary Applicationof Disclosure under IFRS
■ Publication of Business Restructuring achieve cost of capital and share（FY Mar. 2010~）
Practice Guidelines（Jul. 2020～） price conscious management’（Mar 2023～）■ Start of reporting inconsolidated accounting（FY Mar. 2000~）■Mandatory quarterly
reporting（FY Apr. 2003~）

Government-led
initiatives(¥mn)

Dec. 2018■ DivaSystem clients baseexceeded 1,000 companies

Aug. 2007■ Users of DivaSystem reached 500

30,000

Oct 2022■Reorganization

Mar. 2018
Change the Market
Listing to the First
Section of the TSE（currently TSE Prime
Market)25,000Feb. 2007
Listed at OSE Hercules(currently TSE GrowthMarket)20,000BE GLOBAL

Net Sales

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

15,000OI

10,000

May 1997
Founding of DIVA Inc.

5,000

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

24
37

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.

38

Numerical Summary(Millions of yen)(person)(Billions of yen)

©AVANT GROUP CORPORATION. All Rights Reserved.

39

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.
Corporate
Over 1,200
Governance Codecompanies

Optional reporting of
IFRS accounts

J-SOX

Quarterly
reporting

Mandatory reporting of
consolidated accounting©AVANT GROUP CORPORATION. All Rights Reserved.

40

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.

41

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.

42