DIT Report
Interim Financial Report for FY6/2024(July 1 to December 31, 2023)

Stock Code: 3916, First Section of the Tokyo Stock Exchange

To Our Shareholders

As the ﬁscal year ending June 30, 2024 is the last ﬁscal year of themedium-term management plan, we will further strengthen the businesspromotion based on two axes: stabilizing our business foundation andstrengthening growth factors, aiming for even greater growth.
We would like to explain our activities for the ﬁrst half of the ﬁscal year ending June 30, 2024
(from July 1, 2023 to December 31, 2023) with the DIT Report.
Sales hit a record high, as we met healthy demand. However, ﬁrst of all, I would like toapologize for the decline in proﬁt in the ﬁrst half of the ﬁscal year, although it improved slightly
compared with our initial forecast. As the unproﬁtable project about which we were concerned
has been completely wrapped up, proﬁt has been increasing from the second quarter. We will
strive to increase proﬁt and achieve our plan in the second half of the ﬁscal year.
In the term ending June 30, 2024, which is the ﬁnal ﬁscal year of the medium-term management
plan, we shall aim for further growth with new goals and strategies while strengthening thebusiness promotion based on two axes which have supported our growth until now; namely

Satoshi Ichikawa,
Representative Director
and President

stabilizing our business foundation and strengthening growth factors before the start of a
new medium-term management plan in the term ending June 30, 2025.
We look forward to the continued support and guidance of our shareholders.

Sales hit a record high. Proﬁt dropped, but the drop was less thaninitially expected.

Net sales

Operating Income(million yen)

9,575
million yen

7,685(million yen)

+18.0%

FY6/2022 FY6/2023 FY6/2024
2Q
2Q
2Q

(million yen)

Net income attributable toowners of parent(million yen)

1,198

1,187
million yen

million yen

1,249 1,198

1,268 1,187

892

million yen

9,068 9,575+5.6%

Ordinary Income

973+28.4%-4.1%

FY6/2022 FY6/2023 FY6/2024
2Q
2Q
2Q

981

+29.2%-6.3%

FY6/2022 FY6/2023 FY6/2024
2Q
2Q
2Q

811

686
+29.9%

811-9.1%

FY6/2022 FY6/2023 FY6/2024
2Q
2Q
2Q

Interview with President
Although the future outlook is uncertain,
we will operate business carefully so as tominimize its effects, and take onchallenges boldly while utilizing thecapability of responding to changes, whichis the forte of DIT.
Satoshi Ichikawa,
Representative Director and President

Top Interview
The second quarter of the fiscal year ending June 30, 2024 has ended.
How was it?
Demand, such as the needs of enterprises for DX, remains healthy, so thesales in the first half of the fiscal year hit a record high. Profit, too, started
showing a growing trend in the second quarter. Regarding the situation ofeach segment, automotive projects in the Embedded Solutions Unit
maintained favorable performance while licensing sales have further
increased in the Original Product Unit. The sales in the System Sales
Business soared as we responded to the “amendment to the Act on
Special Provisions concerning Preservation Methods for Books andDocuments Related to National Tax Prepared by Means of Computers,”
which was enforced in January 2024, and “introduction of the Qualified
Invoice System.” On the other hand, there was a decline in profit of theBusiness Solutions Unit, which engages in the development of businesssystems and operational support, due to the unprofitable project in theprevious fiscal year, as certain time was required for the rotation ofengineers. Although we made our shareholders worried, the final processof this unprofitable project was successfully completed in the first quarter.
We are working on the rotation of engineers to plant seeds for the future, so
please rest assured. Moreover, both sales and profit of the operational
support hit a record high, thanks to synergy with simplism inc., whichbecame a group company through M&A the year before last.
Which part of the business was the most promising?
The Original Product Unit performed favorably. Sales based on thesubscription model grew, as we provided comprehensive security services
centered on “WebARGUS,” which immediately detects tampering withwebsites and the like and recovers the damage in less than 0.1 seconds.
Moreover, prospective clients for the business streamlining software“xoBlos” actually placed orders, increasing the number of companies that
adopted the software.
We managed to acquire a considerable number of large blue-chip clientswith “DD-CONNECT,” an electronic contract outsourcing service.
Furthermore, we have been successful in deepening the trusting
relationship with our clients, as a result of which they started using auxiliary
services as well.
Please tell us your forecast for the full-year ending June 30, 2024 andyour priority measures.
In this fiscal year, we will aim to increase sales and profit for the 14th
consecutive fiscal year. We have not made any changes to the full-year
forecast, but the progress in the first half has exceeded the initial forecast.
Regarding the Business Solutions Unit, the rotation of engineers has
been dealt with and the system has been arranged. Therefore, we will
ensure the recovery of the Unit while utilizing M&A effects to work toward
the expansion of business mainly in the financial field.
With regard to the Embedded Solutions Unit, we will continue to focus on
automotive projects and work toward expanding the shares of our existingclients by addressing projects which are growing more sophisticated anddiversified every year while forging ahead with reaching out to new clientsand reinforcing our foundation in preparation for the next fiscal year.
Furthermore, we will strive for a significant year-on-year growth in sales of
the Original Product Unit through the following measures.
We believe that we can dramatically expand “xoBlos” among potential
clients by semi-automating the part that hinders adoption by utilizing AI,
and we are forging ahead with the development.
“WebARGUS,” our security product that was updated with measures tocounter ransomware last year, is increasingly recognized as the last
security measure and we are projecting a further growth of the demand.
Moreover, we are proceeding with the development of PoC (Proof ofConcept) for “WebARGUS” for IoT devices, which has been our goal forsome time, in response to the request from our clients.
With regard to “DD-CONNECT,” we shall work toward further expansion,
including auxiliary services, targeting mainly the housing and constructionindustry.
You have opened a DX development base in Hakodate.
In November 2023, we were invited by Hakodate City to open the“Hakodate Branch of the DX Business Laboratory.” We established an
office in Matsuyama City, Ehime Prefecture, in April 2013, recruited local IT
personnel and managed to expand our staff to over 60 members. While thecompetition in personnel recruitment in the Tokyo Metropolitan Area grewfierce, we intend to forge ahead with recruiting IT personnel in the sameway in Hakodate City, where Future University Hakodate, which has the
School of Systems Information Science, and National Institute ofTechnology, Hakodate College are located. We believe that by satisfying
the wishes of people who would like to stay in or return to Hakodate, butcannot do so because there is no work, we can employ personnel who
have returned to their hometown after once leaving to find work andpersonnel who would like to work in a rural area rather than an urban
center. We shall contribute to local revitalization through these initiatives.
Two cases of M&A were announced alongside the financial results forthe second quarter.
As synergy with simplism inc., which was made into a subsidiary in 2022,
was exerted, we carried out M&A to achieve further growth.
System Product Co., Ltd. excels at development for the securities
industry. Their skills coupled with our forte, that is, the development
capability for the bank industry, will bring about significant synergy andallow us to address all aspects of the financial field. Furthermore, it will bepossible to provide engineers in response to demand, expanding thesystem for addressing requests from clients.
Jungle, Inc. is characterized by their capabilities of marketing and selling
software. We believe that utilizing our development capability and Jungle’ sknow-how and sales network will lead to promoting sales of our original
products. Jungle also holds exclusive sales rights for a data transfer tooland copyright for data deletion software, and we are projecting an
expansion of sales of these products, too.
Please tell us about the progress of the medium-term management
plan and the 2030 Vision.
The current fiscal year is the last fiscal year of the medium-term
management plan. While the different segments are cooperating with eachother, the plan is progressing smoothly as a whole, and we expect that wewill be able to achieve our target for this fiscal year, that is, net sales of
19.5 billion yen and operating income of 2.5 billion yen.
With this fiscal year, the first three years of the “2030 Vision,” that is, theperiod of “Promoting the structural reform of business,” will end. Next
comes the “Achievement of a growth trajectory.” Amid the fierce
competition in acquiring personnel, we will raise the salaries of new
employees and also increase the salaries of existing employees. As this will
push down profit, we assume that we will proceed with the medium-term
management plan in the next fiscal year slowly, but we believe that theelevation of salary and treatment will lead to improving motivation andeventually boost profit as well. Moreover, we believe that measures such as
M&A will make a contribution. We are planning to release the next
medium-term management plan alongside the announcement of thefinancial results of this fiscal year, and we intend to not give up on the“Challenge 500” upheld in the “2030 Vision” to accomplish net sales of 30
billion yen or more with organic growth and 50 billion yen or more including
sales of new businesses.
Are there any other messages to shareholders and stakeholders?
We shall continue the business promotion based on two axes which havesupported our growth until now; namely “stabilizing our businessfoundation” and “strengthening growth factors” and make the utmost effort
for further growth. We upwardly revised the dividend payout ratio to 40% or
higher in this fiscal year. We shall do our best to meet your expectations, so
we would appreciate your continued support.

Together with the interviewer Ayako Kanouchi (analyst)

About the Hakodate Branch of the DX Business Laboratory
Regarding the Hakodate Branch of the DX Business Laboratory, established in November 2023, weinterviewed Mr. Yuichi Narita, who is the laboratory head, and Mr. Kento Shoji, who is the ﬁrst
member of the laboratory, on the objective and their thoughts concerning the Hakodate Branch.

01

Interview with Mr. Yuichi Narita

02

Interview with Kento Shoji

After having served as a leader in the various departments of Sumitomo Forestry Information Systems
Co., Ltd., I was invited by DIT to create a DX research department. I joined the company as the first head of
the DX Business Laboratory and have been active at this post for the last four years. Furthermore, weestablished the Hakodate Branch of the DX Business Laboratory in November last year, and I am also
working as head thereof.
We had four objectives in opening the Hakodate Branch. The first objective is to utilize the locational
advantage for securing new graduates as many IT, science and technology-oriented universities and highschools, such as the Future University Hakodate, are located in Hakodate. The second objective is toestablish an employment model compatible with various workstyles and lifestyles. At the Hakodate Branch,
we are focusing on recruitment for forms of employment that match the candidate’ s lifework in addition to
full-time employment. We intend to spread the endeavors to match the working conditions to the lifestyle ofeach employee throughout our company, based on the model of the Hakodate Branch. With regard to thisinitiative, please check the interview with Shoji, who is a concrete example, as well. The third objective is thelinkage between new business areas and our advanced technologies. There are relatively few competitors in Hakodate and we assume that
we can expand our business by proposing the incorporation of our business streamlining tool “xoBlos” and security product “WebARGUS”
to municipalities. The fourth objective is to create the base for the research and development of new technologies. While many enterprises
engage in low-code development at off-shore overseas bases, we intend to achieve diversification by bringing it to countryside cities inJapan, making the Hakodate Branch an advanced near-shore base using new DX technologies such as low-code technology and AI. Lastly,
we shall support countryside revitalization and restoration in Japan through these initiatives.

When I was a student at Hakodate La Salle Senior High School, I belonged to the rugby club and I was ateam member when our school participated in “Hanazono” (The National High School Rugby Tournament)
for the first time. Afterwards, I advanced to a university in Gunma Prefecture and while I was still a student, I
started working at a managerial position under an investor in Gunma Prefecture. I did feel that my work wasworthwhile, but eventually I became unsure about whether I wanted to make this occupation and industry
my lifelong work, and I began to think that I would like to do something with rugby. When I consulted therugby team coach of my alma mater, he told me that “a more proper coach is necessary to make the teamstronger. If you have an opportunity, come back to Hakodate straight away.” I returned to my hometown last
May and started coaching at my alma mater. Afterwards, I was introduced to Narita, the head of the
Hakodate Branch of the DX Business Laboratory, through my network. Hearing that he “would like toproactively employ even people who have time restrictions due to childcare, etc., if they are positive
personnel who would like to make the Hakodate Branch better,” I related to Narita’ s concept and DIT’ sbusiness itself very much and I joined the company last November on the condition that I would work until 3
pm and use the time after that for coaching. Right after joining the company, I worked mainly on establishing the Hakodate Branch which had
nothing, not even office desks. As for now, I am mainly in charge of service engineering for electronic contracts and business planning,
directly visiting municipalities which would collaborate with our company in DX, such as the DX section of Hakodate City and city halls, andproposing our plans to them. I have a great goal of making Hakodate a city with developed DX in future through such proposals.

IR Topics

Report on the questionnaire results

During the period from September 27 to October 27, 2023, our company conducted a questionnaire survey targeted atshareholders, and received answers from 395 shareholders. The opinions received through the questionnaire will bereflected in our future business activities.
Q1. Please let us know what motivated you to purchase or acquire the sharesof our company.
Japan Company Handbook
Investment periodicals other than Japan Company Handbook
Newspaper
Our website
Websites on financial information,such as Yahoo! Finance
Executives, employees, or former
staff of our company

30.6%
16.1%
5.5%
6.4%
13.6%
0.4%

Initial public offering (June 2015)
Listing on the First Section of TSE (March 2017)
Briefing sessions for individual investors
Recommendation by securities firms
TV programs and radio
SNSs and YouTube
Recommendation by family members or friends
Others

1.2%
3.2%
1.4%
7.1%
4.6%
2.8%
3.9%
3.2%

Q2. When you purchased the shares of our company, what did you
consider the most?
Growth potential and future prospects(expectations toward the rise in latent profit)

68.4%

Our business model

4.3%

Stability (expectations toward dividends)

9.9%

Our fans

0.9%

Stock price and technical indices

3.4%

Whether the shares of our company are undervalued

2.7%

Financial standing and soundness

5.6%

Others

1.9%

Our philosophy

2.9%

Q3. Please let us know your future shareholding policy.

Q4. What part of our IR activities do you want to be improved?

Long-term holding (5 years or longer)
Mid-term holding (2-4 years)
Short-term holding (about 1 year)

Enrichment of reports for shareholders

34.1%

Holding of online explanatory sessions for individual shareholders

4.5%

Use of the Internet at the general meeting of shareholders

4.9%

Utilization of information magazines for individual investors

10.2%

Information provision via our website

16.3%

Utilization of the mass media, such as newspaper and TV

13.9%

50.3%
24.2%

To purchase more shares
17.9%
To sell shares (have already sold shares) 3.9%

3.7%Q5. What do you expect the most from our company?

IR e-mail (e-mail newsletter)

5.0%

Utilization of SNSs

2.3%

Events for individual shareholders

7.8%

Others

1.0%

Q6. Please let us know your overall satisfaction with the attached
DIT Report (Report on the Fiscal Year Ended June 30, 2023).

Active business expansion

40.3%

Purchase of treasury shares

6.4%

Satisfied

23.7%

Stable management

21.7%

Enrichment of IR activities

1.1%

Somewhat satisfied

63.6%

Dividends that depend on business performance

11.1%

Others1.9%

Somewhat dissatisfied

11.1%

Stable dividends

17.5%

Dissatisfied

1.6%

Opinions we received

I attended the General Meeting of Shareholders. I would
like to ask you to make efforts to expand your fan base.
Now is the chance for you to grow. Please do your best.

While there are many other system development
companies, the president has made a good impression.
This is a significant reason why I hold the shares of thiscompany. I believe that this is very beneficial for the
recruitment, retention and active participation of
personnel.

I look forward to the growth of the cybersecurity
business.

Your favorable performance is not reflectedon the stock value. Is this due to a lack ofadvertising?

Ehime Office celebrated its 10th anniversary.
Let us share what the 10th anniversary party looked like.

◆ Company ProﬁleCompany nameLocation

Digital Information Technologies Corporation
Abbreviation: DIT
5th Floor of FORECAST Sakurabashi, 4-5-4 Hatchobori, Chuo-ku, Tokyo
TEL：03-6311-6520（main）/FAX：03-6311-6521

Established

January 4, 2002

Capital453,156 thousand yen (as of the end of December 2023)

Closing month

June

Number of employees 1,337 (consolidated) (as of the end of December 2023)◆ Stock Information (as of the end of December 2023)
Number of authorized shares: 24,800,000
Number of issued shares:

15,501,820

Number of shareholders:

5,022

Our IR information page:https://www.ditgroup.jp/ir/