May 17, 2021

Briefing Materials for
Financial Results
Fiscal Year Ended
March 2021
[TSE, First Section: 9600]©2021 I-NET CORP.All rights reserved

www.inet.co.jp

Contents of Briefing

1. Introduction (Overview ofCompany)
2. Overview of Earnings in Fiscal
Year Ended March 2021
3. Initiatives in Medium-termManagement Plan
4. Full-year Earnings Forecasts
5. appendix©2021 I-NET CORP.All rights reserved

www.inet.co.jp

2

1. Introduction (Overview ofCompany)©2021 I-NET CORP.All rights reserved

www.inet.co.jp

3Overview of Company (as of April 1, 2021)
 Trade name: I-NET Corp.
 Founded: April 22, 1971 (50th anniversary) Headquarters: 3-3-1 Minatomirai,
Nishi-ku, Yokohama
 Capital: 3,203 million yen Founder: Noriyoshi Ikeda,
Founder Supreme Adviser
 Representative Director andExecutive President: Mitsuru Sakai
 Subsidiaries: IST-Software Co., Ltd.
Software Control Co., Ltd.
I-NET DATA SERVICE CORP.
 Number of employees: 1,726 (consolidated)

1,012 (non-consolidated) Offices, branches and data centers
Tokyo office, Sapporo branch, Sendai branch, Chubu branch, Osaka branch,
Chu-Sikoku Branch, Fukuoka branch, No. 1 Data Center, No. 2 Data Center©2021 I-NET CORP.All rights reserved

www.inet.co.jp

4Overview of Company (as of April 1, 2021)

I-NET Corp.
Capital: 3,203 million yen
Consolidated employees:
1,726
Non-consolidated
employees: 1,012

Wholly owned
consolidated
subsidiaryBusiness:
Information processing
services
System development
services
Product sales

Wholly owned
consolidated
subsidiary

100% nonconsolidated special
subsidiary company©2021 I-NET CORP.All rights reserved

IST-Software Co., Ltd.
Capital: 608 million yen
Employees: 468

Software Control Co., Ltd.
Capital: 54 million yen
Employees: 246

I-NET DATA SERVICE CORP.
Capital: 9 million yen
Employees: 23

www.inet.co.jp

5History (Over-the-counter trading to present)(Net sales)
350

300

250

Received assignmentsfrom 6 out of 10 designatedoil wholesalers

Listed on firstsection(Unit: 100 million yen)

Merged two
subsidiaries,
founded ISTSoftware

SoftwareControl Co.,
LTD. joined inet
group
Received assignmentsfrom 5 out of
7 designated oilwholesalers

Recordedrecord-high
net sales(Forecast)

Set up droneflying field

Began offering
cloud services

Merger with Soft
Science Co., Ltd.

200

150

100

Listed on second
section1st data center,stage II building
begins operating

Over-the-countertrading begins

2nd data center,stage II building
begins operating
2nd data center,stage I building
begins operating

50

0

1st data center,stage I building
begins operating

'22/3
'21/3
'20/3
'19/3
'18/3
'17/3
'16/3
'15/3
'14/3
'13/3
'12/3
'11/3
'10/3
'09/3
'08/3
'07/3
'06/3
'05/3
'04/3
'03/3
'02/3
'01/3
'00/3
'99/3
'98/3
'97/3
'96/3
©2021 I-NET CORP.All rights reserved

www.inet.co.jp

6Business Overview: Net sales by service category
We provide customers with services in the following
three service categories.
Information processing

4%

30.0
56%

billion yen

40%

11.8

billion yen

System development

16.9

billion yen

Product sales

1.2 billion yen*Net sales as of the fiscal year ended in March 2021
©2021 I-NET CORP.All rights reserved
www.inet.co.jp

7

Achieving stable growth by expanding the stock business
Definition of stock business

Merits of expanding stock business Examples of stock business Growth foundation built up

 Business that generates net sales at a

fixed amount every month Business with contracts that continue
beyond the next fiscal year
 Stock business=information
processing services

with ongoing net sales
 High profitability (most recent
Gross profit was 23％）
 Increase in net sales and income
per person

 Cloud services
 Data center services

 SS commissioned settlement(gas stations) Printing and inserting

Trends in net sales for stock business over past 10 years (consolidated)(Unit: Million yen)

10,000
8,000
6,000
4,000

7,252

7,802

8,487

8,783

9,107

9,607

9,784

10,052

10,091

10,81911,8612,000
0'11/3 '12/3 '13/3 '14/3 '15/3 '16/3 '17/3 '18/3 '19/3 '20/3 '21/3©2021 I-NET CORP.All rights reserved

www.inet.co.jp

Growth foundation that continues
beyond the next fiscal year

12,0008

Information processing : Data center and cloud services
Data center services

Cloud services
Wide range of cloud services
developed at data centers

Hokkaido(1 building)Telework support

Nagano(1 building)

Remote desktop

Yokohama(four buildings)

提携

Osaka
センター
(1 building)Business chat
File sharing

Other Cloud services
Business cardmanagement

No. 1 Data Center(Yokohama)Total floor area of about 9,000 ㎡

No. 2 Data Center(Yokohama)Cloud infrastructure

Total floor area of about 13,000 ㎡©2021 I-NET CORP.All rights reserved

www.inet.co.jp

9

Information processing : Commissioned calculation for gas station

We have provided data processing services for gas stations (SS)nationwide since founding.
Support SS at seven branches nationwide (Sapporo, Sendai, Tokyo, Nagoya, Osaka,
Chugoku & Shikoku, Fukuoka)
We have a relationship with about 30% of all SS based on over 50 years of results

We provide account / credit processing systems for SS affiliated with oil wholesalers (ENEOS,
Idemitsu Showa Shell, Kygnus Sekiyu, Taiyo Oil) and trading companies (Itochu Enex,
Mitsubishi Corporation Energy, Marubeni Energy, San-Ai Oil)（Overview of processing services）

Our petroleum sales settlement service has a long track record and is used by many SS,
generating stock growth through monthly fees•

Inet cloudenvironment

Customer

Invoicedispatched

Settlement-type
Process sales data
Process accounts
receivable data
Process accounts
payable data
Process flash report data

Process kerosene data
Process gasoline data
Internet©2021 I-NET CORP.All rights reserved••••
Send data tocredit cardcompany

Support for building wholesaler
settlement systems
Credit processing
Support for building wholesaling systems
Support for building gas systems
Settlement systems support, etc.

Expanding stock business・Developed public-sector card system
・Service for propane gas business・inet Hikari

www.inet.co.jp

10System development services
We support the digital transformations of many customers through thetrusting relationships we have built up over the years in fields such as
operational application development, package software development, dataservices, AI services, embedded control systems, and space development.

Finance

Petroleum and gas

Retail and distribution

Manufacturing

Architecture andreal estate

Railways andtransportation
infrastructure©2021 I-NET CORP.All rights reserved

www.inet.co.jp

Space

Medicine

11

System Development Business (Example)
We provide a wide variety of proposals tailored to our customers’
needs, as well as support that will reduce their costs and drive new
growth.

Distribution industry:
Higher operational
efficiency and lower costs

Food manufacturing industry:
Operational consolidation, visualization©2021 I-NET CORP.All rights reserved

Construction industry:
3D simulator

Communications industry:
Modernizationwww.inet.co.jp12Group’s business model
Align range of services with customers’ businesses and develop
into stock business centered on cloud data centers
DX

Oil/LNG
Financialindustry
Retail anddistribution
industry
Service industry

Space field

solutionsFintechCloud
services

Operational
monitoring©2021 I-NET CORP.All rights reserved

Commissioned
calculation/
settlement

Cloud
Data Center

Infrastructure
construction,

Wholesale andintegration field
Construction andreal estateindustry

Printing,
Mailing,

BPO

Systemdevelopment
Embedded
controlsystems
www.inet.co.jp

Manufacturing

Communications
and media
Public agencies, local
governments, other13

2. Overview of Earnings in Fiscal
Year Ended March 2021

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

14Overview of Earnings in Fiscal Year Ended March 2021 (consolidated)(Unit: Million yen, %)Fiscal year ended March
2020

Fiscal year ended March
2021

Change over previous
fiscal year

AmountAmountChangePercentage

Percentage

Rate ofchangeNet sales

31,097100.0

30,016100.0▲1,081▲3.5

Cost of sales

24,00077.2

23,211

77.3

▲789

▲3.3

Gross profit

7,096

22.8

6,804

22.7

▲292

▲4.1

Selling, general andadministrative expenses

4,594

14.8

4,648

15.5

54

1.2

Operating income

2,501

8.0

2,155

7.2

▲346

▲13.8

Ordinary income

2,531

8.1

2,279

7.6

▲251

▲9.9

Net income attributable toparent

1,672

5.4

1,494

5.0

▲177

▲10.6

Income per share (yen)

105.1

―

93.6

―

▲11.5

－

Record high©2021 I-NET CORP.All rights reserved

www.inet.co.jp

15

Sales by service category (consolidated)（Unit: Million yen, %)Fiscal year ended
March 2020

Information
processing
Systemdevelopment

Product sales

Total

①

②

ChangeFiscal year ended
March 2021

Amount of change

Percent change

Net sales

10,81911,861

1,041

9.6

Gross profit

2,783

2,803

19

0.7

Ratio of grossprofit to net sales

25.7

23.6

▲2.1

Net sales

18,924

16,936▲1,987▲10.5

Gross profit

4,136

3,821

▲314

▲7.6

Ratio of grossprofit to net sales

21.9

22.6

0.7

Net sales

1,353

1,217

▲135

▲10.0

Gross profit

176

179

3

1.7

Ratio of grossprofit to net sales

13.1

14.8

1.7

Net sales

31,09730,016▲1,081▲3.5

Gross profit

7,096

6,804

▲292

▲4.1

Operating income

2,501

2,155

▲346

▲13.8

Operating margin

8.0

7.2

▲0.9

－

－

－

－

(Primary factors)①Use of date centers was strong, which increased revenue. The use of mailing services declined due to the impact
of progress in digitalization in recent years, among other factors, and the profit margin fell due to the strategicacquisition of projects with low profit margins taken on with the aim of expanding the scope of operations.
②As COVID-19 cases increased, sales and income fell due to changes to system investment, primarily in the
distribution, service, oil and manufacturing industries, a decline in technicians’ utilization rates and other factors.

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

16Consolidated Sales by service category (result of 4Q)（Unit: Million yen, %)1Q～3Q

Information
processing ①

System②
development

Product sales

Total

4Q

Fiscal year
ended March
2021

Change overpreviousyear

Net sales

8,786

685

8.5

3,075

356

13.1

Gross profit

2,005

▲109

▲5.2

797

128

19.3

Ratio of grossprofit to net sales

22.8

▲3.3

―

25.9

1.3

―

Net sales

12,253▲1,774

▲12.7

4,683

▲213

▲4.4

Gross profit

2,627

▲445

▲14.5

1,193

130

12.3

Ratio of grossprofit to net sales

21.4

▲0.5

―

25.5

3.8

―

Net sales

847

▲162

▲16.1

370

27

7.9

Gross profit

113

▲12

▲9.5

66

15

29.4

Ratio of grossprofit to net sales

13.4

1.0

―

17.9

3.0

―

Net sales

21,887▲1,252

▲5.4

8,128

170

2.1

Ratio of grossprofit to net sales

4,747

▲566

▲10.7

2,057

274

15.4

Operating income

1,267

▲606

▲32.4

887

260

41.4

PercentchangeFiscal year
ended
March 2021

Change overprevious
year

Percentchange

5.8
▲2.3
―
3.0
―
10.9
① In information processing services, projects for existing clients contributed to sales, which increased even more in
Q4. The gross profit margin also rose over the previous year in Q4.
② In system development services, the business for financial institutions and the oil industry in particular recovered
toward the end of the year, and the decrease in sales narrowed. The gross margin rose over the previous year.
17©2021 I-NET CORP.All rights reserved
www.inet.co.jp
Operating margin

Information processing: Factors causing trends in net sales
Factors causing trends in net sales for
information processing

12,50011,861

12,00011,500MailingService etc.

Commissioned
calculation

Data center,
Cloud

10,500•

Sales for data center cloud services
increased due to greater use of data
centers, primarily by information
communication companies.

•

Reduced use of mailing services due to theshift to digital and other factors resulted ina decline in sales

△250

＋74

11,000 10,091
10,81910,000(Unit: Million yen)

＋1,217

Previous
fiscal year

Current fiscal
year

Data center and cloud services（part of information processing business）(FY March 2021)

1,271

'11/3

1,966

'12/3

2,471

'13/3

3,032

3,545

3,609

3,917

4,382

4,951

6,169

Net sales increased approximately 5 times
in 11 years as the market grew

2,761

'14/3

©2021 I-NET CORP.All rights reserved

'15/3

'16/3

'17/3

'18/3

www.inet.co.jp

'19/3

'20/3

21/03

18

Trends in net sales for system development

20,000（単位：百万円）(Unit: Million
yen)

Trends in net sales for systemdevelopment
18,92418,00016,936•

Software investment demand was strong and had
trended firm before the COVID-19 pandemic•

In this fiscal year, sales fell due to a review ofsystem investment because of the impact of
COVID-19 and other factors

16,00014,00012,00010,000Previous fiscal year

Current fiscal year

System development(FY March 2021)

18,924
16,395

13,063

13,45813,064

13,45814,081

13,937

16,936

14,348

Solid trends as demand for software
investment increases
'12/3

'13/3

'14/3

'15/3

©2021 I-NET CORP.All rights reserved

'16/3

'17/3

'18/3

www.inet.co.jp

'19/3

'20/3

'21/3

19

Balance sheet (consolidated)(Unit: Million yen, %)End of fiscal year ended in
March 2020
AmountConstituent
ratio

End of fiscal year ended in
March 2021
AmountChange over end of
previous fiscal year

Constituent
ratio

Amount ofchangeRate ofchange

9,628

32.5

10,561

32.9

932

9.7

19,96067.5

21,494

67.1

1,534

7.7

29,589100.0

32,056

100.0

2,466

8.3

Current liabilities

8,407

28.4

8,625

26.9

217

2.6

Non-current liabilities

5,957

20.1

7,218

22.5

1,260

21.2

Total liabilities②

14,36548.5

15,843

49.4

1,478

10.3

Net assets③

15,224

51.5

16,212

50.6

988

6.5

29,589100.0

32,056

100.0

2,466

8.3

Current assets
Non-current assets①

Total assets

Total liabilities and net
assets(Primary factors)①Tangible fixed assets increased by 672 million yen as a result of the augmentation of data center facilities,
and investment securities rose by 637 million yen due to a review of capital injections and appraisal amounts.
②Long-term loans increased by 1,279 million yen, accounts payable—trade rose by 306 million yen, andlease obligations fell by 190 million yen.
③Retained earnings rose by 801 million yen, and the valuation difference on available-for-sale securities
increased by 146 million yen.

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

20

Trends in Capital Investment•

Capital investment was centered on data centers, which are the core of theCompany’s services. We will augment facilities on an ongoing basis together withcustomers’ use of the data centers.

•

Data center and cloud sales are steadily increasing.

•

We expect the peak for total investments to have been reached in the fiscal year
ended in March 2020.

•

Depreciation costs are expected to be roughly flat in the near term.
（million yen）

Trends in capital investment

7,000
6,000
5,000
4,000
3,000
2,000
1,000
0

16'/3

17'/3

18'/3

Capital investment (other)
Depreciation costs©2021 I-NET CORP.All rights reserved

19'/3

20'/3

21'/3

22'/3

（Forecast）

Capital investment (DC expansion)※Estimate
DC and cloud sales

www.inet.co.jp

21

Cash flow statement (consolidated)(Unit: Million yen)

Fiscal year ended
March 2020

Fiscal year ended
March 2021

Change overprevious year

AmountAmountChangeCash flow from operating
activities

3,965

Cash flow from investing
activities▲3,872

Cash flow from financing
activities▲308

Change in cash and cash
equivalents

①

3,419

▲545

② ▲2,929

943

③

454

763

▲216

944

1,160

Balance of cash and cash
equivalents at beginning of
period

3,299

3,083

▲216

Balance of cash and cash
equivalents at end of period

3,083

4,027

944

(Primary factors)①Increased: 2,195 million yen in profit before income taxes, 1,744 million yen in retained earnings from amortization, 306 million
yen in trade payables, etc.
Decreased: 564 million yen in income taxes paid, etc.
② Although we marked 352 million yen in revenue from the sale of investment securities, we also had 2,306 million yen in
expenditures for the purchase of property, plant and equipment, including capital investments in data centers following large-scaleorders from existing customers in particular, as well as 613 million yen in expenditures for the purchase of investment securities.
③ Interest-bearing liabilities increased by 1,446 million yen and dividend payments amounted to 692 million yen.

©2021 I-NET CORP.All rights reserved

www.inet.co.jp22Forecasts of Consolidated Financial Results for Fiscal Year Ending in March 2022
(Unit: Million yen, %)FY endedin Mar2019
Results

First year of mediumterm management
plan

Second year

Final year

FY ended in Mar 2020

FY ended in Mar 2021

FY ending in Mar 2022

Plan

Results

Initialplan

Revisedplan

Results

Initialplan

Revisedplan

Net sales

27,591

30,00031,09731,50030,00030,01633,20032,500Operatingincome

2,345

2,450

2,501

2,580

2,000

2,155

2,730

2,330

ROE

10.9

10.9

11.3

11.0

―

9.5

11.1

10.0

Status of first and second years of plan••••

We posted nine straight fiscal years of higher sales and 10
straight years of higher income, making excellent progresswith our plan.
Data center cloud services are performing well.
The system development field was solid due to higher
demand for IT capital investment.
In the second fiscal year, earnings declined due primarily tothe postponement and cancellation of projects to expand
services for system development due to COVID-19.

©2021 I-NET CORP.All rights reserved

Final year of plan•••

Strengthen engagement with customers (expand
interaction with more customers, establish a backup
system for new transactions)Improve products and services for IoT, FinTech, bigdata, AI, telework and otherPromote and strengthen cloud services

www.inet.co.jp

23

3. Initiatives in Medium-termManagement Plan
Main businesses and topics
Please see the appendix for details of
our medium-term plan initiatives©2021 I-NET CORP.All rights reserved

www.inet.co.jp

24Began offering data analysis service for the three Cs
In October 2020, we began offering a data analysis service for thethree Cs (closed spaces, crowded places, close contact) to prevent the
spread of COVID-19 by using IoT and cloud services.

【Features】

 Alerts can be set up to help maintain  Reduce the risk of COVID-19 infection
during the pandemic
optimal environments
 Eases the burden on customers. Data is Easy-to-understand user interface
sent safely and securely to I-NET data
centers©2021 I-NET CORP.All rights reserved

www.inet.co.jp

25Solutions for work-style reforms
Proactive expansion of services tailored to telework, particularly
work-style reforms

Remote desktop
This makes it possible to use your work PC
anytime, anywhere, even at home.

Business chat
Chat tool exclusively for business that is
simple to use

Web conference system
Video conference tool with high audio andvideo quality

File-sharing service
Tool for securely sharing files

August 7, 2020 (Friday)“Work-at-home might be possible at
my workplace too! Introduction totools and examples”

Briefing on recent telework
trends, background andvarious ways of
implementing teleworkusing I-NET’s tools (virtual
desktop service and Web
conferences, etc.)©2021 I-NET CORP.All rights reserved

NEOJAPAN Co-host Web seminar
November 18, 2020 (Wednesday)“Stable operations even on a large
scale and onsite! Seminar forsupporting introduction of businesschat”

www.inet.co.jp

November 18, 2020
(Wednesday)“Stable operations even on alarge scale and onsite! Seminarfor supporting introduction ofbusiness chat”

A seminar was held to explainin detail ways of utilizing andoperating a chat tool that canfurther accelerate work-stylereforms so that this tool can be
introduced onsite(strengthening security).

26

Space development business expands
We have been involved in space development for more than 40
years, since the first Himawari aircraft in 1977.
Strengths of I-NET’s space business

We offer more than 40 years of experience in system/subsystem design of satellites, inspection/testing, andoperation/evaluation analysis.



We worked on the development project for Hayabusa2, which
released its capsule in December 2020, and have been
involved in many other projects.



We have had requests for cooperation with satellite
development from almost all key space startups, and will
strengthen these affiliations going forward.

※Development of debris removal satellites:
Support for setup, testing, operation and other oflaunch satellites, and operations related to
manufacturing and services

New initiatives in the space business
Satellite data utilization, ultra-small satellite development business・ Participation in ultra-small astronomical, terrestrial and marine
observation satellite project, an affiliation between industry andacademia led by Tokyo Institute of Technology (mounted with JAXA
innovative satellite technology experiment No. 3 model)Antenna operation business・ We aim to make antenna operations a stock business by reducing
the times that antennas are not utilized and raising the utilization
rate.

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

School of Science, theUniversity of Tokyo

Universityof Fukui

National Institute ofTechnology, Sendai
College

Satellite bus
Ground station,
operation
Drones, aircraft
Data center
softwareApplication

Companies

Academic research institutes

Satellite-mounted
devicesAffiliations from ground to skyProject Members
Service areas

Tokyo
Institute ofTechnology

TohokuUniversity

Supercomputing Division,
Information Technology Center,the University of Tokyo

Yokohama National
Imaging technology
University
Hokkaido University

NagoyaUniversity
Tokyo Instituteof Technology-Oceanography-Agriculture, agrology-Environmental studies-Astrophysics
Tohoku-Space science,
University
etc.

Konan University

School of Science,
the University of
Tokyo

Japan Space Systems

27

Building digital platforms in art education (affiliation with local governments)

Signed a partnership agreement to promote“digital creative education” in Oiso-machi
Oiso-machi○ Provides a place for social
implementation of NDC education

Wacom Co., Ltd.

○ Provide digital
pen input tools

CELSYS, Inc.

○ Provide drawing
application thatserves as userinterface

I-NET Corp.

Promotion of NDC
education*

Aiming to makeOiso-machi atown that fosters
creators○ Provides digitalplatform and promotes
data sharing※NDC (new normal digital creative) education
With this kind of education, “analog” creation activities that have been done by drawing on paper with pen and brush are carriedout instead in a digital environment, utilizing the convenience of networks to share works and work together. This kind of creative
activity capitalizing on the merits of digital technology is actively incorporated into education. While stimulating students’ creativity
and inspiring each other, students interact with digital technology in a natural way, build a moral outlook in the network world via
shared experiences, and creativity is fostered from an early stage in elementary and intermediate education. In addition, this kindof education aims to lay a foundation so that students continue to engage closely with art into the future.

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

28

Strengthen consignment calculation services for gas stations
Expansion of information processing services (stock business)
Public-sector card system
 We offer a system that allows public institutions (prefectural police, hospitals, prefectural
government agencies, etc.) in cities and prefectures around the country to refuel theirvehicles with priority in the event of emergencies and disasters. Under a single contract,emergency vehicles can be refueled with the same card at any gas station within the same
prefecture.
 This has been expanded to oil unions around the country and four prefectures have alreadyintroduced the system. It will be expanded going forward.

Service for propane gas business LPG sales management system is managed on the Company’s cloud.
 Development, operations, BPO and call center functions are provided as a one-stop
service.
 We will strengthen the sales system and aim for further expansion of sales.
～Public-sector card system ～©2021 I-NET CORP.All rights reserved

www.inet.co.jp

29

ESG initiatives
Promote health management and diversity
With the belief that employees are the most important asset for management, I-NET considers the mental andphysical health of employees to be the source of sustainable improvements to corporate value, and pursues
health management in line with this approach. We are always reforming work styles to create a work
environment in which all employees can perform with peace of mind.

White 500
(certified for third
straight year)

Primary initiatives on health Declare health management
 Under a Chief Health Officer (CHO), theHR division, health support office andhealth insurance union work together.

※See here for details.

©2021 I-NET CORP.All rights reserved

Y-SDGs*(Certified as “superior,” a high rank)

Overview
Among the categories of region, society, environment,
and governance, we earned a particularly highassessment for regional aspects.
We will continue to focus on initiatives addressing SDGs.
※Y-SDGs is Yokohama City’s system for certifying companies
working to achieve SDGs, and evaluates companies in 30 areas andthe four categories of environment, society, governance and region.
Based on their initiatives, companies are classified as either
supreme, superior or standard.

www.inet.co.jp30

4. Full-year Earnings Forecasts©2021 I-NET CORP.All rights reserved

www.inet.co.jp31Forecast of financial results for year ending March 31,2022 (consolidated)(Unit: Million yen, %)Fiscal year ended March
2021

Fiscal year ending March2022

Change over previous
fiscal year

AmountAmountChangePercentage

Percentage

Rate ofchangeNet sales

30,016100.0

32,500

100.0

2,483

8.3

Cost of sales

23,211

77.3

25,120

77.3

1,908

8.2

Gross profit

6,804

22.7

7,380

22.7

575

8.5

Selling, general andadministrative expenses

4,648

15.5

5,050

15.5

401

8.6

Operating income

2,155

7.2

2,330

7.2

174

8.1

Ordinary income

2,279

7.6

2,330

7.2

50

2.2

Net income attributable toparent

1,494

5.0

1,600

4.9

105

7.0

Income per share (yen)

93.6

―

100.2

―

6.5

―

Record high©2021 I-NET CORP.All rights reserved

www.inet.co.jp32

Forecast of net sales and gross profit by service category (consolidated)(Unit: Million yen, %)Fiscal year ended
March 2021

Information
processing

System development

11,861

12,500638

5.4Gross profit

2,803

2,890

86

3.1

23.6

23.1

▲0.5

Net sales

16,936

18,660

1,723

10.2

Gross profit

3,821

4,250

428

11.2

22.6

22.8

0.2

Net sales

1,217

1,340

122

10.1

Gross profit

179

240

60

34.1

14.8
30,016
6,804

17.9
32,500
7,380

3.1
2,483
575

2,155
7.2

2,330
7.2

174
0.0

Ratio of gross profit
to net sales

Ratio of gross profit
to net sales
Net sales

Total

Rate ofchangeChangeNet sales

Ratio of gross profit
to net sales

Product sales

Fiscal year ending
March 2022

Change over previous
fiscal year

Ratio of gross profit
to net sales
Operating income
Operating margin©2021 I-NET CORP.All rights reserved

www.inet.co.jp

－

－

－

－

8.3
8.5
8.1

33

Dividend Policy
Interim中間

50.0

Year-end
期末(Unit: yen, %)Dividend
配当性向payout rate

60.0%

45.0

《Dividend Policy》
Continue with stabledividends while retaining
earnings to prepare
for future capital demand

50.0%

40.0
35.0

40.0%

30.0
25.0
20.0

19.0

20.0

21.5

23.5

24.0

17.0

18.0

17.0

18.0

19.0

20.0

21.5

22.0

23.5

16/3

17/3

18/3

19/3

20/3

21/3

22/3

20.0%

15.0
10.0
5.0
0.0

30.0%

10.0%
0.0%

（Forecast）*We carried out a stock split on October 1, 2016, but actual dividends (estimates) are noted
here (without adjusting for the impact of the stock split).

Plans for annual dividends per share (tenth straight year of dividend increases planned)
Fiscal year ended
March 2020

Fiscal year ended
March 2021

Fiscal year ending
March 2022

43.0 yen

46.0 yen

47.0 yenInterim (21.5 yen)
Year-end (21.5 yen)Interim (22.0 yen)
Year-end (24.0 yen)Interim (23.5 yen)
Year-end (23.5 yen)

*April 2021 was the 50th anniversary since founding. We raised our dividend and also pay a special
end-of-year commemorative dividend of ¥2 as a thank you to our shareholders.
©2021 I-NET CORP.All rights reserved

www.inet.co.jp

34

5．appendix©2021 I-NET CORP.All rights reserved

www.inet.co.jp

35Initiatives in Medium-termManagement Plan
Business strategy plan
Investment strategy plan
ESG initiative plan
Status of initiatives through March 2021
Please see our home page for details of the medium-term management
plan announced in May 2019.
https://www.inet.co.jp/ir/policy/mid-goal.html#contents©2021 I-NET CORP.All rights reserved

www.inet.co.jp

36

Role of Medium-Term Management Plan

Expandedbusiness scale

Higher corporate
value

Business strategy plan
Investment strategy plan

Toward further
growthESG initiative plan

50 billion
yen in net
sales

32.5 billion
yen in net
sales(review)

2019

2021

Medium-termManagement Plan

©2021 I-NET CORP.All rights reserved

2024

20XX

Next Medium-termManagement Plan

www.inet.co.jp

37

Management strategies

Strengthen ties
with customers

Enter new markets
and service areas

Protect

OffenseEnsure that customer comes first
Proposals with added value

Develop products and services with growthpotential

Invest in human resources©2021 I-NET CORP.All rights reserved

www.inet.co.jp38

3. Initiatives in Mediumterm Management Plan
Business strategy plan
Investment strategy plan
ESG initiative plan
Status of initiatives through March 2021
Please see our home page for details of the medium-term management
plan announced in May 2019.
https://www.inet.co.jp/ir/policy/mid-goal.html#contents©2021 I-NET CORP.All rights reserved

www.inet.co.jp

39

Management strategy: Partner strategy and channel strategy＋

Cloud service
partners

Expansion ofservice line-up

Sales partners

Expansion ofsales channels＝

OEM partners

Expansion ofbusiness fields

Systemdevelopment
partners

Expansion of
top line©2021 I-NET CORP.All rights reserved

www.inet.co.jp

40File-sharing service
Communication tool
ChatLuck
Security system
BIM introduction
support service

inet
inet

Instantaneous falsification
detection and instantaneousrecovery solutions

PartnerPartnerPartnerPartner©2021 I-NET CORP.All rights reserved
Cloudstor®

VIDAAS®

Remote desktop

inet

www.inet.co.jp

様Drone platforms

inet

様

Consignment calculation
services for gas stations

Management strategy: Cloud partner strategy

Turning Cloud Foundation (NGEC) + Apps
into service as platformer…

41

Management strategy: Platform strategy

Satellites

DronesAI

Cloud applications

edge

Antenna groundstations

fog

edge
fog

edge

edge

fog

edge

IoT devices

fog

fog

fog

edge

RobotsEvery kind of data flows to data centers©2021 I-NET CORP.All rights reserved

www.inet.co.jp

42Initiatives toward a digital transformation•

Set up a telework promotion contact point and provide remote desktops and other
tools

•
•

Expand the fields of data science and AI business
Augment AI cloud services to mid-sized and small- and medium-sizedcompanies and strengthen sales•

Strengthen and adjust financial packages tailored to change needs in financial market,
monitor future market trends, revise financial products, expand system scope, and plan andconsider package updates based on cloud compatibility•

Utilize our expertise in sales management operations for the distribution industry todifferentiate ourselves from competing companies
Modernize AS400 legacy assets
Pursue BIM and CIM businesses for the construction industry
Pursue infrastructure inspection services for local governments (Kimitsu
model)••••

Regional broadband wireless access (BWA) initiatives, high-speed data
communications helping to improve local public services©2021 I-NET CORP.All rights reserved

www.inet.co.jp43

3. Initiatives in Mediumterm Management Plan
Business strategy plan
Investment strategy plan
ESG initiative plan
Status of initiatives through March 2021
Please see our home page for details of the medium-term management
plan announced in May 2019.
https://www.inet.co.jp/ir/policy/mid-goal.html#contents©2021 I-NET CORP.All rights reserved

www.inet.co.jp

44

Progress with investment strategy plan•

Development of a next-generation cloud platform thattakes cloud infrastructure (NGEC) to the next level•

Upgrade data center facilities, increase floor space, andsystematically carry out expansions•

Expansion of data analysis and data science business•©2021 I-NET CORP.All rights reserved

Aim to expand services with areas of expertise andcutting-edge technology

www.inet.co.jp

45

Human resource strategies

New graduate
hires

April
2018
graduate
hires

April
2019
graduate
hires

April
2020
graduate
hires

April
2021
graduate
hires

Plans tohire
graduatesin April
2022

44

48

64

67

50

※Trends in new graduate hires by I-NET on a parent basis

Mid-careerhiresHRdevelopment

 Employees using cutting-edge IT technology, suchas data scientists
 Active hiring of employees in specialized fields
such as space development







©2021 I-NET CORP.All rights reserved

Implementation of training
tailored to career steps

Training for new hires →Extensive support for one year
Training for young employees by year →Training by entry year is
carried out every year
Training for management positions →Management training for
newly appointed managers
Management cram school →Special training to educate futureclass of managers
In addition, many training sessions by theme, such as“strengthening management” and “diversity,” are held.

www.inet.co.jp

46

3. Initiatives in Mediumterm Management Plan
Business strategy plan
Investment strategy plan
ESG initiative plan
Status of initiatives through March 2021
Please see our home page for details of the medium-term management
plan announced in May 2019.
https://www.inet.co.jp/ir/policy/mid-goal.html#contents©2021 I-NET CORP.All rights reserved

www.inet.co.jp

47

Strengthening governanceReinforcing system for fair and transparent corporate management

Shift to company with an Audit andSupervisory Committee
Strengthen supervisory functions of board of directors• Audit and Supervisory Committee members, who
supervise the job execution of board members,
become members of the board of directors• Audit and Supervisory Committee members havethe right to vote in board of directors meetings

Establishment of Nominating andCompensation Committee
Strengthen independence and transparency, as well as
accountability, of the functions of board of directors
meetings• Responsible for appointing and removing managers
and nominating candidates for director positions• Compensation for managers and directors, and other©2021 I-NET CORP.All rights reserved

www.inet.co.jp

Strengthensupervisory
function

Enhancetransparency
48

ESG and social contribution activities by I-NET’s regional
development foundation
In January 2020, I-NET’s regional development foundation was authorized as apublic interest corporation. By carrying out long-term and stable activities andsupporting activities that contribute to the development of a better local
community, we are implementing ESG activities and giving back to society.
I-NET's regional development foundation, The foundation carries out the following projects
a public interest corporationin the Kanagawa Prefecture region.

Link for foundation’s website
https://www.inet-found.or.jp/©2021 I-NET CORP.All rights reserved①

Projects to support and provide subsidies or toassess and award the sustainability and activities oforganizations that carry out activities related to thefollowing activities• Sound training and education of children andyouth• Sound mental and physical development throughsports• Improve public sanitation• Environmental conservation and infrastructure• Sound development of local community②

Projects needed to achieve other objectives withpublic benefit

I-NET’s regional development foundation was established by
Noriyoshi Ikeda, I-NET’s founder and chairman of the board, toprovide support and advice on sustainable activities fororganizations carrying out activities contributing to society in
Kanagawa Prefecture (activities aimed at providing public benefit).

www.inet.co.jp

49

ESG Initiative Plans

Plans as of the release in May 2019

Promotion of employment for disabled people

I-NET Data Service

A special subsidiary was established (authorized by
Minister of Health, Labour and Welfare) with theaim of providing a place in which disabled people
can thrive and receive support in living
independently.

Growth of “Cheering on Working Moms”
website to support childrearing andwomen’s participation in the workplace

Cheering on Working Moms
Support Team for Working Mothers was set up and is
run as a search site for childcare centers that uses
open data for Yokohama City.

■Primary operations
Data entry
Scanning

Light work
Preparation ofbusiness cards, etc.

https://kosodate.inet.co.jp/©2021 I-NET CORP.All rights reserved

www.inet.co.jp

50

Initiatives in Medium-termManagement Plan
Earnings plans
Plans as of the release in May 2019©2021 I-NET CORP.All rights reserved

www.inet.co.jp

51

Medium-term Earnings Forecasts (consolidated)
Forecasts released in May 2019

(Unit: Million yen)
Information processing（Net Sales）

Product sales

System development(Operating
income）

Operating income

3,000

30,0002,500
25,0002,000

20,0001,500

15,00010,0005,000

14,081

13,937

14,34816,39518,080

9,607

9,784

10,052

10,092

10,880

1,000
500

0

0

'16/3

'17/3

'18/3

'19/3

'20/3
（plan）'21/3（plan）'22/3（plan）Net sales

24,434

24,617

25,61527,591

30,00031,50033,200Operatingincome

1,918

1,992

2,081

2,345

2,450

2,580

2,730

ROE

9.4%

10.7%

10.4%

10.9%

10.9%

11.0%

11.1%

©2021 I-NET CORP.All rights reserved

www.inet.co.jp

52

These materials were prepared on the basis of
information that is currently available, and actual
performance may differ from forecasts due to arange of factors. We ask for your understanding.
All services and products listed in these materials
are registered trademarks or trademarks of I-NET
or other companies.

Please contact the company with any inquiries.
Corporate Strategy and Investor Relations
TEL
045-682-0806
E-Mail contact_ir@inet.co.jp
URL
https://www.inet.co.jp©2021 I-NET CORP.All rights reserved

www.inet.co.jp

53