Supplementary Materials for Financial
Results for the First Quarter of the Fiscal
Year Ending June 30, 2024
System Support Inc. (Security Code: 4396)
November 8, 2023

Notice: This document is only for reference purposes. In the event of any discrepancy between this translated document andthe original Japanese document, the latter shall prevail.

Company Profile
Company name

System Support Inc. (STS)

Location

9F Rifare, 1-5-2 Honmachi, Kanazawa-shi, Ishikawa Prefecture

Founding

January 1980

Listed market

Tokyo Stock Exchange Prime Market (security code: 4396)

Capital

723 million yen

Net sales

19,267 million yen (FY2023/6, consolidated)

Representative

Ryoji Koshimizu, Representative Director

Number of
employees

1,348 (as of June 30, 2023, consolidated)

OfficesTokyo, Nagoya, Osaka, and Kanazawa (headquarters)

Business outline■Cloud Integration BusinessTechnical support for migration and use of cloud services (ServiceNow,
Microsoft Azure, AWS, Google Cloud, etc.) and resale of licenses, etc.

■System Integration Business

84% of employees
are engineers
Kanazawa
271

Tokyo 698

Nagoya 173
Osaka 194

Overseas (U.S. & Canada):
12

Number of employees by region(as of June 30, 2023, consolidated)

Technical support for the introduction and use of ERP packages, constructionof infrastructure such as Oracle database, and IT system consulting, design, development, operation, and maintenance■Outsourcing Business

Our Group’s private cloud and other data center services, data analysis and input, and near-shore system operation andmaintenance■Product Business

Development and sale of products (software) by Our Group, and customization according to user companies’
applications■Overseas Business© 2023 System Support Inc.

Overseas system integration, outsourcing of payroll and accounting services, recruitment services, and media
management

2Company Profile – Net Sales Trends and History(1 million yen)Entered a Celonis Partner Program Agreement with CELONIS K.K.
Entered a Subcontractor Agreement with Automation Anywhere, Inc.
Entered a Google Cloud & Google for Education Commercial Partner Program Agreement with Google Cloud Japan G.K.

18,00016,00014,000Received Microsoft Cloud Platform Gold Competency certification

12,000Received Microsoft Cloud Platform Silver Competency certification
Entered a PartnerNow Master Terms with ServiceNow Nederland B.V.

10,000Entered an APN Consulting Partner contract with Amazon Japan K.K.

8,000Entered a SAP Service Partner contract with SAP Japan Co., Ltd.

6,000
4,000

Entered an Oracle EBS Technical Partner contract with Oracle
Corporation Japan

2,000

1980/121982/12'80/12 '82/12 1984/6'84/6 1986/6'86/6 1988/6'88/6 1990/6'90/6 1992/6'92/6 1994/6'94/6 1996/6'96/6 1998/6'98/6 2000/6'00/6 2002/6'02/6 2004/6'04/6 2006/6'06/6 2008/6'08/6 2010/6'10/6 2012/6'12/6 2014/6'14/6 2016/6'16/6 2018/6'18/6 2020/6'20/6 2022/6'22/6●Established System Support Inc. in Kanazawa City, Ishikawa Prefecture●Listed on the Tokyo Stock Exchange
Mothers Index●eNet Solutions Co., Ltd. financed and founded●Nagoya Office opened●Tokyo Office opened●Osaka Office opened0●Listed on the First Section of theTokyo Stock Exchange●Moved to TSE Prime●Acquired shares of T4C Co., Ltd., andmade it a subsidiary●STS Medic Inc. financed and founded●Acquired shares of Across Solutions, Inc. and made it a subsidiary●STS Innovation, Inc. financed and founded in California, USA●STS Innovation Canada, Inc. financed andfounded in Vancouver, Canada© 2023 System Support Inc.

* Net sales are consolidated from FY2016/6, and unconsolidated before that.

3

Summary of Financial Results for 1Q of FY2024/6 and Earning
Forecast of FY2024/6
Contents
1．Financial highlights
2．Net sales and income (consolidated)
3．Forecast for full year earning of FY2024/6 (consolidated)
4. Net sales and income by segment (consolidated)© 2023 System Support Inc.

4

Financial Highlights for 1Q of FY2024/6 (Cumulative)
Unit: 1 million yen

1Q of FY2024/6(Cumulative)

Net sales
Operating profit
Current net profit

Difference(YoY change)

Percentage change(YoY change)

5,034

629

+14.3%

399
282

95
76

+31.2%+37.3%

Net sales were strong in all businesses, led by the cloud integration business.
Increase in profit and profit margin due to increase in net sales andimprovement in cost ratioExtraordinary income from the transition to the defined contribution
pension plan

© 2023 System Support Inc.

5

Consolidated Net Sales and Income of 1Q of FY2024/6 (Cumulative)
Unit: 1 million yen

1Q of FY2022/6(Cumulative)

1Q of FY2023/6(Cumulative)

Net sales

3,721

4,404

Gross profit

968(26.0%)

1,185(26.9%)

Operating profit

241（6.5%)

304（6.9%)

Current profit

248（6.7%)

309（7.0%)

Current net profit

162（4.4%)

205（4.7%)■ Composition of net sales by segment*1
1.0%
3.5%
10.3%
29.2%

56.2%

© 2023 System Support Inc.

Cloud integration

1Q of FY2024/6(Cumulative)

5,034
1,399
399
404
282

■ Composition of segment profit*2

140
120
80

Outsourcing

Outsourcing

21.5%
9.9%

(27.8%)（7.9%)（8.0%)（5.6%)

55.2%

Product
Overseas

60
40
20
0

Percentagechange(YoY change)+14.3%+18.1%+31.2%+30.7%+37.3%*Profit ratio in ()

5.0%
■ Changes in investment-related expenses
98

Cloud integration

System integration

Overseas

629
214
95
94
76

100

4.7%
8.7%

System integration
Product

Difference(YoY change)

58
1.6%

72

4.0%
Unit:
1 million yen

3.0% and development expenses■ Research■ Training expenses

2.0%

1.7%

2.0% ■ Recruitment-related expenses

1.0%― Percentageof net sales
0.0%

1Q of FY2022/6 1Q of FY2023/6 1Q of FY2024/6(Cumulative)(Cumulative)(Cumulative)*1 Net sales by segment are sales to external customers.
*2 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

6Forecast for Full Year Earning of FY2024/6 (Consolidated)
Unit: 1 million yen

FY2022/6

Net sales

16,198
1,196

Current
profit1,190

Current net
profit785

Annual dividends

OperatingprofitInterimdividends
Year-end
dividends

12円
13円

FY2023/6

19,267

FY2024/6(Forecast)

21,784(Period overperiod)＋13.1%＋21.0%

1,465

1,755

+19.8%

1,009

1,167

+15.6%

15円
17円

18円
18円

Unit: 1 million yen

25,000

1,763

1,456

■ Net sales/operating profit (consolidated)

Percentagechange19,26720,00015,00011,762

10,0005,000
0FY2019/6

Total© 2023 System Support Inc.

32円

36円

1,456

1500
1000

FY2020/6

FY2021/6

FY2022/6

FY2023/6

Operating profit

FY2024/6（Forecast）

-

25
13
10
FY2020/6

0

Unit: Yen

36

32

FY2019/6

2500

1,763 2000

1,196

■ Dividends*

-

3000

500
Net sales-

16,198

931

754

529

1.5

25円

13,376 14,431

21,78421
FY2021/6

Interim dividends

18

17

12

15

18

FY2022/6

FY2023/6

FY2024/6（Forecast）

Year-end dividends* Our Company conducted a 2-for-1 stock split of shares of common stock on June 1, 2020, and the figures for FY2019/6 in this graph have been retroactively adjusted.

7

Net Sales and Income by Segment for 1Q of FY2024/6 (Consolidated)
10.3%

Cloud Integration Business•■Net sales*1■ Gross profit/profit ratio*2
1,468

39.0％ increase

1,200

1,055
34
120

1,000
800
600
400
200
0

672

130

6
22
93

335

Unit: 1 million yen

125
182

600

130

500

495

312

434

400

Google Cloud300

Microsoft Azure

200

181

100

27.0%

ServiceNow534

50.2％ increase

OthersAWS

237

Unit: 1 million yen

0

1Q of FY2022/6 1Q of FY2023/6 1Q of FY2024/6(Cumulative)(Cumulative)(Cumulative)

440

293

27.8%

30.0%

1Q of
1Q of
1Q of
FY2022/6 FY2023/6 FY2024/6(Cumulative) (Cumulative) (Cumulative)

Gross Profit(1Q of FY2024/6
cumulative)

56.2%■Operating profit/profit ratio(Segment profit/profit ratio*3)
100.0%
300
90.0%
80.0%
250
70.0%
200
60.0%
50.0%
150
40.0%
30.0%
100
20.0%
50
10.0%
0.0%
0

Gross Profit ratio*1 Net sales are sales to external customers.

© 2023 System Support Inc.

Technical support for migration
and use of cloud services(ServiceNow, Microsoft Azure,
AWS, Google Cloud, etc.) andresale of licenses, etc.

Composition of net
sales by segment

Gross profit ratio increased due to many high profitability projects in AWS andMicrosoft Azure.

1,400

Cloud Integration
Business

29.2%

Driven by DX, cloud-related services performed well, with particularly strong growth in AWS,
Google Cloud, and Oracle Cloud Infrastructure.

•

1.0%
3.5%

*2 Gross profit by segment is the amount before adjustment for gross profit in the consolidated financial statements.
*3 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

Unit: 1 million yen

47.8％ increase

227

153
97
14.5%

14.6%

15.5%

1Q of
1Q of
1Q of
FY2022/6 FY2023/6 FY2024/6(Cumulative) (Cumulative) (Cumulative)

Segment Profit

50.0%
45.0%
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%

Segment Profit ratio

8Cloud Integration Business Details (1) Cloud Platform Migration and Usage Support
Cloud platform migration (Microsoft Azure, AWS, Google Cloud) and usage support
Our strength is in the area of using databases and data analysis platforms in the cloud, thanks to ourtechnological expertise in the database field, which we have cultivated over many years.
■Net sales for cloud platform
migration, usage support, etc.

■Flow of cloud platform migration and usage support

Unit: 1 million yen

1Q
4,000

2Q

3Q

Before cloud migration

4Q

Proposal and design

3,462

3,500
3,000

1,046

2,500
2,000

1,860

1,500

586

1,000

424

500

490

0

YoY
(1Q (Cumulative))

850
621

FY2022/6 *1© 2023 System Support Inc.

Up 50.2％

944

359

FY2023/6

Our main services

934
FY2024/6

After cloud migration

Migration and usage support(creation of cloud environment)(Delivery)

Operation and monitoring
Resale■ Changes in resale net sales in net sales for
Reselling cloud accounts (pay- cloud platform migration, usage support, etc.
as-you-go or bulk purchases
Unit: 1 million yen
based on data usage) from Our
1,648
Company to customers to
4Q
1,500
420
ensure stock revenue
991
3Q
424
1,000
773
759
273
2Q
153
216
216
470
141
500
212
1Q
0

273
191

181
163

287
214

FY2020/6

FY2021/6

FY2022/6

*2

333

452

FY2023/6

FY2024/6*1 There have been minor revisions to the net sales figures for each quarter of the fiscal year ended June 30, 2022, compared with the figures shown in the supplementary materials for the 1Q
trough 3Q of the fiscal year ended June 30, 2023.
*2 There have been minor revisions to the sales figures for each quarter of the fiscal year ended June 30, 2022, as compared to the figures shown in the supplementary materials for the 1Q of the
fiscal year ending June 30, 2023.

Up 35.7％

YoY(1Q (Cumulative))9

Cloud Integration Business Details (2) Support for the Introduction and Use of ServiceNow
Support for the introduction and use of ServiceNow*, a cloud service for businesses from the U.S.

*ServiceNow is a cloud service provided by ServiceNow, Inc. to standardize IT service management and other operations.
ServiceNow, Inc. is ranked No. 1 in FORTUNE Future 50 (2020), with a market capitalization of approximately US$120 billion in November 2023.

■ Net sales of ServiceNow
1Q

2,500

2Q

3Q

4Q
Unit: 1 million yen

2,000
1,500
1,000
500
0

1,857
1,527

473

Gross profit ratio:
1Q of FY2023/6(cumulative) 39.7%
1Q of FY2024/6(cumulative) 39.2％

387

FY2022/6* FY2023/6

37

FY2024/6*There have been minor revisions to the sales figures for each quarter of the fiscal year ended
June 30, 2022, as compared to the figures shown in the supplementary materials for the 1Q of
the fiscal year ending June 30, 2023, but the full-year total figures remain unchanged.
© 2023 System Support Inc.

69

84

144

176

(1 billion USD)

6
320

534

Net sales of ServiceNow, Inc. *4
8

488
434

Unit: Case

Eligible certifications
are changed since
May 2023

YoY(1Q (Cumulative))

416

312

■ Number of our ServiceNow
certified build certifications *3

Net Sales: Up 23.0％

461

410

• Our Company actively invests in the development of engineers to create a system capable ofproviding stable service, and captures demand as the number of companies that have adopted
ServiceNow in Japan increases.
• Our Company ranked Third in terms of ServiceNow certified build certifications as of the end of
July 31, 2023*1.
• First domestic company certified as a Bronze Services Partner in 2017*2; currently the highest
ranking Elite Partner.

353

4
2

187

0

June 30,

DecemberJune 30,January 15,

June 30,

September

May 2,

July 31,2020

31, 2020

2021

2022

2022

30, 2022

2023

2023

’15/12 ’16/12 ’17/12 ’18/12 ’19/12 ’20/12 ’21/12 ’22/12＊1 From the ServiceNow Japan website (Eligible certifications: CTA, CSA, CAD, CAS-PA, CIS, Developer Core Skills, Suite (Pro))

From the ServiceNow partner program of ServiceNow, Inc. in the U.S.
Eligible certifications: CIS, CAD, CAS, CTA until the end of September 2022, CTA, CSA, CAD, CAS-PA, CIS, Developer Core Skills, Suite(Pro) from May 2023
10
＊4 Prepared by Our Company from ServiceNow, Inc. financial results＊2＊3Net Sales and Income by Segment for 1Q of FY2024/6 (Consolidated)
System Integration BusinessTechnical support for the introduction
and use of ERP packages, constructionof infrastructure such as Oracle
database, and IT system consulting,design, development, operation, andmaintenanceSystem Integration Business••

SAP ERP faring well.
Database related services decreased due to migration to cloud■Net sales*1
3,500
3,000
2,500
2,000

2,509

1,379

Unit: 1 million yen

2,703

1,000
500
0

448
681
1Q of
FY2022/6(Cumulative)© 2023 System Support Inc.

600

1,627

IT system
development

1,500
500

405
794

759
1Q of
FY2023/6(Cumulative)

0.4％ increase

800
700

1,442

Unit: 1 million yen

900

2,827

Database
ERP

1Q of
FY2024/6(Cumulative)*1Net sales are sales to external customers.

646

585

648

500
400
300

23.3%

23.9%

22.9%

200
100
0

10.3%

29.2%
Composition of net
sales by segment(1Q of FY2024/6
cumulative)

56.2%■Gross profit/profit ratio*2

4.6％ increase

1.0%
3.5%

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Gross Profit

120

50.0%
100
45.0%
40.0%
80
35.0%
30.0%
60
25.0%
20.0%
40
15.0%
10.0%205.0%
0.0% 0Gross Profit ratio■Operating profit/profit ratio(Segment profit/profit ratio*3)

10.0%

Unit: 1 million yen

9.0%
8.0%

7.0%
28.5％ decrease

72

40
2.9%

2.1%

1.4%

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Segment Profit*2Gross profit by segment is the amount before adjustment for gross profit in the consolidated financial statements.

*3 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

6.0%

57

Segment profit
5.0%(operating
profit)decreased
due to4.0%
an increase in
3.0% SG&A
commonexpenses such
2.0%
as head office
1.0%
expenses.

0.0%

Segment Profit ratio

11

Net Sales and Income by Segment for 1Q of FY2024/6 (Consolidated)Outsourcing Business
•
•
700
600

Increase in monthly subscription fees and other stock sales and increasein subscription fees per company due to expansion of customer use
business contributed to increase in data center related sales.
Gross profit ratio increased due to high profitability projects in data
analysis and input.

15.1％ increase

500
400
300

448
379

0

Unit: 1 million yen

303■Gross profit/profit ratio*2

115

150

82

■
365

400

■

© 2023 System Support Inc.

100.0%

35.3%

50

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Gross Profit*1Net sales are sales to external customers.

40.0%
60
30.0%
40
20.0%
20
10.0%
0.0% 0Gross Profit ratio(1Q of FY2024/6
cumulative)

56.2%■Changes in stock sales in net
sales of Outsourcing Business
1Q

80.0%

88

70.0%
60.0%
50.0%

46
12.2%

40.0%

51
11.5%

17.2%

20.0%
10.0%

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Segment Profit

30.0%

0.0%

1,061
274
267

2Q

1,157
302
293

261

283

258

278

3Q

Unit: 1 million yen

4Q

1,294
338
326
319
309

340

FY2021/6 FY2022/6 FY2023/6 FY2024/6

Segment Profit ratio*2Gross profit by segment is the amount before adjustment for gross profit in the consolidated financial statements.

*3 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

29.2%

Composition of net
sales by segment

Unit: 1 million yen

50.0%
80
31.3%

10.3%

90.0%

100
60.0%

140

31.1%

140
80.0%
120
70.0%

71.5％ increase

Data center

0
1Q of
1Q of
1Q of
FY2022/6 FY2023/6 FY2024/6(Cumulative) (Cumulative) (Cumulative)

182

117

Data analysis, input,
near-shore, etc. 100

Outsourcing Business
Our Group’s private cloudand other data center
services, data analysis andinput, and near-shore system
operation and maintenance■Operating profit/profit ratio*3 100.0%
90.0%
Unit: 1 million yen (Segment profit/profit ratio )200
30.0％ increase

516

75

200
100

250

■Net sales*1

1.0%
3.5%

12

Net Sales and Income by Segment for 1Q of FY2024/6 (Consolidated)

Product Business
•
•
•
270

220

Strong sales performance of MOS and Shugyo Yakusha.
SHIFTEE sales declined due to decreased customization at the time of introduction.
While gross profit increased due to the acquisition of new high profitability projects andan increase in the ratio of stock sales, operating profit was impacted by an increase in
SG&A expenses mainly due to participation in exhibitions and sales activities.

164

170
136
120

70

15
14
12

22
14
19
52

53

-30

40

56

■Operating profit/profit ratio
140.0%
90.0%
70*3)(Segment
profit/profit
ratio
Unit: 1 million yen
Unit: 1 million yen
80.0%
Unit: 1 million yen
120.0%
140 15.8％ increase
60
173
70.0%
10.3％ decrease
113
120
100.0%
19
50
60.0%
98
100
Others2239
80.0%40
50.0%
35
78
16
80
Shugyo Yakusha
40.0%
60.0%3065.4%
2360
57.6% 59.7%
SHIFTEE
30.0%
5840.0%20
40
20.0%
MOS
24.3%
20.6%
20.0%10
20
17.2%
10.0%
57

0

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Gross Profit

0.0% 0Gross Profit ratio*1Net sales are sales to external customers.

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Segment Profit

29.2%

Composition of net
sales by segment(1Q of FY2024/6
cumulative)■ Changes in stock sales in
net sales of Product Business

160

1Q of
1Q of
1Q of
FY2024/6
FY2023/6
FY2022/6(Cumulative) (Cumulative) (Cumulative)© 2023 System Support Inc.

100.0%■Gross profit/profit ratio*2

Tate Yakusha

20

10.3%

56.2%

80

180

■Net sales*1
5.6％ increase

1.0%
3.5%

Product Business
Development and sale ofproducts (software) by Our
Group, and customizationaccording to user
companies’ applications

0.0%

Unit: 1 million yen

1Q

301
77
76

2Q

350
89
89

3Q

4Q

396
102
98

73

89

100

74

82

95

109

FY2021/6 FY2022/6 FY2023/6 FY2024/6

Segment Profit ratio*2Gross profit by segment is the amount before adjustment for gross profit in the consolidated financial statements.

*3 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

13

Net Sales and Income by Segment for 1Q of FY2024/6 (Consolidated)

Overseas Business•

In North America, system integration, recruitment services, andoutsourcing of payroll and accounting services performed well.
■Net sales*150

1

Unit: 1 million yen

51.0％ increase

48

0.8

40
0.6

32

30
23

0.4

20

0.2

10
0

3.5%
10.3%

(1Q of FY2024/6
cumulative)

56.2%■Gross profit/profit ratio*2

25© 2023 System Support Inc.

1Q of FY2023/6(Cumulative)

1Q of FY2024/6(Cumulative)

0*1Net sales are sales to external customers.

30■Operating profit/profit ratio

Unit: 1 million yen

30

62.2％ increase

20
15

14

10

61.5%

26

60.0%
10
54.8%

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Gross Profit

40.0%
5
20.0%
0.0% 0Gross Profit ratio

140.0%

19

76.4％ increase

120.0%
100.0%
80.0%

10

10

60.0%

46.7%

39.5%

33.8%

1Q of
1Q of
1Q of
FY2022/6
FY2023/6
FY2024/6(Cumulative) (Cumulative) (Cumulative)

Segment Profit

40.0%
20.0%
0.0%

Segment Profit ratio*2Gross profit by segment is the amount before adjustment for gross profit in the consolidated financial statements.

*3 Segment profit is the amount before adjustment for operating profit in the consolidated financial statements.

160.0%

Unit: 1 million yen

100.0%
15
80.0%

16

51.0%

(Segment profit/profit ratio*3)25
140.0%
120.0%
20

50

1Q of FY2022/6(Cumulative)

29.2%

Composition of net
sales by segment

1.2

70
60

1.0%

Overseas Business
Overseas system integration,
outsourcing of payroll andaccounting services, recruitment
services, and media management

14

Reference Materials
Contents
1. Human resources strategy
2. Growth strategy by segment
3. Strengthening ESG management
4. Our Company topics© 2023 System Support Inc.

15

Human Resources Strategy
Our Group regards human resources as a source of business growth, and is actively
engaged in the expansion of its education system and recruitment activities.

Number of employees (consolidated)
Unit: People

1400

1,348

1200
1000
800
600
400

956

1,039

1,126

18.0%
16.0%
14.0%
12.0%

799

876

8.1%

7.7%

1,039

949

1,134

5.9%

8.0%

4.9%

5.4%

4.0%
2.0%

157

163

177

194

214

FY2019/6

FY2020/6

FY2021/6

FY2022/6

FY2023/6

Sales, management, etc.

© 2023 System Support Inc.

10.0%
6.0%

200
0

1,233

Engineers

Unit: People

20.0%
FY2021/6

FY2022/6

FY2023/6

FY2024/6（Planned）

New
graduate
recruitment

60

70

85

111

Mid-career
recruitment

89

83

100

94

Retirement
rate

5.9%

4.9%

5.4%

-

0.0%

Retirement rate

16

Growth Strategy by Segment (Cloud Integration Business)
Business outline: Technical support for migration and use of cloud services (ServiceNow, Microsoft Azure,
AWS, Google Cloud, etc.) and resale of licenses, etc. (Resale)
1

Expansion of the corresponding area

Developing cloud-related engineers expand orders andmaintain and improve a virtuous cycle of further growthof Our Company business through market growth

Expanding investment to quickly develop new overseas cloud services in
the Japanese market and expanding the range of supported services

2

Expansion of existing businesses
Focusing on AWS, Microsoft Azure, Google Cloud, and ServiceNow, which
are the mainstays of this business, Our Company will strengthen thedevelopment of proprietary services to further enhance customer
convenience and improve the productivity of Our Group, differentiating itself
from other cloud integrators.

Receives customer referrals
from global IT vendors andincreases orders

Background: cloud market growth■Cloud platform services (IaaS/PaaS) market trends and forecasts*(100 million yen)

FY2020 to FY2026 (Forecast)
CAGR

20.2%

10,50013,00015,60018,70022,40026,80031,700Engineertraining andknow-how
accumulation

Expansionof ordersStrengthening
relationships
with global IT
vendors

Strengthens relationships with global
IT vendors by gaining technicalcertifications and recognition

Actively invests in training cloud-related engineers
2020© 2023 System Support Inc.

2021

2022

2023
(Forecast)

2024(Forecast)

2025(Forecast)

2026(Forecast)

Note 1: Business operator's net sales base Note 2: Forecasts for 2023 and subsequent years
Note 3: Market size does not include Software as a Service (SaaS)* Source: “Survey on the Cloud Platform (IaaS/PaaS) Services Market (2023),” by Yano Research Institute,Inc., announced on April 25, 2023

17

Growth Strategy by Segment (Cloud Integration Business)■Net sales of this business and ratio of stock sales *1
against net sales(1 million yen)60%

12,000
8,000
4,000
0

29%

40%

31%

Net Sales

5,319

3,388

20%

FY2022/6 FY2023/6 FY2024/6 FY2025/6 FY2026/6(Planned) (Planned) (Planned)■Changes in number of customers
in this business
146

150

158

172

189

207

204

Ratio of stock
sales

0%

Unit: Company

230

249

1Q of
2Q of
3Q of
4Q of
1Q of
2Q of
3Q of
4Q of
1Q of
FY2022/6 FY2022/6 FY2022/6 FY2022/6 FY2023/6 FY2023/6 FY2023/6 FY2023/6 FY2024/6■History of major certification and awards in this business
Microsoft Azure• Obtained Gold Cloud Platform competency certification
Recognized as a partner with an outstanding track record in Microsoft Azure
deployments
・Obtained Advanced Specialization*2
Obtained highly specialized partner certifications in specific solution areas
・Won the MVP Award five times in a row
Received consecutive awards in the field of data platforms since 2017*3
・Received Microsoft Top Partner Engineer Award
Received the Award in Azure Field in 2023 *3
AWS・Obtained Oracle competency in the AWS competency program*4
・Received APN partner award “Rising Star of the Year 2014”
Google Cloud・Obtained data analysis specialization with Partner Advantage program
Oracle・Received 14 consecutive awards for Oracle Database*5
Received awards including Oracle Certification Award 2020 from Oracle Japan*1

Percentage of resale net sales in the Cloud Integration Business
Acquired in the “Migrating Windows Server and SQL Server to Microsoft Azure” field
Awarded by Our Company employees*4
Program to identify, validate, and recommend AWS Partner Network (APN) advanced and premium tier partners
that have demonstrated technical expertise and customer success for AWS*5
Awards from 2007 to 2020
*2
*3

© 2023 System Support Inc.

18

Growth Strategy by Segment (System Integration Business)
Business outline: Technical support for the introduction and use of ERP packages, construction of
infrastructure such as Oracle database, and IT system consulting, design, development,
operation, and maintenance

Growthstrategy

Expansion of existing
businesses

Steadily recruit and train engineers
and secure orders for ERP-related,database-related, RPA-related, andother IT system development, which
are the mainstay of this business.

Strengthening project
management

Continue project management fromthe perspective of quality, duration,
cost, and risk control to curb theoccurrence of unprofitable projects
and improve service quality© 2023 System Support Inc.

Strengthening relationshipwith customers

Our Company engineers work closely withcustomers such as user companies toexpand projects and continue receiving
orders from existing customers■Efforts to secure stable orders

User
company

SIer

Our Group

Percentage of directtransactions: 67.1%*1
Customer repeat rate: 78.5%*2

Build close relationships with user
companies to expand projects andcontinue receiving orders*1 Percentage of our net sales for FY2023/6. *2 Percentage of customers with sales recorded by Our Company in FY2021/6 who continued to record sales in FY2022/6

19

Growth Strategy by Segment (Outsourcing Business)
Business outline: Our Group’s private cloud and other data center services, data analysis and input, and nearshore system operation and maintenance■Features of Our Group’s data center•

Growthstrategy
Data center expansion

Target customers different from major
cloud users, and use AI-related and otherunique services as a hook tool to build up
the numbers of customers and subscription
fees per customer.

Expansion of ERP nearshore

With the need for maintenance of ERP
products, centered on SAP ERP,
expected to increase toward 2027, Our
Company is strengthening its system
by training near-shore personnel in the
Kanazawa area.

••

Our Group’s data centers are located in Kanazawa and Tokyo,
and customer companies use servers at the data centers.
The revenue structure, based on long-term continuous use,
not temporary use, builds up stock-type sales as the numberof customers increases and their business expands.
It can also be used as a BCP measure by setting up a data
center in Kanazawa City, where earthquakes rarely occur*.

■Net sales of Outsourcing Business and ratio of stock sales(annual and monthly data center fees) against net sales(1 million yen)

2,500

Continuous data center
facility expansion

Gradually expand facilities according tooperating conditions to both improve quality
and ensure profitability.

2,000
1,500
1,000

75%

73%

1,541 1,772

500
0

100%
80%
60%
40%
20%

FY2022/6 FY2023/6 FY2024/6 FY2025/6 FY2026/6(Planned) (Planned) (Planned)

0%

Net Sales
Ratio of stocksales* Sources: Japan Meteorological Agency seismic intensity database Number of earthquakes of intensity 1 or greater observed in 2021: 3 (maximum intensity 2)© 2023 System Support Inc.

20

Growth Strategy by Segment (Product Business)
Business outline: Development, sales, and customization of products (software) by Our Group
Mainly cloud-based products (monthly billing system); sales expansion throughdistributors in addition to direct sales■Our Group’s main products

Growthstrategy

Customer expansion

In order to increase new customers, Our Company
will expand sales channels for agents andstrengthen advertising and publicity. In addition,
Our Company will aim to increase the number ofusers by expanding the number of divisions within
existing customers.
On a product basis, we plan to expand sales of
newly launched Smart Rabbit (food inventory
forecast system for restaurants), Tate Yakusha,
and SHIFTEE.

Maintaining and improving stablehigh profitability

By increasing non-customized sales, we will
strengthen the structure in which increased
sales lead to higher profits. In addition, we
will accumulate stock sales such as monthly
usage fees to ensure stable high profit
margins.
* As of September 30, 2023 (cumulative)© 2023 System Support Inc.

Construction information management
system for the building industry

Mobile order and supply system

720 companies (including OEMs)*

789 companies*

Cloud-based shift management
systemAttendance and work management
system123 companies*

200 companies*■Net sales of Product Business and ratio of stock sales(monthly usage fees, etc.) against net sales(1 million yen)

1,000

Functional
enhancement

Continue to enhance existingproducts to reduce lead time until
introduction and improve
competitiveness against othercompanies’ products.

800

100%
670

80%

693

600
400

60%
52%

57%

40%

200
0

20%
FY2022/6

FY2023/6

FY2024/6(Planned)

FY2025/6(Planned)

FY2026/6(Planned)0%

Net Sales
Ratio of stock
sales

21

Growth Strategy by Segment (Overseas Business)
Business overview: System integration overseas (in the U.S. and Canada), outsourcing of payroll andaccounting services, recruitment services, and media management

Growthstrategy

Our subsidiary
STS Innovation Canada(Vancouver, Canada)

Support forcompanies entering
North America
Expansion of
cutting-edge
services in Japan

Collecting cutting-edge IT
information to develop
promising businesses inJapan© 2023 System Support Inc.

Support for IT infrastructure,
recruitment, and marketing ofJapanese companies entering
North America

Strengthening
outsourcing services

Strengthen remote monitoring
services for Japanese companies
using the time difference between
Japan and North America andoutsourcing services for Japanesecompanies in the U.S.

Support for companies entering
North America and remotemonitoring service using timedifference★
★

Outsourcing
services forJapanesecompanies in
the U.S.
Our subsidiary
STS Innovation(Silicon Valley,
U.S.A.)

22

Medium-Term Theme – Strengthening ESG Management
 Addressing social issues through ESG management based on the management philosophy.
Efforts to date
Environment

E

Advanced
Customer
Service

Contributing
to Society• The Sustainability Committee was establishedto plan and study sustainability measures.
• Implement CO2 emission reduction activities
using renewable energy.
• Start of information disclosure on sustainability

S• Set CO2 emission targets and implement
further reduction measures• Expand a disclosure system in line with the
TCFD, and respond to CDP and improvescore• Development of IT engineers• Realization of diverse human resources
employment and work styles• Contribution to local communities andlocal administration• Expanding the activities of Microsoft BaseKanazawa with the aim of expanding local
businesses and revitalizing the economy
through development of DX humanresources.

• Establishment of various committees andimprovement of systems to improve corporate
governance• The Board of Directors is composed tostrengthen corporate governance and ensure
diversity (Four independent outside directors
and three women out of nine directors).

• Aim to improve the response and quality of
the revised Corporate Governance Code.
• Continue to work to strengthen corporate
governance and ensure diversity in thecomposition of the Board of Directors.

Society

Management
philosophy

Efforts to strengthen

Sharing Value
GovernanceG© 2023 System Support Inc.

23

Our Company Topics for FY2024/6 (July 2023 to September 2023)
Date

Subject

July 6, 2023

System Support announced the new price plan of Introduction Support Service for ChatGPT for Businesses using Azure OpenAI
Service
Support for corporate use of ChatGPT in a secure environment with 0 initial cost and 50,000 yen per month

July 20, 2023

Our employees received Microsoft Top Partner Engineer Award.

July 25, 2023

System Support started offering Smart Rabbit, a food inventory forecast system for restaurants.
Joint development with Bay Cruise to improve efficiency in ordering and reduce food loss and opportunity loss
Ideal for restaurants with a wide variety of menus without the need to disassemble recipes.

August 29, 2023

System Support introduced SHIFTEE, a cloud-based shift management system, to Suntory Publicity Service Limited.
Integral management of shift creation and attendance record by customizing and linking with Shugyo Yakusha, an attendance andwork management system

September 7, 2023

Certified as Select, a service partner of Snowflake
More than 20 staff who gained Snowflake SnowPro Core certification will offer consistent services from sales to building and data
migration support.

September 21, 2023

Received Oracle Certification Award 2023.

September 22, 2023

System Support introduced Dbvisit Standby, a solution for disaster recovery (disaster preparedness) for Oracle database, to Right
Co.,Ltd.

September 26, 2023

System Support started to train XR (Cross Reality) engineers using Kanazawa Institute of Technology’s KIT Cooperation Education
Program (academic–industry partnership education).
Aiming to revitalize local businesses, create opportunities for talented engineers, and promote their retention in local communities© 2023 System Support Inc.

24

Disclaimer and Forward Looking Statements
This document has been prepared by System Support Inc. (hereinafter referred to as “Our

Company”) for the purpose of providing investors with an understanding of the current
status of Our Company.
The contents of this document are prepared based on economic, social, and otherconditions generally recognized as prevailing at the time this report was prepared, as wellas certain assumptions that we have judged to be reasonable, but may be subject to change
without notice due to changes in the business environment or other reasons.
The materials and information provided in this presentation include so-called “forward
looking statements.” These statements are based on current expectations, projections, andassumptions with risks and involve uncertainties that could cause results to differ materiallyfrom those in the statements.
Such risks and uncertainties include general industry and market conditions, and generaldomestic and international economic conditions such as interest rate and currency
exchange rate fluctuations.
For further information, please contact:
Investor Relations, Administrative Planning Department, System Support Inc.
TEL: 076-265-5151 E-mail: ir@sts-inc.co.jp© 2023 System Support Inc.

25

Thank you