Briefing materials on the Financial Results
for the 2nd quarter of FY2024
August 8, 2024
Future Corporation
Copyright © 2024 by Future Corporation

Agenda

1. Topics for the 2nd Quarter of FY2024

2. Results for the 1st Half of FY2024

3. Forecast for FY2024
Copyright © 2024 by Future Corporation

11. Topics for the 2nd Quarter of FY2024

Copyright © 2024 by Future Corporation2

DX investments remain strong across various industries and domains
Creating new value for our clients through our technologies and intellectual properties
that we have cultivated and accumulated over many years

Whole
sale

Bank
Insurance
Securities

RetailReal Time
Architecture*
ApparelLogistics

Media

EnergyManufacture

Infrastructure*Our core competence is to enable our clients to process vast amount of data in real time.

Copyright © 2024 by Future Corporation

3

A support for regional financial institutions to promote DX and contribution toregional development
Next Generation Banking System at Fukushima Bank began operation on schedule✓ While adopting new laws andregulations, Next-Gen Banking
System at Fukushima Bank
successfully began its operationon the 16 th of July 2024.
✓ A subsequent project at
Shimane Bank is currently
undergoing testing phase onschedule.

AI
Other Industries

Robust earning structure
enables adaptation of rapidchanges in environment• Regional Sustainable Growth• Cutting-edge digital technology• Corporate Clients• Local Companies• Venture Businesses
Expansion ofBusiness Domain• Consulting• Life Plan Support

BranchRegional Financial
Institutions
Sophisticated BankManagement

ESG and SDGs

• In-bank operationtransformation• Online/offline hybrid
integration

Promoting regional DX through Future's banking solutions
Copyright © 2024 by Future Corporation

4

A support for regional financial institutions to promote DX and contribution toregional development
Where regional banks perceive IT investments as their core strategy rather than a burden,
we help them develop and implement such strategy✓ By the first half of 2025: secure a 3rd project✓ By the end of 2025: secure a 4th project✓ Post 2026: Multiple projects running simultaneously

Our
Independent
ChannelUtilize our network of 30
banks we cultivated via
years of consulting service
and FutureBANK system

Next Generation
Banking System

Joint
Channelwith
SBI, Inc.

Utilize SBI’s network
through partnership
Copyright © 2024 by Future Corporation

5

A support for regional financial institutions to promote DX and contribution toregional development
We help regional banks to transform their operation stylethrough the use of AI and FutureBANK, our loan support system✓ Leverage our 30+ bank clients’ network to promote system
upgrades, as well as reaching out to potential clients via
their bank alliances
Hokkaido✓ FutureBANK operation began in Toho Bank and Kiraboshi
Bank in 2024
Aomori✓ Commenced feasibility studies with Gunma Bank on the useof generative AI in the area of loan operations

Akita

Iwate

Yamagata
Miyagi

Niigata

Fukushima

TochigiToyamaGunma
Ishikawa
IbarakiNaganoSaitama
Fukui
Gifu
Yamanashi Tokyo
Tottori
KanagawaChiba
Kyoto Shiga
ShimaneAichi
Hyogo
Shizuoka
Okayama
Hiroshima
Osaka
Mie
Nara
KagawaYamaguchi
Tokushima
Ehime
Wakayama
FukuokaKouchi
Saga
Oita
Nagasaki
Kumamoto
MiyazakiKagoshima

Okinawa

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6

The use of generative AI in business
The use of generative AI is steadily expanding both in clients’ operations and in the research field

Generative-AI centric operations are expanding
Food Manufacturing
Company
Introduced and tuned AI
Chat for their company
wide deployment ofgenerative AI

Travel Agency
Company

Feasibility studies with our clients

Manufacturing
Company

ESG
In-store Travel proposals
and customer services
assisted by generative AI

Scope 1~3
trial calculation

Customized industry
trend reports created bygenerative AI

Strengthening our skills to create and utilize generative AI is crucial
Researcher
Recruitment
Unique AI search
and QA technology

Part-time PhD
programs
Vertical LLM

Joint research with
top universities

LLM Development &Operation Methodology

In-house GPU cluster
Copyright © 2024 by Future Corporation

The use of generative AI in business
Introducing generative AI to support legacy system renewal
Current systems
hindering DX

Detailed analysis of
the current system✓ Complex and obscurestructure makes
modernization difficult✓ Increased maintenancecosts due to system aging

Futurefraqta••

Decoding of current
systemVisualization ofsystem-wide structure

New system to achieve DX✓ Safe and accurate system
migration and renewal✓ Enhanced operation andmaintenance in post-system
renewal ➢ Futurefraqta’s decoding
time reduced by 50%
with generative AI

Overall system
structure

Legacy languages
Huge source
assetsGenerative
AI
Program specification
extraction➢

Reduction of skill
dependency on specificindividual yield to higher
decoding accuracy

The combination of legacy language (JCL, COBOL, etc.) decoding feature with reading
comprehension support from generative AI yields to higher productivity
Copyright © 2024 by Future Corporation

8

Integration with Revamp✓ Joint project with a new client already in place
Business✓ Joint sales in the distribution and financial sectors✓ Introducing advancement in digitalization of management
support methodologies to Future’s clients

Quality &Technology✓ Providing Future's management expertise to Revamp✓ Quality control methodology and core technologies
introduced to Revamp

Human✓ Commenced joint training program for new recruits

Resources✓ Unifying recruitment process
Copyright © 2024 by Future Corporation

92. Results for the 1st Half of FY2024

Copyright © 2024 by Future Corporation

10(ⅰ) Overview of business results for the 1st half of FY2024
1H results increased YoY due to the growth of both IT Consulting &ITコンサル事業は大型PJが堅調に推移。BI事業は収益が改善。連結全体で増収増益
Services and Business Innovation.

2024年12月期
Consolidated
第２四半期
resultsfor 1H
連結業績
of
FY2024

Net
Sales
売上高
Operating
Profit
営業利益
Ordinary
Profit
経常利益
Net
Income
当期純利益

IT Consulting &ITコンサルティング＆Services
サービス事業

Business
ビジネス
Innovation
イノベーション事業
Adjustments between
セグメント間調整
segments

Mil. yen ( ＋16.3% )32,954 百万円
Mil. yen (＋9.5% )
6,902 百万円
＋9.2% )
Mil. yen (7,107 百万円
Mil. yen ( ＋12.6% )4,864 百万円

Net sales increased YoY largely due to consolidation of Revamp from 2Q.
リヴァンプの損益を連結開始したことから増収。大型PJの堅調な進捗により増益

売上高
Net Sales
Operating Profit
営業利益Mil. yen (28,436 百万円＋16.4% )Mil. yen (6,719 百万円

＋2.0%

)

Both sales and OP increased YoY mainly due to curiosity’s strong performance.
キュリオシティの複数の大型ストアデザインが完了したことなどから、増収増益

売上高
Net Sales
Operating Profit
営業利益
Net Sales
売上高
Operating Profit
営業利益Mil. yen (4,535 百万円

＋14.2% )( 2023－)Mil. yen （245 百万円
前期：△310百万円）
FY

Mil. yen△ 359 百万円
FY
Mil. yen （ 2023
△ 34 百万円
前期：66百万円 ）Copyright © 2024 by Future Corporation

11

（ⅱ） Sales, OP and EBITDA for the 1st half of FY2024✓✓✓

IT Consulting & Services performed well. “Next-Gen Banking System” at Fukushima Bank went live in July and theother large-scale projects are also proceeding without troubles.
The figures of Revamp are consolidated from the second quarter.
Business Innovation increased its net sales and OP vis-à-vis last year. Curiosity performed very well.

Operating Profit

Net sales
32,95435,000

営業利益
系列1
OP
7,000

6,902

営業利益率
OP margin
系列2

45.0%

8,000

6,214

28,34430,000EBITDA
6,305

25,00022,135

7,945

EBITDA
系列1
EBITDAEBITDAマージン
EBITDA
margin
系列2

40.0%

45.0%

40.0%

6,776

7,000

25,940Millions of yen

6,926

6,000

35.0%

23,117

35.0%

6,000

5,000

30.0%

30.0%

5,000

20,000

3,746

4,000

3,239

4,229

25.0%

24.0%

15,000

4,000

22.2%

3,000

3,782

14.6%

24.4%

24.1%
20.0%

20.9%
3,000

2,000

26.1%

20.0%

17.1%

15.0%

10,000

25.0%

16.2%

18.3%

15.0%

2,000
10.0%

10.0%

5,000
1,000

1,000
5.0%

0

0.0%

5.0%

0

0.0%

0

2020Q22021Q22022Q22023Q22024Q2

2020Q22021Q22022Q22023Q22024Q2

2020Q22021Q22022Q22023Q22024Q2

Copyright © 2024 by Future Corporation

12

（ⅲ） Consolidated Balance Sheet✓✓

Customer-related assets (JPY10.7 billion) and goodwill (10.8 billion yen) are recognized due to the purchase priceallocation of the acquisition of Revamp (*). In addition, total assets increased by JPY23.0 billion from the end of theprevious year, mainly due to the consolidation of Revamp.
Borrowed JPY20.0 billion to fund the acquisition of Revamp. The repayment of the loan has started, and the balance ofthe loan at the end of Q2 was JPY19.2 billion.
100,000

Total
assets
総資産：89,057（＋23,014）

Cash and equivalents
90,000Millions of yen

Current assets
Fixed assets
Liabilities

80,00070,000Total assets
総資産：66,043

Net assets

36,922

14,65660,00050,00031,76028,015

14,87040,00030,00016,222

51,38720,00010,00042,42752,13521,8060Endof 20232023期末2024Q2(*) See Appendix-(iii) for details on goodwill and intangible assets in relation to the acquisition of Revamp.

Copyright © 2024 by Future Corporation

13

（ⅳ） Cash flows✓

Operating CF saw an inflow of JPY 6.0 billion. Investing CF saw an outflow of JPY19.8 billion mainly due to theacquisition of Revamp. Financial CF saw an inflow of JPY17.1 billion due to the bank loan of JPY20.0 billion to financethe acquisition of Revamp while dividends payment amounted to JPY1.7 billion. In total, cash and cash equivalents
increased JPY3.5 billion from the end of the previous year.

Millions of yen

End of 2023

Operating CF

Investing CF

Financial CF

OthersCopyright © 2024 by Future Corporation

14

（ⅴ） Performance by subsidiary : IT Consulting & Services
Operating
営業利益Profit

Net
sales
売上高
3 0,0 0 0

2 5,0 0 024,425

Millions of yen

28,436

2 0,0 0 0

1 5,0 0 0

1 0,0 0 0

6,590

6,719

2023Q22024Q2

5 ,00 002023Q22024Q2

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15

（ⅵ） Breakdown of sales by phase (IT Consulting & Services)✓✓

The sales in Development phase increased due to the various large-scale projects such as Next-Gen Banking System.
The impact of Revamp is an increase of c. JPY1.8 billion in Grand Design, c. JPY200 million in Maintenance and c. JPY
100 million in Merchandise and others.

Grand Design
グランドデザイン

2022Q22023Q22024Q20

Design設計

Develo開発
pment

Merchandise and物販・その他

Maintenance
保守運用

Millions of yenothers

4,435

4,464

7,561

3,755

1,897

(20.1%)(20.2%)(34.2%)(17.0%)(8.6%)

22,113

5,360

2,670

10,508

4,033

1,817

(22.0%)(10.9%)(43.1%)(16.5%)(7.5%)

24,391

6,804

1,743

13,338

4,552

1,956

(24.0%)(20.0%)(9.6%)(6.1%)(47.0%)(16.0%)(6.9%)

5, 00 0(47.3%)
10 ,0 00

15 ,0 00

20 ,0 00

25 ,0 00

28,39630 ,0 00

(Note 1) The figures of sales represent sales to external customers in the IT Consulting & Services.
(Note 2) “Merchandise and others" includes the selection, procurement and sales of relevant IT equipments, and the sales of licenses.
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16

（ⅶ） Breakdown of sales by industry (IT Consulting & Services)✓✓

Sales in financial and distribution sectors increased due to Next-Gen Banking System and the large-scale projects forfood wholesalers.
The impact of Revamp is an increase of c. JPY800 million in service, c. JPY800 million in distribution and c. JPY500
million in manufacturing sectors.
Distribu
流通tion

Serviceサービス

2022Q22023Q22024Q20Financial
金融
SectorManufa製造
cturing

Merchandise and物販・その他Millions of yenothers

6,957

5,360

5,473

2,702 1,618(31.5%)(24.2%)(24.8%)(12.2%) (7.3%)

22,113

7,993

5,381

6,071

3,009

1,934

(32.8%)(22.1%)(24.9%)(12.3%)(7.9%)

24,391

9,191

7,253

6,269

4,457

1,223 28,396(32.4%)(25.5%)(22.1%)(15.7%)(4.3%)

5, 00 0

10 ,0 00

15 ,0 00

20 ,0 00

25 ,0 00

30 ,0 00

(Note 1) The figures of sales represent sales to external customers in the IT Consulting & Services.
(Note 2) “Merchandise and others” includes the selection, procurement and sales of relevant IT equipments and the sales togovernment and local public agencies.
Copyright © 2024 by Future Corporation

17

（ⅷ） Performance by subsidiary : Business Innovation
Operating
営業利益Profit

Net
sales
売上高
4,535

5 ,00 0

4 ,00 0Millions of yen

3,971

3 ,00 02 ,00 0

1 ,00 0▲ 310

0

-1 ,00 02023Q22024Q22023Q2245
2024Q2

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18

（ⅸ） Analysis of consolidated net sales increase/decrease
Millions of yen

IT Consulting &Services

Business Innovation

OthersAdjustments

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19

（ⅹ） Analysis of consolidated OP increase/decrease
Millions of yen

IT Consulting &Services

Business Innovation

OthersAdjustments

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20

3. Forecast for FY2024

Copyright © 2024 by Future Corporation21

（i） Forecast for FY2024✓✓✓

1H results were in line with the plan. Full-year forecasts remain unchanged from the ones which were disclosed on April 24.
As the Next-Gen Banking System at Fukushima Bank went live successfully, we will assign the relevant employees to new
projects in the 2nd half of the year.
Revenue synergies in relation to the acquisition of Revamp will materialize in the next year and beyond.
Millions of yen

FY2024
2024年

2024年
FY2024Rate of
差異
進捗率
Difference
Progress(vs. 1H Budget)(vs. Full-year forecast)(上期計画比) （通期計画比）

通期計画
Forecast

1H
Budget上期計画

1H Results

Net
Sales
売上高

70,20032,10032,954

＋ 854

46.9%

Operating
Profit
営業利益(OP margin)

14,650

6,800

6,902

＋ 102

47.1%

（営業利益率）(20.9%)(21.2%)(20.9%)

親会社株主に帰属するProfit attributable to
当期純利益
ownersof parent(Net income margin)

9,900

4,600

4,864

＋ 264

49.1%

(14.1%)(14.3%)(14.8%)

Full-year（当期純利益率）

上期実績

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22

(ⅱ)Sales, OP and EBITDA Forecasts for FY2024
Millions of yen

Net sales

Operating Profit

EBITDA

系列1
営業利益
OP

80, 000

70,20016, 500

45. 0%

営業利益率
OP margin
系列2

16, 500

14,65070, 000

59,324

13,70014, 500

17,000

系列1
EBITDAEBITDAEBITDAマージン
EBITDA
margin系列2

15,01240. 0%

40. 0%

13,47514, 500

35. 0%

45. 0%

35. 0%

60, 000

53,738

12,226

48,69850, 000

12, 500

30. 0%

12, 500

30. 0%

44,311

10,146

25. 0%

10, 500

25. 0%

10, 500

9,000

40, 000

22.8%

25.1%

23.1%
20.9%

8, 500

25.3%

24.2%

20. 0%

20. 0%

20.8%

8, 50030, 000

18.5%

15. 0%

6, 5006, 5005,235

20, 000

11.8%

15. 0%

6,377
14.4%

10. 0%

4, 500

10. 0%

4, 50010, 000

5. 0%

02, 500

2020

2021

2022

2023

2024

0. 0%

2020

2021

2022

2023

2024

5. 0%

2, 500

0. 0%

2020

2021

2022

2023

2024

(*) In FY2023, the provisional accounting treatment for the business combination was retrospectively finalized so the OP figurein the above chart for FY2022 is slightly different from the one which was disclosed last year (JPY12,229 million).
Copyright © 2024 by Future Corporation

23

(ⅲ) Dividends✓

Interim dividends of JPY 21 per share were approved at the BoD in July. Full-year dividends of JPY 42 (year-end
dividends of JPY 21) remain unchanged.

Annual dividends per share (*)
Dividend
年間配当額
amounts

Dividend
配当性向
payout ratio

45.0円

37.0円
JPY
37.0

40.0円

40.0円
JPY
40.0

JPY
42.0
42.0円

100.0%

90.0%

80.0%
35.0円

JPY
25.5
25.5円

30.0円

25.0円

70.0%

60.0%

JPY
20.0
20.0円

50.0%

20.0円

46.8%

40.0%

15.0円

35.4%

10.0円

35.4%

38.4%

36.7%

30.0%

20.0%

5.0円
10.0%

0.0%

0.0円

2020

2021

2022

2023

2024(Forecast)2024(予)(*) The two-for-one stock split was implemented on Jan 1, 2022. The amounts of dividend before 2021 are adjusted taking into accountthe effect of such stock split.

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24

Appendices

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25

Appendix-①-1 Approach to Order Backlog (IT Consulting & Services Business)(1) For risk management purposes, orders for long-term projects are treated as received
once contracts are signed.
▼ End of 3Q▼ Year-end

Project A
Phase1▼ End of 1Q

Phase 2(Completed)(fixed)

25M

25M

Project B
Phase1(fixed)
50M▼ End of 2Q▼ End of 3Q

Orders received during thecurrent period is 25M

Phase 3Phase 2Phase 3(2) Of the received orders, the amount excluded from sales on a percentage of completionbasis is aggregated as order backlog.
Order backlog ofthe current period=

Order backlog fromthe previous period +Orders received during
the current period

-

Sales

Copyright © 2024 by Future Corporation

26

Appendix-①-2 Relationship between order backlog and net sales
IT Consulting & Services Business Order backlog and sales trends(Quarterly)(Millions of yen)
20,00018,000backlog

Net sales

18,00016,00016,00014,00014,00012,00012,00010,00010,000
8,000
8,000
6,000

6,000
4,000

4,000

2,000

2,000

0

0
2021年2Q••

2021年3Q

2021年4Q

2022年1Q

2022年2Q

2022年3Q

2022年4Q

2023年1Q

2023年2Q

2023年3Q

2023年4Q

2024年1Q

2024年2Q

As explained on the previous slide, the order backlog at the end of the FY does not necessarily
correlate with future sales.
Accounting Standard for Revenue Recognition has been applied with contracts beginning after January
2023.

Copyright © 2024 by Future Corporation27

Appendix-② Quarterly changes in number of employees(Consolidated Basis)

40 00

3,505
3,251

35 00

30 00

2,602

2,671

2,655

22.Q3

22.Q4

23.Q1

2,887

2,910

2,948

23.Q2

23.Q3

23.Q4

25 00

20 00

15 00

10 00

50 0

0

24.Q1

24.Q2

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28

Appendix-③ Purchase Price Allocation of intangible assets and goodwill
regarding the acquisition of Revamp✓ The purchase price allocation with respect to the acquisition of Revamp are decided as shown in the
below chart.
✓ JPY10.7 billion is allocated to customer-related assets which are regarded as identifiable, and theremaining JPY10.8 billion is recognized as goodwill.

Summary
Purchase Price Allocation
リヴァンプ of
識別可能資産とのれんの概要

Millionsof yen（百万円）
Amortization
amounts
償却額

Assets
資産種別

Amounts
金額

Years ofamortization

FY2024＊
当年度

Customer
related
顧客関連資産assets(Customer lists)(取引関連)

10,325

17
17年

456

607

607

Customer
related
顧客関連資産assets(order backlog)
(受注残)

399

1 1年

299

100

－

Goodwill
のれん

10,815

15
15年

541

721

721

Total
合計

21,539

1,296

1,428

1,328

償却年数

*For
9 months※９ヶ月分

FY2025
２年目

FY2026
３年目～

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29

Financial results, supplementary materials, presentationmaterials and other IR materials are available on our website.
https://www.future.co.jp/investor_relations/
IR Contacts
E-mail: ir@future.co.jp

This material contains forward-looking statements and, as such, is subject to known and unknown risks and uncertainties
particularly in relation to the Japanese economy and IT industry; therefore, we do not guarantee nor promise its accuracy.

Copyright © 2024 by Future Corporation30