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Japan - Results up for Meitec

09 May 2013

Tokyo-based staffing firm, Meitec Corporation (9744:TYO), has reported that consolidated net sales (revenue) for the year ended 31 March 2013,  is up by +5.0%, from the previous year to JPY 70,330 million (USD 711 million). The gross margin was up solidly at 9.0% from 8.1% the year before. Consolidated net income for the fiscal year under review increased +112.0%, from a year earlier to JPY 5,993 million (USD 60 million) due to a temporary decline in tax expenses mainly associated with the dissolution of a subsidiary.

The Company reported that many leading manufacturers, who are the major customers of the Company, steadily continued investments in technological development looking to the next generation despite the near-term economic uncertainty. Under these circumstances, the company continued to improve its “utilization ratio” via aggressive recruiting activities to increase the number of engineers and reinforcing sales activities.

According to the company the Japanese economy remained highly uncertain until the third fiscal quarter due to European financial problems, the deceleration of the Chinese economy, persistent appreciation of the Yen and other factors. However, during the fourth quarter, the excessively high Yen appreciation was corrected and stock prices rose, partly because of the effect of economic measures implemented by the new government administration and rising expectations of an end to deflation.

Temporary Staffing Business accounts for more than 90% of the Company’s consolidated net sales and,  for the fiscal year under review, net sales for this segment increased +5.4%, from a year earlier to JPY 67,281 million ( USD680 million), and operating income was raised +17.6%, to JPY 6,144 million (USD 62 million). In the core engineering staffing segment Meitec was able to increase the number of engineers through aggressive and ongoing recruiting activities. They also steadily secured orders received and landed new contracts by reinforcing sales activities, resulting in an improvement in the Company’s non-consolidated average utilization ratio (overall) of 95.4% (compared with 93.2% a year earlier). Also, working hours were steady at 8.88 hours per day (8.83 hours per day for the previous year).

The Global Business engages in the job placement and vocational training for students to supply human resources for Japanese manufacturers that operate in the coastal areas of China. Net sales in the Global Business for the fiscal year under review increased +148.9%, from a year earlier to JPY 69 million (USD 697,576). An operating loss of JPY 59 million (USD 596,478) was posted compared with a loss of JPY 70 million (USD 707,785) a year earlier.

The Recruiting & Placement Business involves job placement and a job board focused on engineering roles. Net sales in the Recruiting & Placement Business advanced +23.4%, from a year earlier to JPY 739 million (USD 7 million), and operating income increased +18.8%, to JPY 176 million (USD 1.8 million).

On Thursday, Meitec’s shares closed at JPY 2,489, -3.75% below its 52-week high of JPY 2,586, set on 11 March, 2013. This is +56.44% above a year ago and means the company is valued at JPY 83.00 billion (USD 839 million).

To download the full results in English, click below.

application/pdf2013_4Q.pdf 339.69 kB

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