Internet Initiative Japan Inc. · TSE:3774

Internet Initiative Japan — FY2009 Earnings Presentation

24 slides from Internet Initiative Japan's earnings presentation, May 14, 2010

  1. Slide 1: Fiscal Year ended March 31, 2010 Consolidated Financial Results

    Fiscal Year ended March 31, 2010 Consolidated Financial Results Internet Initiative Japan Inc. 2010.5.14

  2. Slide 2: Agenda

    Agenda Ⅰ. Summary of FY2009 Financial Results and Target for FY2010 Ⅱ. FY2009 Consolidated Financial Results Ⅲ. FY2010 Financial Target Ⅳ. Reference Materials 1

  3. Slide 3: Summary of FY2009 Financial Results and FY2010 Target

    I. Summary of FY2009 Financial Results and FY2010 Target ≪ FY2009 Financial Results ≫  Revenue JPY68,006 million (down 2.5% YoY)  Operating Income JPY 3,412 million (up 16.9% YoY)  Income before Income Tax Expense JPY 2,859 million (up 40.5% YoY)  Net Income Attributable to IIJ JPY 2,234 million

  4. Slide 4: II-1. Consolidated Results for FY2010

    II-1. Consolidated Results for FY2010 Unit: JPY million % of Revenues % of Revenues  Connectivity and outsourcing service FY09 FY08 YoY revenue increased 5.4% YoY （09/4～10/03） （08/4～09/03）  SI revenue decreased 10.6% YoY Total affected by the weak economy Revenues 68.0 69.7 (2.5%)  Continued cost

  5. Slide 5: II-2. Revenues

    II-2. Revenues Internet Connectivity Services Systems Construction Unit: JPY million One-time Recurring Outsourcing Services Revenues Equipment Saleｓ Revenues Systems Operation and Maintenance ATM Operation Business FY07: 66,835 FY08: 69,731 FY09: 68,006 19,694 18,486 18,942 318 98 18,359 4 6 16,926

  6. Slide 6: II-3. Cost of Revenues and Gross Margin Ratio

    II-3. Cost of Revenues and Gross Margin Ratio Cost of Revenues Connectivity and Outsourcing Services SI Equipment Sales ATM Operation Gross Margin Ratio Total Gross Margin Ratio Business Connectivity and Outsourcing Services SI 28.9% 28.1% 27.8% Unit: JPY million 26.7% 25.5% 26.2% 25.7% 24.6% 23.5%

  7. Slide 7: II-4. Connectivity and Outsourcing Services (1) Revenues

    II-4. Connectivity and Outsourcing Services (1) Revenues Connectivity Services for Home Use Outsourcing Services Unit: JPY million Connectivity Services for Corporate Use Total Contracted Bandwidth (Gbps) 647.2 650.4 YoY = 4Q09 compared to 4Q08 619.8 584.7 QoQ = 4Q09 compared to 3Q09 530.5 449.1 476

  8. Slide 8: II-4. Connectivity and Outsourcing Services (2) Cost of Revenues

    II-4. Connectivity and Outsourcing Services (2) Cost of Revenues Purchasing Costs Unit: JPY million Others Outsourcing Costs Personnel Related Costs FY08 : 29,318 FY09 : 30,534 Network Operation Related Costs Circuit Related Costs 7,510 7,466 7,651 7,661 7,567 7,655 7,276 8 9 7 3 7,065 18 9 1 526 52

  9. Slide 9: II-5. Systems Integration (1) Revenues

    YoY = 4Q09 compared to 4Q08 II-5. Systems Integration (1) Revenues Unit: JPY million QoQ = 4Q09 compared to 3Q09 (Systems construction) Systems Construction Revenues FY07 : 18,025 FY08 : 14,659 FY09 : 11,354 Systems Operation and Maintenance Revenues 9,234 Order Backlog System construction’s order b

  10. Slide 10: II-5. Systems Integration (2) Cost of Revenues

    YoY = 4Q09 compared to 4Q08 II-5. Systems Integration (2) Cost of Revenues QoQ = 4Q09 compared to 3Q09 Unit: JPY million Purchasing Costs Outsourcing Costs Others Network Operation Related Costs Personnel Related Costs FY08 :25,543 6,326 FY09 : 21,904 7,152 6,154 6,326 6,024 2,566 2,705 5,174 1,619

  11. Slide 11: II-6. SG&A Expenses/R&D

    II-6. SG&A Expenses/R&D Sales and Marketing Expenses Research and Development Unit: JPY million General and Administrative Expenses ( ) % of Revenues FY07 : 9,193 FY08 : 10,668 FY09 : 10,554 2,978 2,931 （15.7%） （14.9%） 2,614 2,647 72 2,458 （16.0%） 2,550 2,526 199 （16.7%） 2,540 2,372 （15.1%） （14.4%）

  12. Slide 12: II-7. Number of Employees

    II-7. Number of Employees （number of employees） [Employee Distribution] 1,800 1,700 1,699 Contract worker 1,673 1,687 Full time worker 1,602 Administration 1,600 228 255 266 263 229 15% 1,373 1,400 173 Sales 1,200 1,155 18% 987 129 Engineers 1,000 67% 127 800 1,373 1,445 1,445 1,433 1,424 600 1,200

  13. Slide 13: II-8. Operating Income and Net Income

    YoY = 4Q09 compared to 4Q08 II-8. Operating Income and Net Income QoQ = 4Q09 compared to 3Q09 Operating Income Net Income Operating Margin Ratio  Operating Income: Unit: JPY million FY09: up 16.9% YoY Operating income ： 4,759 Operating income ： 2,917 Operating income ： 3,412 Gross margin of connec

  14. Slide 14: II-9. Connectivity and Outsourcing Service and SI

    II-9. Connectivity and Outsourcing Service and SI Unit: JPY million [Gross margin and gross margin ratio] Gross Margin Gross Margin Ratio Operating Income Operating margin Ratio FY08 : JPY13,984 million FY09 : JPY14,713 million 20.1% 21.7% YoY = 4Q09 compared to 4Q08 QoQ = 4Q09 compared to 3Q09 23.1

  15. Slide 15: II-10. Operating Income YoY Change

    YoY = 4Q09 compared to 4Q08 II-10. Operating Income YoY Change QoQ = 4Q09 compared to 3Q09 ATM Operation Unit: JPY million Gross margin of Gross margin of SG&A expenses Business connectivity and Gross margin of SI equipment sales (excluding ATM) outsourcing service ・Gross Loss: (358) +681 +63 ▲14 +6

  16. Slide 16: II-11. Consolidated Balance Sheets

    II-11. Consolidated Balance Sheets Unit: JPY million March 31, March 31, Changes 2010 2009 Cash and Cash 8,764 10,188 (1,423) Equivalents Increased correspondingly to the Accounts Receivable 11,397 10,257 +1,140 increase in on-going SI Projects Inventories 808 530 +278 Prepaid Expenses 1,593 1,772

  17. Slide 17: II-12. Consolidated Cash Flows

    II-12. Consolidated Cash Flows Unit: JPY million Net cash provided by (used in) operating activities FY09 : 9,621 FY09 : YoY FY07 : 4,538 FY08 : 8,631 4,083 Increase in operating income 3,280 3,360 2,164 2,628 Increase in accounts receivable: JPY1,179 2,018 1,987 1,444 1,346 1,468 million 338 Inc

  18. Slide 18: II-13. Other Financial Data (CAPEX etc.)

    II-13. Other Financial Data (CAPEX etc.) Unit: JPY million CAPEX (Include Capital Lease)  CAPEX related to ATM operation business: JPY297 million FY07 : 6,078 FY08 : 7,006 FY09 : 5,584 2,685 2,232 1,831 1,832 1,752 1,546 1,489 Adjusted EBITDA 1,242 1,218 1,058 1,124 FY07 : 9,534 FY08 : 8,348 FY09 :

  19. Slide 19: III. FY2010 Financial Target

    III. FY2010 Financial Target Unit: JPY billion (except for Net Income and FY10 Revised Target FY09 Actual YoY Cash Dividend per Share) （10/4～11/3） （09/4～10/3） Total Revenues 71.0 68.0 +3.0 4.4% Operating Income 4.3 3.4 +0.9 26.0% Income before Income Tax 3.7 2.9 +0.8 29.4% Expense (Benefit) Net Inco

  20. Slide 20: IV-1. The construction of Module-Type Eco Data Center

    IV-1. The construction of Module-Type Eco Data Center  Conducted Proof-of-Concept Testing for the module-type eco-Data Center from February 2010 A modular Data Center with a cooling system that directly uses outside air The first Data Center in Japan with a container unit cooled all year round by

  21. Slide 21: IV-2. Topics

    IV-2. Topics ◆ Business development of IIJ cloud computing service “IIJ GIO”  Launched “IIJ GIO” in Nov 2009  We are receiving over 600 inquiries from all different sectors such as internet service, finance sector etc.  IIJ acquired global security standard of PCI DSS (Payment Card Data Security

  22. Slide 22: IV-3. Reference: IIJ Group Companies

    IV-3. Reference: IIJ Group Companies （As of April 30, 2010) Company Name Ownership Main Business Provides a full range of network operation and management services, Net Care, Inc. from customer support, end-user help desks, monitoring and troubleshooting to integrated management services. Provides n

  23. Slide 23: IV-4. Reference: Press Release

    IV-4. Reference: Press Release Date Press Releases 10/1 IIJ Makes the IIJ Managed Firewall Service IPv6 Compatible 10/5 IIJ Group Announces the Latest Cloud Services for IIJ GIO 10/8 IIJ and Cybozu Research Form Alliance to Promote Cloud Services 10/13 IIJ Strengthens Compliance Function of IIJ Secu

  24. Slide 24: Forward-looking Statements

    ※ Forward-looking Statements Statements made in this presentation regarding IIJ’s or management’s intentions, beliefs, expectations, or predictions for the future are forward-looking statements that are based on IIJ’s and managements’ current expectations, assumptions, estimates and projections abou

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