Internet Initiative Japan Inc. · TSE:3774

Internet Initiative Japan — FY2011 1Q-3Q Earnings Presentation

19 slides from Internet Initiative Japan's earnings presentation, Feb 8, 2012

  1. Slide 1: FY2011/1Q-3Q (cumulative) Consolidated Financial Results

    FY2011/1Q-3Q (cumulative) Consolidated Financial Results Internet Initiative Japan Inc. 2012.2.8

  2. Slide 2: Agenda

    Agenda Ⅰ. Summary of FY2011/1Q-3Q (cumulative) Financial Results Ⅱ. Consolidated Financial Results for FY2011/1Q-3Q (cumulative) Ⅲ. Reference Materials 1

  3. Slide 3: Summary of FY2011/1Q-3Q (cumulative) Financial Results

    I. Summary of FY2011/1Q-3Q (cumulative) Financial Results < FY2011/1Q-3Q (cumulative) Financial Results > •Revenues JPY70,752 million (up 24.6% YoY) •Gross Margin JPY14,098 million (up 22.2% YoY) •Operating Income JPY3,998 million (up 64.5% YoY) •Income before Income Tax Expense JPY3,780 million (up

  4. Slide 4: Consolidated Results for FY2011/1Q-3Q (cumulative)

    II-1. Consolidated Results for FY2011/1Q-3Q (cumulative) Unit: JPY billion % of Revenues % of Revenues 3Q11 3Q10 YoY （11/4～11/12） （10/4～10/12） Total Revenues 70.8 56.8 24.6% 80.1% 79.7% Total Costs 56.7 45.3 25.2% 19.9% 20.3% Gross Margin 14.1 11.5 22.2% 14.3% 16.0% SG&A/R&D 10.1 9.1 10.9% 5.7% 4.3%

  5. Slide 5: Revenues

    II-2. Revenues Internet Connectivity Services Unit: JPY million One-time Systems Construction Recurring Outsourcing Services Revenues Equipment Sales Revenues WAN Services Systems Operation and Maintenance ATM Operation Business FY09: 68,006 FY10: 82,418 (down 2.5% YoY) (up 21.2% YoY) 25,622 23,362

  6. Slide 6: Cost of Revenues and Gross Margin Ratio

    II-3. Cost of Revenues and Gross Margin Ratio Unit: JPY million Cost of Revenues Network Services SI Equipment Sales ATM Operation Gross Margin Ratio Business Network Services SI Total Gross Margin Ratio 28.1% 27.8% IIJ-Global 2Q10* 3Q10 4Q10 1Q11 2Q11 3Q11 26.7% 25.7% 26.2% Cost of 1,761 5,215 5,16

  7. Slide 7: Network Services

    YoY = 3Q11 compared to 3Q10 II-4. Network Services QoQ = 3Q11 compared to 2Q11 Internet Connectivity Services for Home Use WAN Services Outsourcing Services Unit: JPY million Internet Connectivity Services for Corporate Use 853.0 791.0 820.7 733.4 702.5 702.0 647.2 650.4 660.9 619.8 584.7 Total Cont

  8. Slide 8: Network Services (2) Cost of Revenues

    II-4. Network Services (2) Cost of Revenues Unit: JPY million Purchasing Costs Personnel Related Costs Others Network Operation Related Costs YoY = 3Q11 compared to 3Q10 Outsourcing Costs Circuit Related Costs QoQ = 3Q11 compared to 2Q11 FY10: 41,678 (Gross Margin: 19.3%) 12,402 12,474 12,440 12,606

  9. Slide 9: Systems Integration (1) Revenues

    YoY = 3Q11 compared to 3Q10 II-5. Systems Integration (1) Revenues Unit: JPY million QoQ = 3Q11 compared to 2Q11 (Systems construction) Systems Construction Revenues 5,928 5,741 5,297 5,344 Systems Operation and Maintenance Revenues 4,428 4,580 4,710 4,590 3,844 3,796 Order Backlog System constructi

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

    YoY = 3Q11 compared to 3Q10 II-5. Systems Integration (2) Cost of Revenues QoQ = 3Q11 compared to 2Q11 Purchasing Costs Unit: JPY million Outsourcing Costs FY10: 22,466 Others (Gross Margin: 23.7%) Network Operation Related Costs Personnel Related Costs 7,590 7,152 FY09: 21,904 (Gross Margin: 27.2%)

  11. Slide 11: Number of Employees

    II-6. Number of Employees YoY = 3Q11 compared to 3Q10 QoQ = 3Q11 compared to 2Q11 (Number of Employee) 1,962 1,944 1,953 1,955 1,941 2,000 1,687 269 258 243 246 250 Contract Worker Full time Worker 263 1,500 [Employee Distribution] 1,000 Admin. 1,693 1,686 1,710 1,709 1,691 14% 1,424 Sales 500 19% E

  12. Slide 12: SG&A Expenses/R&D

    II-7. SG&A Expenses/R&D Unit: JPY million IIJ-Global 2Q10* 3Q10 4Q10 1Q11 2Q11 3Q11 Sales and Marketing Expenses Research and Development General and Administrative Expenses ( ) % of Revenues SG&A 224 777 767 856 663 754 Amortization of customer 20 109 125 106 106 106 FY10: 12,449 relationships FY09

  13. Slide 13: Operating Income and Net Income

    YoY = 3Q11 compared to 3Q10 II-8. Operating Income and Net Income QoQ = 3Q11 compared to 2Q11 Operating Income Unit: JPY million FY2009 FY2010 Net Income Attributable to IIJ Operating Margin Ratio Operating income: 3,412 Operating income: 4,141 Net income attributable Net income attributable 3Q11 O

  14. Slide 14: Consolidated Balance Sheets

    II-9. Consolidated Balance Sheets Unit: JPY million March 31, December 31, Changes 2011 2011 Nonmarketable equity securities: Cash and Cash Equivalents 13,314 10,928 (2,386) JPY1,949 million Available-for-sale equity securities: Accounts Receivable 16,431 15,456 (976) JPY794 million Inventories 60

  15. Slide 15: Consolidated Cash Flows

    II-10. Consolidated Cash Flows Unit: JPY million <Operating Activities> <3Q11 Operating Activities> FY09: 9,621 FY10: 12,564 Operating Income increased 4,177 Accounts Receivable increased: JPY1,004 million 3,360 3,279 2,628 2,835 2,966 Accounts payable and other current 2,164 2,274 2,292 1,468 1,

  16. Slide 16: Other Financial Data (CAPEX etc.)

    II-11. Other Financial Data (CAPEX etc.) Unit: JPY million CAPEX (Include Capital Lease) 3,567 FY09: 5,584 FY10: 6,752 2,878 2,212 2,208 1,752 1,804 1,489 1,515 1,218 1,221 Adjusted EBITDA 1,124 FY09: 8,718 FY10: 10,210 3,543 3,294 3,376 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 2,777 2

  17. Slide 17: Developments of IIJ GIO

    III-1. Developments of IIJ GIO ■ Business developments of IIJ GIO Over ・3Q11 Revenues: JPY817 million 1,000 (2Q11:JPY736 million) (JPY million) IIJ GIO Revenues projects  Growth in 3Q11 came from the increase in 600 Over enterprise business and other clients Enterprise Business and Others 830 proje

  18. Slide 18: Reference: FY2011 Financial Target (revised on Feb. 8, 2012)

    III-3. Reference: FY2011 Financial Target ( revised on Feb. 8, 2012) Unit: JPY billion (except for Net Income and Cash Dividend per Share) FY11 Revised FY11 Initial FY10 Actual YoY Target Target (Revised FY11 to FY10 Acutal) （10/4～11/3） （11/4～12/3） （11/4～12/3） Total Revenues 97.0 100.0 82.4 +14.6 17

  19. Slide 19: 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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