WEB NEWS Comments & Business Outlook
Internet Initiative Japan Inc. and Subsidiaries
Three Years in the Period Ended March 31, 2016
Thousands of Yen
2014
2015
2016
REVENUES (Notes 6 and 22):
Network services:
Internet connectivity services (enterprise)
¥
16,585,175
¥
16,349,785
¥
17,597,343
Internet connectivity services (consumer)
6,024,560
8,222,015
15,255,596
WAN services
25,005,867
24,325,951
25,176,730
Outsourcing services
19,670,127
20,107,850
21,265,895
Total
67,285,729
69,005,601
79,295,564
Systems integration:
Systems construction
18,673,638
20,437,326
21,144,677
Systems operation and maintenance
23,795,927
27,800,132
33,043,669
Total
42,469,565
48,237,458
54,188,346
Equipment sales
1,690,225
2,166,928
3,275,220
ATM operation business
2,826,832
3,640,128
3,888,878
Total revenues
114,272,351
123,050,115
140,648,008
COSTS AND EXPENSES (Notes 6, 9, 13 and 22 ):
Cost of network services
53,045,814
54,932,285
64,239,600
Cost of systems integration
36,510,328
41,561,621
46,225,629
Cost of equipment sales
1,526,618
1,932,180
2,968,711
Cost of ATM operation business
2,123,168
2,551,437
2,558,883
Total costs
93,205,928
100,977,523
115,992,823
Sales and marketing (Note 21)
8,547,693
9,188,425
10,588,887
General and administrative (Note 7)
6,374,057
7,367,600
7,470,746
Research and development
421,361
441,329
455,198
Total costs and expenses
108,549,039
117,974,877
134,507,654
OPERATING INCOME
5,723,312
5,075,238
6,140,354
OTHER INCOME (EXPENSES):
Dividend income
51,003
63,143
93,054
Interest income
26,719
23,111
27,587
Interest expense
(256,371
)
(238,260
)
(241,057
)
Foreign exchange gain (loss), net
219,381
(5,045
)
(71,270
)
Net gain on sales of other investments (Note 4)
107,655
41,251
23,765
Net gain on other investments (Note 4)
313,393
–
–
Impairment of other investments (Note 4)
–
(29,117
)
(14,729
)
Other—net
89,799
208,671
235,630
Other income—net
551,579
63,754
52,980
INCOME FROM OPERATIONS BEFORE INCOME TAX EXPENSE AND EQUITY IN NET INCOME OF EQUITY METHOD INVESTEES—(FORWARD)
¥
6,274,891
¥
5,138,992
¥
6,193,334
Comments & Business Outlook
Three Years in the Period Ended March 31, 2015
Thousands of Yen
2013
2014
2015
REVENUES (Notes 6 and 22):
Network services:
Internet connectivity services (enterprise)
¥ 16,027,134 ¥ 16,585,175 ¥ 16,349,785
Internet connectivity services (consumer)
5,466,198 6,024,560 8,222,015
WAN services
25,168,425 25,005,867 24,325,951
Outsourcing services
18,570,641 19,670,127 20,107,850
Total
65,232,398 67,285,729 69,005,601
Systems integration:
Systems construction
15,824,938 18,673,638 20,437,326
Systems operation and maintenance
21,380,158 23,795,927 27,800,132
Total
37,205,096 42,469,565 48,237,458
Equipment sales
1,490,906 1,690,225 2,166,928
ATM operation business
2,320,086 2,826,832 3,640,128
Total revenues
106,248,486 114,272,351 123,050,115
COSTS AND EXPENSES (Notes 6, 9, 13 and 22 ):
Cost of network services
50,692,190 53,045,814 54,932,285
Cost of systems integration
30,424,802 36,510,328 41,561,621
Cost of equipment sales
1,318,344 1,526,618 1,932,180
Cost of ATM operation business
1,959,597 2,123,168 2,551,437
Total costs
84,394,933 93,205,928 100,977,523
Sales and marketing (Note 21)
8,058,481 8,547,693 9,188,425
General and administrative (Note 7)
5,632,430 6,374,057 7,367,600
Research and development
410,000 421,361 441,329
Total costs and expenses
98,495,844 108,549,039 117,974,877
OPERATING INCOME
7,752,642 5,723,312 5,075,238
OTHER INCOME (EXPENSES):
Dividend income
47,117 51,003 63,143
Interest income
25,708 26,719 23,111
Interest expense
(287,314 ) (256,371 ) (238,260 )
Foreign exchange gain (loss), net
112,136 219,381 (5,045 )
Net gain on sales of other investments (Note 4)
13,565 107,655 41,251
Net gain on other investments (Note 4)
- 313,393 -
Impairment of other investments (Note 4)
(19,788 ) - (29,117 )
Other—net
112,798 89,799 208,671
Other income—net
4,222 551,579 63,754
INCOME FROM OPERATIONS BEFORE INCOME TAX EXPENSE AND EQUITY IN NET INCOME OF EQUITY METHOD INVESTEES—(FORWARD)
¥ 7,756,864 ¥ 6,274,891 ¥ 5,138,992
Internet Initiative Japan Inc. and Subsidiaries
Consolidated Statements of Income
Three Years in the Period Ended March 31, 2015
Thousands of Yen
2013
2014
2015
INCOME FROM OPERATIONS BEFORE INCOME TAX EXPENSE AND EQUITY IN NET INCOME OF EQUITY METHOD INVESTEES—(FORWARD)
¥ 7,756,864 ¥ 6,274,891 ¥ 5,138,992
INCOME TAX EXPENSE (Note 12)
2,607,582 1,795,305 1,896,865
EQUITY IN NET INCOME OF EQUITY METHOD INVESTEES (Note 6)
168,065 204,046 154,626
NET INCOME
5,317,347 4,683,632 3,396,753
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
(16,693 ) (241,395 ) (74,672 )
NET INCOME ATTRIBUTABLE TO INTERNET INITIATIVE JAPAN INC.
¥ 5,300,654 ¥ 4,442,237 ¥ 3,322,081
Shares
NET INCOME ATTRIBUTABLE TO INTERNET INITIATIVE JAPAN INC. PER SHARE (Note 16):
Basic weighted-average number of common shares outstanding
40,536,800 44,306,680 45,942,291
Diluted weighted-average number of common shares outstanding
40,572,600 44,361,083 46,014,737
Yen
BASIC NET INCOME ATTRIBUTABLE TO INTERNET INITIATIVE JAPAN INC. PER COMMON SHARE
¥ 130.76 ¥ 100.26 ¥ 72.31
DILUTED NET INCOME ATTRIBUTABLE TO INTERNET INITIATIVE JAPAN INC. PER COMMON SHARE
130.65 100.14 72.20
Comments & Business Outlook
Three Years in the Period Ended March 31, 2014
Thousands of Yen
Thousands of
U.S. Dollars
(Note 1)
2012
2013
2014
2014
REVENUES (Notes 6 and 22):
Network services:
Internet connectivity services (corporate use)
¥ 14,706,511 ¥ 16,027,134 ¥ 16,585,175 $ 161,052
Internet connectivity services (home use)
5,717,417 5,466,198 6,024,560 58,502
WAN services
25,666,524 25,168,425 25,005,867 242,823
Outsourcing services
17,318,954 18,570,641 19,670,127 191,009
Total
63,409,406 65,232,398 67,285,729 653,386
Systems integration:
Systems construction
11,997,680 15,824,938 18,673,638 181,333
Systems operation and maintenance
19,471,641 21,380,158 23,795,927 231,073
Total
31,469,321 37,205,096 42,469,565 412,406
1,111,722 1,490,906 1,690,225 16,413
ATM operation business
1,324,156 2,320,086 2,826,832 27,450
Total revenues
97,314,605 106,248,486 114,272,351 1,109,655
COSTS AND EXPENSES (Notes 6, 9, 13 and 22):
Cost of network services
49,984,821 50,692,190 53,045,814 515,108
Cost of systems integration
24,978,607 30,424,802 36,510,328 354,538
Cost of equipment sales
980,279 1,318,344 1,526,618 14,824
Cost of ATM operation business
1,382,194 1,959,597 2,123,168 20,617
Total costs
77,325,901 84,394,933 93,205,928 905,087
Sales and marketing (Note 21)
7,946,852 8,058,481 8,547,693 83,003
General and administrative (Note 7)
5,299,608 5,632,430 6,374,057 61,896
Research and development
388,761 410,000 421,361 4,092
Total costs and expenses
90,961,122 98,495,844 108,549,039 1,054,078
OPERATING INCOME
6,353,483 7,752,642 5,723,312 55,577
OTHER INCOME (EXPENSES):
Dividend income
48,269 47,117 51,003 495
Interest income
34,602 25,708 26,719 260
Interest expense
(299,271 ) (287,314 ) (256,371 ) (2,489 )
Foreign exchange gain (loss), net
(4,549 ) 112,136 219,381 2,130
Net gain (loss) on sales of other investments (Note 4)
(3,154 ) 13,565 107,655 1,045
Net gain on other investments (Note 4)
- - 313,393 3,043
Impairment of other investments (Note 4)
(159,592 ) (19,788 ) - -
Other—net
6,432 112,798 89,799 872
Other income (expenses)—net
(377,263 ) 4,222 551,579 5,356
INCOME FROM OPERATIONS BEFORE INCOME TAX EXPENSE AND EQUITY IN NET INCOME OF EQUITY METHOD INVESTEES―(FORWARD)
¥ 5,976,220 ¥ 7,756,864 ¥ 6,274,891 $ 60,933
Management Discussion and Analysis
Total revenues¥114.3 billion for the fiscal year ended March 31, 2014, an increase of 7.6% compared to ¥106.2 billion for the previous fiscal year mainly due to an increase in the number and volume of systems construction projects and growth in monthly recurring revenues.
¥4.4 billion compared to ¥5.3 billion for the previous fiscal year. The decrease primarily reflects the decrease in operating income by ¥2.0 billion compared to the previous fiscal year.
Joint Venture
TOKYO--(BUSINESS WIRE Briscola will use its expertise in the design and development of sensor-driven cloud platforms to build and supply M2M platforms on the IIJ GIO cloud service, and IIJ will provide a complete infrastructure environment: from IIJ GIO cloud services connected directly to Japan�s largest Internet backbone network, to mobile data communications services tailored for M2M applications. The two companies will leverage their individual strengths, as well as the advantages of cloud computing, to support their joint construction and operation of high-speed cloud-based M2M systems for their clients.
In the first project through this alliance, Briscola and IIJ have built a proof-of-concept environment for a solar monitoring system for Asahi Denshi Co., Ltd. (Asahi Denshi). Asahi Denshi�s High-efficiency Solar Power System Monitoring Data Cloud R&D Project has started in October 2013. The low-cost solar power management system aims to optimize power generation efficiency and enable monitoring by multiple power producers.
In this proof-of-concept project, Briscola built the system for collecting and monitoring data using Neoale solar power monitoring sensors mounted on solar panels, while IIJ provided its IIJ GIO service and network environment as the system infrastructure. Full operation is scheduled to begin in July 2014. Neoale are sensors developed by Asahi Denshi as monitoring devices for solar power generation, measuring current and voltage in real time, and quickly detecting defective modules.
Briscola plans to develop this monitoring system as an M2M open platform for the energy sector, and IIJ intends to continue cooperating by providing the necessary infrastructure. Briscola is scheduled to present the results of the project at the PV EXPO 2014 7th International Photovoltaic Power Generation Expo, in Japan starting February 26, 2014.
Comments & Business Outlook
Full Year 2013 Results
Total revenues were JPY106,248 million, up 9.2% YoY.
As a result of the above, net income was JPY5,317 million, up 48.8% YoY (JPY3,575 million for FY2011).
"We finished pretty well this fiscal year as each of our business progressed as planned. Our revenues exceeded JPY100 billion for the first time since the inception of the company. The business developments we accomplished should position IIJ for further growth in the coming years," said Koichi Suzuki, the founder and CEO of IIJ.
"We continue to enjoy greater network efficiency by having multiple revenue sources on our large network infrastructure. We remain as a top ISP choice for large network operators who require broader bandwidth and stable connectivity. As for systems integration, we're seeing more large scale projects, supported by the overall Japanese economy recovery. ATM operation business, a stock-type revenue, turned positive and has become a revenue and income driver. We're confident our strategic businesses continue to contribute to our overall revenue and earnings growth further.
"We've been working vigorously to expand cloud and overseas businesses this fiscal year. Our continued efforts to introduce and promote attractive cloud services that would encourage more cloud adoption by enterprises have led this fiscal year's cloud revenue to approximately JPY6.2 billion. Along with continued revenue growth, we decided to double the size of our container type datacenter in Matsue, the western suburbs of Japan. We're well positioned in the Japanese cloud market as we've been engaging in the operation of systems and network ever since the establishment which should differentiate us from competitors. We've also made good progress for overseas business by expanding service facilities and accumulating orders of large server construction and operation projects. Currently, these businesses would be small portion of our total revenue, but we expect them to be our business scale-up drivers.
"As the outsourcing of IT systems by business enterprises becomes a norm in the Japanese society gradually, we see a huge growth opportunity ahead of us. We target the increase of revenue and operating income by 10.1% and 21.2% YoY for FY2013.
"We're excited to announce we invited Mr. Katsu as our new President, Chief Operating Officer, and a representative director, which appointment should become effective at the next shareholders meeting this coming June. I will remain as CEO and co-work with him. This new management structure should further enhance our competitive advantages and take IIJ to the next level of growth. We must stay aggressive in taking effective means to scale up as a growing company in a growing market," concluded Suzuki.
Share Structure
TOKYO, Sept. 6, 2012 (GLOBE NEWSWIRE ) -- Internet Initiative Japan Inc. ("IIJ") (Nasdaq:IIJI) (TSE1:3774) hereby announces that IIJ's Board of Directors resolved the following items at the meeting of the Board of Directors held today.
1. Purpose of Stock Split, Adoption of the Unit Share System and Partial Amendments to its Articles of Incorporation
In April, 2012, the securities listing regulations, etc of the securities exchanges of Japan were amended, whereby listed companies whose number of shares constituting a share-trading unit is a number other than 100 shares or 1,000 shares are obliged to set their number of shares constituting a unit as 100 shares. Accordingly, IIJ will adopt the unit share system which sets a share-trading unit as 100 shares and simultaneously conduct a 1:200 stock split in order to reduce the investment unit amount of IIJ's common shares. As a result of the stock split and adoption of the unit share system, the investment unit amount of IIJ's common stock will be one half (1/2) of the previous amount.
2. Summary of Stock Split
(1) Method of stock split
The stock split shall have a record date of Sunday, September 30, 2012 and shall involve the splitting of common shares held by shareholders whose names appear or are recorded in the latest Registry of Shareholders on the record date at a ratio of 1:200.
(2) Number of additional shares as a result of the stock split
The number of additional shares as a result of the stock split shall be 199 times the final total number of issued shares on Sunday, September 30, 2012. The numbers of shares presented below are based on the total number of shares issued on Wednesday, September 5, 2012.
Full details here.
Comments & Business Outlook
Highlights of 1 st Quarter FY2012 Financial Results
Revenues JPY 24,841 million ($311 million, up 6.3% YoY)
Operating Income JPY1,374 million ($17 million, up 50.2% YoY)
1Q12 revenues increased by 6.3%. Revenues for network services, system integration, and ATM operation business each grew YoY.
1Q12 operating income increased by 50.2% mainly because gross margin of network services and ATM operation business increased while SG&A stayed around the same level as 1Q11.
Overview of 1st Quarter FY2012 Financial Results and Business Outlook
"We had a very encouraging start for FY2012 as we carried out our business developments as planned during this 1st quarter, and our 1Q12 revenues and operating income grew by 6.3% and 50.2% YoY," said Koichi Suzuki, President and CEO of IIJ.
"Demands for broader bandwidth have been rising continuously and our Internet connectivity services for corporate use continued to show good growth. Another good news is that consumer Internet connectivity revenues increased compared to the previous quarter as our new LTE service has been attracting and accumulating many users," continued Suzuki.
"Regarding IIJ GIO, our cloud computing services, business scale has been expanding consistently. We are focused on elaborating service line-ups and the reliability of our services to accelerate a cloud shift for Japanese entities' internal IT systems. Currently, we are preparing to launch new service line-ups called VWseries in August. VWseries deliver VMware hypervisor functions to users and these services are very much expected to encourage Japanese clients to adopt hybrid cloud usage, a combination of on-premise systems and cloud services."
"As for our overseas business, we are also making satisfying progress as expected. The overseas business revenue reached around JPY 1.0 billion. We had large server construction projects in the U.S. for a prominent SNS game client. Also, our cloud services in the U.S. are starting up well and we are currently expanding our server facilities in order to meet prospective orders."
"We are now engaged in software development of SDN (Software Defined Network) platform aiming to take initiative over network virtualization technologies. We plan to release our SDN software products in 2H12."
"Lastly, we are pleased to announce that operating income of our ATM operation business turned positive in this quarter. Along with placements of additional ATMs, we anticipate this business to grow continuously and expect high profitability in the future."
Auditor trail
BEIJING , June 27, 2012 /PRNewswire-Asia-FirstCall / -- Hollysys Automation Technologies, Ltd. (NASDAQ: HOLI) ("Hollysys" or the "Company"), a leading provider of automation and control technologies and applications in China , today announced that it dismissed its principal independent accountant, BDO Limited ("BDO Hong Kong") from its engagement with the Company and engaged with Ernst & Young Hua Ming , which is effective June 27, 2012 .
On June 27, 2012 , the Company engaged Ernst & Young Hua Ming to serve as its independent auditor, effective immediately. The Company believes the transition from BDO Hong Kong to Ernst & Young Hua Ming will be smooth and does not have any adverse effects on the Company's annual audit. The decision to change Company's principal independent accountant from BDO Hong Kong to Ernst & Young Hua Ming was not the result of any disagreements between the Company and BDO Hong Kong on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, and the Company sincerely appreciates the services that have been provided by BDO Hong Kong up to date.
Acquisition Activity
TOKYO, April 2, 2012 (GLOBE NEWSWIRE ) -- Internet Initiative Japan Inc. (IIJ) (Nasdaq:IIJI) (TSE1:3774), one of Japan's leading Internet access and comprehensive network solutions providers, today acquired the stocks of Exlayer Global Inc.(" Exlayer Global") from its existing shareholders. Exlayer Global is a holding company with overseas subsidiaries in the system integration industry. The newly acquired company will begin its operation as IIJ's subsidiary under the name IIJ Exlayer Inc.
Exlayer Global owns five overseas subsidiaries and has developed its business with high engineering skills in the SI and IT project management fields and with its reliabilities. Their strength lies in their business development ability in many countries, and with its strong presence among Japanese-owned local corporations, Exlayer Global has been steadily expanding its business.
IIJ, together with IIJ Global Solutions Inc., one of its subsidiaries, is expanding its overseas offices mainly in Asia and is accelerating its global business development by providing services such as Cloud services in the United States, China, and Asia. For IIJ Group to further accelerate its global business, IIJ has decided to make Exlayer Global its subsidiary. We believe the expertise and human resources that Exlayer global and its group companies had built could better help IIJ Group to accelerate its international business development.
IIJ Exlayer will continue to leverage IIJ Group's Cloud services and wide range of network solutions to strengthen business infrastructure in foreign countries and leads IIJ Group's international business development together with IIJ and IIJ Global.
Joint Venture
TOKYO, March 12, 2012 (GLOBE NEWSWIRE ) -- Internet Initiative Japan Inc. ("IIJ") (Nasdaq:IIJI) (TSE1:3774) and China Telecom Corporation Limited (China Telecom) today announced that they have forged a strategic partnership to jointly provide Cloud computing services in China. As part of the partnership, the two companies plan to develop Cloud computing services such as IaaS, PaaS and SaaS, and aim to provide them to the Chinese market from summer 2012.
IIJ has long experience in providing resource on-demand services, a prototype service for Cloud computing from 2000. From 2009, IIJ began providing Cloud computing service under the brand name "IIJ GIO" which covers layers from IaaS to SaaS. Currently,IIJ GIO has been recognized as No.1 Cloud computing service in Japan and is adopted by over 600 Japanese blue-chip customers. From 2011, IIJ has strengthened its overseas business and considers China to be one of the most important markets in Asia.
China Telecom is the largest carrier in China that provides an array of telecommunications-related services, from voice, internet connectivity to wireless services and also owns and operates data centers facilities across the country. With its elaborate network infrastructure, China Telecom provides services to around 170 million local line subscribers.
To make the most from this strategic partnership, IIJ and China Telecom will jointly provide high quality and flexible Cloud computing services in China, as is provided in Japan, by exploiting IIJ's abundant experiences in providing Cloud computing service and utilizing the largest and strongest network infrastructure that China Telecom owns throughout China. China Telecom will offer its data center and network infrastructure and IIJ will build and operate the Cloud computing platform.
Many Japanese companies are operating businesses in China and there would be demands for Cloud computing services. Also IIJ and China Telecom believe there are potential demands especially for IaaS from Chinese companies. We will cooperate together in developing and operating many great services most suited in the Chinese market.
IIJ Global Solutions China Inc., which is a Shanghai-based subsidiary of IIJ Global Solutions Inc., a subsidiary of IIJ, was established on January 6, 2012, and it will serve as a contact point for providing the above-mentioned services to the Japanese companies in China.
Comments & Business Outlook
Third Quarter 2011 Results
Revenues were JPY70,752 million, up 24.6% YoY.
Net income attributable to IIJ was JPY2,390 million, up 19.7% YoY (JPY1,997 million in 3Q10).
"Outsourcing trend for Japanese IT systems has been a tailwind for us. Our business continued to show steady growth and we remain confident with our overall business strategy. For this fiscal year, we have some cost burden related to our new services and projects, especially cloud computing, FX services and ATM operation business, yet they are showing good progress so far and would contribute to income growth next fiscal year," said Koichi Suzuki, President and CEO of IIJ.
"Regarding our cloud computing service "IIJ GIO", the numbers of clients are continuously increasing and leveraging our client bases, we are now providing "IIJ GIO" to many blue-chip companies such as NTT DOCOMO, Nippon Life Insurance, Sumitomo Forestry, Japan Mint, Tokyo Stock Exchange, Ricoh and more. Transaction volumes from Social Game Provider are also increasing alongside with their increasing usage. Cloud computing revenues for the 9 months ended December 2011 has reached over 2 billion yen."
"Related to our global business expansion, IIJ-Global has established a subsidiary in Shanghai, China in January 2012. As a Group, in effort to meet and supply demands from Japanese companies that are making inroads into foreign market, we will continue to expand our global network services. We are now providing private cloud computing service in the United States to our largest Japanese Social Game client and we expect to bring our cloud computing service to the Asian region soon."
"Systems construction revenues for this third quarter decreased YoY as orders received in the second quarter were low affected by the weak Japanese economic situation. However, we accumulated order backlogs during this third quarter and expect revenues to realize going forward."
FY2011 Financial Targets
During the nine months ended December 31, 2011, our revenues, especially for systems integration and ATM operation business were below our initial target. Systems integration projects were generally mid- to-small sizes reflecting the cautious attitude towards systems investment due to weak Japanese economic situation. As for ATM operation business, revenue and income are continuously improving quarter by quarter with the increasing number of ATMs in place, but the progress was slower than our initial expectation. Profit level is in line with our initial target due to cost control, despite the increase in initial investment related to our cloud computing services.
Considering our FY2011 nine months results and the weak order backlog for systems construction and equipment sales, we changed our full FY2011 revenue target from JPY1,000 million to JPY970 million. Targets for operating income, income before income tax expense and net income attributable to IIJ remain unchanged.
Comments & Business Outlook
First Quarter 2011 Results
Revenues were JPY23,362 million ($290 million), up 47.7% YoY. Our overall business grew and there were additional revenue from IIJ Global Solutions ("IIJ-Global"), a consolidated subsidiary from Sep. 1, 2010. Network service was up 66.8% YoY and systems integration ("SI") was up 15.4% YoY.
Operating income was JPY915 million ($11 million), up 244.2% YoY due to IIJ-Global, increase in gross margin for our network service and the decrease in operating loss related to the ATM operation business.
Net income attributable to IIJ was JPY512 million ($6 million), up 107.4% YoY.
"We recorded a strong and very encouraging first quarter growth in a volatile economic environment. Revenue and operating income for this quarter was the highest 1st quarter results recorded," said Koichi Suzuki, President and CEO of IIJ. "In addition to the contributions from IIJ-Global, we have seen continuous growth in our overall business, including SI, despite the weakened Japanese economic momentum after the March11 Earthquake. Followed by various outsourcing needs, our recurring revenues continued to accumulate and contributed to steady business growth."
"As for our cloud computing service, it continued to deliver strong performance from the first quarter. Although cloud computing services have just begun in Japan and our customers are mostly Social Application Providers at the moment, we are helping more Japanese blue-chip companies build their new systems using our cloud computing service. Currently, we are servicing nearly 600 cloud computing projects and monthly revenue from our cloud computing services for June 2011 has reached over JPY180 million from JPY120 million for March 2011. For FY2011, we target our cloud computing service to earn over JPY3 billion in revenues."
"Due to stronger demands, we will further invest in cloud computing-related facilities such as the 'Matsue Data Center' and other service facilities to drive future growth and augment competitive advantage."
"In addition, we have opened the new lease based data center in the Kansai region, the 'Kozu Data Center', to meet the increasing demands for data center facilities in relation to BCP (Business Continuity Plan) and disaster recovery needs."
"For the coming quarters, we expect our outsourcing services and cloud computing-related services to grow steadily. We will continue to be best positioned as one of the leading total network solutions provider in Japan for those in need for network service, outsourcing service and systems integration."
