Internet Initiative Japan Inc. ("IIJ") (Nasdaq:IIJI) (TSE:3774)
today announced its full year ("FY2011") and 4th quarter ("4Q11")
consolidated financial results for the fiscal year ended March 31,
2012.1
Highlights of Financial
Results for FY2011 |
|
FY2011 Actual
Results |
FY2012
Target |
Revenues |
JPY97,315 million ($1,180.9 million) |
JPY107,000 million |
Operating Income |
JPY6,353 million ($77.1
million) |
JPY7,500 million |
Net Income attributable to IIJ |
JPY3,641 million ($44.1 million) |
JPY4,000 million |
- Revenues were up 18.1% YoY. Internet connectivity services for
corporate use, outsourcing services, SI operation and maintenance
such as cloud computing, and WAN services revenues continued to
grow.
- Operating income was up 53.4% YoY. In addition to the increase
of gross margin of network services, IIJ-Global's full year
operation results contributed to operating income
growth.
- Net income attributable to IIJ was JPY3,641 million, up 13.7 %
YoY.
- Revised the year-end dividend plan from previous JPY1,500 to
JPY1,750 per share of common stock2 along with the increase in
income.
Financial Targets for FY2012
- IIJ targets revenues of JPY107 billion, operating income of
JPY7.5 billion, income before income tax expense (benefit) of
JPY6.9 billion and net income attributable to IIJ of JPY4.0 billion
for FY2012.
- IIJ targets cash dividend of JPY3,500 per share for FY2012
(JPY1,750 cash dividend for interim-period and fiscal year-end,
respectively.)
Overview of FY2011 Financial Results and Business
Outlook
"FY2011 results were satisfactory to us with revenues and income
largely increasing. In addition to the good financial results, we
saw good progress with our new services and businesses we've
invested in, such as cloud computing services and ATM operation
business. We can expect another double-digit growth the following
year," said Koichi Suzuki, President and CEO of IIJ.
"Today's results demonstrate our successful strategy," continued
Suzuki. "Combining our over 15 years of experience providing
outsourcing services, pioneering technological skills in developing
network services and our strong relationships with Japanese blue
chip clients, we have been successful in attracting outsourcing and
network service demands. Broadband services are growing as data
traffic increases. Outsourcing services such as data center and
security related services are growing fast along with customers'
needs for professional IT support. Our cloud computing service "IIJ
GIO" has also continued its revenue growth during its second year
of service. IIJ GIO increased its number of clients and revenue for
FY2011 reached over JPY3.1 billion compared to JPY0.6 billion the
previous year."
"We have also strengthened our global network services towards
the growing demands from Japanese companies that are heading into
global markets. We are now prepared to provide Cloud computing
services in the United States and in China together with global
internet-VPN service and bilingual help desk service. We have also
established a subsidiary and a representative office in the Asian
region.
"As a result, combined with the full contribution of IIJ Global
Solutions which we acquired in September 2010, our FY2011 revenues
increased by 18.1% YoY and operating income increased by 53.4% YoY.
Although there were initial cost burden related to our new services
and projects, especially cloud computing services, gross margin
related to network service increased. In addition to that, ATM
operation business which we have been engaging as a new
supplemental growth driver nearly reached its break-even point in
4Q11."
1 Unless otherwise stated, all financial figures discussed in
this announcement are prepared in accordance with U.S. GAAP. All
financial figures are unaudited and consolidated. The translation
of Japanese yen into U.S. dollars is solely for the convenience of
readers outside of Japan. The rate used for the translation was
JPY82.41 per US$1.00, which was the noon buying rate on March 30,
2012.
2 IIJ's 1 common stock is equivalent to 400 ADSs
FY2011 Financial Results
Summary |
|
|
|
|
|
|
|
Operating Results
Summary |
|
FY2010 |
FY2011 |
YoY % change |
|
JPY millions |
JPY millions |
|
Total Revenues |
82,418 |
97,315 |
18.1 |
Network
Services |
51,662 |
63,410 |
22.7 |
SI |
29,444 |
31,469 |
6.9 |
Equipment
Sales |
796 |
1,112 |
39.6 |
ATM Operation
Business |
516 |
1,324 |
156.3 |
Total Costs |
65,828 |
77,326 |
17.5 |
Network
Services |
41,678 |
49,985 |
19.9 |
SI |
22,467 |
24,979 |
11.2 |
Equipment
Sales |
683 |
980 |
43.5 |
ATM Operation
Business |
1,000 |
1,382 |
38.2 |
SG&A Expenses and
R&D |
12,449 |
13,636 |
9.5 |
Operating Income |
4,141 |
6,353 |
53.4 |
Income before Income Tax
Expense |
3,834 |
5,976 |
55.9 |
Net income attributable to
IIJ |
3,203 |
3,641 |
13.7 |
|
|
Segment
Summary |
|
|
FY2010 |
FY2011 |
|
|
JPY millions |
JPY millions |
|
Net Revenues |
82,418 |
97,315 |
|
Network services
and SI business |
82,357 |
96,497 |
|
ATM operation
business |
516 |
1,324 |
|
Elimination |
455 |
506 |
|
Operating Income
(Loss) |
4,141 |
6,353 |
|
Network service
and SI business |
4,813 |
6,631 |
|
ATM operation
business |
(643) |
(194) |
|
Elimination |
29 |
84 |
|
We have omitted segment analysis because most of our
revenues are dominated by Network services and SI business.
FY2011 Results of Operation
Revenues
Revenues were JPY97,315 million, up 18.1% YoY. In addition to
the full year contribution from IIJ-Global of JPY26,118 million
(JPY15,094 million for FY2010 (7 months)), network services
revenues contributed to the total revenue growth.
Network Services revenue were JPY63,410 million, up 22.7%
YoY.
Revenues for Internet connectivity services for corporate use
were JPY14,707 million, up 5.0% YoY as new IP Service contracts
accumulated and volume charge revenues increased.
Revenues for Internet connectivity services for home use were
JPY 5,717 million, down 12.4% YoY.
WAN Services revenue was JPY25,667 million, up 59.4% YoY due to
the full year contribution of IIJ-Global as well as the increase in
number of new contracts of IIJ's WAN services.
Outsourcing services revenue were JPY17,319 million, up 15.2%
YoY. Services such as data center services, IIJ GIO Hosting Package
Service and security-related services grew continuously.
Number of
Contracts for Connectivity Services |
|
as of 3/31/2011 |
as of 3/31/2012 |
YoY Change |
Internet Connectivity Services
(Corporate Use) |
86,803 |
93,807 |
7,004 |
IP
Service (-99Mbps) |
908 |
923 |
15 |
IP
Service (100Mbps-999Mbps) |
305 |
344 |
39 |
IP
Service (1Gbps--) |
126 |
132 |
6 |
IIJ
Data Center Connectivity Service |
305 |
323 |
18 |
IIJ
FiberAccess/F and IIJ DSL/F |
42,851 |
44,510 |
1,659 |
IIJ Mobile
Service3 |
40,988 |
46,329 |
5,341 |
Others |
1,320 |
1,246 |
(74) |
Internet Connectivity Services
(Home Use) |
374,328 |
397,191 |
22,863 |
Under IIJ
Brand |
41,176 |
42,721 |
1,545 |
hi-ho |
151,828 |
153,901 |
2,073 |
OEM |
181,324 |
200,569 |
19,245 |
Total Contracted
Bandwidth |
733.4 Gbps |
857.7 Gbps |
124.3Gbps |
|
Network Services
Revenues Breakdown |
|
FY2010 |
FY2011 |
YoY % change |
|
JPY millions |
JPY millions |
|
Internet Connectivity Service
(Corporate Use) |
14,005 |
14,707 |
5.0 |
IP
Service4 |
8,962 |
9,299 |
3.8 |
IIJ
FiberAccess/F and IIJ DSL/F |
3,047 |
3,151 |
3.4 |
IIJ Mobile
Service5 |
1,738 |
2,013 |
15.8 |
Others |
258 |
244 |
(5.2) |
Internet Connectivity Service
(Home Use) |
6,525 |
5,717 |
(12.4) |
Under IIJ
Brand |
989 |
911 |
(7.8) |
hi-ho |
4,996 |
4,222 |
(15.5) |
OEM |
540 |
584 |
8.1 |
WAN Services |
16,100 |
25,667 |
59.4 |
Outsourcing
Services |
15,032 |
17,319 |
15.2 |
Total Network
Services |
51,662 |
63,410 |
22.7 |
|
|
|
|
3 Contracts of IIJ Mobile
Service are of mobile data communication service for corporate
use. |
4 IP Service revenues include
revenues from the Data Center Connectivity Service. |
5 Revenue from mobile data
communication service for home use is included in Internet
Connectivity service (home use). |
SI revenues were JPY31,469 million, up 6.9% YoY.
Systems construction revenue, a one-time revenue, increased by 0.5%
to JPY11,997 million. Projects were mainly mid- to small sized
construction projects. Systems operation and maintenance revenue, a
recurring revenue, increased by 11.2% to JPY19,472 million. The
increase was mainly due to the steady increase in IIJ GIO Component
service.
The order backlog for systems construction and
equipment sales was JPY3,839 million, up 1.1% YoY. The order
backlog for systems operation and maintenance was JPY13,014
million, up 14.7% YoY.
Equipment sales revenues were JPY1,112 million, up 39.6%
YoY.
ATM Operation Business revenues were JPY1,324 million (JPY516
million in FY2010). The ATM operation business is operated by Trust
Networks Inc., IIJ's consolidated subsidiary, and it receives a
commission for each bank withdrawal transaction when a customer
uses its serviced ATMs. As of May 15, 2012, 440 ATMs are
placed.
Cost and expense
Cost of revenues was JPY77,326 million, up 17.5% YoY. Cost of
revenues related to IIJ-Global was JPY20,894 million (JPY12,137
million for FY2010(7 months)).
Cost of Network Services revenue was JPY49,985
million, up 19.9% YoY mainly due to the increase in circuit-related
costs of IIJ-Global and outsourcing-related costs. Gross margin for
network services was JPY13,425 million, up 34.5% YoY and gross
margin ratio was 21.2%, up 1.8 points YoY.
Cost of SI revenues was JPY24,979 million, up 11.2%
YoY. The increase was mainly due to the increase in both
outsourcing cost and network operation related cost mostly for IIJ
GIO. Gross margin for SI was JPY6,491 million, down 7.0% YoY and
gross margin ratio was 20.6%.
Cost of Equipment Sales revenues was JPY980 million, up 43.5%
YoY. Gross margin was JPY131 million and gross margin ratio was
11.8%.
Cost of ATM Operation Business revenues was JPY1,382 million, up
38.2% YoY mainly due to the increase in the number of newly placed
ATMs. Gross loss for ATM operation business decreased to JPY58
million from JPY484 million in FY2010 due to the increase in
revenues.
SG&A and R&D Expenses
SG&A and R&D expenses were JPY13,636 million, up 9.5%
YoY. SG&A expenses related to IIJ-Global was JPY3,037 million
(JPY1,767 million for FY2010(7 months)). The ratio of SG&A and
R&D expenses to total revenue was 14.0%, down 1.1 points
compared to the ratio of FY2010.
Sales and marketing expenses were JPY7,947 million,
up 20.1% YoY mainly due to the increase in personnel-related
expenses, depreciation and amortization, and advertisement
expenses. Amortization of customer relationship related to
IIJ-Global was JPY425 million (JPY255 million for FY2010 (7
months)).
General and administrative expenses were JPY5,300
million, down 3.3% YoY. While personnel-related expense increased,
rent expense decrease as a result of allocation change.
Research and development expenses were JPY389 million, up 9.9%
YoY.
Operating income
Operating income was JPY6,353 million, up 53.4% YoY
as there were full year contribution from IIJ-Global, increase in
gross margin of network services revenues and the decrease in gross
loss of ATM operation business.
Other income (expenses)
Other income (expenses) was expense of JPY377 million (expense
of JPY307 million for FY2010) mainly due to interest expenses.
Income before income tax expenses
Income before income tax expenses was JPY5,976 million, up 55.9%
YoY (JPY3,834 million for FY2010).
Net Income
Income tax expense was JPY2,525 million (JPY956
million for FY2010).
Equity in net income of equity method investees was JPY124
million (JPY123 million for FY2010) mainly due to income of
Internet Multifeed Co. and Internet Revolution, Inc.
Net income was JPY3,575 million, up 19.1% YoY (JPY3,001 million
for FY2010).
Net income attributable to IIJ
Net loss attributable to noncontrolling interests was JPY66
million (JPY202 million for FY2010) related to Trust Networks Inc.
Net income attributable to IIJ was JPY3,641 million, up 13.7%
YoY (JPY3,203 million for FY2010).
FY2011 Financial Condition
Balance Sheets
As of March 31, 2012, the balance of total assets
was JPY73,493 million, increased by JPY2,020 million from the
balance as of March 31, 2011.
For current assets as of March 31, 2012, as
compared to the respective balances as of March 31, 2011, accounts
receivable decreased by JPY709 million. As for noncurrent assets,
as compared to each of the respective balances as of March 31,
2011, property and equipment increased by JPY3,255 million,
resulting from the increase of investment in servers, network
equipment and facilities for cloud computing service and others,
prepaid expense –noncurrent increased by JPY350 million and other
intangible assets- net decreased by JPY658 million. As for current
liabilities, as compared to each of the respective balances as of
March 31, 2011, accounts payable decreased by JPY3,821 million and
income taxes payable increased by JPY1,855 million.
As for the bank borrowings, as compared to the
respective balances as of March 31, 2011, the balance of short-term
borrowings decreased by JPY4,430 million, long-term
borrowings-current portion increased by JPY1,010 million and
long-term borrowing increased by JPY1,990 million, respectively.
Bank borrowings to purchase the stocks of IIJ-Global was partially
repaid and refinanced. Capital lease obligations-noncurrent
increased by JPY1,115 million.
As of March 31, 2012, the balance of other
investments was JPY2,938 million, an increase of JPY144 million
from the balance as of March 31, 2011. The breakdown of other
investments were JPY1,958 million in nonmarketable equity
securities, JPY861 million in available-for-sale securities and
JPY119 million in other.
As of March 31, 2012, the balance of non-amortized
intangible assets (excluding telephone rights) such as goodwill was
JPY5,943 million, and the breakdown of non-amortized intangible
assets were JPY5,788 million in goodwill and JPY155 million in
trademark. As of March 31, 2012, the balance of amortized
intangible assets, which was customer relationships, was JPY5,223
million.
Total IIJ shareholders' equity as of March 31, 2012
was JPY32,688 million, an increase of JPY3,036 million from the
balance as of March 31, 2011. IIJ Shareholders' equity ratio (total
IIJ shareholders' equity/total assets) as of March 31, 2012 was
44.5%.
Cash Flows
Cash and cash equivalents as of March 31, 2012 were JPY13,537
million compared to JPY13,314 million as of March 31, 2011.
Net cash provided by operating activities for FY2011 was
JPY11,659 million compared to net cash provided by operating
activities of JPY12,564 million for FY2010. Operating income
increased YoY mainly due to the full year operating income from
IIJ-Global contributed, gross margin of network services revenues
increased and gross loss of ATM operation business decreased. In
addition, there were effects of changes in operating assets and
liabilities such as decrease in accounts payable in relation to
payment for equipments for systems integration projects.
Net cash used in investing activities for FY2011
was JPY5,954 million compared to net cash used in investing
activities of JPY13,493 million for FY2010, mainly due to payments
for purchase of property and equipment of JPY6,167 million
(JPY3,839 million for FY2010). As for FY2010, there was payment for
the acquisition of IIJ-GS for JPY9,170 million.
Net cash used in financing activities for FY2011
was JPY5,464 million compared to net cash provided by financing
activities of JPY5,521 million for FY2010, mainly due to proceeds
from issuance of short-term borrowings with initial maturities over
three months and long-term borrowings of JPY3,370
million, repayments of short-term borrowings with initial
maturities over three months of JPY620 million and net decrease of
short-term borrowings with initial maturities less than three
months of JPY 4,180 million (net proceeds from issuance of
short-term borrowings of JPY8,980 million for FY2010), principal
payments under capital leases of JPY3,426 million (JPY2,989 million
for FY2010) and JPY608 million for FY2010 year-end and FY2011
interim dividends payments.
FY2012 Financial Targets
Our targets for the fiscal year ending March
31, 2013 are as follows: |
|
|
|
|
|
|
|
|
(JPY in millions) |
|
Revenues |
Operating
Income |
Income before Income Tax
Expense (Benefit) |
Net Income attributable to
IIJ |
1H FY2012 Target |
50,500 |
2,700 |
2,500 |
1,400 |
Full FY2012
Target |
107,000 |
7,500 |
6,900 |
4,000 |
We target revenue of JPY107 billion yen, up 10.0% YoY. We expect
revenues from our network services to continue to increase, IIJ GIO
revenue to largely increase (to reach over JPY7.0 billion from
JPY3.1 billion for FY2011), additional revenues from the global
business, and ATM operation business revenues to increase (to
become almost double from JPY1.3 billion for FY2011) along with the
increase in number of newly placed ATMs.
For operating income, we target JPY7.5 billion, up 18.0 % YoY
with expectations for continuous gross margin increase in network
services, and by IIJ GIO and ATM operating business to turning into
positive in FY2012 from their deficits in FY2011.
For income before income tax expense (benefit), considering
interest and other expenses, we target JPY6.9 billion, up 15.5%
YoY.
For net Income attributable to IIJ, we target JPY4.0 billion, up
9.9% YoY. FY2012 Dividend Forecast
Our FY2012 dividend forecasts are as
follows: |
|
|
|
|
|
|
|
|
Interim |
Year-end |
Full-Year |
FY2012 Dividend
(forecast) |
JPY1,750
(forecast) |
JPY1,750
(forecast) |
JPY3,500
(forecast) |
FY2011 Dividend
(scheduled) |
JPY1,500 |
JPY1,750
(scheduled) |
JPY3,250
(scheduled) |
While we give full consideration in securing our funds to
strengthen our financial position and to prepare for our mid-
to-long term operation and business development, we seek to achieve
stable and continuous dividends to shareholders.
Based on our Company's article of incorporation, we plan to pay
our dividend twice a year, at interim and at fiscal year-end. The
dividends for interim and fiscal year-end are decided at the
Company's board of directors and the general meeting of
stockholders, respectively.
As for the FY2011 year-end dividend, we plan to revise our
year-end dividend from JPY1,500 to JPY1,750 per share of our common
stock. We have paid interim dividend of JPY1,500 per share of
common stock for FY2011 interim period. FY2011 total dividend is
scheduled to be JPY3,250.
For FY2012, we target to pay total dividend of JPY3,500 per
share of common stock (JPY1,750 for the interim period and JPY1,750
for the fiscal year-end).
Reconciliation of Non-GAAP Financial
Measures
The following table summarizes the reconciliation of adjusted
EBITDA to net income attributable to IIJ in our consolidated
statements of income that are prepared in accordance with U.S.
GAAP.
Adjusted
EBITDA |
|
FY2010 |
FY2011 |
|
JPY millions |
JPY millions |
Adjusted EBITDA |
10,210 |
13,534 |
Depreciation and Amortization
6 |
(5,851) |
(7,144) |
Impairment loss on other
intangible assets |
(218) |
(37) |
Operating Income |
4,141 |
6,353 |
Other Income
(Expense) |
(307) |
(377) |
Income Tax
Expense |
956 |
2,525 |
Equity in Net Income of Equity
Method Investees |
123 |
124 |
Net income |
3,001 |
3,575 |
Net loss attributable to
noncontrolling interests |
202 |
66 |
Net Income attributable to
IIJ |
3,203 |
3,641 |
|
CAPEX |
|
FY2010 |
FY2011 |
|
JPY millions |
JPY millions |
CAPEX, including capital
leases |
6,752 |
10,917 |
Acquisition of Assets by
Entering into Capital Leases |
2,913 |
4,750 |
Purchase of Property and
Equipment |
3,839 |
6,167 |
6 Depreciation and amortization includes
impairment loss on other intangible assets. (See IIJ's consolidated
financial statements for details). |
Presentation
Presentation Materials will be posted on our web site
(http://www.iij.ad.jp/en/IR/) on May 15, 2012.
About Internet Initiative Japan Inc.
Founded in 1992, IIJ is one of Japan's leading Internet-access
and comprehensive network solutions providers. IIJ and its group of
companies provide total network solutions that mainly cater to
high-end corporate customers. IIJ's services include high-quality
systems integration and security services, Internet access,
hosting/housing, and content design. Moreover, IIJ has built one of
the largest Internet backbone networks in Japan, and between Japan
and the United States. IIJ listed on the U.S. NASDAQ Stock Market
in 1999 and on the First Section of the Tokyo Stock Exchange in
2006.
The Internet Initiative Japan Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4613
Statements made in this press release 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 about its business and the industry. These
forward-looking statements, such as statements regarding FY2008
revenues and operating and net profitability, are subject to
various risks, uncertainties and other factors that could cause
IIJ's actual results to differ materially from those contained in
any forward-looking statement. These risks, uncertainties and other
factors include: IIJ's ability to maintain and increase revenues
from higher-margin services such as systems integration and
outsourcing services; the possibility that revenues from
connectivity services may decline substantially as a result of
competition and other factors; the ability to compete in a rapidly
evolving and competitive marketplace; the impact on IIJ's profits
of fluctuations in costs such as backbone costs and subcontractor
costs; the impact on IIJ's profits of fluctuations in the price of
available-for-sale securities; the impact of technological changes
in its industry; IIJ's ability to raise additional capital to cover
its indebtedness; the possibility that NTT, IIJ's largest
shareholder, may decide to exercise substantial influence over IIJ;
and other risks referred to from time to time in IIJ's filings on
Form 20-F of its annual report and other filings with the United
States Securities and Exchange Commission.
Tables to follow
Internet Initiative
Japan Inc. |
Consolidated Balance
Sheets (Unaudited) |
(As of March 31, 2011
and March 31, 2012) |
|
|
|
|
|
As of March 31, 2011 |
As of March 31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
ASSETS |
|
|
|
CURRENT ASSETS: |
|
|
|
Cash and cash equivalents |
13,313,615 |
164,262 |
13,536,824 |
Accounts receivable, net of allowance for
doubtful accounts of JPY 44,002 thousand and JPY
107,919 thousand at March 31, 2011 and March 31, 2012,
respectively |
16,431,374 |
190,779 |
15,722,135 |
Inventories |
601,088 |
9,126 |
752,075 |
Prepaid expenses |
1,680,158 |
22,429 |
1,848,344 |
Deferred tax assets -Current |
978,263 |
11,399 |
939,370 |
Other current assets, net of allowance
for doubtful accounts of JPY 43,640 thousand and JPY
10,732 thousand at March 31, 2011 and March 31, 2012,
respectively |
1,533,185 |
10,818 |
891,560 |
Total current assets |
34,537,683 |
408,813 |
33,690,308 |
INVESTMENTS IN EQUITY METHOD INVESTEES |
1,251,990 |
17,069 |
1,406,634 |
OTHER INVESTMENTS |
2,794,046 |
35,653 |
2,938,146 |
PROPERTY AND EQUIPMENT, net of accumulated
depreciation and amortization of JPY 21,891,126
thousand and JPY 25,693,163 thousand at March 31, 2011
and March 31, 2012, respectively |
16,480,724 |
239,480 |
19,735,546 |
GOODWILL |
5,788,333 |
70,238 |
5,788,333 |
OTHER INTANGIBLE ASSETS -Net |
6,054,503 |
65,483 |
5,396,469 |
GUARANTEE DEPOSITS |
1,889,796 |
23,053 |
1,899,815 |
DEFERRED TAX ASSETS -Noncurrent |
16,393 |
301 |
24,760 |
NET INVESTMENT IN SALES-TYPE
LEASES —Noncurrent |
1,266,409 |
11,351 |
935,446 |
Prepaid expenses —Noncurrent |
1,187,219 |
18,650 |
1,536,932 |
OTHER ASSETS, net of allowance for doubtful
accounts of JPY81,448 thousand and JPY86,388 thousand
at March 31, 2011 and March 31, 2012, respectively, and net
of loan loss valuation allowance of JPY 16,701thousand at
March 31, 2011. |
205,893 |
1,709 |
140,857 |
TOTAL |
71,472,989 |
891,800 |
73,493,246 |
|
|
|
|
As of March 31, 2011 |
As of March 31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
CURRENT LIABILITIES: |
|
|
|
Short-term borrowings |
13,430,000 |
109,210 |
9,000,000 |
Long-term borrowings -Current
portion |
-- |
12,256 |
1,010,000 |
Capital lease obligations -Current
portion |
2,787,955 |
36,370 |
2,997,292 |
Accounts payable |
13,574,152 |
118,346 |
9,752,923 |
Income taxes payable |
355,183 |
26,818 |
2,210,089 |
Accrued expenses |
1,889,891 |
27,634 |
2,277,307 |
Deferred income -Current |
1,667,336 |
18,147 |
1,495,468 |
Other current liabilities |
460,934 |
8,705 |
717,342 |
Total current liabilities |
34,165,451 |
357,486 |
29,460,421 |
LONG-TERM BORROWINGS |
-- |
24,148 |
1,990,000 |
CAPITAL LEASE OBLIGATIONS -Noncurrent |
3,626,565 |
57,532 |
4,741,241 |
ACCRUED RETIREMENT AND PENSION COSTS
-Noncurrent |
1,567,050 |
21,911 |
1,805,683 |
DEFERRED TAX LIABILITIES -Noncurrent |
609,412 |
7,915 |
652,280 |
DEFERRED INCOME -Noncurrent |
1,270,984 |
18,774 |
1,547,159 |
OTHER NONCURRENT LIABILITIES |
592,177 |
7,283 |
600,215 |
Total Liabilities |
41,831,639 |
495,049 |
40,796,999 |
COMMITMENTS AND CONTINGENCIES |
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY: |
|
|
|
Common-stock—authorized, 377,600 shares;
issued and outstanding, 206,478 shares at March 31,
2011 and March 31, 2012 |
16,833,847 |
204,269 |
16,833,847 |
Additional paid-in capital |
27,318,912 |
330,789 |
27,260,318 |
Accumulated deficit |
(14,023,259) |
(133,362) |
(10,990,348) |
Accumulated other comprehensive loss |
(85,134) |
(285) |
(23,533) |
Treasury stock—3,794 shares held by the
company at March 31, 2011 and March 31, 2012,
respectively |
(392,079) |
(4,758) |
(392,079) |
Total Internet Initiative Japan Inc.
shareholders' equity |
29,652,287 |
396,653 |
32,688,205 |
NONCONTROLLING INTERESTS |
(10,937) |
98 |
8,042 |
Total equity |
29,641,350 |
396,751 |
32,696,247 |
TOTAL |
71,472,989 |
891,800 |
73,493,246 |
|
|
|
|
|
|
|
|
(Note1) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable transfers
in foreign currencies as certified for customs purposes by the
Federal Reserve Bank of New York prevailing as of March 30,
2012. |
|
|
|
(Note2) The above presentation as
of March 31, 2011 has been changed to conform to the presentation
as of March 31, 2012. |
|
|
|
|
Internet Initiative
Japan Inc. |
Consolidated Statements
of Income (Unaudited) |
(For the fiscal year
ended March 31, 2011 and March 31, 2012) |
|
|
|
|
|
Fiscal Year Ended March 31, 2011 |
Fiscal Year Ended March
31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
REVENUES: |
|
|
|
Network services: |
|
|
|
Internet connectivity services (corporate
use) |
14,004,608 |
178,455 |
14,706,511 |
Internet connectivity services (home
use) |
6,525,128 |
69,378 |
5,717,417 |
WAN services |
16,100,046 |
311,449 |
25,666,524 |
Outsourcing services |
15,031,785 |
210,156 |
17,318,954 |
Total |
51,661,567 |
769,438 |
63,409,406 |
Systems integration: |
|
|
|
Systems construction |
11,936,581 |
145,585 |
11,997,680 |
Systems operation and maintenance |
17,507,099 |
236,278 |
19,471,641 |
Total |
29,443,680 |
381,863 |
31,469,321 |
Equipment sales |
796,385 |
13,490 |
1,111,722 |
ATM operation business |
516,574 |
16,068 |
1,324,156 |
Total revenues |
82,418,206 |
1,180,859 |
97,314,605 |
COST AND EXPENSES: |
|
|
|
Cost of network services |
41,678,052 |
606,538 |
49,984,821 |
Cost of systems integration |
22,466,436 |
303,102 |
24,978,607 |
Cost of equipment sales |
683,285 |
11,895 |
980,279 |
Cost of ATM operation business |
1,000,470 |
16,772 |
1,382,194 |
Total cost |
65,828,243 |
938,307 |
77,325,901 |
Sales and marketing |
6,616,013 |
96,431 |
7,946,852 |
General and administrative |
5,479,176 |
64,308 |
5,299,608 |
Research and development |
353,732 |
4,717 |
388,761 |
Total cost and expenses |
78,277,164 |
1,103,763 |
90,961,122 |
OPERATING INCOME |
4,141,042 |
77,096 |
6,353,483 |
OTHER INCOME (EXPENSE): |
|
|
|
Interest income |
23,113 |
420 |
34,602 |
Interest expense |
(268,129) |
(3,632) |
(299,271) |
Foreign exchange losses |
(31,975) |
(55) |
(4,549) |
Net gains (losses) on sales of other
investments -net |
105,252 |
(38) |
(3,154) |
Losses on write-down of other
investments |
(179,829) |
(1,937) |
(159,592) |
Other -net |
44,515 |
664 |
54,701 |
Other income (expense) -net |
(307,053) |
(4,578) |
(377,263) |
INCOME FROM OPERATIONS BEFORE INCOME
TAX EXPENSE AND EQUITY IN NET INCOME OF EQUITY METHOD
INVESTEES |
3,833,989 |
72,518 |
5,976,220 |
INCOME TAX EXPENSE |
955,697 |
30,645 |
2,525,486 |
EQUITY IN NET INCOME OF EQUITY METHOD
INVESTEES |
122,667 |
1,502 |
123,776 |
NET INCOME |
3,000,959 |
43,375 |
3,574,510 |
LESS: NET LOSS ATTRIBUTABLE TO
NONCONTROLLING INTERESTS |
202,409 |
806 |
66,453 |
NET INCOME ATTRIBUTABLE TO INTERNET
INITIATIVE JAPAN INC. |
3,203,368 |
44,181 |
3,640,963 |
|
|
|
|
Fiscal Year Ended March 31, 2011 |
Fiscal Year Ended March
31, 2012 |
NET INCOME PER SHARE |
|
|
|
BASIC WEIGHTED-AVERAGE NUMBER OF
SHARES (shares) |
202,644 |
|
202,684 |
DILUTED WEIGHTED-AVERAGE NUMBER OF
SHARES (shares) |
202,644 |
|
202,782 |
BASIC WEIGHTED-AVERAGE NUMBER OF
ADS EQUIVALENTS (ADSs) |
81,057,600 |
|
81,073,600 |
DILUTED WEIGHTED-AVERAGE NUMBER OF
ADS EQUIVALENTS (ADSs) |
81,057,600 |
|
81,112,800 |
BASIC NET INCOME PER SHARE (JPY /
U.S. Dollars / JPY) |
15,807.86 |
217.98 |
17,963.74 |
DILUTED NET INCOME PER SHARE (JPY /
U.S. Dollars / JPY) |
15,807.86 |
217.87 |
17,955.06 |
BASIC NET INCOME PER ADS
EQUIVALENT (JPY / U.S. Dollars / JPY) |
39.52 |
0.54 |
44.91 |
DILUTED NET INCOME PER ADS
EQUIVALENT (JPY / U.S. Dollars / JPY) |
39.52 |
0.54 |
44.89 |
|
|
|
|
(Note) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable transfers
in foreign currencies as certified for customs purposes by the
Federal Reserve Bank of New York prevailing as of March 30,
2012. |
|
|
|
|
Internet Initiative
Japan Inc. |
Consolidated
Statements of Shareholders' Equity (Unaudited) |
(For the fiscal
year ended March 31, 2011 and March 31, 2012) |
|
|
|
|
|
|
|
|
|
|
|
Total equity |
Comprehensive income (loss) |
Internet Initiative Japan
Inc. shareholders' equity |
NON CONTROLLING INTERESTS |
|
|
|
Accumulated deficit |
Accumulated other comprehensive
income (loss) |
Shares of common stock
outstanding |
Common Stock |
Treasury Stock |
Additional Paid-in Capital |
|
|
Thousands of JPY |
Thousands of JPY |
Thousands of JPY |
Thousands of JPY |
Shares |
Thousands of JPY |
Thousands of JPY |
Thousands of JPY |
Thousands of JPY |
BALANCE, APRIL 1, 2010 |
27,363,703 |
|
(16,720,092) |
168,769 |
206,478 |
16,833,847 |
(406,547) |
27,443,600 |
44,126 |
Subsidiary stock issuance |
-- |
|
|
|
|
|
|
(147,346) |
147,346 |
Comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
Net Income (loss) |
3,000,959 |
3,000,959 |
3,203,368 |
|
|
|
|
|
(202,409) |
Other Comprehensive loss, net of
tax |
(253,903) |
(253,903) |
|
(253,903) |
|
|
|
|
|
Total comprehensive income |
2,747,056 |
2,747,056 |
|
|
|
|
|
|
|
Dividends paid |
(506,535) |
|
(506,535) |
|
|
|
|
|
|
Disposal of Treasury stock |
37,126 |
|
|
|
|
|
14,468 |
22,658 |
|
BALANCE, MARCH 31, 2011 |
29,641,350 |
|
(14,023,259) |
(85,134) |
206,478 |
16,833,847 |
(392,079) |
27,318,912 |
(10,937) |
Purchase of noncontrolling interests of
consolidated subsidiaries |
(5) |
|
|
|
|
|
|
(19,395) |
19,390 |
Subsidiary stock issuance |
-- |
|
|
|
|
|
|
(66,042) |
66,042 |
Stock-based compensation |
26,843 |
|
|
|
|
|
|
26,843 |
|
Comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
Net Income (loss) |
3,574,510 |
3,574,510 |
3,640,963 |
|
|
|
|
|
(66,453) |
Other Comprehensive income, net of
tax |
61,601 |
61,601 |
|
61,601 |
|
|
|
|
|
Total comprehensive income: |
3,636,111 |
3,636,111 |
|
|
|
|
|
|
|
Dividends paid |
(608,052) |
|
(608,052) |
|
|
|
|
|
|
BALANCE, MARCH 31, 2012 |
32,696,247 |
|
(10,990,348) |
(23,533) |
206,478 |
16,833,847 |
(392,079) |
27,260,318 |
8,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
 (For the fiscal
year ended March 31, 2012 (In USD)) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity |
Comprehensive income (loss) |
Internet Initiative Japan
Inc. shareholders' equity |
NON CONTROLLING INTERESTS |
|
|
|
Accumulated deficit |
Accumulated other comprehensive
income (loss) |
Shares of common stock
outstanding |
Common Stock |
Treasury Stock |
Additional Paid-in Capital |
|
|
Thousands of USD |
Thousands of USD |
Thousands of USD |
Thousands of USD |
Shares |
Thousands of USD |
Thousands of USD |
Thousands of USD |
Thousands of USD |
BALANCE, APRIL 1, 2011 |
359,681 |
|
(170,165) |
(1,033) |
206,478 |
204,269 |
(4,758) |
331,500 |
(132) |
Purchase of noncontrolling interests of
consolidated subsidiaries |
0 |
|
|
|
|
|
|
(235) |
235 |
Subsidiary stock issuance |
-- |
|
|
|
|
|
|
(801) |
801 |
Stock-based compensation |
325 |
|
|
|
|
|
|
325 |
|
Comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
Net Income (loss) |
43,375 |
43,375 |
44,181 |
|
|
|
|
|
(806) |
Other Comprehensive income, net of
tax |
748 |
748 |
|
748 |
|
|
|
|
|
Total comprehensive income: |
44,122 |
44,122 |
|
|
|
|
|
|
|
Dividends paid |
(7,378) |
|
(7,378) |
|
|
|
|
|
|
BALANCE, MARCH 31, 2012 |
396,751 |
|
(133,362) |
(285) |
206,478 |
204,269 |
(4,758) |
330,789 |
98 |
|
|
|
|
|
|
|
|
|
|
(Note) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable transfers
in foreign currencies as certified for customs purposes by the
Federal Reserve Bank of New York prevailing as of March 30,
2012. |
|
|
|
|
|
|
|
|
|
|
Internet Initiative
Japan Inc. |
Consolidated Statements
of Cash Flows (Unaudited) |
(For the fiscal
year ended March 31, 2011 and March 31, 2012) |
|
|
|
|
|
Fiscal Year Ended March 31, 2011 |
Fiscal Year Ended March
31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
OPERATING ACTIVITIES: |
|
|
|
Net income |
3,000,959 |
43,375 |
3,574,510 |
Adjustments to reconcile net income to
net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
5,850,882 |
86,684 |
7,143,631 |
Impairment loss on other intangible
assets |
218,073 |
449 |
37,000 |
Provision for retirement and pension
costs,   less payments |
253,818 |
2,273 |
187,287 |
Provision for (reversal of) allowance for
doubtful accounts |
(10,522) |
996 |
82,046 |
Loss on disposal of property and
equipment |
23,588 |
757 |
62,398 |
Net losses (gains) on sales of other
investments |
(105,252) |
38 |
3,154 |
Impairment of other investments |
179,829 |
1,937 |
159,592 |
Gain on receipt of investment
securities |
(18,060) |
-- |
-- |
Foreign exchange losses, net |
27,309 |
172 |
14,202 |
Equity in net income of equity method
investees |
(122,667) |
(1,502) |
(123,776) |
Deferred income tax expense |
606,875 |
433 |
35,714 |
Others |
16,960 |
819 |
67,440 |
Changes in operating assets and
liabilities net of effects from acquisition of business and a
company: |
|
|
|
Decrease in accounts receivable |
429,691 |
7,606 |
626,783 |
Decrease (increase) in net investment in
sales-type lease―noncurrent |
(765,510) |
4,016 |
330,961 |
Increase in inventories, prepaid expenses
and other current and noncurrent assets |
(65,828) |
(1,959) |
(161,418) |
Increase (decrease) in accounts
payable |
1,995,375 |
(35,541) |
(2,928,912) |
Increase in income taxes payable |
27,490 |
22,358 |
1,842,553 |
Decrease (increase) in deferred
income-noncurrent |
333,548 |
(3,707) |
(305,512) |
Increase in accrued
expenses and other current and noncurrent
liabilities |
687,658 |
12,276 |
1,011,685 |
Net cash provided by
operating activities |
12,564,216 |
141,480 |
11,659,338 |
INVESTING ACTIVITIES: |
|
|
|
Purchase of property and
equipment |
(3,839,011) |
(74,838) |
(6,167,434) |
Proceeds from sales of property
and equipment |
174,334 |
4,249 |
350,136 |
Purchase of available-for-sale
securities |
(141,020) |
(3,268) |
(269,218) |
Purchase of other
investments |
(200,000) |
(2,259) |
(186,115) |
Investment in an equity method
investee |
-- |
(299) |
(24,647) |
Proceeds from sales of
available-for-sale securities |
155,571 |
2,747 |
226,346 |
Proceeds from sales of other
investments |
66,047 |
1,144 |
94,285 |
Payments of guarantee
deposits |
(686,825) |
(478) |
(39,403) |
Refund of guarantee
deposits |
165,193 |
316 |
26,045 |
Payments for refundable
insurance policies |
(22,188) |
(80) |
(6,604) |
Refund from insurance
policies |
29,642 |
521 |
42,948 |
Acquisition of a newly
controlled company, net of cash acquired |
(9,170,000) |
-- |
-- |
Other |
(24,860) |
(7) |
(594) |
Net cash used in
investing activities |
(13,493,117) |
(72,252) |
(5,954,255) |
|
Fiscal Year Ended March 31,
2011 |
Fiscal Year Ended
March 31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
FINANCING ACTIVITIES: |
|
|
|
Proceeds from issuance of short-term
borrowings with initial maturities over three months and
long-term borrowings |
1,600,000 |
40,893 |
3,370,000 |
Repayments of short-term borrowings with
initial maturities over three months |
(1,550,000) |
(7,523) |
(620,000) |
Principal payments under capital
leases |
(2,989,471) |
(41,569) |
(3,425,680) |
Net increase (decrease) in short-term
borrowings with initial maturities less than three
months |
8,930,000 |
(50,722) |
(4,180,000) |
Dividends paid |
(506,535) |
(7,378) |
(608,052) |
Proceeds from sales of
treasury stock |
37,126 |
-- |
-- |
Net cash provided by
(used in) financing activities |
5,521,120 |
(66,299) |
(5,463,732) |
|
|
|
|
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS |
(43,019) |
(220) |
(18,142) |
|
|
|
|
NET INCREASE IN CASH AND
CASH EQUIVALENTS |
4,549,200 |
2,709 |
223,209 |
CASH AND CASH
EQUIVALENTS, BEGINNING OF YEAR |
8,764,415 |
161,553 |
13,313,615 |
CASH AND CASH
EQUIVALENTS, END OF YEAR |
13,313,615 |
164,262 |
13,536,824 |
|
|
|
|
ADDITIONAL CASH FLOW INFORMATION: |
|
|
|
Interest paid |
267,750 |
3,614 |
297,862 |
Income taxes paid |
346,561 |
5,844 |
481,580 |
|
|
|
|
NONCASH INVESTING AND FINANCING
ACTIVITIES: |
|
|
|
Acquisition of assets by entering into
capital leases |
2,912,806 |
57,635 |
4,749,695 |
Facilities purchase liabilities |
1,559,343 |
8,000 |
659,266 |
Asset retirement obligation |
213,336 |
513 |
42,273 |
Acquisition of a company: |
|
|
|
Assets acquired |
14,956,137 |
-- |
-- |
Cash paid |
(9,170,000) |
-- |
-- |
Liabilities assumed |
5,786,137 |
-- |
-- |
|
|
|
|
|
|
|
|
(Note1) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable transfers
in foreign currencies as certified for customs purposes by the
Federal Reserve Bank of New York prevailing as of March 30,
2012. |
(Note2) The above presentation
for the fiscal year ended March 31, 2011 has been changed to
conform to the presentation for the fiscal year ended March 31,
2012. |
4th Quarter FY2011 Consolidated Financial Results (3
months)
The following tables are highlight data of 4th Quarter FY2011
consolidated financial results (unaudited, from January 1, 2012 to
March 31, 2012).
Operating Results
Summary |
|
4Q10 |
4Q11 |
YoY % Change |
|
JPY millions |
JPY millions |
|
Total
Revenues: |
25,622 |
26,563 |
3.7 |
Network
Services |
15,552 |
16,167 |
4.0 |
SI |
9,659 |
9,761 |
1.1 |
Equipment
Sales |
247 |
233 |
(5.6) |
ATM Operation
Business |
164 |
402 |
145.5 |
Cost of
Revenues: |
20,572 |
20,672 |
0.5 |
Network
Services |
12,474 |
12,398 |
(0.6) |
SI |
7,591 |
7,712 |
1.6 |
Equipment
Sales |
210 |
194 |
(7.7) |
ATM Operation
Business |
297 |
368 |
24.2 |
SG&A Expenses and
R&D |
3,339 |
3,535 |
5.9 |
Operating
Income |
1,711 |
2,356 |
37.7 |
Income before Income
Tax Expense |
1,659 |
2,196 |
32.4 |
Net Income
attributable to IIJ |
1,206 |
1,251 |
3.7 |
|
Connectivity and
Outsourcing Services Revenues Breakdown and Cost |
|
4Q10 |
4Q11 |
YoY % Change |
|
JPY millions |
JPY millions |
|
Internet Connectivity Service
(Corporate Use) |
3,572 |
3,787 |
6.0 |
IP
Service |
2,256 |
2,389 |
5.9 |
IIJ
FiberAccess/F and IIJ DSL/F |
782 |
799 |
2.1 |
IIJ Mobile
Service |
471 |
539 |
14.7 |
Others |
63 |
60 |
(4.4) |
Internet Connectivity Service
(Home Use) |
1,551 |
1,389 |
(10.4) |
Under IIJ
Brand |
236 |
241 |
2.3 |
hi-ho |
1,178 |
1,000 |
(15.2) |
OEM |
137 |
148 |
8.7 |
WAN Services |
6,398 |
6,489 |
1.4 |
Outsourcing
Services |
4,031 |
4,502 |
11.6 |
Network Services
Revenues |
15,552 |
16,167 |
4.0 |
Reconciliation of Non-GAAP Financial
Measures
The following table summarizes the reconciliation of adjusted
EBITDA to net income in our consolidated statements of income that
are prepared in accordance with U.S. GAAP.
Adjusted EBITDA |
|
|
|
4Q10 |
4Q11 |
|
JPY millions |
JPY millions |
Adjusted EBITDA |
3,543 |
4,285 |
Depreciation and
Amortization |
(1,714) |
(1,892) |
Impairment loss on other
intangible assets |
(118) |
(37) |
Operating Income |
1,711 |
2,356 |
Other Income
(Expense) |
(52) |
(160) |
Income Tax
Expense |
496 |
922 |
Equity in Net Income (Loss) of
Equity Method Investees |
(7) |
(29) |
Net income |
1,156 |
1,245 |
Net income attributable to
noncontrolling interests |
50 |
6 |
Net Income attributable to
IIJ |
1,206 |
1,251 |
The following table summarizes the reconciliation of capital
expenditures to the purchase of property and equipment in our
consolidated statements of cash flows that are prepared and
presented in accordance with U.S. GAAP.
CAPEX |
|
4Q10 |
4Q11 |
|
JPY millions |
JPY millions |
CAPEX, including capital
leases |
2,212 |
2,265 |
Acquisition of
Assets by Entering into Capital Leases |
1,410 |
632 |
Purchase of
Property and Equipment |
802 |
1,633 |
|
Internet Initiative
Japan Inc. |
Quarterly Consolidated
Statements of Income (Unaudited) |
(Three Months
ended March 31, 2011 and March 31, 2012) |
|
Three Months Ended March 31,
2011 |
Three Months Ended March
31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
REVENUES: |
|
|
|
Network services: |
|
|
|
Internet connectivity services (corporate
use) |
3,571,836 |
45,952 |
3,786,887 |
Internet connectivity services (home
use) |
1,550,768 |
16,861 |
1,389,488 |
WAN services |
6,397,936 |
78,743 |
6,489,229 |
Outsourcing services |
4,031,223 |
54,625 |
4,501,619 |
Total |
15,551,763 |
196,180 |
16,167,223 |
Systems integration: |
|
|
|
Systems Construction |
5,016,059 |
56,412 |
4,648,913 |
Systems Operation and Maintenance |
4,643,273 |
62,033 |
5,112,100 |
Total |
9,659,332 |
118,445 |
9,761,013 |
Equipment sales |
246,761 |
2,827 |
232,973 |
ATM operation business |
163,690 |
4,876 |
401,804 |
Total revenues |
25,621,546 |
322,328 |
26,563,013 |
COST AND EXPENSES: |
|
|
|
Cost of network services |
12,473,729 |
150,441 |
12,397,820 |
Cost of systems integration |
7,590,400 |
93,575 |
7,711,543 |
Cost of equipment sales |
209,940 |
2,350 |
193,690 |
Cost of ATM operation business |
297,104 |
4,478 |
368,996 |
Total cost |
20,571,173 |
250,844 |
20,672,049 |
Sales and marketing |
1,860,161 |
24,350 |
2,006,664 |
General and administrative |
1,384,663 |
16,734 |
1,379,078 |
Research and development |
94,574 |
1,812 |
149,321 |
Total cost and expenses |
23,910,571 |
293,740 |
24,207,112 |
OPERATING INCOME |
1,710,975 |
28,588 |
2,355,901 |
OTHER INCOME (EXPENSE): |
|
|
|
Interest income |
6,161 |
116 |
9,555 |
Interest expense |
(74,625) |
(875) |
(72,144) |
Foreign exchange losses |
(2,722) |
108 |
8,920 |
Net gains (losses) on sales of other
investments -net |
51,327 |
-- |
(2,984) |
Losses on write-down of other
investments |
(7,966) |
(910) |
(75,015) |
Other—net |
(23,813) |
(339) |
(27,930) |
Other expense — net |
(51,638) |
(1,937) |
(159,598) |
INCOME FROM OPERATIONS BEFORE INCOME
TAX EXPENSE AND EQUITY IN NET INCOME IN EQUITY METHOD
INVESTEES |
1,659,337 |
26,651 |
2,196,303 |
INCOME TAX EXPENSE |
496,288 |
11,187 |
921,880 |
EQUITY IN NET INCOME (LOSS) OF EQUITY
METHOD INVESTEES |
(6,692) |
(359) |
(29,560) |
NET INCOME |
1,156,357 |
15,106 |
1,244,863 |
LESS: NET LOSS ATTRIBUTABLE TO
NONCONTROLLING INTERESTS |
49,923 |
78 |
6,453 |
NET INCOME ATTRIBUTABLE TO INTERNET
INITIATIVE JAPAN INC. |
1,206,280 |
15,184 |
1,251,316 |
|
|
|
|
|
Three Months Ended March 31,
2011 |
Three Months Ended March
31, 2012 |
NET INCOME PER SHARE |
|
|
|
BASIC WEIGHTED-AVERAGE NUMBER OF
SHARES (shares) |
202,684 |
|
202,684 |
DILUTED WEIGHTED-AVERAGE NUMBER OF
SHARES (shares) |
202,684 |
|
202,822 |
BASIC WEIGHTED-AVERAGE NUMBER OF
ADS EQUIVALENTS (ADSs) |
81,073,600 |
|
81,073,600 |
DILUTED WEIGHTED-AVERAGE NUMBER OF
ADS EQUIVALENTS (ADSs) |
81,073,600 |
|
81,128,800 |
BASIC NET INCOME PER SHARE (JPY /
U.S. Dollars / JPY) |
5,951.53 |
74.91 |
6,173.73 |
DILUTED NET INCOME PER SHARE (JPY /
U.S. Dollars / JPY) |
5,951.53 |
74.86 |
6,169.53 |
BASIC NET INCOME PER ADS EQUIVALENT
(JPY / U.S. Dollars / JPY) |
14.88 |
0.19 |
15.43 |
DILUTED NET INCOME PER ADS
EQUIVALENT (JPY / U.S. Dollars / JPY) |
14.88 |
0.19 |
15.42 |
|
|
|
|
(Note) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable transfers
in foreign currencies as certified for customs purposes by the
Federal Reserve Bank of New York prevailing as of March 30,
2012. |
|
Internet Initiative
Japan Inc. |
Quarterly Consolidated
Statements of Cash Flows (Unaudited) |
(Three Months ended
March 31, 2011 and March 31, 2012) |
|
|
|
|
|
Three Months Ended March 31,
2011 |
Three Months Ended March
31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
OPERATING ACTIVITIES: |
|
|
|
Net income |
1,156,357 |
15,106 |
1,244,863 |
Adjustments to reconcile
net income to net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
1,714,029 |
22,960 |
1,892,149 |
Impairment loss on other
intangible assets |
118,073 |
449 |
37,000 |
Provision for retirement and
pension costs, less payments |
52,322 |
463 |
38,182 |
Provision for allowance for
doubtful accounts and advances |
11,649 |
439 |
36,194 |
Loss on disposal of property and
equipment |
8,186 |
276 |
22,782 |
Net losses (gains) on sales of
other investments |
(51,327) |
36 |
2,984 |
Impairment of other
investments |
7,966 |
910 |
75,015 |
Foreign exchange gains, net |
(1,629) |
(217) |
(17,886) |
Equity in net income of equity
method investees |
6,692 |
359 |
29,560 |
Deferred income tax expense
(benefit) |
365,171 |
(879) |
(72,460) |
Others |
(44,817) |
397 |
32,735 |
Changes in operating
assets and liabilities net of effects from acquisition of
business and a company: |
|
|
|
Increase in accounts
receivable |
(311,785) |
(3,658) |
(301,511) |
Decrease (increase) in
net investment in sales-type lease―noncurrent |
(924,955) |
1,257 |
103,590 |
Decrease in inventories,
prepaid expenses and other current and noncurrent assets |
815,388 |
10,758 |
886,578 |
Increase (decrease) in
accounts payable |
(1,954,506) |
11,356 |
935,852 |
Increase in income taxes
payable |
158,475 |
12,252 |
1,009,680 |
Increase (decrease) in
deferred income― noncurrent |
850,278 |
(2,248) |
(185,293) |
Increase (decrease) in
accrued expenses, other current and noncurrent
liabilities |
2,201,488 |
(8,381) |
(690,643) |
Net cash provided by operating activities |
4,177,055 |
61,635 |
5,079,371 |
INVESTING ACTIVITIES: |
|
|
|
Purchase of property and
equipment |
(801,940) |
(19,818) |
(1,633,158) |
Proceeds from sales of
property and equipment |
170,187 |
678 |
55,871 |
Purchase of
available-for-sale securities |
(94,552) |
(1,823) |
(150,270) |
Purchase of other
investments |
(50,000) |
(971) |
(80,000) |
Proceeds from sales of
available-for-sale securities |
101,966 |
2,700 |
222,467 |
Proceeds from sales of
other investments |
36,146 |
389 |
32,080 |
Payments of guarantee
deposits |
(258,296) |
(232) |
(19,134) |
Refund of guarantee
deposits |
41,768 |
57 |
4,731 |
Payments for refundable
insurance policies |
(4,998) |
(2) |
(182) |
Other |
(4,238) |
48 |
3,983 |
Net cash used in financing activities |
(863,957) |
(18,974) |
(1,563,612) |
|
|
|
|
Three Months Ended March 31,
2011 |
Three Months Ended
March 31, 2012 |
|
Thousands of JPY |
Thousands of U.S. Dollars |
Thousands of JPY |
FINANCING ACTIVITIES: |
|
|
|
Proceeds from issuance of short-term
borrowings with initial maturities over three months and
long-term borrowings |
300,000 |
-- |
-- |
Repayments of short-term borrowings
with initial maturities over three months |
(1,250,000) |
-- |
-- |
Principal payments under capital
leases |
(779,830) |
(11,201) |
(923,078) |
Net Increase (decrease) in short-term
borrowings with initial maturities less than three
months |
930,000 |
-- |
-- |
Net
cash used in financing activities |
(799,830) |
(11,201) |
(923,078) |
|
|
|
|
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS |
444 |
197 |
16,172 |
|
|
|
|
NET INCREASE IN CASH AND CASH  
 EQUIVALENTS |
2,513,712 |
31,657 |
2,608,853 |
CASH AND CASH EQUIVALENTS, BEGINNING OF
THE PERIOD |
10,799,903 |
132,605 |
10,927,971 |
CASH
AND CASH EQUIVALENTS, END OF THE PERIOD |
13,313,615 |
164,262 |
13,536,824 |
|
|
|
|
(Note1) The U.S. dollar amounts
represent translations of yen amounts at the rate of JPY 82.41
which was the noon buying rate in New York City for cable
transfers in foreign currencies as certified for customs purposes
by the Federal Reserve Bank of New York prevailing as of March 30,
2012. |
(Note2) The above presentation
for the three months ended March 31, 2011 has been changed to
conform to the presentation for the three months ended March
31, 2012. |
Note: The following information is provided to
disclose Internet Initiative Japan Inc. ("IIJ") financial results
(unaudited) for the Fiscal Year Ended March 31, 2012("FY2011") in
the form defined by the Tokyo Stock Exchange.
Consolidated Financial Results for the Fiscal Year Ended
March 31, 2012 [Under accounting principles generally accepted in
the United States ("U.S. GAAP")]
May 15, 2012
Company name: Internet Initiative Japan
Inc. Exchange listed: Tokyo
Stock Exchange First Section
Stock code number:
3774
URL: http://www.iij.ad.jp/
Representative: Koichi Suzuki, President and
Representative Director
Contact: Akihisa Watai, Managing Director and
CFO TEL: (03) 5259-6500
Annual general shareholder's meeting: scheduled on
June 27, 2012
Payment of dividend: Scheduled to be started on
June 28, 2012
Filing of annual report (Yuka-shoken-houkokusho) to
the regulatory organization in Japan: Scheduled on June 29,
2012
Supplemental material on Fiscal year results:
Yes
Presentation on Fiscal year results: Yes (for
institutional investors and analysts)
(Amounts of less than JPY one million are
rounded)
1. Consolidated Financial
Results for the Fiscal Year Ended March 31, 2012 |
|
|
|
|
|
|
|
(April 1, 2011 to March 31,
2012) |
|
|
|
|
|
|
|
|
(1) Consolidated Results of
Operations |
|
|
|
|
|
|
(% shown is YoY
change) |
|
Total Revenues |
Operating Income |
Income before Income Tax
Expense |
Net Income attributable
to IIJ |
|
JPY millions |
ï¼… |
JPY millions |
ï¼… |
JPY millions |
ï¼… |
JPY millions |
ï¼… |
Fiscal year ended March 31, 2012 |
97,315 |
18.1 |
6,353 |
53.4 |
5,976 |
55.9 |
3,641 |
13.7 |
Fiscal year ended March 31, 2011 |
82,418 |
21.2 |
4,141 |
21.4 |
3,834 |
34.1 |
3,203 |
43.4 |
(Note1) Total comprehensive income |
Fiscal Year ended March 31, 2012:
JPY3,636 million (up 32.4% YoY) |
|
|
|
|
|
|
|
|
Fiscal Year ended March 31, 2011:
JPY2,747 million (up 15.6% YoY) |
|
|
|
|
|
|
|
(Note2) Income before income tax expense
represents income from operations before income tax expense and
equity in net income in equity method investees, respectively, in
IIJ's consolidated financial statements. |
|
|
|
|
|
|
|
|
|
Basic Net Income attributable to IIJ
per Share |
Diluted Net Income attributable to
IIJ per Share |
Net Income attributable to IIJ to
Total Shareholders' Equity |
Income before Income Tax Expense to
Total Assets |
Total Revenues Operating Margin
Ratio |
|
JPY |
JPY |
% |
% |
% |
Fiscal year ended March 31, 2012 |
17,963.74 |
17,955.06 |
11.7 |
8.2 |
6.5 |
Fiscal year ended March 31, 2011 |
15,807.86 |
15,807.86 |
11.2 |
6.2 |
5.0 |
(Reference) Equity in net income of equity
method investees |
Fiscal Year ended March 31, 2012:
JPY124 million |
|
|
|
|
|
Fiscal Year ended March 31, 2011:
JPY123 million |
|
|
|
|
(2) Consolidated Financial
Position |
|
|
|
|
|
|
Total Assets |
Total Equity |
Total IIJ Shareholders' Equity |
Total IIJ Shareholders' Equity
to Total Assets |
Shareholders' Equity per share |
|
JPY millions |
JPY millions |
JPY millions |
% |
JPY |
March 31, 2012 |
73,493 |
32,696 |
32,688 |
44.5 |
161,276.69 |
March 31, 2011 |
71,473 |
29,641 |
29,652 |
41.5 |
146,298.11 |
(3) Consolidated Cash
Flow |
|
|
|
|
|
Operating Activities |
Investing Activities |
Financing Activities |
Cash and Cash Equivalents (End of the
Period) |
|
JPY millions |
JPY millions |
JPY millions |
JPY millions |
Fiscal year ended March 31, 2012 |
11,659 |
(5,954) |
(5,464) |
13,537 |
Fiscal year ended March 31, 2011 |
12,564 |
(13,493) |
5,521 |
13,314 |
2.
Dividends |
|
|
|
|
|
|
|
|
|
Dividend per Shares |
Total cash dividends for the year |
Payout Ratio (consolidated) |
Ratio of Dividends to Shareholder's Equity
(consolidated) |
|
1Q-end |
2Q-end |
3Q-end |
Year-end |
Total |
|
|
|
|
JPY |
JPY |
JPY |
JPY |
JPY |
JPY millions |
% |
% |
Fiscal year ended March 31, 2011 |
-- |
1,250.00 |
-- |
1,500.00 |
2,750.00 |
557 |
17.4 |
2.0 |
Fiscal year ended March 31, 2012 |
-- |
1,500.00 |
-- |
1,750.00 |
3,250.00 |
659 |
18.1 |
2.1 |
Fiscal year ending March 31,
2013 (Target) |
-- |
1,750.00 |
-- |
1,750.00 |
3,500.00 |
|
17.7 |
|
3. Target of Consolidated
Financial Results for the Fiscal Year Ending March 31,
2013 |
|
|
|
|
|
(April 1, 2012
through March 31, 2013) |
|
|
|
|
|
|
|
|
  (%
shown is YoY change) |
|
Total Revenues |
Operating Income |
Income before Income Tax
Expense (Benefit) |
Net Income Attributable
to IIJ |
Basic Net Income attributable to IIJ
per Share |
|
JPY millions |
% |
JPY millions |
% |
JPY millions |
% |
JPY millions |
% |
JPY |
Interim Period Ending September 30, 2012 |
50,500 |
7.0 |
2,700 |
10.3 |
2,500 |
9.1 |
1,400 |
2.8 |
6,907.30 |
Fiscal year ending March 31, 2013 |
107,000 |
10.0 |
7,500 |
18.0 |
6,900 |
15.5 |
4,000 |
9.9 |
19,735.15 |
4. Others |
(1) Changes in significant subsidiaries for
the Fiscal Year ended March 31, 2012 |
(Changes in significant
subsidiaries for the Fiscal year ended March 31, 2012 which
resulted in changes in scope of consolidation): None |
Newly Consolidated: None, Excluded:
None |
(2) Changes in Significant Accounting and
Reporting Policies for Consolidated Financial Statements |
1) Changes due to the revision of
accounting standards: Yes |
2) Others: Yes |
(3) Number of Shares Outstanding (Shares of
Common Stock) |
1) The number of shares outstanding
(inclusive of treasury stock): |
As of March 31, 2012: 206,478 shares |
As of March 31, 2011: 206,478 shares |
2) The number of treasury stock: |
As of March 31, 2012: 3,794 shares |
As of March 31, 2011: 3,794 shares |
3) The weighted average number of shares
outstanding: |
For the Fiscal Year ended March 31, 2012:
202,684 shares |
For the Fiscal Year ended March 31, 2011:
202,644 shares |
[English Translation]
May 15, 2012
Company name: 1-105 Kanda Jimbo-cho, Chiyoda-ku,
Tokyo Internet Initiative Japan Inc.
Company representative: Koichi Suzuki, President
and Representative Director (Stock Code Number: 3774 The First
Section of the Tokyo Stock Exchange)
Contact: Akihisa Watai, Managing
Director and CFO TEL: 03-5259-6500
Information Pertaining to
Controlling Shareholders |
|
|
|
|
1. Name of Controlling Shareholders |
|
|
|
(as of March 31,
2012) |
|
|
|
Name |
Relationship |
Its Ownership Percentage (%) |
Securities Exchanges where its Shares
are Listed |
Nippon Telegraph and Telephone
Corporation |
IIJ is NTT's affiliate company |
29.9 |
Tokyo Stock Exchange, Inc. (First
Section) |
|
|
(5.0) |
Osaka Securities Exchange, Co., Ltd. (First
Section) |
|
|
|
Nagoya Stock Exchange, Inc. (First
Section) |
|
|
|
Fukuoka Stock Exchange |
|
|
|
Sapporo Stock Exchange |
|
|
|
New York Stock Exchange, Inc. |
|
|
|
London Stock Exchange plc. |
(Notes) The percentage in parentheses is the
indirect ownership by NTT included in the figure above. |
|
|
|
2. Position of the Listed Company (IIJ) within
Parent Company's Corporate Group and other Parent Company
Relationships
a) Position of the Listed Company (IIJ) within the
Group of the Parent Company
The ownership percentage by NTT, which is IIJ's largest
shareholder, was 29.9% as of March 31, 2012, including its indirect
ownership. However, IIJ's sales activities are not affected by
NTT's ownership in IIJ and IIJ is maintaining its management
independence.
b) Personal Relationships with the Parent Company,
other Related Company and their Group Companies
IIJ's board of directors consists of 12 members including 4
outside directors. Takashi Hiroi, an outside director (part-time
director) of IIJ, is an employee of NTT (General Manager of
Business Planning Division of NTT). However, he is monitoring IIJ's
business operations as an outside director and does not have any
personal relationships, such as family relationships, with IIJ's
other directors and auditors. He did not acquire any interest such
as capital or business relationships upon becoming an outside
director.
3. Business Relationship with NTT Group
IIJ uses services provided by Nippon Telegraph and Telephone
East Corporation ("NTT East") and Nippon Telegraph and Telephone
West Corporation ("NTT West") for a significant portion of its
access circuits, and services provided by NTT Communications
Corporation ("NTT Communications") for a significant portion of its
domestic and international backbones. The amount paid to NTT East
and West, and to NTT Communications for their telecommunication
circuits was JPY1,426million and JPY3,046 million, respectively for
the fiscal year ended March 31, 2012.
IIJ leases a part of Internet data center facilities from NTT
Group companies to provide our Internet data center services to our
customers and the amount paid to NTT Group related to the lease of
Internet data center facilities are JPY1,699 million.
Business transactions with the NTT Group are within the scope of
normal business practices, and there is no special contract made in
relation to the investment by NTT Group.
CONTACT: YUKO KAZAMA
IIJ Investor Relations Office
Tel: +81-3-5259-6500
E-mail: ir@iij.ad.jp
URL: http://www.iij.ad.jp/en/IR
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