Avant : Presentation for the fiscal year ended June 30, 2023

3836 TSE Prime

Avant Group Corporation

Financial Results Presentation

for the third quarter of Fiscal Year June 2023

August 4, 2023

©2023 AVANT GROUP CORPORATION. All Rights Reserved.

Executive Summary

• Summary of financial results for the fiscal year ended June 30, 2023
• • For the full year ending June 2023, sales increased in all segments, and consolidated sales increased 14.5% year-on-year to 21.4 billion yen. Operating income increased +1.3% year-on-year due to factors such as restructuring costs, increased headcount for growth, and increased outsourcing costs in response to strong demand.
  • Although net sales fell 1.7% against the forecast, operating income was +6.1% and net income was +3.2%, achieving profit targets.
  • In the fourth quarter, the DX business and the outsourcing business posted a high growth rate of more than 20% year-on-year, but the Group Governance business saw a decline in sales, resulting in an overall increase of 6.5% year-on-year. In terms of operating income, there was a decline in profit in the Group Governance Business, and overall profit decreased in the fourth quarter.
• Earnings and Dividend Forecasts
• • For the fiscal year ending June 2024, we forecast net sales of 24.0 billion yen (up 12.0% year-on-year), operating income of 3.85 billion yen (up 17.0% year-on-year), and net income of 2.50 billion yen (up 19.4% year-on-year).
  • While raising the dividend on net assets ratio while always being aware that it will always be above the average for all listed companies, we expect to increase the dividend per share to 19 yen in the fiscal year ending June 2024 with the aim of achieving a dividend on net assets ratio of 8%.
• Actions to Realize our Materiality
• • Announced a new medium-term management plan, "BE GLOBAL2028," and accelerated the realization of our strategic materiality of "becoming a software company that helps improve corporate value."

©2023 AVANT GROUP CORPORATION. All Rights Reserved.

2

INDEX

Ⅰ. Summary of financial results for the fiscal year ended June 30,

2023

Ⅱ. Earnings and Dividend Forecast

Ⅲ. Actions to Realize our Materiality

＊ Figures in this presentation are rounded down to the unit of display.

The information contained in this material regarding the business outlook and other forecasts and strategies etc. are forward-looking statements and are determined within the range that could normally be predicted based on the information reasonably available to the Company at the time of preparation of this material. Investors should be aware of the risks, however, that actual results may differ from the business prospects described in the material due to the occurrence of extraordinary circumstances that cannot usually be predicted or the occurrence of results that cannot usually be predicted. The Company will proactively disclose information that is considered material to investors, but investors should be advised not to make judgment based entirely on only the business prospects described in this material. This material should not be copied or transferred for any purpose without permission of the Company.

©2023 AVANT GROUP CORPORATION. All Rights Reserved.

3

I. Summary of financial results for the fiscal year

ended June 30, 2023

©2023 AVANT GROUP CORPORATION. All Rights Reserved.

4

Results Highlights

• Net sales increased 6.5% in the fourth quarter and 14.5% for the full year, despite a decline in the Group Governance business in the fourth quarter.
• Gross profit and operating income decreased in the fourth quarter on a non-consolidated basis due to a decline in gross profit margin due to additional personnel for growth and restructuring costs. Full-year increase rate is small, but profit growth is achieved.
• Net sales are below forecasts, but operating and net income exceed forecasts.

(Millions of yen)

		FY6/23	YoY Variance
		Q4	Yr earlier	% chg
	Net Sales	5,236	4,916	6.5%
	Cost of Sales	3,173	2,686	18.1%
	Gross Profit	2,063	2,230	-7.5%
	GPM	39.4%	45.4%	-6.0pt
	SG&A	1,695	1,606	5.5%
	Operating Income	368	624	-41.0%
	OPM	7.0%	12.7%	-5.7pt
	Net Income	223	472	-52.8%
	NPM	4.3%	9.6%	-5.4pt
	EBITDA	492	711	-30.8%
	EBITDA margin	9.4%	14.5%	-5.1pt

©2023 AVANT GROUP CORPORATION. All Rights Reserved.

FY6/23	YoY Variance	vs Forecast
	Yr earlier	% chg	Forecast	% Achieve
21,424	18,703	14.5%	21,800	-1.7%
12,028	9,782	23.0%	ー	ー
9,395	8,921	5.3%	ー	ー
43.9%	47.7%	-3.8pt	ー	ー
6,106	5,674	7.6%	ー	ー
3,289	3,247	1.3%	3,100	6.1%
15.4%	17.4%	-2.0pt	14.2%	1.1pt
2,094	2,045	2.4%	2,030	3.2%
9.8%	10.9%	-1.2pt	9.3%	0.5pt
3,737	3,582	4.3%	ー	ー
17.4%	19.2%	-1.7pt	ー	ー
				5