ITOCHU Techno-Solutions Corporation
Summary of Q&A at Conference Call on Operating Results for Q1 of FY2020
Date/Time: August 4, 2020 (Tuesday) 2:00 p.m. – 2:45 p.m.
Presenter: Mamoru Seki, Managing Executive Officer, Officer in charge of Corporate Administration Group and CFO
Q：Orders received decreased 5.7% year on year in Q1. Is this within or outside the scope of internal expectations? In particular, could you tell me whether or not the decreases that occurred to the Enterprise Group and Regional and Social Infrastructure Group were in line with expectations?
A：They were almost in line with expectations. We had assumed that the COVID-19 would affect a range of industries, in particular, the manufacturing industry in conjunction with the Enterprise Group and that the Regional and Social Infrastructure Group would experience a reactionary decline from the year-ago level.
Q：Was any revenue moved up from Q2 to Q1?
A：With respect to certain projects, for example, although we had estimated that it would take a long time to complete construction, we moved up revenue because they were completed earlier than expected. None of these projects were large, though.
Q：The most recent order backlogs show a slight decrease, although operating income is higher than the year-ago level. What should we estimate with respect to forecasts for Q2?
A：The COVID-19 will continue to affect our operations in Q2. Even so, we will do our best to maintain the record level that we achieved in the first half of the previous year.
Q：Since you deal with several thousand companies, I understand the difficulty of making projections. That said, do you see any recovery in customers’ interest in capital spending in Q2? Or do you think that no change is taking place between Q1 and Q2? What are your insights for the second half? Please share your view on the direction in which things are moving in general?A：The Q1 results reflects efforts that we made to ensure the posting of order backlogs at the end of the previous year. With respect to capital spending, although companies took a wait-and-see attitude in Q1, we have the impression that some of them have started to take action in Q2. I am unable to provide you with any insights for the second half as yet.Q： Please let me ask a question regarding the negative impact of the COVID-19 in Q2 discussed on page 6 of the financial results reference data attached to the presented materials. You said that the effects may […]