To our shareholders and prospective investors

Message

We aim to achieve further growth by rolling out
enterprising IT based on our slogan of
“to be a ‘five-star’ company.”

Takeaki Hirabayashi
President and CEO
Japan System Techniques Co., Ltd.

 Our Group was founded as a software company in 1973, when the IT industry was still in its infancy. We launched our business “believing in the idea of making society a better place by creating and providing new types of IT services.” Since that time, we have taken on development projects in a wide variety of areas, unconstrained by industry, technology, or platform as a completely independent IT company not affiliated with any other corporate groups. Today, the core of our business is large-scale contracted software development for corporations, educational institutions and public agencies, and we also develop products under our own brand, including the GAKUEN series, which holds the top market share among strategic management systems for universities, and JMICS, our medical information service.

 The environment surrounding IT is currently undergoing changes at blinding speed, including advances in technological innovation in the areas of AI, IoT, big data and robots. With these changes in the environment, we believe that it will be difficult to achieve sustainable growth into the future with a business portfolio consisting primarily of contracted development, so we formulated “JAST Vision 2020” to define basic medium- to long-term management policies and targets for fiscal 2020. This vision sets forth the type of organization we want to become, including goals for the corporate image, brand image, business fields, the size of our operations and other items, based on the slogan of “to be a ‘five-star’ company.” In so doing, we will establish a structure by which we are able to immediately address changes in customers, technology and the market.

 We were listed on the First Section of the Tokyo Stock Exchange on June 23, 2017. I would like to express my sincere gratitude to our customers, shareholders and stakeholders, because this would not have been possible without your support. We will aim for further growth by rolling out enterprising IT to pursue new markets while leveraging the technologies and know-how we have cultivated up to now. We ask for your continued support and guidance in the days ahead.

Basic Management Principles

 Our basic management philosophy is that everything starts with principles. We believe that having a principled mindset is essential for running a company and that making sure our thoughts and actions adhere to this mindset in everything we do is of utmost importance.
 Put simply, our basic management philosophy follows what Mencius once said: that “fame and fortune (jinshaku) follows naturally for those who gain nature’s nobility (tenshaku).” Tenshaku means developing one’s character or moral code by sticking steadfastly to one’s personal morals, doctrine, or rules. Virtuous people who do just that gain respect and trust over time, and eventually attain nature’s nobility. Jinshaku, meanwhile, refers to status that is man-made or granted expediently by superiors or organizations in recognition of one’s achievements or experience.
 One who earns nature’s nobility (tenshaku) eventually wins the respect of peers (jinshaku), but there are many people working under the false assumption that winning votes from peers entitles one to receive nature’s nobility. This is getting the order of things completely wrong. One who achieves both tenshaku and jinshaku is a success in the true sense of the word.
 If one thinks and acts based on impure motives, self-interest, arrogance, or cold calculations of gain and loss, they might become successful briefly, but any such success (jinshaku) is unlikely to last. Ultimately, the path to tenshaku, or righteousness, requires following a moral compass when taking on meaningful tasks. Success comes to those who maintain a strong sense of altruism and choose to act ethically.
 Based on this thinking, our company has tried to live by the idea of making society a better place by creating and providing new types of IT services. JAST has guarded its complete independence, keeping itself unaffiliated with other corporate groups. Our basic management policy has been to consistently pursue the latest technologies and remain free to take on development projects in a wide variety of areas, unconstrained by industry, technology, or platform.
 Sticking to this policy, we aim for a win-win relationship between our company and our clients, our shareholders, our employees, and the society-at-large. Our goal is to maximize value for each of these four key stakeholders. We’re aiming to achieve stable growth by raising corporate value overall.
 What drives such growth is the passion for IT systems development that our employees feel, as well as their sincerity in dealing with clients. To achieve this, learning how to add a human touch is crucial for our employees, and our management approach reflects that by focusing on helping them become better people.

Major Businesses and Share of Sales

 Our Group operates four main businesses. First is the software business, which develops software on contract to meet the specific needs of clients. Second is the GAKUEN business, which develops and provides administrative IT software packages and services mainly to educational institutions. Third is the system sales business which sells IT equipment and builds ICT infrastructure. Fourth is the medical big data business.
 The software business provides a custom-made software development service to meet the individual needs of customers in the two fields of business applications (back office processing systems) and engineering applications (communication, control and technical systems).
 In the GAKUEN business, we will be the dominant leader in the educational IT market, promoting a marketing and branding strategy aimed at further increasing the share of our GAKUEN operations software package for educational institutions while at the same time creating new services utilizing the latest technologies such as AI and robots and also working to promote business development in overseas markets by expanding use of our products in China and expanding our business into ASEAN countries.
 In the system sales business, we provide integrated hardware, software and infrastructure sales, maintenance and network construction services.
 In the medical big data business, we provide support for optimization of medical costs of insurers and improvement of the health of subscribers through the operation of our medical data inspection, analysis and related services of our JMICS automated electronic health insurance claims checking and analysis system.
 The breakdown of FY3/20 sales by business segment is as follows:

Net Sales ¥15.63 billion

Medium- and Long-Term Growth Strategy

 Our Group’s focus up to now has been on the contracted development business, but we believe that it will be difficult to achieve sustainable growth into the future with our past business portfolio. As such, we formulated “JAST Vision 2020” to define basic medium- to long-term management policies and targets for fiscal 2020. Specifically, we will focus our efforts on four priority measures, namely increasing the proportion of our own brand businesses, improving the profitability of our contract development business, promoting growth through human resources system innovation and maximizing synergy among group companies.
 To increase the proportion of our own brand businesses, we will strengthen marketing, implementation support and development of our existing GAKUEN, JMICS and BankNeo brands while also engaging in R&D to launch new brand products, strengthening our overseas sales strategy and expanding alliances, including M&As, to increase the proportion of our own brand businesses.
 To improve the profitability of our contract development business, we will focus on expanding direct contracts with end users by strengthening solution sales while also strengthening management of the development process and promoting off-shore development. At the same time, we will strengthen our organizational structure for development of new SI businesses to increase the volume of orders received in the Tokyo area, the largest market in Japan, and we will increase the proportion of sales in the Tokyo area to expand profits.
 To promote growth through human resources system innovation, we will promote diversity and work culture reform and work on developing a human resources system that increases motivation and improving pay and benefits. At the same time, we will work on improving our project management technology, increasing added value by enhancing our menu of solutions and introducing an education and human resources system that leads directly to the production of top-level human resources to further strengthen the foundation of our growth.
 Finally, to maximize synergy among group companies, we will work to maximize synergy within the company and between group companies while promoting alliances and M&As in domains that our technologies cannot cover.

Dividend Policy

 Our basic policy for dividends is to achieve stable growth over the long term. We will decide on specific policies and amounts based on earnings trends, financial conditions and other environmental factors, while taking into consideration the payout ratio. Additionally, in regard to retained earnings, we hope to invest effectively in things like development of professional human resources, creation of new businesses, promotion of various alliances and R&D on new products.
 We will continue our basic policy of treating record dates for paying dividends to shareholders of record as March 31 and September 30 but leave open the option of paying out dividends on other dates as well.