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Satoshi Kikuchi,President & CEO

I would like to begin by thanking our valued stakeholders for their continued support.

Under “Opening New Horizons,” our three-year medium-term management plan, we are working to fulfill our responsibility as a leading company driving the advancement of the IT industry. In FY2018, the first year of this plan, we took the first steps to attaining our goals by leveraging the Group’s strengths while making forays into new fields.

In terms of business performance, we recorded increased revenues and profits over the previous year, ending the period higher than we had initially predicted. Moreover, in terms of revenue, all profit items, orders and order backlog, we managed to post the highest figures since ITOCHU Techno Science Corporation and CRC Solutions Corporation integrated their management structures in 2006. Meanwhile, net profit attributable to CTC’s shareholders achieved a post-integration high for the fifth consecutive period.

Specifically, we have pursued four new “Horizons” in our activities: Go Upwards! (Challenge Business Transformation), Go Forwards! (Sharpen our Advantages), Go Outwards! (New Coverage, New Region in Globe) and Consolidate Footholds! (Stabilize Management Infrastructure).

To “Go Upwards,” we have looked to the age of digital transformation, strengthening partnerships with key customers by delivering faster and more sophisticated management decision-making through real-time information processing, and by supporting business streamlining with the use of AI. At the same time, we have made every effort to embrace the challenges of business reform.

To “Go Forwards,” we have enhanced CTC’s strength in building infrastructure through the utilization of network virtualization technologies (NFV) and other initiatives.

To “Go Outwards,” we entered into a capital tie-up with SYSCOM (USA) Inc. in the United States and implemented a business alliance with Newton Information Technology Ltd. in the United Kingdom with the aim of expanding operations and strengthening support at the global level. We also took up the challenge of developing new fields of business through investment projects undertaken by CTC Innovation Partners, our corporate venture capital fund, including investment in AI start-up Cinnamon Inc. and an alliance with CoCooking Co., Ltd., which is committed to reducing food loss.

To “Consolidate Footholds,” we enhanced our AI business promotion structure by providing AI training to roughly 3,000 employees. We also continue to focus on strengthening our management infrastructure, as evidenced by CTC’s selection as a Health and Productivity Management Organization (White 500) for 2019, the third consecutive year.

New Horizons

The following three keywords describe the priority measures we will pursue in FY2019, the second year of our medium-term management plan.

5G:

We will begin developing infrastructure for the Fifth-generation Mobile Communications System (5G) that is set to enter full-scale commercial service in Japan, and work to earn business for improvements, expansions and feature additions on an ongoing basis.

DX:

To expand the digital business with the use of cutting-edge technologies, we will establish partnerships that allow us to grow together with customers through improved consulting services and enhanced development capabilities.

GLOBAL:

We will actively promote business expansion in the ASEAN region in coordination with our Group companies in Indonesia, Thailand, Malaysia and Singapore. We are also looking to develop R&D structures in China and Europe, and to drive a regional expansion that includes M&A activities.

three keywords

CTC recognizes that returning profits to shareholders is an important management issue. We put an emphasis on passing on profits to reflect business performance, and maintain a basic policy of increasing the level of dividends. In FY2018 the annual dividend was 50 yen per share, marking the tenth consecutive period of increased dividends and a consolidated dividend payout ratio of 46.9%. In FY2019 we again expect improved business results and plan to offer an annual dividend of 55 yen per share. To meet the expectations of our shareholders, we will make every effort to realize sustained growth in corporate value.

I appreciate your continued support as we pursue this vision.

June 2019
Satoshi Kikuchi
President and Chief Executive Officer

All company, product and service names indicated herein are trademarks or registered trademarks of ITOCHU Techno-Solutions Corporation or their respective owners.

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