Financial Data and Key Metrics Changes - Consolidated operating revenue for the fiscal year ending March 2023 was JPY 5,671.8 billion, an increase of 4.1% year-on-year [3][42] - Operating income reached JPY 1,075.7 billion, up 1.4% year-on-year [3][42] - The impact of fuel price hikes was negative JPY 36.3 billion, but overall profits grew due to strength in focus areas and cost efficiency efforts [5][44] Business Line Data and Key Metrics Changes - Multi-Brand Communications ARPU for fiscal year March 2023 was JPY 3,960, with a total of 31.23 million IDs [12][42] - The Business Services segment saw revenue growth of 17.6% year-on-year, with operating income expanding at a CAGR of 13% over the last five years [16][22] - The financial business reported a 17.7% year-on-year growth in finance-related value-added ARPU revenue [25] Market Data and Key Metrics Changes - IoT connections reached a total of 37 million, with expectations for expansion across all industries [8] - The company aims to increase 5G stations to approximately 90,000 by the end of March 2024, achieving over 90% population coverage [11] Company Strategy and Development Direction - KDDI Vision 2030 focuses on enhancing connectivity and contributing to a society where anyone can realize their dreams [6][7] - The company plans to invest an additional JPY 50 billion in network quality improvements over the mid-term [7] - The satellite growth strategy aims to provide new values through initiatives like drone delivery and smart fisheries [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving record profits despite challenges from fuel price hikes and roaming revenue declines [41][47] - The company anticipates a rebound in communications ARPU revenue and growth in focus areas for the fiscal year ending March 2024 [30][31] - Management emphasized the importance of enhancing customer attractiveness and increasing data usage to drive ARPU growth [14][59] Other Important Information - The company aims to increase dividends for the 22nd consecutive year, targeting a DPS of JPY 140 for the fiscal year ending March 2024 [32][35] - A share buyback program of JPY 300 billion has been earmarked to enhance shareholder returns [35] Q&A Session Summary Question: What are the assumptions behind the JPY 60 billion decline in roaming revenue? - Management explained that the decline reflects reduced roaming areas due to agreements with Rakuten, but some mitigation is expected from new agreements [50][54] Question: Can you elaborate on the JPY 180 decline in ARPU in the fourth quarter? - The decline was primarily due to connection fees and retrospective billing, with expectations for a rebound in the upcoming fiscal year [68][70] Question: What is the expected balance between downgrading from au to UQ and upgrading from UQ to au? - Currently, downgrading from au to UQ is larger, but the rate of migration from UQ to au is increasing, indicating a potential shift towards equilibrium [86][87] Question: How will the marketing strategy change in the new fiscal year? - The focus will be on making au more attractive through increased marketing efficiency, with a rise in marketing costs expected compared to the previous year [79][80] Question: How does the Business Services segment differentiate itself from IT services companies? - The Business Services segment leverages its telecommunications base to provide unique solutions, particularly in IoT and digital transformation [81][82]
KDDI(KDDIY) - 2023 Q4 - Earnings Call Transcript