Japanese jobs site operator En-Japan Inc. saw revenue fall 24.1% year-on-year to Y10.4 billion in the first quarter of FY2021 ended June 30. As expected, the Covid-19 pandemic hurt the company’s jobs advertisement market, but sales still managed to fall 4% above the company’s previous guidance.
Operating income also substantially outpaced expectations. The strong results were due to a 7% reduction in cost of sales and a 17% reduction in SGA (sales, general and administrative expenses) in Q1.
The news wasn’t all good, though. Operating income fell 57% to Y1.2 billion, while net income declined 68% to Y618 million.
Since June, the number of job ads has slowly been ratcheting up to pre-Covid levels after bottoming out in May.
“Although greatly affected by the decline in hiring needs, a recovery trend was seen from June after bottoming out in May, less affected than market’s decline rate,” the company said in earnings report.
The Tokyo-based company improved online activities and set up a recording studio for external and internal online communications. It also reduced office space by approximately 40%, it said.
The push toward digital led to a massive increase in quarterly sales for En-Japan’s recruitment support tool, Engage, which pulled in Y246 million in Q1.
Engage lets companies create corporate recruitment sites and job listings that can be integrated with Indeed and Google Jobs. Engage is used by over 280,000 employers and recruitment agencies, En-Japan said.
The company’s HR tech segment is expected to see profit margins grow nearly 400% year-on-year next quarter. This is due to the company reversing a (450%) profit margin in Q2 FY20 after the company ran a Y400 million operating loss.
Overall sales for the company’s domestic job board and overseas segment were expected to decline, bringing cumulative sales down to Y9.3 billion compared to Y14.4 billion in the same period a year ago.
“Achieving the Q2 target is assumed to be difficult as the core service is job board and recovery of hiring needs is slow,” the company said.