In-Depth Earnings Report: Management Solutions Co., Ltd. (7033) FY2026 Q2 – Expanding Demand for Execution-Oriented PMO and Strengthening Revenue Foundations

Management Solutions Co., Ltd. (7033) reported strong results for the second quarter of the fiscal year ending December 2026. Driven by robust corporate demand for Project Management Office (PMO) services, the company achieved record-high sales on both a quarterly and cumulative basis. The company successfully delivered significant growth in operating profit while absorbing upfront costs associated with aggressive recruitment of both new graduates and mid-career professionals.

This report provides a multi-faceted analysis of the Q2 FY2026 financial results, covering performance highlights, key KPI trends, structural shifts and competitive advantages in the consulting market, full-year forecasts, and shareholder return policies, divided into 10 key topics.

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1. Q2 Performance Highlights: Steady Growth in Both Sales and Operating Profit

For the first half (1Q-2Q) of the fiscal year ending December 2026, consolidated results showed net sales of 12,540 million yen (+12.5% YoY) , operating profit of 1,566 million yen (+37.0% YoY) , and quarterly net profit of 1,089 million yen (+45.8% YoY) .

In the second quarter (2Q) alone, net sales reached 6.3 billion yen (+13.9% YoY) , marking a record high on a quarterly basis, while operating profit hit 600 million yen (+100.3% YoY) , doubling from the same period last year. The company achieved high profit growth while absorbing personnel and recruitment costs associated with the onboarding of 169 new graduates.

Significance and Background of Slide (Page 3)

The slide above is an executive summary that concisely and clearly encapsulates the overall picture of these financial results. This slide is crucial for investors because the quarterly performance graph illustrates that the company’s business is on a clear upward trajectory, despite seasonal fluctuations. Notably, the fact that operating profit doubled year-on-year in the second quarter—typically the period with the heaviest personnel cost burden due to new graduate hiring—demonstrates that the company is beginning to realize systematic operating leverage, where top-line growth from improved utilization rates and an increased number of consultants is outpacing the rise in fixed costs.

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2. Key KPI Trends: Utilization Control and Rising Unit Prices

The three pillars supporting the company’s growth—utilization rate, average unit price, and the number of PMO consultants—all showed steady progress.

• Number of PMO Consultants : Reached 1,046 as of the end of June 2026 (an increase of 216 from 830 at the end of the same period last year), indicating steady organizational expansion.
• Average Unit Price : The monthly charge per consultant rose to 1.797 million yen (up from 1.747 million yen in the same period last year). Despite a temporary increase in the ratio of younger staff due to new graduate hiring, the company has maintained higher unit prices by enhancing the value provided.
• Utilization Rate : Stood at 84.8% (85.4% in the same period last year). While there was a slight decline due to intensified recruitment and training for second-half projects and the impact of organizational integration (-0.5%), the rate remains at a high level in line with the plan.

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3. Performance by Business Segment: PMO and MSOL Digital

The core PMO segment accounted for the majority of total sales, with 10,672 million yen in the first half, continuing to expand as a solid revenue base. In addition, the MSOL Digital segment , which handles data integration and AI implementation support, saw rapid growth with Q2 sales up 24.7% YoY .

In MSOL Digital, demand for building AI-driven data analysis platforms is extremely strong, and the number of specialized personnel (data analysts, infrastructure experts, etc.) has grown by 18.9% YoY . The synergy between PMO execution support and digital technology is beginning to bear fruit.

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4. Strength of Customer Base: Solid Transactions Centered on Large Enterprises

The company’s customer base is exceptionally robust. Its list of clients includes industry-leading companies such as Toyota Motor, Denso, Tokyo Gas, JR West, KDDI, TIS, Sakura Internet, and Tsumura.

Notably, large-scale clients with annual sales of 100 billion yen or more account for approximately 96% of total sales . The company has established a position that allows it to continuously win large-scale, long-term, and complex projects such as DX promotion and business structural reform.

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5. Consulting Industry Trends: Shift in Demand Toward "Execution Support" in the AI Era

The consulting industry is currently facing a major transformation due to the rapid penetration of generative AI. As reported in various media, traditional research-based consulting that relies on "providing knowledge and expertise (dependent on information asymmetry)" is at high risk of being replaced by AI.

In this environment, the "execution-oriented (PMO)" model, which is the company's core focus, is extremely difficult to replace even in the AI era. Instead, the structure is such that demand is accelerating for PMOs to act as the driving force for the success of AI implementation projects themselves.

Significance and Background of Slide (Page 10)

This slide is a strategic framework that logically organizes the market environment and future growth vision. Investors should understand this slide because it demonstrates the logic that the spread of AI is not a risk, but a "strong tailwind for the expansion of the PMO business." As the world shifts from an era of information superiority to the "democratization of knowledge," the value of "knowing" decreases, while the value of execution—the ability to "see a transformation through to the end" by navigating complex human relationships and inter-organizational interests—increases dramatically. By clearly presenting this market structural shift, the company confirms that its PMO services are riding a long-term mega-trend.

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6. Expansion of the PMO Market and Strengthening Talent Supply

The domestic PMO market is expanding rapidly beyond the IT sector into non-IT areas (new business launches, business reform, organizational restructuring, etc.). According to data from major market research firms, the domestic PMO market is expected to grow to 1.3936 trillion yen by 2030 , with latent demand becoming increasingly apparent.

To capture this market opportunity, the company is significantly strengthening its talent acquisition capabilities. The number of monthly applicants for mid-career positions has reached over 1,000 (2.7 times the FY23 average of 474), and the job offer acceptance rate remains high at the 50% level . The number of supported clients has also increased 1.5 times (241 companies) over the past three years.

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7. SG&A Expense Structure and Strategic Investment

SG&A expenses for the first half totaled 3,568 million yen (+2.1% YoY) . A breakdown shows that while recurring expenses (personnel costs, rent, etc.) were contained at 2,498 million yen (+2.0% YoY), the company invested 808 million yen (+30.1% YoY) in recruitment and training as a strategic investment.

System and development costs related to the proprietary product "PROEVER" are being shifted from SG&A to cost of sales or capitalization as the phase progresses. Overall, the company is efficiently allocating funds by concentrating investment on the recruitment and development of talent necessary for growth.

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8. Full-Year Earnings Forecast: Expecting Growth in Line with the Plan

The full-year earnings forecast for the fiscal year ending December 2026 remains unchanged from the announcement on February 15, 2026, as follows:

• Net Sales : 26 billion yen (+12.7% YoY) (1H actual: 12.5 billion yen / 2H forecast: 13.3–13.7 billion yen)
• Operating Profit : 3 billion yen (+9.4% YoY) (1H actual: 1.5 billion yen / 2H forecast: 1.5–1.8 billion yen)
• Number of Mid-career PMO Consultants : 220–240 (1H actual: 127 / 2H forecast: 100–110)

Significance and Background of Slide (Page 19)

This slide provides important data on progress toward full-year earnings and the outlook for the second half . The progress rate for net sales in the first half is 48.2%, and for operating profit is 52.2%, indicating a very steady pace. In the second half, operating expenses are expected to increase due to the full-year impact of personnel costs for the 169 new graduates, the continuation of aggressive recruitment activities through the third quarter, and additional branding investments. The key point is that the company expects to achieve its full-year operating profit target of 3 billion yen while having already factored in these upfront investments.

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9. Financial Foundation and Cash Flow Generation

The company maintains an extremely high level of financial soundness. As of the end of June 2026, total assets were 9,358 million yen , net assets were 6,700 million yen , and the equity ratio reached 70.0% .

Furthermore, the company’s cash-generating ability from its core business (operating cash flow) has remained in the range of 1.3 to 2.3 billion yen annually over the past three years, consistently generating free cash flow that comfortably covers financial cash outflows such as share buybacks and dividend payments.

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10. Strengthening Shareholder Returns: Significant Dividend Increase and Policy

Against the backdrop of a strengthened financial foundation and stable cash generation, the company has announced an expansion of shareholder returns.

• Dividend Increase Plan : The company plans to significantly increase the annual dividend per share for the fiscal year ending December 2026 from 32 yen to 50 yen .
• Dividend Payout Policy : The company has set a medium-term goal of a consolidated dividend payout ratio of 50% .
• Other Returns : The company continues its shareholder benefit program (with a maximum yield equivalent to 2.1%) and implements flexible share buybacks in response to market trends, advancing measures to improve total shareholder value.

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Summary

The Q2 FY2026 financial results for Management Solutions demonstrate a company successfully balancing organizational expansion with profit growth, fueled by rising PMO demand in the era of AI. The company’s "strengthened ability to supply high-quality talent" through new graduate and mid-career hiring, combined with the "acquisition of high-unit-price projects centered on large clients," is functioning effectively. The company’s commitment to enhancing shareholder returns is also clear, as evidenced by the significant dividend increase aimed at achieving a 50% payout ratio.