SHOWA SYSTEM ENGINEERING CORPORATION
4752・Standard Market・Information & Communication
SHOWA SYSTEM ENGINEERING CORPORATION
4752・Standard Market・Information & Communication
Business
Showa System Engineering Co., Ltd. was founded in 1966 and is listed on the Standard Market of the Tokyo Stock Exchange as an IT services company. The company operates two segments: the Software Development Business (approximately 99% of net sales), which provides comprehensive services covering the entire range of corporate computer systems, including system integration, consulting, and software design, development, and maintenance, as well as infrastructure-related areas; and the BPO Business, which includes Administrative Outsourcing for Financial Institutions, Health Checkup Reservation Outsourcing, and Scanning Service. Its main customer is the BIPROGY Group (formerly Nippon Univac), with which it has maintained a business relationship of over 40 years since the establishment of a joint venture in 1982. The top two customers by sales (Nikko System Solutions and BIPROGY) account for approximately 32.6% of net sales.
Business Model
The core of revenue is a man-month type SI business that receives orders for customer companies' system development and maintenance projects and provides services by deploying in-house SEs and business partner engineers. The order backlog at the end of FY2026 (ending March 2026) stood at ¥2,316 million (up 12.6% year on year), building a structure that secures a certain level of future revenue for the following period onward. The company continues to improve its operating margin by aggressively expanding new graduate hiring and investing in DX talent development to raise the added-value unit price.
Company Strengths
The company has maintained a business relationship spanning over 40 years since establishing a joint venture with BIPROGY (formerly Nihon Univac) in 1982. In FY2026 (ending March 2026), sales to BIPROGY Corporation amounted to ¥979 million (11.2% of net sales), and sales to Nikko System Solutions amounted to ¥1,868 million (21.4% of net sales), together accounting for approximately 32.6% of net sales, representing a stable customer base.
From FY2022 (ended March 2022) to FY2026 (ending March 2026), net sales grew from ¥6,461 million to ¥8,731 million, and operating profit grew from ¥613 million to ¥1,025 million, achieving 5 consecutive years of increased revenue and profit. Cash flows from operating activities in FY2026 (ending March 2026) improved significantly to ¥797 million from ¥624 million in the previous fiscal year, and under debt-free management, cash and deposits reached ¥6,378 million.
The order backlog at the end of FY2026 (ending March 2026) totaled ¥2,316 million (up 12.6% year on year), of which the Software Development Business accounted for ¥2,294 million (up 12.5% year on year). Order intake also trended above net sales at ¥8,990 million (up 7.5% year on year), giving the company a structural strength of being able to secure a certain level of sales in advance for the following period.
ENVALITH's Perspective
Performance Trend
In FY2026 (ending March 2026), revenue reached ¥8,731 million (+5.0% YoY), operating profit ¥1,025 million (+8.0%), ordinary profit ¥1,048 million (+8.9%), and net income ¥769 million (+7.7%), achieving five consecutive years of revenue and profit growth, with both revenue and operating profit setting new record highs. The gross profit margin remained flat at 17.8% (17.8% in the previous period). Externally, expanding DX investment centered on generative AI and cloud technologies, along with robust demand for core system renewal, served as tailwinds. On the other hand, outsourcing costs within cost of sales expanded to ¥3,511 million (from ¥3,333 million in the previous period), and rising dependence on outsourcing amid a shortage of IT personnel has emerged as a challenge in the cost structure. For FY2027 (ending March 2027), the company expects continued revenue and operating profit growth, with revenue of ¥9,000 million and operating profit of ¥1,053 million, but forecasts net income to decline to ¥722 million (-6.1%) due to the impact of tax reforms and other factors.
Growth Strategy
Under the medium-term management plan "+transform into Values," the company is advancing human capital strengthening, DX business expansion, and internal digitalization.
The company is enhancing compensation to strengthen employee engagement while pursuing active recruitment activities, significantly increasing the number of new graduate hires in FY2026 (ending March 2026). Recruitment expenses rose 26% year on year to ¥12 million. The policy of continuing to expand new graduate hiring will be maintained in FY2027 (ending March 2027) as well, strengthening the response to the IT talent shortage.
Through proactive proposal activities aligned with major clients' priority investment areas, the company aims to expand orders across a wide range of industries. It is supplementing its personnel supply capacity by strengthening collaboration with business partners, while advancing both deeper penetration of existing clients and development of new clients. In FY2026 (ending March 2026), revenue reached a record high of ¥8,731 million, reflecting the effects of these initiatives.
By strengthening talent development in AI, data science, and cloud fields, the company has achieved increased orders for DX-related projects. In FY2026 (ending March 2026), SE Services revenue expanded to ¥8,128 million (from ¥7,574 million in the previous fiscal year), reflecting progress in capturing DX demand. The policy of continuing efforts to develop advanced talent will be maintained in FY2027 (ending March 2027) as well.
The company is actively promoting trials to improve efficiency and productivity in internal operations using new technologies such as AI. It aims to reduce indirect costs and improve operational quality through internal digitalization. In FY2026 (ending March 2026), commission expenses paid increased 39% year on year (from ¥24 million to ¥34 million), reflecting a rise in costs associated with introducing digital tools.
Last updated: July 19, 2026