Q1 2023 Recruit Holdings Co Ltd Earnings Call

Outage in such types of jobs, so even with a slight decline in the job.

Okay.

The supply side has problems so.

How much can this be matched by.

Addressing on the interest rate this is questionable.

So for the first time in human history.

Our labor market is not so bad but people all everyone says its recessionary.

Okay.

So it seems that it will become worse.

Cause the supply side has problem, but the it is trying to be balanced by reducing the demand.

So my personal view is that.

Wage inflation cannot be lowered that much.

Yeah.

So.

We think it's better to operate our business conservatively and that is why we are reviewing our hiring plan.

Yeah.

So we will turn.

Conservative.

For.

For this time temporarily win.

When Covid started.

We stopped hiring and the biggest mistake, we did was because we our HR jobs have disappeared completely.

And it took time for us to <unk>.

Restart the engine.

So.

Rather than us.

Putting on are stepping on the gas pedal all of a sudden we watched a more smoother adjustment.

To address the changes.

In the medium to long term.

Well if the when the sale was softening.

The sales and client support.

Hiring will be adjusted.

To match the demand.

But if possible.

For engineers.

Like we said earlier the stock.

Based compensation.

Is in place and other competitors are now slowing down their hiring and so we can hire a capable talent and so we will work hard and continue our hiring like considering that as a long term investment. So that is the kind of hiring we want to pursue.

Yeah.

Thank you I understand.

Yeah.

Thank you.

Next is our Morrison from JP Morgan.

Thank you for this opportunity I have two questions.

First.

Of Ducker iPhone explained earlier.

Well I'm focusing on the short term viewpoint, but revenue in July a group of 15% and if this trend continues or you will land on the lower half of the range.

And I would like to confirm.

In the first quarter I believe the performance was quite strong.

And if we look at July alone.

This expectation for the lower half of the range.

Yeah.

Is it because.

Of.

The slowdown beyond two line it would be faster than expected.

And.

Previously.

My.

Revenue per job with disclosed for the first time and how has it trended in the first quarter if possible I would appreciate that comment.

Thank you.

Yeah.

First of all situation in July .

And the state of Florida and beyond July .

Oh, where well go to <unk>.

Point in your question.

Well I believe they are a couple of factors.

In the guidance for HR took us being you are this is based on U S dollar.

Therefore, if the U S dollar is stronger.

But it would affect the revenue growth.

However, especially the decline of speed in the U S.

Is quite fast in July .

From our viewpoint.

If the speed continues.

And as we speak with our customers.

We hear voices, saying, there thinking about reducing the number of hirings.

And as I said earlier.

And the typical economic recession.

Signs.

B the number of job postings by a small and medium sized companies. If we see them decline, although it won't be a sign of economic recession.

But we also believe the speed maybe faster than we had expected.

But as you said.

And this July if we look up this July .

Where based on the assumption that the trend continues so if we look at August or September .

Well. It is also true for the share price, but maybe the decline or won't be flu wears on than we had expected.

Especially in the U S.

The mood for.

Economic slowdown if not just nordics and where spreads are perhaps the situation may be better.

But if we only focus on the silver ration in July .

We have to say.

Was that a it was a quick slowdown.

And the other point is priced parish of revenue pretty sharp trend in the first quarter.

Well to be specific.

For large enterprises.

System, our integrated in such companies and such and I'm, a number of such companies have been increasing.

So the number of job advertisements by such large enterprises.

It has been increasing.

I believe we discussed this previously.

But oh, no we're acquiring platform.

There are employers would directly post their <expletive>.

And are there are clients, who are connected buy system they have different trends.

Of course, we.

Strive to offer value to every customer.

But system connected customers tend to have a larger volume.

And Oh, not is resulting in a slow growth in the revenue per job, but a four oh that was on platform we have been taking various measures.

Therefore, we have been seeing stronger trend that is our impression.

I hope I answered your question.

I would like to ask a follow up question.

Yeah.

Probably index job and have the child is what you're talking about.

Posted job.

The trend to see or is upward.

In price per job has been pushed up.

Yeah.

Food.

This timing.

Indexed job is it starting to increase suddenly has there been any change in the trend.

Yes. Thank you.

Indexed job is what I referred to a system connected customers.

They have always been on an upward trend.

And these.

Customers are large enterprises.

But they are connected through the system and.

There are they also post jobs as directly on the platform such customers is increasing.

So both services are used by menu large enterprises today.

Indexed job the system connected jobs.

They have not been on a downward trend as they have been on a growing trend. It's just not a more customers are using both services today.

In this first quarter.

Index job customers increased further.

So they are a more of a driver for the cost per job.

I see and is there any reason for that trend.

For this increase in the index child.

Or did it just happened to be that way in the first quarter.

A T S integration.

Well there are more customers who are connected.

Through the system.

And.

Depending on customers well.

100000 jobs will be the volume are they budget for.

And if we look at budget pershall it can be smaller.

Yeah.

So.

System integration type of customers is increasing that is how I would address your question.

And regarding my second question.

Today, you've explained are the macroeconomic situation and I, whereas it able to deepen my understanding.

Previously you discussed.

C P. A C P QA shift to our C. P. A C P Kuwait and medium to long term.

Today, you're facing.

Uncertainty.

When we tried to foresee the future.

And Oh, how would these factors affect your transition a two C. P. A N C P QA.

I believe the impact would not be a large during this period.

Yeah.

And.

Maybe it just not something you can judge in the short term.

But.

During these are one or two years or a from a medium term viewpoint, what kind of impact do you expect on this shift.

Thank you so C P. A C P QA.

We are trying to enlarge the value we can offer and these are just one of the examples.

What is important is especially for CP QA.

So there is application.

And the applicant.

If the company likes the applicant we charge a price.

This type of.

Business model.

Why do we do this is <unk>.

Because the job seekers.

Their largest complained.

Was that a they are flat for five or 10 jobs, but they you don't hear back into a three weeks.

That has been their biggest complaint for many years in the past and that resulted in low satisfaction level of job seekers.

For those job seekers, who are seeking jobs.

It is important that they receive a reply within 48 hours.

And they wouldn't know if they can go to the next step or not so we have been pushing this pricing model.

Regardless of the economic condition I believe we discussed this previously.

But from the company's point of view.

Maybe their HR personnel is busy or in large enterprise. They would receive a 100 applications in the day and they wouldn't be able to read them all.

Who.

We do see that there is a hurdle in expanding there's a pricing model further.

Yeah.

So this.

C P Q way, it's not going to be the only solution.

But for example C P C.

Instead of C. P C.

If begin application button is clicked.

Weaken a charge of price.

That is another.

Version.

We have been testing variety of solutions and these are just one of the examples.

So not status has not changed.

From the previous briefing.

Yeah.

We.

Or are willing to promote solutions that are good for the job seekers.

I Hope I was able to answer your question.

Thank you very much that was clear thank you.

Well C P ACP QA and.

In addition to them are we are trying to offer various values, especially for those on our platform.

We've been seeing a rise in the the revenue.

The unit revenue.

Thank you.

It is almost time, so we will take the next question last question B of a securities cannot Stephane lease Yeah can you hear me.

Yes, we do.

Sorry, I'm mindful of time I will just ask one question. So thank you for the U S update.

The non U S countries.

For indeed.

Compared to the U S.

The non U S countries are still in the development phase I think.

So you mentioned that in the U S. The hiring will be reviewed.

On the others, but in non U S countries or what is your strategy and what is the status.

Given the current macroeconomics that is are you changing your strategy.

So in other words non U S countries HR tech strategy or status.

My question. Thank you.

Thank you.

So non U S countries roughly speaking.

The non U S advanced nations.

The OECD countries and non U S.

Developing countries.

The emerging countries.

So there are two main groups.

Our first countries centered on Europe .

All the tests that were conducted in U S are deployed very actively in Europe .

The employees that is is.

Mostly sales local sales personnel.

So the hiring there.

Is.

Got it.

The hiring is done controlled in accordance with the situation in each country.

And the current status is the Europe growth rate is higher than that of the U S and therefore.

Yeah.

U S sales are which we prioritize on the adjustment of the hiring of its U S that we prioritize now the developing countries in countries like India.

Yeah.

It had been a challenging country for us, but finally, the number of users.

Exceeded the company the local company that had already been number one and now we are number one.

So this is a promising country. So in such countries Oh, we will first secure the number of users and tried to invest as much as possible.

Does this answer your question.

Yes, just for clarification.

So.

Yeah.

You will oh.

Police more focus on Europe than U S.

But.

A dollar a stronger euro is weaker.

So from a dollar perspective, it seems like that and so the growth rate seems relatively lower.

But.

The market maturity from indeed perspective.

It is still growing.

So we want to secure market share.

So on the Q on Q basis, the U S and non U S. Non.

Non U S seems lower but.

Oh on local currency basis that is not the case the non U S countries are growing a more solidly is that correct.

Well, especially Japan.

Yeah, Newsweek and so on a dollar denominated basis Q on Q It is pretty.

DVA did budge.

Thank you.

Thank you at this time, so we will now close of the financial results briefing call. Thank you very much.

Thank you.

Okay.

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