Formation and Standardization of Post-Merger Integration (“PMI”) and Effects

ALH Inc.

As SHIFT has been pushing forward with M&A since Fiscal Year ended August 2015, it has formed and standardized its PMI, and its PMI way has been delivering meaningful results. The revenue growth rate of those group companies that joined the SHIFT Group three years ago or before has been 20% per annum on average, showing stable numbers even during the COVID-19 pandemic.

Among other group companies, the theoretical value of ALH Inc. has increased 7 times than the first quarter of Fiscal Year ended August 2017 when ALH joined the SHIFT Group.

※Results as of April 2021
※Based on the growth rate and price-earnings (“P/E”) ratio of listed IT companies, estimated the sales growth rate of 20% as P/E: 30x

System I Co., Ltd.

In sales collaboration with System I, which is part of its PMI effort, the ratio of end user clients rose, resulting in higher gross margins. By repeating this success pattern with other group companies, SHIFT expects to further increase the value of services throughout the SHIFT Group.