Outsourcing Inc. full-year revenue up 8.6% in 2023
TOKYO, JAPAN — Global staffing firm Outsourcing Inc. reported an 8.6% year-on-year (YoY) increase in its 2023 full-year revenue, reaching a record JPY 749.60 billion (US$4.99 billion).
In its latest financial report, the firm attributed its revenue surge to the robust demand in the engineering sector and a rebound in transportation equipment production.
According to Outsourcing Inc., all five of its business segments reported unprecedented revenue figures at the end of last year.
Leading the charge is its Overseas Manufacturing and Service Operations Outsourcing Business segment, which posted a revenue growth of 14.9% thanks to the firm’s strong e-commerce business in the Netherlands, its logistics-related business, an increase in dispatch unit prices, and a strong demand in the aviation industry in Germany.
This is followed by the firm’s Domestic Service Operations Outsourcing Business and Domestic Engineering Outsourcing businesses — up by 9.8% and 8.6%, respectively — supported by the firm’s services to US military facilities and a strong demand for engineering professionals.
Meanwhile, the Overseas Engineering Outsourcing Business and Domestic Manufacturing Outsourcing Business segments also recorded revenue growth of 5.7% and 0.8%, respectively, by the end of 2023.
Nevertheless, the company encountered several obstacles, including heightened competition for talent and a slowdown in electrical equipment production, which hindered its financial performance.
Notably, operating profit and profit attributable to owners of the parent company did not meet the forecast, with the latter dropping by 51.6% to JPY 5.16 billion (US$34.4 million).
Impairment losses on goodwill, totaling JPY 9.05 billion (US$60.3 million), significantly affected the company’s profits. These losses were a consequence of adjustments made following the discovery of fraudulent financial reporting in previous years, which has since been resolved with the conclusion of internal investigations.
Outsourcing Inc. specializes in providing outsourcing and temporary staffing services across various sectors, including electronics and automotive. The company has expanded its international presence through strategic acquisitions but has also faced challenges due to accounting irregularities.
Last December, the firm announced its transition to a private entity following a JPY 221 billion (US$1.47 billion) management buyout led by Bain Capital Private Equity. The company’s shares are set to be delisted upon completion of the tender offer and subsequent procedures.
