TASUKI Holdings (166A) FY2026 Q1 Earnings Report

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Executive Summary

Revenue declined sharply, primarily due to a decrease in real estate deliveries in the Life Platform Business, resulting in both operating and net losses. Revenue was ¥69.5B (-59.0% YoY), Operating Income was ¥-1.0B (-104.5% from ¥21.4B in the previous year), Ordinary Income was ¥-5.5B (-127.5% from ¥19.8B in the previous year), and Net Income was ¥-3.4B (-124.7% from ¥13.8B in the previous year). In addition to a 9.0% increase in SG&A expenses despite the decline in revenue, an increase in interest expense further expanded the ordinary loss.

Factors Affecting Performance

【Revenue】Revenue was ¥69.5B, a 59.0% decline YoY. The core Life Platform Business generated ¥69.1B (-59.2% YoY), accounting for 99.4% of consolidated revenue, with a decrease in deliveries of real estate sales projects serving as the primary cause of the revenue decline. The Finance Consulting Business increased revenue to ¥0.4B (+33.5% YoY), but its impact on the consolidated scale was limited.

【Profit and Loss】Operating Income was ¥-1.0B, turning to a loss from ¥21.4B in the previous year. While Revenue declined 59.0%, SG&A expenses increased 9.0%, and lower fixed-cost absorption amplified the shift to an operating loss. Non-operating expenses reached ¥4.6B, including ¥2.6B in interest expense (+80.5% YoY), causing Ordinary Income to deteriorate to ¥-5.5B. A one-time gain on the sale of property, plant and equipment of ¥1.6B mitigated the loss before tax to ¥-3.9B, but Net Income was ¥-3.4B. Overall, the results reflected declines in both revenue and profit.

Segment Analysis

The Life Platform Business generated Revenue of ¥69.1B (-59.2% YoY) and recorded a segment loss of ¥2.4B, deteriorating from segment profit of ¥20.8B in the previous year, and was the primary driver of the deterioration in consolidated performance. The segment margin fell from 12.3% in the previous year to negative 3.5%. The Finance Consulting Business secured Revenue of ¥0.4B (+33.5% YoY) and segment profit of ¥0.1B (15.9% margin), but its share of consolidated revenue remained at only 0.5%, insufficient to offset fluctuations in the Life Platform Business.

Key Financial Indicators

【Profitability】The Operating Income margin was -1.4%, a significant deterioration from 12.6% in the same period of the previous year, while the Net Income margin also declined to -4.9% from 7.1%. The gross profit margin was 17.1%, down from 19.5% in the previous year, indicating changes in project mix and cost management.【Cash Quality】A gain on the sale of property, plant and equipment of ¥1.6B was recorded as an extraordinary gain, meaning that the underlying loss excluding this one-time factor was structurally larger than the ¥-3.9B loss before tax.【Investment Efficiency】ROE (annualized) was -4.5%, primarily because the operating loss and financial expense burden pushed down the Net Income margin.【Financial Soundness】The Equity Ratio was 32.3%, down from 38.3% in the previous year. Long-term borrowings increased to ¥392.9B (+30.7% YoY), indicating greater reliance on interest-bearing debt.

Cash Flow Analysis

As cash flow statement data has not been disclosed, cash trends are analyzed based on changes in the balance sheet. Cash and deposits declined 36.6% YoY to ¥166.0B, while long-term borrowings increased to ¥392.9B (+30.7% YoY), indicating greater reliance on external financing. The concentration of funds in real estate for sale and real estate under development, which account for most of total assets (approximately ¥657B in total, or 69.8% of total assets), is believed to be behind the decline in cash balances and the increase in borrowings. Short-term interest-bearing debt, comprising short-term borrowings, long-term borrowings due within one year, and corporate bonds due for redemption within one year, reached approximately ¥220B, a level that cannot be fully covered by cash alone. Progress in recovering funds through property sales will be an important point of observation in assessing future cash management.

Quality of Earnings

The current-period loss before tax of ¥-3.9B includes the one-time factor of a ¥1.6B gain on the sale of property, plant and equipment; the underlying loss excluding this gain is therefore larger. Interest expense accounted for ¥2.6B of the ¥4.6B in non-operating expenses and increased 80.5% YoY, with the burden expanding and the increase in financial expenses continuing to pressure Ordinary Income. Non-operating income was minimal at ¥0.1B, providing little support to offset the weakness in recurring earning power. Comprehensive income was ¥-3.8B, broadly close to the ¥-3.4B net loss attributable to owners of the parent, with the difference attributable to valuation differences on securities limited to ¥-0.3B.

Earnings Forecast and Guidance

The full-year company forecasts are Revenue of ¥1,004.5B (+35.0% YoY), Operating Income of ¥110.0B (+24.8% YoY), and Ordinary Income of ¥93.0B (+19.1% YoY). Progress rates against Q1 results were 6.9% for Revenue, -0.9% for Operating Income, and -5.9% for Ordinary Income, substantially below the standard 25% progress level. Achieving the company forecasts requires the assumption that deliveries and revenue recognition from real estate sales will be heavily weighted toward the latter half of the fiscal year from Q2 onward. Neither the earnings forecast nor the dividend forecast was revised during the current quarter.

Shareholder Returns

The full-year dividend forecast is ¥40.00 per share, with no revision made as of the current quarter. Based on approximately 61.62 million average shares outstanding during the period, the annual total dividend is approximately ¥2.46B, resulting in an expected Payout Ratio of approximately 42.5% against the full-year forecast of ¥5.80B in profit attributable to owners of the parent. As the company recorded a loss attributable to owners of the parent in Q1, the dividend funding capacity cannot be assessed against quarterly profit, and recovery of full-year earnings is a prerequisite for the dividend to be delivered.

Risk Factors

1. Risk of fluctuations in the timing of real estate deliveries: Q1 Revenue declined 59.0% YoY, and the progress rate against the full-year Revenue plan was 6.9%; delays in project deliveries would directly affect the full-year plan.

2. Leverage and interest payment risk: Long-term borrowings increased to ¥392.9B (+30.7% YoY), while the Equity Ratio declined to 32.3% from 38.3% in the previous year. Interest expense increased to ¥2.6B (+80.5% YoY), and during the current period, when operating results were in the red, this burden could not be absorbed by core operating earnings.

3. Real estate inventory risk: Real estate for sale and real estate under development totaled approximately ¥657B, accounting for approximately 70% of total assets. Declines in selling prices or delays in deliveries could affect both profitability and cash recovery.

Industry Benchmark (Reference; Company Analysis)

Industry Benchmark (real_estate)

Profitability and Returns

The Company's profitability metrics were negative for both Operating Income and Net Income, and comparative data against the median is currently insufficient.

Growth and Capital Efficiency

The Revenue growth rate was substantially negative, likely reflecting the significant impact of the timing of real estate deliveries.

※Source: Company aggregation

Key Takeaways from the Results

1. In Q1, Operating Income turned from a profit of ¥21.4B in the previous year to a loss of ¥1.0B, primarily due to the decline in Revenue from the core Life Platform Business. The progress rate against the full-year Operating Income plan of ¥110.0B was negative, making a substantial recovery in subsequent quarters a prerequisite for achieving the plan.

2. The Equity Ratio declined to 32.3%, while long-term borrowings increased 30.7% YoY. Along with the upward trend in interest expense, changes in financial leverage will be an important point of observation going forward.

3. A ¥1.6B gain on the sale of property, plant and equipment was recorded as an extraordinary gain, and the loss before tax includes this one-time factor. When assessing sustainable earning power, it is necessary to focus primarily on trends in operating results.

Theoretical Share Price (Reference Value)

Sensitivity: ¥631–¥668 at Cost of Equity ±1%, and ¥645–¥655 at ω±0.1.

Notes:

• Net Income is substantially compressed relative to Operating Income due to tax expenses, acquisition-related expenses, non-controlling interests, and other factors (Net Income ÷ Operating Income 53%). This value reflects that compression at face value; if the factors are temporary, underlying earnings power may be higher.
• Net assets as of the end of the quarter are used (there is a timing difference from the full-year forecast).
• As net assets include non-controlling interests, the theoretical value may be calculated somewhat higher.

(Calculation model: Residual Income Model (Ohlson-type; explicit 5-year fade) / Interest rate reference month: 2026-07 / Mechanically calculated value based solely on publicly disclosed data; this is not a forecast of the market share price or a recommendation of any specific investment action, and does not forecast or guarantee future share prices.)

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This report is an earnings analysis document automatically generated by AI based on XBRL earnings summary data. It does not recommend investment in any specific security. The industry benchmarks are reference information aggregated by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own responsibility, after consulting with a professional as necessary.

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