| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥649.3B | ¥637.4B | +1.9% |
| Operating Income / Operating Profit | ¥15.7B | ¥19.5B | -19.6% |
| Ordinary Income | ¥8.0B | ¥12.2B | -35.1% |
| Net Income / Net Profit | ¥-18.1B | ¥3.9B | -34.0% |
| ROE | -18.7% | 3.2% | - |
For the fiscal year ended March 2026, Revenue / Net Sales were ¥649.3B (YoY +¥11.9B +1.9%), achieving top-line growth. However, Operating Income was ¥15.7B (YoY ▲¥3.8B ▲19.6%), Ordinary Income ¥8.0B (YoY ▲¥4.2B ▲35.1%), and Net Income ¥-18.1B (YoY ▲¥22.0B), resulting in a substantial decline in profitability and a return to a net loss. Despite slight revenue growth, higher cost of goods sold and increased SG&A pressures reduced profitability at the operating level. Rising financial costs (interest expense ¥8.5B) further widened the decline at the ordinary income level, and the recognition of Special Losses ¥36.0B (of which impairment ¥30.6B) pushed the bottom line to a ¥-18.1B loss. Operating margin was 2.4% (prior year 3.1%, ▲0.7pt), Ordinary Income margin 1.2% (prior year 1.9%, ▲0.7pt), and Net margin ▲2.8% (prior year 0.6%, ▲3.4pt), indicating deterioration across all profit measures.
[Revenue] Single reportable segment: Sports Club Operations recorded ¥649.3B (+1.9%). Under the reportable segment framework, detailed disclosure is limited, but the structure retaining over 90% domestic revenue remains. Gross margin declined to 8.4% (prior year 8.9%, ▲0.5pt), with a notable increase in Cost of Sales to ¥594.9B. Rising energy costs, labor costs, and facility maintenance expenses appeared to pressure gross margin. SG&A of ¥38.8B increased by ¥1.5B YoY (+3.9%), outpacing revenue growth of +1.9% and causing operating leverage to reverse.
[Profitability] Operating Income was ¥15.7B (▲19.6%). The decline was mainly due to lower gross margin and higher SG&A, indicating the top-line growth could not offset deteriorating profitability. Non-operating income was ¥1.2B versus non-operating expenses ¥9.0B, netting to ▲¥7.8B; interest expense of ¥8.5B was a heavy burden, expanding the decline at the Ordinary Income level to ¥8.0B (▲35.1%). Special gains were ¥5.3B (including gains on sale of investment securities ¥0.2B), but Special Losses ¥36.0B (impairment ¥30.6B, loss on disposal of fixed assets ¥0.8B, etc.) significantly depressed final results, leading to Pre-tax Income of ¥-22.8B and Net Income of ¥-18.1B after tax effects. The divergence between Ordinary Income and Net Income is mainly due to the one-off impairment, and evaluating recurring earning power should focus on operating and ordinary profit deterioration. Conclusion: revenue up, profits down (net loss).
[Profitability] Operating margin 2.4% (prior year 3.1%, ▲0.7pt), Ordinary Income margin 1.2% (prior year 1.9%, ▲0.7pt), Net margin ▲2.8% (prior year 0.6%, ▲3.4pt) — all profit stages deteriorated. ROE was ▲18.7% (prior year estimate +6.5%) falling into negative territory, driven mainly by the sharp drop in Net margin. EBITDA was ¥49.6B (Operating Income ¥15.7B + Depreciation ¥33.9B), giving an EBITDA margin of 7.6%, so fundamental cash-generating capacity was maintained. However, interest burden is heavy; EBIT-based interest coverage (Operating Income ¥15.7B ÷ Interest Expense ¥8.5B) was 1.85x, in a warning zone. [Cash Quality] Operating Cash Flow was ¥41.2B (positive), with a cash conversion ratio to EBITDA of 0.83x, generally healthy, but the gap between Net Income ¥-18.1B and OCF ¥41.2B indicates an accrual ratio of ▲10.9% (high non-cash charges, mainly impairment ¥30.6B). [Investment Efficiency] Total Asset Turnover was 1.14x (Revenue ¥649.3B ÷ Total Assets ¥570.4B), similar to prior year. EPS was ▲112.47 yen (prior year 39.48 yen), BPS 405.89 yen (prior year 534.87 yen), indicating significant per-share value erosion. [Financial Soundness] Equity Ratio was 17.0% (prior year 21.8%, ▲4.8pt), current ratio 81.3% (prior year 80.8%), and D/E ratio 4.89x (prior year 3.56x), reflecting higher leverage and deteriorated financial health.
Operating Cash Flow ¥41.2B (YoY +¥6.2B +17.4%) remained positive, supported by non-cash charges including Depreciation ¥33.9B and Impairment ¥30.6B, offsetting Pre-tax Loss ¥-22.8B. Working capital movements were minor: inventories Δ +¥1.0B, trade receivables Δ +¥2.2B, trade payables Δ ▲¥0.5B. Investing Cash Flow was ¥-44.0B (prior year ¥-31.6B), driven mainly by Capital Expenditures ¥-37.3B; reinvestment continued at a level exceeding depreciation (Capex/Depreciation 1.10x) for maintenance, new openings, and refurbishments. Financing Cash Flow was +¥11.9B (prior year +¥10.9B), increasing funding via long-term borrowings +¥38.6B and short-term borrowings +¥12.9B, while repaying long-term borrowings ▲¥26.6B and lease liabilities ▲¥9.7B. Free Cash Flow was ¥-2.8B (OCF ¥41.2B + Investing CF ¥-44.0B), a small negative, meaning growth investment slightly exceeded operating cash. Cash and deposits increased to ¥85.7B (prior year ¥76.8B, +¥8.9B), securing short-term liquidity.
Recurring earning power is evidenced by Operating Income ¥15.7B and EBITDA ¥49.6B, indicating the core business income base is maintained. Non-operating income ¥1.2B is minor (0.2% of sales), composed of interest income ¥0.2B, foreign exchange gains ¥0.2B, etc. Non-operating expenses ¥9.0B are primarily interest expense ¥8.5B (1.3% of sales), with financial costs weighing on profitability. Special gains ¥5.3B and Special losses ¥36.0B are one-off items; in particular, impairment ¥30.6B is a non-cash charge that distorts this period’s P/L without accompanying future cash flows and is not sustainable. The large gap between Ordinary Income ¥8.0B and Net Income ¥-18.1B is mainly due to Special losses, so evaluation at the ordinary stage better reflects underlying performance. OCF ¥41.2B being positive versus Net Income ¥-18.1B and an accrual ratio of ▲10.9% underscores the significant impact of non-cash impairment. Comprehensive Income ¥-20.9B includes Net Income ¥-18.1B and FX translation adjustments ▲¥0.2B and retirement benefit adjustments +¥0.4B, so the difference is small. EBITDA-based interest coverage 5.84x (EBITDA ¥49.6B ÷ Interest Expense ¥8.5B) is acceptable, but EBIT-based 1.85x is in a cautionary zone, making management of financial costs important.
The company guides Full Year forecasts of Revenue ¥680.0B (YoY +¥30.7B +4.7%), Operating Income ¥18.0B (YoY +¥2.3B +15.0%), Ordinary Income ¥9.0B (YoY +¥1.0B +13.2%), and Net Income ¥5.0B. Compared with this fiscal year’s results, the company plans an operating-level profit increase of ¥2.3B, conditional on strict cost control and improvements in utilization rates and pricing. With Special losses expected to dissipate, the company expects to return to net profitability; EPS is projected at 25.38 yen (a substantial improvement from actual ▲112.47 yen). Dividend is planned at ¥4.0/ share, down from ¥13.0 this year. Progress ratios are high: Operating Income 87.2% (¥15.7B/¥18.0B), Ordinary Income 88.4% (¥8.0B/¥9.0B), but these reflect this year’s one-off cost increases and Special losses; achieving next fiscal year’s profitability recovery will be key.
This fiscal year dividends were Interim ¥4.0 and Year-end ¥9.0, totaling ¥13.0/ share, with Net Income ¥-18.1B yet total dividends paid ¥2.66B (total return amount ¥2.66B, no share buybacks). Payout Ratio is not computable due to net loss (effectively underfunded by earnings), and paying dividends ¥2.66B against Free Cash Flow ¥-2.8B could not be covered by internal funds alone, implying use of cash reserves or borrowing. Next fiscal year plans a reduced dividend of ¥4.0/ share; with projected Net Income ¥5.0B, the payout ratio would be 30.4% (¥4.0 / ¥25.38), indicating a stable-dividend policy. Sustainability of future dividends depends on recovery of Operating Income and EBITDA, stabilization of FCF, reduction of interest burden, and deleveraging. Cash and deposits ¥85.7B compared to short-term liabilities ¥173.6B yields 49.4% coverage, indicating limited liquidity and that sustained cash generation is necessary to maintain dividends.
Profitability deterioration risk: Low-profit structure is evident with Operating margin 2.4% and Net margin ▲2.8%; Gross margin 8.4% declined ▲0.5pt YoY. Rising energy, labor, and facility maintenance costs have not been fully passed through via pricing or utilization improvements, and SG&A increased +3.9%, reversing operational leverage. Future wage and energy price trends could further compress profits, making implementation of operating-level improvement measures urgent.
Financial leverage & liquidity risk: D/E 4.89x and Equity Ratio 17.0% indicate high leverage; current ratio 81.3% and cash/short-term liabilities 1.56x signal short-term liquidity concerns. Short-term borrowings ¥55.0B, long-term borrowings ¥67.1B, and lease liabilities (current ¥10.3B, non-current ¥138.1B) are burdensome, with interest expense ¥8.5B reducing EBIT interest coverage to 1.85x. Changes in interest rate environment, worsening borrowing terms, or downside in operating cash flow could materialize refinancing risk and higher interest burdens.
Asset quality & impairment risk: This fiscal year recorded impairment ¥30.6B and reassessed fixed-asset soundness. The company holds goodwill ¥15.5B, intangible assets ¥25.6B, and tangible fixed assets of ¥249.2B. Further declines in future profitability or store utilization could trigger additional impairments or asset write-offs. With shareholders’ equity ¥96.9B (down from ¥121.2B), the financial cushion is thin, and ongoing asset revaluation remains a management challenge.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 2.4% | 8.1% (3.6%–16.0%) | -5.7pt |
| Net Margin | -2.8% | 5.8% (1.2%–11.6%) | -8.6pt |
Both Operating Margin and Net Margin are materially below industry medians, showing relative weakness in profitability.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 1.9% | 10.1% (1.7%–20.2%) | -8.2pt |
Revenue growth rate lags the industry median by 8.2pt, indicating weaker growth.
※Source: Company compilation
Revenue up but profits down, with a fall to net loss and structural issues: Revenue +1.9% but Operating Income ▲19.6% and Net Income ¥-18.1B, showing significant deterioration in profitability. Gross margin 8.4% (▲0.5pt) and Operating margin 2.4% (▲0.7pt) indicate marked increases in COGS and SG&A, necessitating urgent improvement in fundamental earning power. Special Losses ¥36.0B (impairment ¥30.6B) are one-off, but sustainable return to positive net income is difficult without ongoing operating- and ordinary-level improvements; speed of cost optimization and price/utilization enhancements will be watched.
High leverage, interest burden, and liquidity constraints: D/E 4.89x, EBIT interest coverage 1.85x, current ratio 81.3% — financial metrics are in a cautionary zone, and interest expense ¥8.5B pressures Ordinary Income. Interest-bearing liabilities including lease liabilities are large, making the company vulnerable to interest rate shifts and deteriorating borrowing terms. Shareholders’ equity ¥96.9B (down from ¥121.2B) reduces the financial cushion; achieving FCF positivity and deleveraging is key for medium-term stability.
Next fiscal year aims for profit growth and return to net profit but plans dividend cut: The company forecasts Revenue ¥680B (+4.7%), Operating Income ¥18B (+15%), and Net Income ¥5B, but plans to cut dividends to ¥4/ share. Given current Free Cash Flow ¥-2.8B and dividends paid ¥2.66B this year, the company appears to prioritize cash conservation and financial health. The degree to which recurring profitability recovers, excluding the one-off Special losses, will determine whether guidance and dividend policy are achievable.
This report is an earnings analysis document automatically generated by AI from XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on public financial statement data. Investment decisions are your responsibility; consult a professional advisor as needed before making investment decisions.