Kurashiru (299A) FY2026 Q3 Earnings Report

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Executive Summary

The company delivered higher revenue and higher earnings, continuing double-digit growth in both areas, with expansion of the Purchasing Business driving growth. Revenue was ¥12.48B (+31.6% YoY), Operating Income was ¥2.54B (+22.6%), Ordinary Income was ¥2.56B (+26.0%), and Net Income was ¥1.78B (+37.2%). Although the increase in cost of revenue (+40.9%) outpaced revenue growth and reduced the gross margin, an improvement in the SG&A ratio partially offset this effect, enabling the Operating Income margin to remain at a high level of 20.4%.

Factors Affecting Performance

【Revenue】Revenue was ¥12.48B, up +31.6% YoY. The main growth driver was the core Purchasing Business, which captured the expansion of Recipe Challenge-related MAU (2.92 million, +250,000 QoQ) and year-end promotional demand, resulting in a sharp increase of +66.0% YoY on a standalone Q3 basis. The Media Business also posted revenue growth of +9.6% YoY, supported by strong PV volume.

【Profit and Loss】Operating Income was ¥2.54B (+22.6%), Ordinary Income was ¥2.56B (+26.0%), and Net Income was ¥1.78B (+37.2%). Cost of revenue increased at a faster pace than revenue (+40.9%), causing the gross margin to decline to 46.9% from 50.5% in the prior year. However, the SG&A ratio improved to 26.6% from 28.6%, partially absorbing the decline in profitability. Non-operating items were minor, comprising a gain on the sale of fixed assets of ¥0.001B and a loss on disposal of ¥0.002B. The divergence between Ordinary Income and Net Income was primarily attributable to changes in the tax burden ratio. In conclusion, the company achieved higher revenue and higher earnings.

Segment Analysis

In terms of composition, the Media Business (¥2.11B) accounted for the largest revenue scale as the core business. However, from the perspective of contribution to Operating Income/Loss, the Purchasing Business (¥1.75B, +66.0% YoY) was the primary factor behind fluctuations in performance. The Purchasing Business expanded sharply by +29.6% QoQ on a standalone Q3 basis, driven by year-end promotional demand and the expansion of Recipe Challenge MAU. The Other Businesses (¥0.76B) experienced a decline in gross margin due to a change in revenue composition resulting from the expansion of high-return-rate streamer revenue, creating differences in profitability among segments. While the Media Business is achieving stable growth through increased PV volume, the Purchasing Business is leading in growth rate, indicating that the business structure is gradually shifting from Media to Purchasing.

Key Financial Metrics

Profitability: ROE 19.0% (annualized), Operating Income margin 20.4%
Cash quality: Operating CF/Net Income 0.84x (below 1.0x), FCF ¥1.05B
Investment efficiency: Capital expenditures/Depreciation and amortization 1.00x
Financial soundness: Equity Ratio 80.4%, Current Ratio 425.9%

Cash Flow Analysis

Operating CF was ¥1.50B, or 0.84x Net Income, below 1.0x, indicating that cash backing for earnings was somewhat weak. The main factor was a ¥0.53B increase in accounts receivable, against the backdrop of an increase in business partners accompanying the rapid expansion of the Purchasing Business. Investing CF was -¥0.45B, mainly due to ¥0.30B in acquisitions of shares in subsidiaries and affiliates and ¥0.115B in acquisitions of investment securities; capital expenditures were small at ¥0.03B. Financing CF was ¥0.13B. FCF remained positive at ¥1.05B. While the company’s cash generation is at a standard level, the OCF/EBITDA ratio of 0.58x also warrants monitoring.

Quality of Earnings

The difference between Ordinary Income of ¥2.56B and Net Income of ¥1.78B was primarily attributable to the tax burden (¥0.78B in income taxes, effective tax rate of 30.6%), while temporary factors were minor. Non-operating income was ¥0.04B, remaining below 5% of revenue, indicating a recurring earnings structure. Operating CF of ¥1.50B was below Net Income of ¥1.78B (0.84x), and although the accrual ratio remained low, the delay in cash conversion caused by the increase in accounts receivable represents a minor point requiring attention regarding earnings quality.

Earnings Forecast and Guidance

Cumulative progress against the full-year forecast (revenue ¥17.14B, Operating Income ¥3.37B, Net Income ¥2.29B) was 72.8% for revenue, 75.3% for Operating Income, and 77.5% for Net Income. Compared with standard progress (Q3=75%), revenue was slightly below while the earnings metrics were above, indicating progress led by profitability. Revenue of ¥4.665B and Operating Income of ¥0.834B are required in Q4, and the continuation of year-end promotional benefits in the Purchasing Business will be key to achieving the forecast.

Shareholder Returns

Both the Q2 dividend and the full-year forecast dividend are ¥0 per share, resulting in a Payout Ratio of 0%. Meanwhile, the company newly introduced a shareholder benefit program offering one year of Crasil Premium membership (equivalent to an approximately 5.2% benefit yield). As Net Income is not distributed as dividends, the full amount is retained as retained earnings and serves as a source of funds for growth investment. No share buybacks have been confirmed, and the Total Return Ratio is currently at the same level as the Payout Ratio.

Catalysts

【Short term】Continuation of promotional demand for the Purchasing Business in Q4, trends in Recipe Challenge MAU expansion, and the degree of recovery from the full-year revenue progress rate of 72.8%. 【Long term】Expansion of partner companies in the Crasil Retail Network (including participation by LINE WALK), expansion of Recipe Challenge for the food-service industry, and progress in the transformation of the business structure from Media to Purchasing.

Industry Benchmark (For Reference; Compiled by the Company)

Industry Benchmark (healthcare)

Profitability and Returns

The company’s Operating Income margin and Net Income margin significantly exceed the industry median, positioning it favorably in terms of profitability.

Growth and Capital Efficiency

The revenue growth rate also significantly exceeds the industry median, positioning the company as a high-growth company within the industry.

※Source: Compiled by the Company

Risk Factors

1. Declining gross margin: Cost of revenue increased +40.9% YoY, exceeding revenue growth (+31.6%), and the gross margin declined by approximately 352bp to 46.9%. If deterioration in the cost structure continues, the scope for maintaining the high Operating Income margin will narrow.

2. Increase in accounts receivable and cash conversion efficiency: Accounts receivable increased +32.2% YoY to ¥2.58B, becoming a ¥0.53B source of cash outflow in Operating CF. Operating CF/Net Income was 0.84x and OCF/EBITDA was 0.58x, both below 1.0x and 0.7x, respectively. Managing collections in line with the expansion of the Purchasing Business will be an issue going forward.

3. Risk of changes in the business environment: In the Media Business, the market impact of 3rd Party display advertising has been observed, while in the Other Businesses, a decline in gross margin has been confirmed due to the expansion of high-return-rate streamer revenue. Changes in platform specifications and fluctuations in the promotional market may affect customer acquisition efficiency and monetization.

Key Points in the Earnings Results

1. Earnings metrics are ahead of revenue, with full-year progress of 75.3% for Operating Income and 77.5% for Net Income versus 72.8% for revenue, indicating that improved cost efficiency is supporting performance.

2. The approximately 352bp decline in gross margin and sharp increase in accounts receivable are structural changes accompanying the rapid growth of the Purchasing Business (+66.0% on a standalone Q3 basis), and will be key points in assessing the sustainability of future profit margins and cash generation.

3. With the continuation of a no-dividend policy, retained earnings increased 26.2%. The company has secured capacity for growth investment and M&A, supported by retained earnings and high financial safety reflected in an Equity Ratio of 80.4%.

Theoretical Share Price (Reference Value)

Sensitivity: ¥381–¥405 at cost of equity ±1%, and ¥390–¥397 at ω±0.1.

Notes:

• Goodwill amortization of ¥3.0 per share is added back to earnings (to reflect a non-cash expense and comparability with IFRS companies).
• Net assets as of the quarter-end are used (there is a timing difference from the full-year forecast).
• As net assets include non-controlling interests, the theoretical values may be calculated somewhat higher.

(Calculation model: Residual Income Model (Ohlson-type, explicit 5-year fade) / Interest rate reference month: 2026-07 / Mechanically calculated values based solely on publicly disclosed data; these are not forecasts of the market share price or recommendations of specific investment actions, and do not predict or guarantee future share prices.)

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

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