| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥55.4B | ¥39.5B | +40.2% |
| Operating Income / Operating Profit | ¥6.7B | ¥11.0B | -39.1% |
| Ordinary Income | ¥6.1B | ¥10.9B | -43.5% |
| Net Income / Net Profit | ¥3.5B | ¥6.0B | -41.6% |
| ROE | 7.3% | 11.2% | - |
The fiscal year ended March 2026 results reflected significant revenue growth from M&A consolidation alongside a slowdown in legacy businesses, resulting in Revenue ¥55.4B (YoY +¥15.9B +40.2%), Operating Income ¥6.7B (YoY -¥4.3B -39.1%), Ordinary Income ¥6.1B (YoY -¥4.7B -43.5%), and Net income attributable to owners of the parent ¥2.7B (YoY -¥3.9B -59.1%), i.e., higher revenue but substantially lower profits. Revenue expansion was mainly driven by consolidation of Horizon 14 shares (Property Management Business contributed ¥18.4B), while the existing Media Platform Business declined to ¥34.2B (-5.5%) and M&A Advisory Business to ¥2.8B (-14.8%). Consolidated operating margin fell to 12.1% from 27.8% a year earlier, down 15.7ppt, and net margin deteriorated to 4.9% (down about 10.3ppt from ~15.2% a year earlier). A sharp increase in goodwill amortization of ¥2.8B (prior year ¥0.4B) and the low-margin structure of the Property Management Business (operating margin 1.0%) pressured profitability.
[Revenue] The composition of Revenue ¥55.4B (+40.2%) comprised Property Management Business ¥18.4B (newly consolidated), Media Platform Business ¥34.2B (-5.5%), and M&A Advisory Business ¥2.8B (-14.8%). With the addition of the Property Management Business, revenue mix became Media Platform 61.8%, Property Management 33.2%, and M&A Advisory 5.0%. On a standalone basis, the Media Platform recorded a ¥2.0B year-on-year decline due to stagnation in existing media such as job advertisements and store property listings. M&A Advisory decreased ¥0.5B due to fewer closed deals. Gross margin fell to 63.2% (prior year 82.0%), down 18.8ppt, and gross profit only edged up to ¥35.0B (prior year ¥32.4B). This was mainly attributable to the comparatively low gross margin of the Property Management Business.
[Profit & Loss] Operating Income ¥6.7B (-39.1%) was primarily impacted by SG&A ¥28.3B (prior year ¥21.4B), a +32.2% increase; SG&A ratio improved to 51.1% from 54.2% a year earlier (3.1ppt improvement), but a sharp increase in goodwill amortization ¥2.8B (prior year ¥0.4B) weighed on profits. By segment, Media Platform Operating Income ¥5.8B (-40.7%, margin 17.0%), M&A Advisory ¥0.7B (-31.1%, margin 24.2%), and Property Management ¥0.2B (margin 1.0%). The Property Management Business generated Operating Income of ¥0.2B on Revenue ¥18.4B, extremely low margin, diluting consolidated margins. Non-operating expenses included interest expense ¥0.3B, resulting in Ordinary Income ¥6.1B (-43.5%). Extraordinary loss included impairment loss ¥1.6B, and a high effective tax rate of 56.1% (tax expense ¥3.4B on income before tax ¥6.1B) further reduced final profit to ¥2.7B (-59.1%). In conclusion, the company reported higher revenue but substantially lower profits.
The Media Platform Business recorded Revenue ¥34.2B (-5.5%), Operating Income ¥5.8B (-40.7%), margin 17.0%. Year-on-year, Revenue fell ¥2.0B and Operating Income declined ¥4.0B. Goodwill amortization ¥0.1B (prior year ¥0.4B) decreased, but fixed cost increases including depreciation ¥0.2B and lower sales pressured margins. The M&A Advisory Business posted Revenue ¥2.8B (-14.8%), Operating Income ¥0.7B (-31.1%), margin 24.2%. Revenue and profits declined due to fewer closed deals, but margin remained highest among the three segments. The Property Management Business, newly consolidated, reported Revenue ¥18.4B, Operating Income ¥0.2B, margin 1.0%. Goodwill amortization ¥2.6B exceeded operating income; pre-amortization operating income is estimated at about ¥2.8B, but even then the margin would be only around 15%. There is a large inter-segment margin dispersion (1.0%–24.2%), and the low-margin nature of the Property Management Business was the primary driver of the decline in consolidated margins.
[Profitability] ROE was 7.3%, down 6.4ppt from 13.7% a year earlier. DuPont decomposition shows Net Profit Margin 4.9% (prior year ~15.2%) × Total Asset Turnover 0.48x (prior year 0.64x) × Financial Leverage 3.09x (prior year 1.38x). The substantial decline in net profit margin was the largest deterioration factor, with goodwill amortization ¥2.8B (equivalent to 41.8% of Operating Income) and a high effective tax rate of 56.1% pressuring profits. Operating margin was 12.1% (prior year 27.8%), down 15.7ppt, and EBITDA (Operating Income + Depreciation + Goodwill Amortization) is approximately ¥9.6B, implying an estimated EBITDA margin of 17.3%. Even on a pre-amortization basis, profitability remains well below prior-year levels.
[Cash Quality] Operating Cash Flow (OCF) ¥9.3B was 3.4x Net Income ¥2.7B, and the OCF/EBITDA ratio was about 0.97x, indicating strong cash conversion efficiency. The accrual ratio (Net Income - OCF)/Total Assets was -5.7%, showing healthy conversion of profits to cash.
[Investment Efficiency] Total Asset Turnover 0.48x (prior year 0.64x) declined due to asset increases from acquisitions. Goodwill ¥50.3B accounts for 43.7% of Total Assets ¥115.0B, and intangible asset ratio is extremely high at 44.1%. Goodwill/Net Assets ratio stands at 106%, indicating substantial potential capital erosion if impairment risk materializes.
[Financial Soundness] Equity Ratio fell sharply to 41.4% (prior year 86.9%). Raising long-term borrowings ¥31.4B (prior year zero) increased reliance on interest-bearing debt, and Debt/EBITDA ratio is about 3.3x. Interest coverage (EBIT / Interest Expense) is roughly 23.5x, indicating adequate interest-paying capacity, but increased leverage reduces financial flexibility. Current ratio 250% and quick ratio 250% indicate adequate short-term liquidity; cash and deposits ¥37.6B substantially exceed current liabilities ¥17.5B.
Operating Cash Flow was ¥9.3B (prior year ¥4.4B, +110.7%), a large increase. Relative to income before tax ¥6.1B, non-cash expenses including goodwill amortization ¥2.8B and depreciation ¥0.1B plus working capital movements contributed positively. Specifically, trade receivables -¥0.1B, inventories +¥0.1B, and trade payables +¥0.2B were minor movements, and corporate tax payments -¥3.6B were absorbed. Contract liabilities (advance receipts) increased to ¥6.2B from ¥3.3B a year earlier, serving as a short-term cash source. Investing Cash Flow was -¥41.1B (prior year -¥0.1B), primarily due to acquisition of subsidiary shares -¥41.6B (funding for acquisition of Horizon 14 shares). Capital expenditures were minimal at -¥0.0B, maintaining an asset-light business model. Financing Cash Flow was ¥19.4B (prior year ¥3.7B), reflecting long-term borrowings procured ¥40.0B offset by long-term borrowings repayments -¥12.5B, dividends -¥4.1B, and share buybacks -¥4.2B. Free Cash Flow (OCF ¥9.3B + Investing CF -¥41.1B) was -¥31.8B, significantly negative as acquisition investments far exceeded operating cash generation. Cash and deposits decreased ¥11.9B from opening balance ¥49.5B to closing balance ¥37.6B, indicating part of the acquisition funds were paid from on-hand cash.
Operating Income ¥6.7B was generated from recurring business activities, but included goodwill amortization ¥2.8B (a non-cash expense specific to JGAAP), so pre-amortization operating income is estimated at about ¥9.5B. Non-operating income ¥0.2B was mainly interest income ¥0.1B, with limited one-off items. Of non-operating expenses ¥0.8B, interest expense ¥0.3B was a recurring cost associated with acquisition funding. An impairment loss ¥1.6B was recorded as an extraordinary loss, representing a one-time negative factor equivalent to about 60% of Net Income ¥2.7B. The effective tax rate of 56.1% substantially exceeds statutory rates, suggesting a reassessment of deferred tax asset recoverability and unrecognized tax effects. Comprehensive income ¥2.7B roughly equals Net Income ¥2.7B, with Other Comprehensive Income under ¥0.1B and immaterial. The accrual (Net Income - OCF) was -¥6.6B, indicating OCF exceeded Net Income significantly and there are no signs of profit manipulation. OCF/EBITDA ratio ~0.97x and OCF/Net Income 3.4x indicate healthy cash realization of earnings.
Full-year guidance is Revenue ¥75.0B (YoY +35.3%), Operating Income ¥3.3B (YoY -50.3%), Ordinary Income ¥2.9B (YoY -52.0%), and Net income attributable to owners of the parent ¥1.4B (YoY -47.6%). Progress as of the end of Q2 stood at 73.9% for Revenue, 202.7% for Operating Income, and 210.3% for Ordinary Income, meaning operating and ordinary profits have already substantially exceeded the full-year plan. This likely reflects conservative full-year assumptions that incorporate full consolidation of the Property Management Business and ongoing goodwill amortization. Revenue through Q2 was ¥55.4B against a full-year plan of ¥75.0B, implying expected incremental Revenue of ¥19.6B in the second half. Operating Income was ¥6.7B through Q2 versus a full-year plan of ¥3.3B, implying a planned second-half loss of -¥3.4B, assuming continued goodwill amortization and delayed profitability improvement in the Property Management Business. Forecast dividend of ¥15 per share is maintained, implying a calculated payout ratio of 297% which is extremely high; maintaining dividends while FCF is negative will require flexibility in capital policy.
A year-end dividend of ¥15 per share is planned, with total dividends estimated at approximately ¥4.3B (shares outstanding 29,123 thousand - treasury shares 1,080 thousand). Given dividends were maintained last year with a payout ratio of 62.5%, the company appears to preserve a stable dividend policy. For the current fiscal year, the payout ratio is calculated at 162%, substantially exceeding earnings; paying dividends ¥4.3B against Net Income ¥2.7B while FCF is -¥31.8B appears unsustainable. However, given cash and deposits ¥37.6B and operating cash generation ¥9.3B, short-term dividend paying ability is secured. Share buybacks of ¥4.2B were executed, bringing total shareholder returns (dividends + buybacks) to approximately ¥8.5B. The total return ratio is calculated at 315%, extremely high, and FCF coverage is -¥31.8B / ¥8.5B = -3.7x. Long-term sustainability of returns requires either improved monetization and expanded pre-amortization EBITDA of the Property Management Business or a return to positive FCF. The dividend policy nominally maintains the conventional "payout ratio target of 62.5%", but with full-year forecast Net Income ¥1.4B and dividends ¥15 per share (total about ¥4.2B), the implied payout ratio is around 300%, indicating room for adjustment.
Low-margin structure of the Property Management Business: With an operating margin of 1.0% (Operating Income ¥0.2B / Revenue ¥18.4B), profitability is extremely low; even after considering goodwill amortization ¥2.6B, pre-amortization margin is estimated at only about 15%. Rental income and sublease operations carry high fixed costs, and delays in improving occupancy and tenancy rates would chronically pressure consolidated margins. Risks include integration costs from the new consolidation and delays in contract renegotiations.
Concentration of goodwill and intangible assets and impairment risk: Goodwill ¥50.3B represents 43.7% of Total Assets ¥115.0B and 106% of Net Assets ¥47.6B. If acquired businesses (mainly Property Management) fail to meet performance plans or market conditions deteriorate, impairment risk could materialize and substantially erode equity. An impairment loss of ¥1.6B was recorded in the prior period, and recoverability of acquisition goodwill requires ongoing monitoring. Under JGAAP, goodwill amortization of ¥2.8B per year (equivalent to 41.8% of Operating Income) is a persistent downward pressure on margins.
Slowdown in legacy businesses and segment concentration risk: The Media Platform Business (Revenue ¥34.2B, -5.5%; Operating Income ¥5.8B, -40.7%) shows notable deceleration despite representing 61.8% of revenue. The M&A Advisory Business also slowed (Revenue ¥2.8B, -14.8%) in line with market sensitivity. As reliance on the Property Management Business increases, unless its low profitability is resolved, overall margin recovery will be difficult. Immediate priorities include retaining Media Platform customer base and improving ARPU, and rebuilding the M&A deal pipeline.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 12.1% | 8.1% (3.6%–16.0%) | +4.0pt |
| Net Profit Margin | 6.3% | 5.8% (1.2%–11.6%) | +0.5pt |
Operating margin exceeds the industry median by 4.0ppt, maintaining at least mid‑range profitability within the IT & Communications sector. However, given the sharp decline from 27.8% a year earlier, goodwill amortization and low-margin newly consolidated businesses are temporarily depressing profitability.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 40.2% | 10.1% (1.7%–20.2%) | +30.1pt |
Revenue growth rate is well above the industry median, driven by M&A consolidation. However, organic growth is decelerating and is likely below the industry average.
※ Source: Company compilation
Although goodwill amortization burden and consolidation of low-margin businesses caused a material short-term decline in operating and net margins, Operating Cash Flow ¥9.3B (YoY +110.7%) indicates expanded cash generation. Future assessments should focus on pre-amortization EBITDA profitability and progress in monetizing the Property Management Business (improvement in margin from 1.0% to above 3%).
Equity Ratio 41.4% (prior year 86.9%) and long-term borrowings ¥31.4B have increased financial leverage, but interest coverage ~23.5x and current ratio 250% indicate that short-term financial soundness is maintained. The full-year guidance is conservatively set, incorporating a full consolidation of the Property Management Business and ongoing goodwill amortization. While the implied payout ratio exceeds 300% and appears unsustainable, short-term dividend-paying ability is supported by cash and operating cash generation; attention should be paid to potential mid-term adjustments to the return policy.
This report was automatically generated by AI analyzing 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 publicly disclosed financial statements. Investment decisions are your own responsibility; please consult a professional advisor as needed.