Will Smart Co.,LTD.

Business Details

The company targets the Mobility industry—encompassing the movement of people and goods such as transportation and logistics—as well as national and local government bodies as key customers, providing total services ranging from consulting to software development, hardware provision, and maintenance support. By combining IoT technology with Web open-system technology, the company supports unmanned operation, labor-saving, and DX transformation. Revenue consists of shot-based revenue such as system development and stock-based revenue from maintenance and license usage fees. In the first quarter of FY2026 (ending March 2026) (January to March 2026), revenue was ¥206 million and operating loss was ¥52 million.

Recent Overview

Q1 revenue declined 2.9% year-on-year, but operating loss improved. The fall into negative net worth and the resolution on the third-party allotment capital increase are the biggest points of focus.

Revenue for the first quarter of FY2026 (ending December 2026) (January to March 2026) was ¥206 million (down 2.9% year-on-year). Meanwhile, thanks to the effect of reduced selling, general and administrative expenses, operating loss improved to ¥52 million from ¥68 million in the same period of the prior year. However, the recording of a quarterly net loss of ¥54 million caused net assets to fall to -¥51 million, resulting in negative net worth, with the equity ratio at -12.3%. There is material uncertainty regarding the going concern assumption. As a countermeasure, on May 15, 2026, the company resolved to conduct a third-party allotment capital increase totaling approximately ¥450 million (669,600 shares, ¥672 per share, payment date June 1, 2026) with Zenrin and Sen-yo Kogyo as the allottees. Following the capital increase, Zenrin's voting rights ratio is expected to reach 54.10%, making the company a consolidated subsidiary of Zenrin. The proceeds will be used for contracted development system construction (¥244 million) and proprietary platform development (¥200 million). Business progress was also confirmed, including the opening of the Phase 2 area of "Bus Terminal Tokyo Yaesu" and the start of a regional transportation DX collaboration with KCS Corporation.

Key Products

Growth Drivers

• Continued accumulation of stock revenue (maintenance, operation, and system usage fees): Monthly stock revenue continued to increase steadily during the current fiscal year as well
• Regional public transportation field: The Ministry of Land, Infrastructure, Transport and Tourism has designated FY2025-2027 as the "Intensive Countermeasure Period for Eliminating Transportation Gaps," leading to an increasing trend of orders from local governments funded by subsidies
• New entry into the logistics field: Following the acquisition of type designation for the OBD-II Digital Tachograph (Digitaco) in December 2025, full-scale sales began in April 2026, capturing demand related to compliance with the revised Logistics Two Laws
• Strengthening of the capital alliance with Zenrin: Deepening the one-stop solution collaboration for identifying and resolving "transportation gaps" that began in April 2025. Promoting joint proposals and joint order-taking leveraging Zenrin's nationwide sales network
• Capital and business alliance with Sen-yo Kogyo: Opening up new business areas such as providing digital signage, reservation and ticketing, and mobility services for Ferris wheels and amusement facilities, and designing tourist routes for regional tourist destinations
• Medium-Term Management Plan "2030 Beyond 100": Targeting revenue of ¥3,000 million, operating profit of ¥350 million, and an operating margin of 12% for FY2030, with nationwide expansion as a core player in compact, plus-network-type urban development
• Stabilization of the financial base through a third-party allotment capital increase (approximately ¥450 million): Securing funding sources for investment in contracted development and proprietary platform development

Risks

• Material uncertainty regarding the going concern assumption: Net assets fell to -¥51 million (equity ratio of -12.3%), resulting in negative net worth. Operating loss and negative operating cash flow continue. Completion of the third-party allotment capital increase (payment date June 1, 2026) is a prerequisite for stabilizing the financial base
• Risk of becoming a consolidated subsidiary of Zenrin following the third-party allotment capital increase: Zenrin's voting rights ratio will reach 54.10% after the capital increase, potentially constraining management independence and autonomous decision-making
• Risk of dependence on major customers: The termination of business or reduction of investment by specific customers poses a risk that directly impacts business performance. In the prior fiscal year, the disappearance of a car-sharing project affected results
• Dependence on subsidies in the regional public transportation field: Orders from national and local governments are structurally funded by subsidies, so changes in the scale of the national budget and subsidy requirements directly affect order intake
• Market penetration risk for the OBD-II Digital Tachograph: Market penetration is expected to be limited in the first year of sales. There is a track record of the release being delayed from the initial plan
• Increase in interest expense: Short-term borrowings expanded to ¥374 million (up ¥49 million from the end of the prior fiscal year), and interest expense in the current Q1 rose significantly to ¥1,750 thousand from ¥410 thousand in the same period of the prior year. Reliance on borrowing for cash flow is pushing up financial costs
• Difficulty in achieving the full-year earnings forecast: Q1 revenue of ¥206 million represents only 17.9% of the full-year forecast of ¥1,150 million, requiring ¥944 million in revenue to be recorded over the remaining three quarters. Progress in expanding sales of the OBD-II Digital Tachograph and securing large-scale orders is key