ENVALITH
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Hakuten Corporation

2173・Growth Market・Services

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株式会社博展 logo
Hakuten Corporation2173

Business

Hakuten Co., Ltd. was founded in 1967 and incorporated in 1970 as a company specializing in experience marketing. Under its purpose of "creating the driving force that connects hearts through communication between people and society, leading to the future," the company provides end-to-end planning, production, and operation of various events and marketing tools associated with the advertising and promotional activities of corporations and organizations. It has three consolidated subsidiaries — Digital Experience Co., Ltd., Nichinan Co., Ltd., and Hiramiya Co., Ltd. — which together address clients' communication challenges across the fields of real events, digital, and commercial environments. Its main customers are corporate clients, primarily major domestic companies, and it delivers experiential value through diverse touchpoints such as exhibitions, conferences, and commercial facilities.

Business Model

A project-based business model that provides an integrated, end-to-end service—from planning to production, construction/setup, and on-the-day operations—for events, exhibitions, digital content, and commercial space design, addressing client companies' marketing challenges. The real event field accounts for over 83% of net sales, and the acquisition of high-value-added projects through nominated orders (指名受注) underpins profitability. In FY2025, the operating margin reached 11.1% and the gross profit margin reached 32.1%.

Company Strengths

The company has built an in-house integrated system covering the planning, production, construction, and operation of events and exhibitions. Sales from invitation-based orders, which have been recognized for their "experiential value," have trended steadily, serving as a differentiating factor versus competitors. In FY2025, the company achieved net sales of ¥23,336 million and an operating margin of 11.1%.

The order backlog at the end of FY2025 stood at ¥7,682 million (up 4.34% year on year). Orders received also expanded to ¥23,655 million (up 16.07% year on year), securing a certain level of sales carryover into the next fiscal period. The accumulation of the order backlog serves as an indicator underpinning the stability of business performance.

In FY2025, operating cash flow amounted to ¥2,704 million (approximately 2.5 times the previous period). Cash and cash equivalents at period-end reached ¥4,495 million, and net assets stood at ¥5,003 million (up ¥1,642 million year on year). Capital expenditures were light at ¥54 million, with the majority of free cash flow being accumulated as cash on hand.

ENVALITH's Perspective

For Q1 FY2026 (ending December 2026), net sales increased 13.5% year-on-year to ¥4,811 million, while operating profit declined sharply to ¥138 million (down 53.2% year-on-year). The gross profit margin fell from 32.6% to 28.7%, and selling, general and administrative expenses increased from ¥1,084 million to ¥1,245 million. Going forward, the focus will be on determining whether the rise in cost of sales ratio reflects a temporary shift in project mix or a structural increase in costs.

The full-year forecast for FY2026 (ending December 2026) remains unchanged at net sales of ¥23,750 million and operating profit of ¥2,248 million (down 13.3% year-on-year). Q1 operating profit of ¥138 million represents only about 6.1% of the full-year forecast, requiring substantial profit accumulation over the remaining three quarters. While the company describes progress as "generally in line with plan," even accounting for the seasonality of the events business (weighted toward the second half), progress in order fulfillment and margin recovery in the latter half needs to be carefully monitored.

Following a peak in operating profit of ¥2,593 million in FY2025, the full-year forecast for FY2026 points to a decline to ¥2,248 million (down 13.3%). External factors appear to be weighing on profitability, including a normalization of demand following large-scale events and upward pressure on labor and outsourcing costs. The business structure's reliance on a single segment centered on real-world events carries inherent vulnerability to external shocks such as economic downturns or a resurgence of infectious disease, making accelerated expansion into digital areas a medium- to long-term challenge.

Growth Strategy

Aiming for sustainable growth through three pillars: establishing competitive advantage, strengthening organizational talent, and enhancing governance

A strategy of securing future revenue in advance by building up the order backlog at period-end. As of the end of Q1 FY2026 (ending December 2026), the order backlog stood at ¥9,118 million (up 1.8% year on year), maintaining a high level and forming the foundation for achieving the full-year revenue forecast of ¥23,750 million.

Aiming for continued expansion of order intake, driven by robust demand for initiatives combining real-world events with digital elements. Order intake for Q1 FY2026 (ending December 2026) was ¥6,247 million (up 7.1% year on year), maintaining an upward trend and confirming sustained project acquisition capability.

In response to the rise in the cost of sales ratio (71.3% in Q1 FY2026, ending December 2026) and increasing SG&A expenses, improving profit margin through outsourcing cost management, personnel efficiency, and better project mix is an urgent priority. Achieving the full-year operating profit forecast of ¥2,248 million requires a substantial improvement in profit margin over the remaining three quarters.

Last updated: July 17, 2026