KG Intelligence CO., LTD.

Business Details

The sole reportable segment of KG Information Group Co., Ltd. It comprises two pillars: HR solutions-related information (the job listing site "ARPA," the recruitment management system "Arpa Connect," job placement support "Shigoto Keikaku Gakko," and staffing of foreign workers, etc.) and lifestyle-related information (housing consultation "Ie-zukuri Gakko" and rental property search "Chintai Style"). Leveraging a regionally focused sales network as its strength, the segment provides information services primarily to businesses and consumers in the western Japan area (Okayama, Hiroshima, Kagawa, Ehime, etc.). Under the Medium-Term Management Plan (FY2026–FY2028), the segment is pursuing a shift away from a labor-intensive business model toward a higher-profitability structure.

Recent Overview

Interim operating profit rose 49.9% year on year, and with the addition of a gain on sale of investment securities, net income surged 138.3%

For H1 FY2026 (December 21, 2025 to June 20, 2026), consolidated operating revenue was ¥1,453 million (up 10.6% year on year), operating profit was ¥246 million (up 49.9% year on year), and ordinary profit was ¥260 million (up 52.0% year on year). Furthermore, a gain of ¥137 million (¥137,488 thousand) on sale of investment securities was recorded as extraordinary income, resulting in a substantial increase in interim net income attributable to owners of parent to ¥278 million (up 138.3% year on year). Location expansion continued, including the opening of the Fukuyama school for "Shigoto Keikaku Gakko" and the Onomichi and Saijo online schools for "Ie-zukuri Gakko." The full-year earnings forecast was revised upward to operating revenue of ¥2,887 million (up 5.5% year on year) and operating profit of ¥501 million (up 13.8% year on year).

Key Products

Growth Drivers

• Expansion of locations through new online schools for "Ie-zukuri Gakko" (Onomichi, Saijo) and capturing demand for high-performance housing
• Improved retention rates and accumulation of HR solutions revenue through strengthened customer success framework for "Arpa Connect"
• Increase in support personnel through expansion of source countries for foreign worker acceptance and addition of post-arrival training locations
• Simultaneous improvement in customer unit price and reduction in operating costs through data utilization such as generative AI (a key initiative of the FY2026–FY2028 Medium-Term Management Plan)
• Strengthened revenue base for the job placement support business through expansion of new "Shigoto Keikaku Gakko" locations (e.g., opening of Fukuyama school)
• Expansion of non-operating income, including increased interest received (from ¥2 million in the same period last year to ¥7 million in the current interim period) amid rising interest rates

Risks

• Risk of declining traffic to digital services such as "Chintai Style" due to search engine algorithm changes
• Declining profitability of existing print media amid the spread of major aggregator sites and growing demand for spot work
• Declining competitiveness of the traditional job media outlet "ARPA" due to the progress of digital shift
• Rising recruitment and personnel training costs amid worsening labor shortages
• Decline in recruitment and housing demand due to economic deterioration stemming from geopolitical risks such as U.S. trade policy and Middle East tensions
• Reduction in net assets and impact on financial flexibility due to share buybacks (¥127 million spent in the current interim period)