ENVALITH
株式会社タウンニュース社 logo

TOWNNEWS-SHA CO.,LTD.

2481・Standard Market・Services

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株式会社タウンニュース社 logo
TOWNNEWS-SHA CO.,LTD.2481

Business

Town News Corporation was founded in 1977 and publishes the free newspaper "Town News" in 36 editions across 36 districts covering the entirety of Kanagawa Prefecture and the Machida, Hachioji, and Tama areas of Tokyo. It is a regional information company whose main customers are local small and medium-sized businesses and advertising agencies, and it operates an "Ad-Comi" (Advertising + Communication) model that combines detailed local information organized by administrative district with advertising. In recent years, the company has expanded into digital media such as web, LINE, and email editions, and has diversified into non-print businesses including designated management of municipal facilities (PPP projects) and proposal-based contracts. Under its second medium-term management plan (FY2024–FY2026 (ending March 2026)), the company has set forth a structural transformation into a "comprehensive information company that also publishes regional information newspapers." It is listed on the Standard Market of the Tokyo Stock Exchange.

Business Model

By distributing free copies to each household and business via insertion in daily newspapers without collecting a subscription fee, the company secures a high reach rate, and generates revenue by selling advertising space in these publications directly to clients or through advertising agencies. Printing is outsourced externally, and distribution is handled through insert distribution contractors, which helps keep fixed costs low. In addition, web-version advertising and digital advertising, designated administrator operations for municipal facilities (PPP projects), and various promotional and proposal-based projects contribute to revenue diversification.

Company Strengths

The company publishes 36 editions across all 33 districts in Kanagawa Prefecture plus 3 districts in the Tama area of Tokyo, with content varying by administrative district to provide hyper-local information that is difficult for other media to replicate. Since achieving full coverage of Kanagawa Prefecture in 2006, it has functioned as a community-based information infrastructure for approximately 20 years.

As of the end of FY2025 (ending June 2025), the company maintained debt-free management with zero interest-bearing liabilities, an equity ratio of 88.2%, and total net assets of ¥5,108 million. Surplus funds are invested in safe, highly liquid financial assets centered on time deposits. The company has established a structure that allows it to fund capital expenditures, stable dividends, and new business investments from its own funds without financial constraints.

Following the Hadano City Cultural Hall in April 2022 and the Chigasaki Park Experiential Learning Center (Umikaze Terrace) in April 2024, the company was awarded and began the designated manager operations for the Odawara Citizens' Hall (Odawara Sannomaru Hall) in April 2025. Leveraging its regional information-gathering capabilities and administrative network, the company is establishing public-private partnership (PPP) business as a pillar of its non-print operations.

ENVALITH's Perspective

Cumulative sales for the first nine months of FY2026 (ending June 2026) of ¥3,152 million represent 76.6% of the full-year forecast of ¥4,117 million, while operating profit of ¥608 million has already exceeded the full-year forecast of ¥520 million. Maintaining the full-year forecast unchanged reflects a conservative stance, but given the structure whereby Q4 alone tends to record an operating loss (as was the case in the prior fiscal year), there is a possibility that full-year results could exceed the forecast, though attention should be paid to the seasonal concentration of facility operating costs and personnel expenses as a downward pressure factor.

It has been disclosed that print-related sales in the cumulative nine months of the current fiscal year fell slightly short of the same period a year earlier, continuing the gradual contraction trend in the core business. External factors such as declining newspaper subscription rates and regional advertisers shifting media channels are acting as headwinds. Growth in promotion, digital, and PPP businesses is offsetting this, but whether the growth rate of these alternative revenue streams can consistently outpace the decline in print will be a key point differentiating the medium- to long-term assessment.

In the cumulative nine months of the prior fiscal year, a gain on sale of investment securities of ¥46 million was recorded under non-operating income, but this was zero in the cumulative nine months of the current fiscal year, causing total non-operating income to decrease significantly from ¥110 million to ¥49 million. While operating profit improved significantly, up 25.8% year-on-year, the main reason growth in ordinary profit was limited to 10.9% lies in this structural change. The balance of investment securities has increased, and depending on the timing of future sales, both risks and opportunities for fluctuation in ordinary profit coexist.

Growth Strategy

Centered on the transformation into a "comprehensive information company," the company is accelerating revenue diversification through three pillars: digital, PPP, and non-print businesses.

The renewal of the web version of Town News has led to a significant increase in access numbers. User touchpoints have been diversified through email, LINE, and curation site distribution, expanding digital revenue such as inline advertising. In April 2026, the company launched "JichiCa," a new service for neighborhood associations (jichikai/chonaikai), promoting regional revitalization and diversification of revenue opportunities.

In addition to the stable operation of Odawara Sannomaru Hall and Umikaze Terrace, Hadano City Cultural Hall (Coorstek Hadano Culture Hall), which had been closed for renovation, is scheduled to reopen in April 2026. Through the accumulation of facility management expertise, the company aims to secure new outsourcing opportunities from local governments.

In addition to various publishing, commercial printing, and promotional goods development and sales, the company addresses diverse regional promotional needs, including providing safety and crime-prevention goods for neighborhood associations. In the third quarter under review, the concentration of year-end projects contributed to sales growth, while expanding the project pipeline remains a challenge.

Through the continued regular publication of "Kodomo Town News" and various special issues and feature projects, the company pursues value and accuracy as a print medium. While efforts to retain existing advertisers are being made through careful reporting based on interviews with local businesses, government bodies, and organizations, cumulative results for the first nine months of the fiscal year were slightly below the same period of the previous year, and addressing the shrinking trend remains an ongoing challenge.

Last updated: July 17, 2026