MBK Co.,Ltd.

Business Details

The sole reportable segment of the Group. Centered on real estate investment in Japan and overseas (capital gains from rental and sale, and rental income), the segment also operates a money lending business collateralized by shares, real estate, and accounts receivable, project investment in the renewable energy field, and corporate investment/M&A. The main sources of revenue are gains on sale of real estate and rental income, and the company is advancing the development and strengthening of investment opportunities with higher profitability than real estate investment. The segment includes consolidated subsidiaries and targets both Japanese and overseas companies for investment.

Recent Overview

Operating profit improved substantially to ¥253 million, up 93.4% year on year, while a crypto asset valuation loss of ¥94 million weighed on ordinary profit

In the second quarter (interim period) of FY2026 (ending October 2026), net sales declined slightly to ¥1,628 million (down 2.2% year on year), but gross profit and operating profit improved substantially to ¥458 million and ¥253 million, respectively, due to reductions in cost of sales and SG&A expenses. Meanwhile, due to the decline in Bitcoin prices, a valuation loss on crypto assets of ¥94 million was recorded as a non-operating expense, limiting ordinary profit to ¥24 million. As a subsequent event, the company increased its treasury share acquisition allowance to ¥820 million (for the purpose of funding M&A acquisitions) and resolved to make AI startup TIGEREYE Inc. an equity-method affiliate (planned acquisition of 21.0%). As a change in presentation method, real estate rental income and expenses were reclassified into net sales and cost of sales.

Key Products

Growth Drivers

• Realization of capital gains and securing of cash flow through active sales of rental real estate (property, plant and equipment decreased by ¥988 million from the end of the prior fiscal year)
• Increase in money lending business revenue through substantial expansion of operating loans receivable (from ¥69 million at the end of the prior fiscal year to ¥601 million at the end of the current interim period)
• Portfolio shift toward investment opportunities with higher profitability than real estate investment (money lending, renewable energy, and M&A)
• Advancement of a strategic capital policy of increasing the treasury share acquisition allowance to ¥820 million for use as M&A acquisition funds
• New investment in the AI field through making AI startup TIGEREYE Inc. (facial recognition, conversational avatars, etc.) an equity-method affiliate
• Improved cost efficiency through reduction in selling, general and administrative expenses (from ¥257 million in the same period of the prior year to ¥204 million)

Risks

• Reduction in gains on property sales and increases in borrowing costs due to rising real estate prices and interest rates (long-term borrowings balance, including current portion due within one year: ¥9,684 million)
• Risk of fluctuations in the prices of crypto assets such as Bitcoin (a valuation loss on crypto assets of ¥94 million was recorded in the current interim period; period-end balance of ¥210 million)
• Risk of failing to achieve property sales plans and a skew of sales and profit toward the second half (interim progress rate of 36.2% against the full-year forecast of ¥4,500 million)
• Financial soundness challenges, with the equity ratio of 31.1% falling short of the management target (over 40%), and a high level of interest-bearing debt
• Uncertainty regarding the monetization of new investment opportunities such as TIGEREYE Inc. (acquisition price undetermined, financial information undisclosed)
• Risk of reduced liquidity on hand due to the substantial increase in treasury share acquisitions (total of ¥820 million) (cash and cash equivalents of ¥719 million)