ENVALITH
株式会社アールエイジ logo

EARLY AGE CO.,Ltd.

3248・Standard Market・Real Estate

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株式会社アールエイジ logo
EARLY AGE CO.,Ltd.3248

Business

R-AGE Co., Ltd. operates two business segments: the "Operation Management Business," which handles the leasing, sub-leasing, and management outsourcing of company-owned properties such as residential rental apartments, primarily in Tokyo and western Chiba Prefecture; and the "Development and Sales Business," which plans, develops, and sells real estate for rental use. Founded in 1986, the company listed on the Tokyo Stock Exchange Mothers market (now the Standard Market) in 2007. In recent years, anticipating the polarization of the rental market, the company has been pursuing a development strategy focused on central Tokyo. In October 2021, BHAG Corporation became the parent company, and under this group structure, the company aims for stable and sustainable growth.

Business Model

In the management operations business, the company secures recurring stock-type revenue by accumulating rental income from company-owned properties, sublease margin income, and management outsourcing fees. Properties planned and completed under the development and sales business flow into the management operations business as sublease or managed properties even after sale, forming a circular structure that continuously expands the managed portfolio. A unique strength lies in reflecting user needs gained through leasing brokerage activities into development planning, and the company positions improvement of the ordinary profit margin on net sales as a key management indicator.

Company Strengths

Through leasing brokerage activities, the company grasps user needs and rent trends in real time and reflects them in its proprietary planning and development capabilities. In FY2025 (ending October 2025), it acquired and completed four development land parcels, a tenant building, and two rental apartment buildings in Tokyo's Chiyoda, Shinjuku, Taito, and Shibuya wards, among others, executing concentrated investment in central Tokyo.

The property management business is a stock-type revenue model consisting of leasing of company-owned properties, sublease operations, and management fee income. In FY2025 (ending October 2025), it recorded net sales of ¥2,880 million and segment profit of ¥589 million (profit margin of 20.4%), growing steadily (net sales +1.0% and profit +5.7% year on year) independent of fluctuations in the development and sales business.

Properties completed and sold in the development and sales business continue to flow into the property management business as sublease or management-contracted properties even after sale. At the end of FY2025 (ending October 2025), segment assets of the property management business reached ¥13,001 million, and the portfolio continues to expand through active acquisition of tangible fixed assets (¥1,715 million in the same period).

ENVALITH's Perspective

For the interim period of FY2026 (ending March 2026 [October 2026]), net sales were ¥1,666 million (down 7.7% year-on-year), operating income was ¥315 million (down 9.0%), ordinary income was ¥257 million (down 6.3%), and net income attributable to owners of the parent for the interim period was ¥171 million (down 1.6%), with all profit items falling below the prior-year interim period. The main cause was a substantial decline in sales in the development and sales business to ¥260 million (versus ¥364 million in the prior-year interim period, down 28.7%). On the other hand, the fact that the decline in net income was limited to 1.6% appears attributable to the absence in the current period of the provision for allowance for doubtful accounts (¥24,927 thousand) recorded in the prior-year period, as well as a decrease in income taxes (from ¥100,668 thousand to ¥86,045 thousand).

The full-year earnings forecast for FY2026 (ending March 2026 [October 2026]) (net sales of ¥3,100 million, operating income of ¥469 million, ordinary income of ¥350 million, net income of ¥231 million) remains unchanged from the figures announced on December 15, 2025. Progress rates for the first half were 53.8% for net sales, 67.3% for operating income, 73.6% for ordinary income, and 74.2% for net income, indicating high progress on the profit side. Given the structural tendency for property deliveries in the development and sales business to be concentrated in the second half, the second-half weighting of sales is within expectations; however, achieving the full-year forecast will require recording ¥1,434 million in sales and ¥154 million in operating income in the second half, making the status of property deliveries in the development and sales business the key factor.

Long-term borrowings (including the portion due within one year) at the end of the interim period of FY2026 (ending March 2026 [October 2026]) continued to increase, reaching ¥9,999 million (versus ¥9,686 million at the end of the previous fiscal year), while the equity ratio declined slightly to 30.9% (versus 31.1% at the end of the previous fiscal year). Interest expenses increased 38.2% year-on-year, from ¥47,527 thousand in the prior-year interim period to ¥65,692 thousand in the current period, with the increase in outstanding borrowings and changes in the interest rate environment weighing on ordinary income. As an external factor, if the rising interest rate environment continues, there is a risk that further increases in funding costs could put downward pressure on the ordinary income margin. On the other hand, operating cash flow improved substantially to ¥547 million (versus ¥360 million in the prior-year interim period), with the decrease in inventory assets due to the sale of self-owned properties and other factors contributing to cash generation.

Growth Strategy

Continued strengthening of development focused on central urban areas and ongoing expansion of the recurring-revenue property management portfolio

The company continues to promote the planning and development of high-quality real estate for lease business, focusing on central urban areas. In the interim period of FY2026 (ending March 2026)... wait, this should be October, investment in acquisition of property, plant and equipment amounted to ¥721,965 thousand (¥1,134,767 thousand in the same period of the previous year), expanding net buildings and structures to ¥6,155 million (¥5,654 million at the end of the previous fiscal year) and land to ¥6,682 million (¥6,471 million at the end of the previous fiscal year). Construction in progress of ¥408 million indicates that the development pipeline toward completion and sales in subsequent periods continues.

The company continues its strategy of incorporating properties completed and sold in the development and sales business into the property management business—either as company-held assets or through sublease/management contracts—thereby expanding its management portfolio. Group-wide efforts focused on improving quality and efficiency have maintained a segment profit margin of 21.7% in the interim period of FY2026 (ending October 2026). Rental income (other revenue) remained stable at ¥1,153 million, confirming the steady buildup of a recurring revenue base.

The annual dividend forecast for FY2026 (ending October 2026) remains unchanged from the previous fiscal year (¥36.00) at ¥36.00 (¥15.00 at the end of the second quarter, ¥21.00 at year-end). Together with the absence of any revision to earnings forecasts, this demonstrates the stability of the company's shareholder return policy externally. Against interim net income per share of ¥53.94 (¥54.82 in the same period of the previous year), the interim dividend of ¥15.00 represents a payout ratio of 27.8%.

Last updated: July 17, 2026