RECOMM CO.,LTD.

Business Details

A core domestic business that sells LED lighting and other decarbonization products, business phones, digital MFPs (Multifunction Printers), ReSPR, and other IT equipment through three channels: directly-operated stores, franchise (FC) member stores, and agencies. The business aims to stabilize earnings by expanding proposal-based sales leveraging its customer database and stock-type revenue such as maintenance services. Revenue for the six months ended March 2026 (FY2026, ending March 2026) was ¥2,134 million (external customer basis), accounting for approximately 30.6% of consolidated revenue.

Recent Overview

Profit margin improved significantly due to SG&A cost reductions; FC member stores achieved double-digit revenue growth

In the Domestic Solutions Business for the six months ended March 2026 (FY2026, ending March 2026; October 2025 to March 2026), revenue increased 5.1% year on year to ¥2,134 million. Directly-operated stores grew 5.2%, driven by efficient sales activities leveraging the customer database and successful proposals of proprietary MFP plans and environmental products. FC member stores performed strongly, up 16.3%, due to the horizontal deployment of directly-operated store sales methods and the development of new franchisees. Meanwhile, the agency channel declined 4.3% as the downward trend in security product sales continued. Segment profit improved substantially to ¥163 million (up 119.3% year on year) due to a decrease in SG&A expenses, with the profit margin rising from 3.6% to 7.6%.

Key Products

Growth Drivers

• Efficient proposal-based sales to existing customers leveraging the customer database (cross-selling of proprietary MFP plans and environmental products)
• Development of new FC member stores and horizontal deployment of directly-operated store sales methods (up 16.3% year on year in the six months ended March 2026, FY2026 ending March 2026)
• Expansion of sales of LED lighting, air conditioners, and other decarbonization products against the backdrop of corporate carbon-neutrality demand
• Stabilization of earnings through the accumulation of stock-type revenue such as maintenance services
• Profitability improvement through SG&A expense reductions (segment profit for the six months ended March 2026, FY2026 ending March 2026, increased 119.3% year on year)

Risks

• Continued decline in price competitiveness and downward sales trend for security products in the agency channel
• Risk of a decrease in the number of FC member stores due to business transfers, etc.
• Increasing difficulty in acquiring new customers amid slowing growth in the information/communication and office equipment markets
• Risk of reduced capital expenditure by customers due to rising prices and interest rates
• Reduced comparability due to structural reclassification of revenue resulting from segment classification changes (transfer of RPA services and AI agents to the DX Business)