LOIVE Co., Ltd

Business Details

Under the mission "To help women love themselves and shine," the company operates monthly membership-based group lesson studios targeting women, with all locations directly managed. The high-profitability business model minimizes initial investment through a small-scale format of 65-80 tsubo per store, while enhancing labor cost efficiency through group lessons where one instructor serves an average of 20-30 members simultaneously. With Hot Yoga Studio "loIve" and Machine Pilates Specialty Studio "pilates K" as flagship brands, the company operated 200 stores nationwide as of the end of March 2026.

Recent Overview

Net sales increased 34.5%, while operating income declined 28.1% due to upfront investment in the market dominance strategy

In FY2026 (ending March 2026), net sales maintained high growth at ¥11,421 million (up 34.5% year on year), but as a result of significantly increasing advertising expenses as a strategic investment to accelerate market dominance in the pilates market, operating income fell sharply to ¥722 million (down 28.1% year on year) and net income declined to ¥343 million (down 31.4% year on year). The company opened 45 new pilates K stores, achieving 200 stores and 83 thousand members by fiscal year-end. Impairment losses of ¥81 million (versus ¥4 million in the prior fiscal year) were also recorded as an extraordinary loss. For FY2027 (ending March 2027), the company plans to open 71 new stores and forecasts net sales of ¥14,570 million (up 27.6% year on year) and operating income of ¥270 million (down 62.6% year on year). As a subsequent event, the company entered into a ¥1,800 million term loan agreement with MUFG Bank and a ¥1,000 million overdraft agreement with Hokuyo Bank to secure funds for new store openings.

Key Products

Growth Drivers

• Expansion of member numbers and net sales through accelerated pilates K store openings (125 stores as of the end of March 2026, with plans to add 71 more stores in FY2027)
• Stable accumulation of revenue through a monthly membership subscription-based revenue structure
• Increase in per-member revenue through improvement in the merchandise sales ratio (7.6%, up 0.8 percentage points year on year) and expansion of recurring subscription purchases
• Diversification of the revenue base through the Women's Talent Development Program "Mission'S"
• Expanding trend in the domestic fitness market driven by growing health consciousness and an aging population
• LTV improvement measures through continuous release of new lessons and expansion of membership plans and business days

Risks

• Risk of short-term margin decline due to increased upfront costs associated with accelerated new store openings (71 stores planned for FY2027), with operating income forecast to decline 62.6% year on year to ¥270 million in FY2027
• Risk that instructor recruitment and training could become a constraining factor on the store opening plan
• Risk of market share competition intensifying due to increased entry by competitors into the machine pilates market
• Risk of rising member churn rate (increased cancellations) under the monthly membership fee model
• Risk of rising interest rates and financial burden associated with the long-term borrowings balance (¥3,464 million combined current and non-current as of the end of March 2026) and new borrowings disclosed as a subsequent event (up to ¥2,800 million)
• Risk of breaching financial covenants (maintenance of net assets, ordinary income/loss, and net interest-bearing debt ratio) under the MUFG Bank term loan, given the low forecast ordinary income of ¥150 million for FY2027
• Risk of deteriorating profitability at existing stores, as indicated by increased impairment losses (¥81 million in the fiscal year under review)