Summary
Meeting the full-year plan revised on 8/14 (operating income of JPY 370M) requires standalone 4Q operating income of JPY 129M (our estimate). Standalone 3Q posted an operating loss of roughly JPY 12M. The plan therefore assumes 4Q profit recovers to near a single 1H quarter's level. Revenue growth has accelerated each quarter on a YoY basis: +0.7% in 1Q, +3.6% in 2Q and +5.7% in 3Q (our estimate). Whether 4Q reaches the +8.2% implied by the plan will gauge momentum in the core Professional Talent business. Goodwill has been fully written down, so no goodwill amortization will be incurred from 4Q, which should lower SG&A. The key focus of the full-year results will be KPI trends, such as contract count and direct sales headcount, and how the FY09/27 plan maps out a return to a growth trajectory.
Key Points for Next Quarter
| Key Points & Focus | Implications |
|---|---|
Plan AchievementRevenue and recurring profit landing vs. the revised full-year plan | 9M recurring profit progress is 66.5%, below the 79.0% recorded in the prior-year period relative to full-year actuals (our estimate). Achieving the plan requires standalone 4Q recurring profit of JPY 124M, roughly double the prior-year 4Q figure of JPY 62M (our estimate). |
Standalone 4Q ProfitabilityStandalone 4Q gross profit margin and SG&A level | Standalone 3Q gross profit margin was 25.0% and SG&A was JPY 712M. Versus standalone 2Q (26.5%, JPY 655M), margins fell and costs rose (our estimate). We want to see whether SG&A returns to 2Q levels in 4Q, when goodwill amortization ceases. |
Key KPIsTrends in contract count, gross profit per contract and direct sales headcount | As of 3Q, contracts stood at 826, gross profit per contract at JPY 248K and direct sales headcount at 62.9. Growing standalone 4Q revenue by +8.2% YoY requires KPI improvement, which would lay the groundwork for next year's growth. |
Extraordinary Losses and Net IncomeAny additional extraordinary losses in 4Q and trends in income taxes | Backing out from planned net income of JPY 144M implies standalone 4Q net income of JPY 96M (our estimate). Goodwill impairment on Greenroom was booked as an extraordinary loss for two consecutive years. With the balance now at zero, scope for similar losses has narrowed. |
Next Year OutlookFY09/27 earnings plan and the path to renewed growth in the core business | This year's revised plan calls for revenue of JPY 11,650M (+4.3%) and operating income of JPY 370M (+23.2%). Next year's planned revenue growth and operating income margin will determine whether a re-rating is warranted. |
Key Issues from Previous Results (FY09/26 3Q Results)
9M revenue was JPY 8,649M (+3.3%) and operating income JPY 241M (+5.8%), securing growth in both sales and profit. However, standalone 3Q posted an operating loss, and the company also booked a JPY 113M goodwill impairment loss on Greenroom. The company revised its full-year plan the same day. The full-year results will therefore test both achievement of the revised plan and the path to a growth recovery next year. The earnings release did not include numerical targets from the medium-term management plan, so we will check progress in the full-year results presentation.
1. Achievement of the Revised Full-Year Plan
- Previous Quarter: 9M revenue of JPY 8,649M represents 74.2% progress against the full-year plan of JPY 11,650M (our estimate). Recurring profit of JPY 246M represents 66.5% progress, below the 79.0% recorded in the prior-year period relative to full-year actuals (our estimate).
- This Quarter's Check: Backing out from the plan, implied standalone 4Q targets are revenue of JPY 3,001M, operating income of JPY 129M and recurring profit of JPY 124M (our estimate). Prior-year standalone 4Q revenue was JPY 2,773M and operating income JPY 56M, so the plan assumes improvement in both sales and profit (our estimate).
- Key Metrics: Achievement rates for full-year revenue, operating income and recurring profit, and YoY growth in standalone 4Q revenue.
2. Standalone 4Q Profitability Recovery and SG&A Trends
- Previous Quarter: Standalone 3Q gross profit was JPY 701M against SG&A of JPY 712M, resulting in an operating loss of roughly JPY 12M (our estimate). 9M gross profit and SG&A both grew +6.5% YoY.
- This Quarter's Check: The goodwill balance reached zero at end-3Q, so no goodwill amortization will be incurred from 4Q. 9M goodwill amortization was JPY 22M. We want to see whether SG&A returns to around the standalone 2Q level of JPY 655M. We will also watch whether gross profit margin, which fell to 25.0% in standalone 3Q, recovers to the 26% range seen in 1H (our estimate).
- Key Metrics: Standalone 4Q gross profit margin (standalone 3Q: 25.0%; prior-year standalone 4Q: 26.4%) and SG&A (standalone 3Q: JPY 712M; prior-year standalone 4Q: JPY 676M). All figures are our estimates.
3. Key KPI Trends and Core Business Growth
- Previous Quarter: As of 3Q, contracts stood at 826, gross profit per contract at JPY 248K, direct sales headcount at 62.9 and large-enterprise clients at 77. Registered professionals surpassed 98,000.
- This Quarter's Check: Standalone quarterly revenue growth has accelerated YoY: +0.7% in 1Q, +3.6% in 2Q and +5.7% in 3Q (our estimate). The focus is whether this momentum carries into 4Q and whether contract count and sales headcount turn to growth.
- Key Metrics: Changes from 3Q in period-end contract count, gross profit per contract, direct sales headcount and number of large-enterprise clients.
4. Greenroom Goodwill Impairment and Net Income Landing
- Previous Quarter: The company booked a JPY 113M impairment loss on goodwill from Greenroom, acquired in March 2025. It had also booked a JPY 93M impairment loss in the prior-year 9M period. 9M recurring profit grew +5.5% while net income attributable to owners of parent company rose +21.1%, widening the gap. A swing in deferred income tax adjustments, from +JPY 25M in the prior-year period to -JPY 7M, also contributed to the gap.
- This Quarter's Check: With the goodwill balance at zero, scope for a recurrence of similar impairment is limited. We will check for any additional extraordinary losses in 4Q and monitor trends in income taxes.
- Key Metrics: Achievement rates for full-year net income attributable to owners of parent company (plan: JPY 144M) and EPS (plan: JPY 27.62), and the breakdown of extraordinary losses.
5. FY09/27 Plan and Next Year's Growth Scenario
- Previous Quarter: This year's revised plan calls for revenue of JPY 11,650M (+4.3%) and operating income of JPY 370M (+23.2%). Cash and deposits at end-3Q were JPY 1,764M, up JPY 316M from the prior fiscal year-end. The equity ratio was 42.9%.
- This Quarter's Check: The focus is how next year's plan factors in a growth recovery in the Professional Talent business and continued contract wins in the Regional Revitalization business. The year-end dividend forecast is JPY 0.00, and we will also check for any change in shareholder return policy.
- Key Metrics: YoY changes in FY09/27 revenue and operating income plans, period-end cash and deposits, and operating cash flow.
Key Timely Disclosures This Fiscal Year
- 2026/09/15Mirai Works and GMO TECH Form Business Alliance to Support Corporate and Regional Information Dissemination in the Era of AI Search - The joint pilot begins on October 1, 2026, so it will not affect FY09/26 earnings. Whether it leads to new services for local governments and corporates is a point to monitor from FY09/27 onward.
- 2026/09/14Awarded Cabinet Office Contract for "FY2026 Research and Study on the Concrete Picture and Significance of Related Populations to Promote Understanding" - This central government project aligns with the Regional Revitalization 2.0 policy theme and strengthens the Regional Revitalization business's track record. Given the timing of the award, it remains to be confirmed whether revenue will be recognized in 4Q or in FY09/27 or later.
- 2026/08/14Notice of Revision to Consolidated Earnings Forecast - The full-year plan was revised down: revenue from JPY 13,000M to JPY 11,650M, operating income and recurring profit from JPY 600M to JPY 370M, and net income from JPY 360M to JPY 144M. The main reason was an expected shortfall versus plan in contract count and direct sales headcount in the Professional Talent business. Achievement of the revised plan and KPI recovery will be the focus of the full-year results.
Previous Quarter Results (FY09/26 3Q Actual)
The company's core business is Professional Talent, which provides professionals to corporate clients on an outsourcing or staffing basis through its registration platform "FreeConsultant.jp". Together with the Regional Revitalization and Solutions businesses, it operates as a single segment. The Regional Revitalization business centers on the side-job matching site "Skill Shift". It has partnerships with 130 regional financial institutions nationwide, 4 central government ministries/agencies, 31 prefectures and 107 municipalities. 9M results showed growth in both sales and profit, but standalone 3Q profitability stalled, and the company revised its full-year plan the same day.
| Item | Amount | YoY | vs. Company Plan | Notes |
|---|---|---|---|---|
| Revenue | JPY 8,649M | +3.3% | 74.2% progress | 826 contracts; standalone 3Q +5.7% YoY (our estimate) |
| Operating Income | JPY 241M | +5.8% | 65.1% progress | Gross profit margin 26.0% (prior-year period: 25.2%); SG&A +6.5% |
| Recurring Profit | JPY 246M | +5.5% | 66.5% progress | - |
| Quarterly Net Income Attributable to Owners of Parent Company | JPY 48M | +21.1% | 33.5% progress | JPY 113M impairment loss on Greenroom goodwill booked as extraordinary loss |
| EPS | JPY 9.25 | +23.8% | 33.5% progress | Progress against full-year EPS forecast of JPY 27.62 |
Guidance Achievement Rate (Recurring Profit Basis): 66.5% (prior-year period: 79.0%; prior-year ratio is our estimate against prior fiscal year's full-year actual of JPY 295M)
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