AHC GROUP INC.

The company operates 97 locations providing continuous services from early childhood to adulthood, including 43 After-School Day Service / Child Development Support facilities, 38 Communal Living Support (Group Home) facilities (34 Beetle, 4 Beetle Care), 4 Daily Life Care facilities, and 8 Type B Continuous Employment Support facilities, among others. The one-stop system, capable of consistently supporting individuals from school age through post-graduation independence support, serves as a differentiating factor against competitors.

Revenue from the welfare and nursing care businesses is primarily derived from public benefit payments channeled through the National Health Insurance Federations. In the fiscal year ending November 2025, the Tokyo National Health Insurance Federation (¥1,887 million, 28.3% of sales) and the Chiba National Health Insurance Federation (¥1,095 million, 16.5% of sales) were major revenue sources, giving the company a stable revenue structure that is less susceptible to economic fluctuations.

Since entering the welfare business in 2014, the company has expanded its number of locations through a combination of M&A and organic openings. In the fiscal year ending November 2025, it newly opened a total of 8 facilities—3 Daily Life Care, 2 Communal Living Support (Group Home), 2 Type B Continuous Employment Support, and 1 Child Development Support—and also made Papageno Co., Ltd. a wholly owned subsidiary. Sales increased 62% over five fiscal years, from ¥4,114 million in FY2021 to ¥6,660 million in FY2025.

Systematically opening multiple business formats including Type B Continuous Employment Support, Daily Life Care, and Communal Living Support (Group Home) to expand scale and build up earnings. Opened one Type B Continuous Employment Support location (Tokyo) in May 2026, bringing the total to 98 locations as of the interim period-end. Promoting improved utilization rates, supported by the continued increase in the number of users of disability welfare services.

Rolling out the in-house developed generative AI tool across all business locations to both reduce the administrative burden on frontline staff and improve service quality. Accelerating efforts to optimize operational efficiency as a countermeasure to labor shortages and rising personnel costs, contributing to improved profit margins.

Fundamentally reviewing the profit and loss structure by closing two unprofitable Day Care Service (Day Service) locations and opening a new Home Care Support location (Tokyo). Through operational improvements and the acquisition of new users, the operating loss was reduced from ¥24 million in the same period of the previous year to ¥19 million. Aiming to achieve profitability.

Continuing to expand the scale of the Welfare Business through M&A, including the full consolidation of Papageno Co., Ltd. as a wholly owned subsidiary (in the previous interim period). Goodwill balance stood at ¥285 million (as of end-May 2026), which the company aims to recover through the expansion of revenue and user numbers resulting from the acquisition effect.

Maintaining profitability through appropriate price pass-through and the provision of added value amid continued increases in raw material, logistics, and energy costs. In the interim period, Foodservice Business sales reached ¥731 million (up 10.9% year on year), with operating profit of ¥49 million (up 9.6% year on year), achieving both revenue and profit growth. Also promoting store operation efficiency improvement through labor-saving measures and DX utilization.