UP GARAGE GROUP Co., Ltd.

Business Details

The Group operates as a single segment consisting of buying/selling of car and motorcycle goods and related ancillary operations. It is structured around two pillars: the Reuse business (directly-operated stores, franchises, EC sites) and the distribution wholesale business (Tire Distribution Center and the order platform "NEXLINK"). In FY2026 (ending March 2026), net sales were ¥15,384 million (up 10.0% year on year), and operating profit was ¥1,103 million (up 5.7% year on year). The company operates a total of 281 directly-operated and franchise stores (196 locations), including 2 overseas stores in the U.S. (California).

Recent Overview

Net sales up 10.0%, but net profit slightly declined due to increased SG&A expenses. New store openings significantly exceeded the plan, reaching 10 stores

In FY2026 (ending March 2026), the company achieved net sales of ¥15,384 million (up 10.0% year on year) and operating profit of ¥1,103 million (up 5.7% year on year). The company opened 10 new directly-operated stores, far exceeding the annual plan of 5 stores, and existing store sales performed well at 105.4% of the prior-year level. On the other hand, SG&A expenses increased significantly to ¥5,057 million (up 11.5% year on year) due to human capital investments such as raising starting salaries for new graduates and revising salary tables, as well as recruitment and capital expenditures associated with accelerated store openings, causing the operating margin to decline to 7.2% (from 7.5% in the prior period). Net profit was ¥780 million, down 0.6% year on year. In the U.S., the company opened its second store, the Ontario, California store, in November 2025. For FY2027 (ending March 2027), the company forecasts net sales of ¥17,000 million (up 10.5% year on year) and operating profit of ¥1,400 million (up 26.8% year on year).

Key Products

Growth Drivers

• Continued expansion of consumer demand for reuse products, driven by rising prices and increases in the price of new car goods
• Increase in store visitor numbers through aggressive new store openings for directly-operated stores (10 stores opened in FY2026 (ending March 2026), far exceeding the annual plan of 5 stores) and the OMO strategy (utilizing the UP GARAGE App)
• Increase in royalty and EC commission income driven by higher sales at franchise stores
• Continued expansion in the number of Tire Distribution Center member stores (209 stores at the end of FY2026 (ending March 2026)) and an increase in new NEXLINK business partners
• Structural expansion of demand for reuse goods driven by the trend of longer vehicle ownership periods
• Expansion of profitability in U.S. operations (2 stores in California) and early opening of a third store
• Forecast for FY2027 (ending March 2027): net sales of ¥17,000 million (up 10.5% year on year), operating profit of ¥1,400 million (up 26.8% year on year)

Risks

• Risk of consumers holding back purchases due to price increases by tire and other manufacturers (impact on the distribution wholesale business)
• Risk of profit margin pressure from increased SG&A expenses associated with accelerated new store openings and human capital investment (raising starting salaries, revising salary tables)
• Risk of fluctuations in studless tire wholesale sales due to weather factors such as mild winters
• Uncertainty in U.S. trade policy and foreign exchange fluctuation risk (impact on overseas expansion)
• Impact on personal consumption from uncertainty stemming from Middle East conditions and U.S. trade policy trends
• Risk that increased store investment and recruitment costs associated with accelerated new store openings will pressure profit margins in the short term