Hirose Tusyo Inc.

Business Details

The only major segment of the Group. Centered on internet-based FX (foreign exchange margin trading) for individual investors, the business also encompasses over-the-counter securities CFDs and commodity CFDs, a White Label Service for financial instruments business operators, and cover transactions as a counterparty. Domestically, the Group appeals to a broad range of investors under the LION FX and LION CFD brands by emphasizing low spreads and no commissions. Overseas, the Group also pursues global expansion through subsidiaries in the UK, Malaysia, and elsewhere, but the scope of consolidation has narrowed following the termination of services by some overseas subsidiaries.

Recent Overview

Operating revenue increased, but higher expenses and a heavier tax burden caused net profit to decline 7.6%.

In FY2026 (ending March 2025), a weak-yen, strong-dollar trend continued against a backdrop of US-China trade friction and concerns over Japan's fiscal expansion, with the yen closing the period at around ¥158. Foreign exchange trading volume rose 8.4% year on year and foreign exchange margin deposits received increased 14.4%, expanding the scale of the business. On the other hand, selling, general and administrative expenses rose to ¥7,386 million (up 4.3% year on year), causing operating profit to decline slightly. As deferred tax expense adjustments swung from a reversal in the prior period to an expense in the current period, the tax burden increased, and net profit attributable to owners of parent came to ¥2,060 million (down 7.6% year on year). Following the removal of overseas subsidiary LION PAYMENT UK LTD. from the scope of consolidation and the termination of the LION Trader and MT4 services, the number of customer accounts fell 18.9% year on year to 450,713, though the impact on consolidated results is described as minor.

Key Products

Growth Drivers

• Strengthening of the revenue base through expansion of foreign exchange trading volume (up 8.4% year on year for the full FY2026 (ending March 2026))
• A thicker customer base driven by an increase in foreign exchange margin deposits received (period-end balance of ¥88,359 million, up 14.4% year on year)
• Trading activation through spread improvement measures such as the narrowing of the TRY/JPY spread (April 2025)
• Expansion of products and measures capturing demand for safe-haven assets, such as the physical pure gold gift campaign for LION CFD
• Improved customer convenience and continued trading among existing customers through enhanced trading tool functionality such as LION Chart Plus+ and LION FX C2
• Continuation of new customer acquisition measures such as cashback campaigns for new account openings
• A trading-activation environment supported by the continuation of the weak-yen, strong-dollar trend (around ¥158 at period-end)

Risks

• Decline in trading volume and revenue per unit due to lower foreign exchange volatility (high dependence on market conditions)
• Declining profit margin due to a rising trend in selling, general and administrative expenses (¥7,386 million, up 4.3% year on year)
• Intensifying competition in the domestic FX industry to acquire new customers and increase trading volume
• Market volatility risk from macroeconomic uncertainty, including Bank of Japan monetary policy, US trade policy (reciprocal tariffs, etc.), and geopolitical risk
• Decline in the number of customer accounts (down 18.9% year on year) following the termination of overseas subsidiary services, and uncertainty over the overseas business's revenue contribution
• Risk of an increased tax burden due to fluctuations in deferred tax expense adjustments (an expense of ¥54 million was recorded in the current period, versus a reversal of ¥205 million in the prior period)
• Operating cash flow turning negative (¥-443 million): expanding funding needs due to an increase in deposits placed in customer segregation trusts, among others