Mercuria Holdings Co., Ltd.

Business Details

The company's core operations are the Fund Management Business (management fees and success fees) and the Proprietary Investment Business (Same Boat Investment, etc.). It operates five investment strategies: Buyout, Growth, Real Estate, CF, and Value. In the first quarter of FY2026 (ending December 2026), the revenue breakdown was as follows: management fees ¥683 million, success fees ¥55 million, consulting and other ¥180 million, and Proprietary Investment Business ¥45 million. As the company operates in a single segment, segment-level disclosure is omitted.

Recent Overview

Operating revenue increased 13.0% YoY, but operating loss widened due to increased SG&A expenses

Operating revenue for Q1 of FY2026 (ending December 2026) (January to March 2026) was ¥963 million (+13.0% YoY). Growth was driven by success fees from Buyout Fund No. 1 (¥55 million, +123% YoY) and gains on fund investment interests recorded through Same Boat Investment. On the other hand, cost of sales increased to ¥221 million (from ¥140 million in the same period of the prior year) due to a decline in Spring REIT's unit price, and SG&A expenses expanded to ¥882 million (from ¥823 million in the same period of the prior year), resulting in a widened operating loss of △¥140 million (compared to △¥111 million in the same period of the prior year). Ordinary loss improved to △¥102 million (compared to △¥169 million in the same period of the prior year), aided by a foreign exchange gain of ¥29 million due to the continued depreciation of the yen (compared to a foreign exchange loss of ¥66 million in the same period of the prior year). There is no change to the full-year earnings forecast (operating revenue of ¥5,000 million, operating profit of ¥1,500 million). Progress continues on the concretization of new strategies, including the establishment of the aircraft fund and participation in the joint venture for real estate development in Vietnam.

Key Products

Growth Drivers

• Increase in success fees due to Buyout Fund No. 1 and No. 2 reaching the investment recovery phase (Q1 success fees were approximately 2.2 times the prior-year period at ¥55 million)
• Expansion of gains on fund investment interests from the Proprietary Investment Business (Same Boat Investment)
• Establishment and commencement of operation of an open-end aircraft fund jointly with Airborne Capital Limited
• Expansion of the Proprietary Investment Business through participation in a condominium development project (joint venture with Bcons) in Ho Chi Minh City, Vietnam
• Expansion into the planning business field through the launch of the "Hyakunen Noren Project" with Takashimaya
• Plans to boost management fees through the organization of successor funds such as Buyout Fund No. 3

Risks

• Success fees depend on the timing of fund investment recovery, resulting in large fluctuations in single-year earnings (full-year forecast is a significant decline of △40.4% YoY)
• Fair value fluctuations of held assets, such as the decline in Spring REIT's unit price, directly affect cost of sales (fair value changes were recorded in cost of sales in Q1)
• Risk regarding compliance with the Prime Market listing maintenance criteria (tradable share market capitalization of ¥10 billion or more)
• Geopolitical risks (situations in Ukraine and the Middle East) and foreign exchange fluctuations affect the valuation of overseas investment assets (valuation difference on available-for-sale securities worsened to △¥411 million at the end of Q1)
• SG&A expenses remain elevated (¥882 million in Q1), creating a revenue structure that tends to result in structural operating losses in Q1, when revenue is lower
• Cash and deposits decreased by ¥2,088 million from the end of the prior fiscal year to ¥3,145 million at the end of Q1, making cash flow management important