ENVALITH
株式会社はるやまホールディングス logo

Haruyama Holdings Inc.

7416・Standard Market・Retail Trade

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株式会社はるやまホールディングス logo
Haruyama Holdings Inc.7416

Business

Haruyama Holdings Co., Ltd. is a business-wear specialty retail group founded in 1974 and originating in Okayama. Through subsidiaries such as Haruyama Shoji Co., Ltd. and Moriwan Co., Ltd., the group sells suits, formal wear, office casual wear, dress shirts, and related apparel and accessories through 363 stores nationwide (as of end-March 2026). Its main customers are business people (primarily men, with women's offerings being expanded). The holding company itself also engages in real estate leasing, and is responsible for group strategy formulation and overall management supervision. It moved to the Tokyo Stock Exchange Standard Market in 2022. Net sales are on the scale of ¥35,213 million.

Business Model

The company's main revenue source is clothing retail sales (Heavy Clothing, Light & Medium Clothing, and Alteration & Processing Fee Income and Ancillary Services) across 363 stores nationwide. Products combine in-house planning and procurement, based on the core policy of "better products at lower prices." Real estate leasing income from properties held by the holding company (¥653 million in FY2026 (ending March 2026)) supports profit as non-operating income. The company is also promoting mutual customer referrals between e-commerce and physical stores (OMO initiatives). The target metric is an operating margin (ordinary income to sales ratio) of 5%.

Company Strengths

Since its founding in 1974, the company has expanded nationwide from its base in Okayama, operating 363 stores as of the end of March 2026. It opened 14 new stores in the fiscal year alone, while continuing to optimize its store portfolio through relocations and closures. Its long-accumulated store opening/closing management know-how and community-based customer base constitute proprietary assets that are difficult for competitors to replicate in a short period.

The holding company handles real estate leasing, recording rental income of ¥653 million (up 13.7% year on year) in FY2026 (ending March 2026). Even during periods of operating loss, this has served a buffering function that narrows the ordinary loss relative to the operating loss (operating loss of ¥658 million → ordinary loss of ¥297 million), functioning as a group-specific mechanism for stabilizing earnings.

Through the expansion of functional office-casual and women's product lineups, the in-house development and launch of the Fatigue-Recovery Wear "YOKUNERU," and the rollout of the new business format Health Clothing Specialty Store "DRUG WEAR," the average purchase price at existing stores rose to 102.6% year on year in FY2026 (ending March 2026). The company possesses product planning capabilities that offset the decline in customer traffic (94.6% year on year) to a certain extent through higher unit prices.

ENVALITH's Perspective

In FY2026 (ending March 2026), net sales came to ¥35,212 million (down 2.6% year on year), with an operating loss of ¥658 million, an ordinary loss of ¥297 million, and net loss attributable to owners of the parent of ¥1,094 million, resulting in losses at all profit stages. In addition to existing-store customer traffic falling to 94.6% of the year-earlier level, a change in the estimate for asset retirement obligations (reducing profit by ¥112 million) and an impairment loss of ¥355 million were also recorded. While the gross profit margin remains high at approximately 58.5%, the SG&A ratio has reached approximately 60.3%, reconfirming the structural vulnerability whereby even a slight decline in sales tips the company into an operating loss.

Operating cash flow in FY2026 (ending March 2026) was an outflow of ¥2,120 million (a significant deterioration from an outflow of ¥138 million in the previous period). The main causes were an outflow of ¥1,845 million due to a shortening of the payment cycle for trade payables and an increase in inventory of ¥665 million. In financing activities, the company raised ¥2,700 million in short-term borrowings and ¥2,345 million in long-term borrowings to cover the shortfall, increasing its reliance on interest-bearing debt. The interest coverage ratio stood at -32.8x, negative for the second consecutive period, warranting close attention also from the perspective of debt-servicing capacity.

The company's forecast for FY2027 (ending March 2027) calls for net sales of ¥35,300 million (up 0.2% year on year), operating profit of ¥150 million, ordinary profit of ¥500 million, and net profit of ¥100 million, indicating a return to profitability. However, this assumes a recovery in existing-store customer traffic amid a continuing external environment of ongoing price increases and cautious consumer spending. There also remains a risk of economic downside stemming from the impact of U.S. trade policy on the market environment, and uncertainty accompanies the achievement of the forecast. The company plans to maintain an annual dividend of ¥15.50 (a high payout ratio on a forecast basis), but the planned total dividend payout of ¥243 million against net profit of ¥100 million warrants attention from a sustainability standpoint.

Growth Strategy

Aiming to rebuild the profit base and return to profitability through product mix review, SG&A cost containment, and EC enhancement

In response to the trend toward casualization of business wear, the company is expanding its functional office casual and women's product lineup. Existing-store purchase unit price remained solid at 102.6% year on year, contributing to higher average spend per customer, but this has not been sufficient to offset the decline in customer count (94.6% year on year).

Through the launch of the Fatigue-Recovery Wear "YOKUNERU" and the opening of the Health Clothing Specialty Store "DRUG WEAR", the company is moving away from its traditional business-wear-only model to cultivate new customer segments. As these initiatives only began in FY2026 (ending March 2026), their contribution to performance remains limited at this stage.

In FY2026 (ending March 2026), the company opened 14 new stores and closed 21 stores (including 6 relocations), bringing the total store count at fiscal year-end to 363. The company continues to streamline unprofitable stores and concentrate on high-profitability locations. However, impairment losses of ¥355 million (across 50 stores) were incurred in connection with the closures, resulting in a heavy short-term cost burden.

The company is promoting integrated marketing initiatives leveraging multiple channels to raise awareness of the business wear market, alongside efforts to strengthen its EC sales channel. Intangible fixed assets (software in progress) increased from ¥343 million to ¥757 million, indicating ongoing systems investment.

For FY2027 (ending March 2027), the company forecasts net sales of ¥35,300 million (up 0.2% year on year) and targets a return to profitability with operating income of ¥150 million. Containing SG&A expenses, optimizing inventory control, and improving sales efficiency are key to achieving this goal. In FY2026 (ending March 2026), one-time expenses such as a change in the estimate of asset retirement obligations pushed up SG&A expenses, and the fading of this effect is also factored into the forecast.

Last updated: July 19, 2026