Summary
For FY02/2026 full year, revenue reached JPY 42.2B (+15.8% YoY) and operating income came in at JPY 1.37B (+51.1% YoY), marking the fifth consecutive year of top-line growth since transitioning to consolidated reporting. During the call, President Fujiwara quantified the one-time demand from new game hardware launches at over JPY 2B on a single-year basis, explicitly framing this as the reason for essentially flat revenue guidance next fiscal year. On trading cards (TCG), he noted that the overall market has now grown beyond JPY 300B, with the potential to reach JPY 500B by 2029–30, and expects the company to continue benefiting from this tailwind. For the coming fiscal year, the company guides operating income of JPY 1.6B (+16.2%), while its medium-term targets for FY02/2029 call for revenue of JPY 50B and operating income of JPY 2.5B.
Key Points (Earnings Highlights And Growth Actions)
- Management Strategy And Market Assessment
- President cited research indicating the new TCG market has expanded beyond JPY 300B, with potential to reach JPY 500B by 2029–30
- Leveraging chain-store advantages, the company differentiates from specialty shops by offering fair pricing to a broad customer base
- Acknowledging potential contraction in the new game market, the company is proactively building community engagement and pursuing IP initiatives
- Current Business Progress And Drivers
- Internal estimates peg the special demand from new game hardware launches at over JPY 2B; new product mix rose +3pt YoY to 49.9%
- TCG gross margins are trending upward after last year's decline; directly-operated store P&L improvement of +JPY 639M was the single largest profit contributor
- Q4 revenue of JPY 12.23B hit a record high, though Q4 operating income declined YoY due to a tough comp from last year's TCG recovery
- Strategic Initiatives And Inflection Points
- Developing in-house a next-generation IoT-equipped TCG vending machine, targeting a low-cost design adaptable to non-TCG merchandise
- Preparations underway for a second Taiwan store; aiming to establish a physical-store model inclusive of local trade-in operations within this fiscal year
- Targeting contracts with major enterprises for the TAYS automated appraisal scanner, building a foundation for recurring B2B revenue streams
Outlook And Strategy
- FY02/2027 guidance: revenue JPY 42.5B, operating income JPY 1.6B. Same-store growth and new openings are expected to offset the special demand roll-off
- Medium-term targets for FY02/2029: revenue JPY 50B, operating income JPY 2.5B. Incremental contributions expected from IP and global initiatives alongside the core retail business (including e-commerce)
- Taiwan operations positioned as an investment/incubation phase, with logistics buildout, talent development, and local trade-in infrastructure taking priority
- In the IP business, the company has established a track record of monetization through event sponsorships (pop-up stores) in Nagoya, and plans to scale this domestically and internationally
- Ordinary dividend maintained at JPY 4 (FY02/2027 forecast); the JPY 1 special dividend was a one-time measure funded by gains on securities sales
- President assessed the current fiscal year positively in terms of earnings and balance sheet improvement, while identifying corporate alliances and M&A as priorities going forward
Positive Factors
- Fifth consecutive year of revenue growth since consolidation. Revenue of JPY 42.2B marks a new peak in the re-growth phase
- SG&A ratio improved from 31.3% to 29.9% (−1.4pt), demonstrating tangible scale efficiencies as top-line growth (+15.8%) outpaced SG&A increases (+10.8%)
- Operating cash flow of JPY 1.93B (vs. JPY 1.46B prior year), with JPY 855M in debt repayment reducing interest-bearing debt
- TCG market stabilization driving pre-owned TCG sales to 119.5% YoY and new TCG to 106.6% YoY, returning to a steady growth trajectory
- Mall-based store count reached a cumulative 45 locations; the efficient store-opening model leveraging low initial costs and built-in foot traffic is now well-established
- Total net assets increased from JPY 6.14B to JPY 6.97B; equity ratio improved from 45.9% to 48.8%
Concerns And Risks
- The reversal of over JPY 2B in new game hardware special demand is expected to effectively offset top-line growth next fiscal year
- President personally acknowledged the risk that rule changes and new title launches in TCG could impact pre-owned card pricing
- Gross profit margin declined from 33.8% to 33.2% (−0.6pt), reflecting margin dilution from a higher new product sales mix
- Fixed cost inflation continues: personnel expenses +JPY 496M (from store openings and wage hikes), advertising expenses +JPY 106M
- Taiwan operations experienced delays in corporate registration procedures that slowed the ramp to normal operations, highlighting overseas expansion uncertainty
- Used books were the only declining category at 96.8% YoY, as the structural headwind from e-book adoption persists
Performance Highlights
FY02/2026 full-year consolidated revenue was JPY 42,233M (+15.8% YoY) and operating income was JPY 1,377M (+51.1% YoY), delivering both top- and bottom-line growth. Gross profit margin dipped slightly to 33.2% (vs. 33.8% prior year), but the SG&A ratio improved to 29.9% (vs. 31.3%), lifting overall profitability. Net income surged to JPY 867M (+73.0% YoY).
- Store Count: 179 stores (as of April 14, 2026; directly-operated + subsidiaries + franchises)
- Directly-Operated Stores: 143 stores (as of end-February 2026)
- Cumulative Mall-Based Stores: 45 stores
- SG&A Ratio: 29.9% (prior year 31.3%, −1.4pt)
- OPM: 3.3% (prior year 2.5%, +0.8pt)
- New Product Sales Mix: 49.9% (+3pt YoY)
- Operating Cash Flow: JPY 1,936M (prior year JPY 1,462M, +32.4%)
- Cash and Cash Equivalents: JPY 2,983M (prior year JPY 2,815M)
- Dividend Per Share: JPY 5 (ordinary JPY 4 + special JPY 1); next-year forecast JPY 4
- Payout Ratio: 36.6% (prior year 50.4%)
- New Game Sales YoY: 149.0%
- Pre-Owned TCG Sales YoY: 119.5%
- Pre-Owned Hobby Sales YoY: 127.9%
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