ENVALITH
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HIRAGA CO., LTD.

7863・Standard Market・Other Products

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株式会社平賀 logo
HIRAGA CO., LTD.7863

Business

Hiraga Co., Ltd. is a company listed on the TSE Standard Market, founded in 1956. Under the mission "Looking at retail and distribution today, designing tomorrow," it provides an integrated offering of Sales Promotion, planning and management of a Sales Promotion Management System, Digital Marketing Support utilizing WEB and SNS, and Comprehensive Printing, primarily to retail industry clients. The company is characterized by hands-on support spanning marketing strategy design, planning, production, execution, and effectiveness verification, and offers comprehensive sales promotion support that combines its in-house manufacturing capabilities—including the Saitama Plant and Wakayama Plant—with its proprietary system "mikke!". Revenue for the 71st fiscal term (FY2026, ending March 2026) was ¥9,967 million.

Business Model

The company receives orders for sales promotion-related work from retail clients and provides added value by combining in-house factory printing production with its proprietary Sales Promotion Management System and digital marketing capabilities. In addition to execution functions such as production and printing, the company is expanding upstream proposals from the marketing design stage and data utilization initiatives, aiming to increase the proportion of transactions in higher-value-added, higher-unit-price areas. This structure secures stable earnings through continuous business relationships with clients.

Company Strengths

The company has accumulated deep expertise in sales promotion and store merchandising through its long-term specialization in the retail and distribution industry, and possesses a strong customer base built on ongoing business relationships. In FY71 (the 71st fiscal period), the company maintained an order backlog of ¥1,187 million (up 1.4% year on year), and continuous transactional relationships with customers form a stable order base.

In addition to its own manufacturing capabilities at the Saitama Plant and Wakayama Plant, the company owns its proprietary Sales Promotion Management System "mikke!", enabling it to provide an integrated set of services from planning to printing and digital initiatives. Of the ¥279 million in capital expenditures in FY71 (the 71st fiscal period), the company introduced an offset rotary press (¥217,800 thousand) and renovated mikke! (¥16,690 thousand), continuing to strengthen both its manufacturing and digital capabilities.

The equity ratio at the end of FY71 (the 71st fiscal period) stood at 59.2% (having risen steadily from 43.0% in FY67 (the 67th fiscal period)), reflecting high financial soundness. Net assets stood at ¥4,439 million (up ¥297 million from the previous fiscal year), and cash and cash equivalents stood at ¥2,338 million, while the interest coverage ratio remained at a solid 37.9x, indicating that financial stability has been maintained.

ENVALITH's Perspective

Operating profit peaked at ¥494 million in FY2024 (ended March 2024), then declined sharply for two consecutive periods to ¥365 million in FY2025 (ended March 2025) and ¥216 million in FY2026 (ending March 2026). This represents a significant divergence from the mid-term management plan SPX2027's target of operating profit exceeding ¥600 million. The FY2027 (ending March 2027) forecast of ¥310 million in operating profit also falls well short of the target level, suggesting investors need to scrutinize the plan's feasibility.

Total SG&A expenses for FY2026 (ending March 2026) amounted to ¥1,741 million, up 11.3% from ¥1,565 million in the previous period. The main drivers were an increase in salaries and allowances due to base pay increases and more holidays (from ¥573 million to ¥610 million), a sharp rise in sales promotion expenses (from ¥106 million to ¥175 million), and an increase in commission fees paid (from ¥185 million to ¥211 million). Elevated material costs and outsourcing expenses also continued as an external factor. While the gross profit margin remained largely flat at 19.6% (versus 19.7% in the previous period), the rise in the SG&A expense ratio pushed the operating profit margin down to 2.2% (versus 3.7% in the previous period).

The full-year forecast for FY2027 (ending March 2027) calls for net sales of ¥10,200 million (up 2.3% year on year), operating profit of ¥310 million (up 43.5%), and net income of ¥260 million (up 37.9%), marking a return to profit growth. The cumulative second-quarter operating profit forecast of ¥120 million represents an aggressive plan, up 55.2% year on year. On the other hand, the extent to which the recovery from the "decline in orders from some high-gross-margin clients" that affected FY2026 (ending March 2026), and the shift toward emphasizing "quality of sales," will actually translate into improved profits will determine the plan's achievability. The dividend is maintained at ¥40, implying a high payout ratio of 61.0%.

Growth Strategy

Under SPX2027, the company is promoting a shift toward a revenue structure that emphasizes "quality of revenue" and a shift toward higher value-added areas.

Operations for projects with major retail companies with which transactions began in recent years have moved into full-scale operation, and a certain degree of sales growth was confirmed in FY2026 (ending March 2026). For FY2027 (ending March 2026), net sales of ¥10,200 million (up 2.3% year on year) are forecast, and the company aims to continue expanding its customer base.

The company is increasing the proportion of transactions in higher value-added areas through proposals from the marketing design stage, expanded provision of targeted digital initiatives, and the introduction of comprehensive sales promotion support utilizing its proprietary systems. Although there is a headwind from a decline in orders from high-gross-margin clients, in areas excluding certain specific transactions, both sales and gross profit have continued to improve.

The company is promoting the transformation of its cost structure and business structure through DX and the use of proprietary systems. While reviewing outsourcing standards and promoting in-house production has avoided a significant increase in factory operation costs, management itself recognizes that improvement in profitability remains a work in progress.

The company is promoting a shift toward a revenue structure that emphasizes "quality of revenue" rather than relying simply on expanding sales scale. In anticipation of further increases in raw material prices, the company has explicitly stated in its outlook for FY2027 (ending March 2026) a policy of strengthening earnings resilience through cost control and structural productivity improvements.

Last updated: July 19, 2026