XEBIO HOLDINGS CO., LTD.

Business Details

The Group consists of 35 consolidated subsidiaries and is a sporting goods retailer operating multiple business formats under its umbrella, including XEBIO, Victoria, and Golf Partner. The Group operates a total of 972 stores with 208,821 tsubo of sales floor space. It operates large-format sporting goods specialty stores, golf specialty stores, outdoor specialty stores, and other formats, while also expanding its E-Commerce Business. The Group also operates Sports Marketing Business, Product Development Business, credit card business, and other operations.

Recent Overview

Recorded ¥7,372 million in extraordinary losses, resulting in a net loss for the period; structural reforms continue

In FY2026 (ending March 2026), net sales rose slightly to ¥252,331 million (up 0.7% year on year), but operating profit plunged to ¥2,370 million (down 66.2% year on year) due to price appeals and increased losses on inventory valuation under the policy of short-term reduction of aged inventory, higher depreciation expenses associated with the launch of the EC system, and rising unit costs for labor and store expenses. In addition, in the fourth quarter, the company recorded extraordinary losses totaling ¥7,372 million, including an impairment loss of ¥3,610 million, a loss of ¥2,366 million on disposal of fixed assets related to the renovation and donation of XEBIO Arena Sendai, and a loss of ¥751 million on valuation of investment securities, resulting in a net loss attributable to owners of parent of ¥2,164 million. For FY2027 (ending March 2027), the company forecasts net sales of ¥264,600 million, operating profit of ¥7,000 million, and net income of ¥7,500 million, anticipating a significant recovery in profitability.

Key Products

Growth Drivers

• Expanding demand for running, footwear, and wellness-related products driven by growing health consciousness (FY2026, ending March 2026: sales in the general competitive sports and footwear division up 4.6% year on year)
• Continued expansion of the E-Commerce Business: sales growth continues following the full launch of the EC system, with ongoing strengthening of online sales channels
• Full-scale rollout of the X'tyle format: 130 stores were opened in FY2025, including 81 stores developed within existing stores, strengthening sales capability through format evolution
• Positioning FY2027 (ending March 2027) as the 'culminating year of management structural reform,' improving investment efficiency and profitability through business standardization and infrastructure integration
• Strengthening the management foundation and expanding the business domain of overseas operations (including the Southeast Asia golf business)
• Improving management efficiency and capital efficiency through consolidation of back-office operations and utilization of digital technology

Risks

• Climate change risk: fluctuations in demand for winter sports and cold-weather products due to warm winters and unstable temperature trends (FY2026, ending March 2026: winter sports division sales down 15.2% year on year)
• Risk of declining gross margin: decline in gross profit margin due to price appeals and increased losses on lower-of-cost-or-market valuation under the policy of short-term reduction of aged inventory, and recording of a loss on inventory valuation in the overseas golf business (FY2026, ending March 2026: gross profit of ¥95,094 million, down from ¥97,671 million in the prior period)
• Cost increase risk: rising unit labor costs (salaries and allowances of ¥27,237 million, up from ¥26,259 million in the prior period), increased depreciation expenses associated with the operation of the EC system (depreciation within SG&A expenses of ¥6,491 million, up from ¥5,440 million in the prior period), and rising rent expenses
• Risk of continued one-time losses associated with structural reforms: risk of recording impairment losses (¥3,610 million in FY2026, ending March 2026) related to the review of low-efficiency stores and unprofitable businesses, as well as extraordinary losses such as losses on disposal of fixed assets
• Risk of low ROE and deteriorating capital efficiency: return on equity remained significantly below the cost of capital at △1.8% in FY2026 (ending March 2026), and the market-value-based equity ratio also declined to 19.9%
• Risk of delayed response to intensifying selective consumer spending, the ongoing shift to EC, and heightened competition: sluggish sales in the golf and sports apparel divisions continue