GENDA Inc.

Business Details

Comprises "Amusement," "Karaoke," "Food & Beverage (F&B)," "Tourism," and "Lifestyle." In addition to operating domestic and overseas amusement facilities centered on GENDA GiGO Entertainment, the segment continues to expand its business domains through M&A, including Karaoke BanBan (Shin Corporation), SMART EXCHANGE (foreign currency exchange machines), and Carat (photo studios), functioning as an offline platform connecting IP content with fans.

Recent Overview

While advancing internal group reorganization, sales grew 47.8% year on year, though second-half weighting is intensifying

In Q1 FY2027 (ending January 2027) (February to April 2026), in the karaoke domain, ENNE was established through the merger of Ontsu and Kaji Corporation (February 2026), Aesetsu was absorbed (March 2026), and Shin Corporation absorbed Melo Works (April 2026). In North America, Kiddleton, Inc. was renamed GENDA Americas, Inc., consolidating operations into one company each in the U.S. and Canada. In China, a new store opened in Shanghai. Meanwhile, the pronounced second-half weighting seasonality of GENDA Playnation Entertainment in the UK is intensifying the overall second-half weighting of consolidated results. Segment profit (before M&A-related expenses) secured ¥4,399 million, up 14.7% year on year, but profit growth was limited relative to the sales growth rate (47.8%).

Key Products

Growth Drivers

• Rapid expansion of the store network and number of locations through aggressive roll-up M&A (including realization of integration synergies through internal group reorganization)
• Significant growth in existing store sales through conversion to the Crane Game Oasis format and new store openings (the 3 converted stores achieved significant sales growth compared to pre-conversion levels)
• Acceleration of overseas expansion: global platform expansion through GENDA Americas (North America), GENDA Playnation (UK), and new store openings in China
• Strengthened value chain and scale benefits through vertical integration of karaoke equipment distribution (ENNE) (establishing the largest business platform in the industry)
• Capture of inbound demand and expansion of installed units by SMART EXCHANGE (approximately 300 units increase year on year as of the end of April 2026)
• Enhanced customer acquisition through collaboration campaigns with popular IP and cross-group customer referrals utilizing the GiGO app and GENDA ID

Risks

• Risk that the pronounced second-half weighting seasonality of GENDA Playnation Entertainment in the UK will intensify the overall second-half weighting of consolidated results, reducing first-quarter profitability
• Pressure on operating profit from increased M&A-related expenses (goodwill amortization increased significantly to ¥1,204 million year on year from ¥759 million in the prior-year period)
• Risk of impairment and increased amortization burden associated with the significant increase in goodwill and intangible assets (goodwill balance of ¥50,506 million)
• Rising financial leverage and increased interest expenses (¥563 million in the current first quarter) due to a sharp increase in interest-bearing debt (long-term borrowings of ¥63,744 million, bonds of ¥18,300 million, etc.)
• Foreign exchange fluctuation risk in overseas operations (U.S., UK, China) and operational integration risk associated with internal group reorganization
• Rising store operating costs due to price increases and higher labor costs, and impact on consumers' disposable income