Musashino Kogyo Co., Ltd.
9635・Standard Market・Services
Business
Musashino Kogyo has a history spanning over 100 years since opening the movie theater "Musashinokan" in Shinjuku in 1920, and is listed on the TSE Standard Market (also listed on the Fukuoka Stock Exchange as of November 2025). It currently operates four segments: Movie Business (Shinjuku Musashinokan's 3 screens and movie distribution), Real Estate Business (tenant buildings and rental apartments in Omiya, Saitama City, and Suginami-ku/Meguro-ku, Tokyo), Driving School Business (Yorii-machi, Saitama Prefecture), and Trading Business (contracted management of restaurants in Meguro-ku). Its main customers span a wide range, including movie fans, tenant companies (such as Takashimaya), driver's license applicants, and elderly driver training participants. Of consolidated net sales of ¥1,331 million (FY2026 (ending March 2026)), the Real Estate Business accounts for 43%, the Movie Business for 32%, and the Driving School Business for 24%.
Business Model
The Real Estate Leasing Business generates stable cash flow (segment profit of ¥316 million, profit margin over 55%) through long-term contracts with major tenants such as Takashimaya and Nowa Building, supporting the group's overall revenue base. The Movie Business pursues variable revenue through box office income driven by film selection expertise and in-house distribution, while the Driving School Business supplements earnings through fee revisions and contracted elderly driver training services. The combination of these three businesses creates a structure in which the stable revenue from real estate hedges the fluctuation risk of movie theater operations.
Company Strengths
Shinjuku Musashinokan, which opened in 1920, has established a firm brand as one of Tokyo's leading mini-theaters with a history unmatched in the metropolitan area. In FY2026 (ending March 2026), box office performance at Musashinokan exceeded the previous year's results, with the selection of quality films such as "The Fall (4K Digital Remaster)" and "Robot Dreams" contributing to audience attraction. The ability to plan award-winning film screenings and special feature programs serves as a differentiating factor.
The segment profit margin of the Real Estate Business is extremely high at over 55% (¥316 million/¥575 million), supported by long-term stable leasing relationships with Takashimaya (sales of ¥221 million, 16.7% of the total) and Yawa Building (¥155 million, 11.7%). Vacancy risk is also reduced through diversification across multiple locations (Omiya, Suginami, and Meguro).
In FY2026 (ending March 2026), due to the effect of fee increases for regular vehicle driving lessons and steady growth in commission income from elderly driver training and other contracted services, sales achieved a 3.6% year-on-year increase to ¥315 million even as the number of enrolled trainees fell below the previous year's level. Amid the structural headwinds of a declining birthrate and a decrease in the number of people obtaining driver's licenses, the business is working to stabilize operations by actively capturing a new revenue source through elderly driver training contracted services.
ENVALITH's Perspective
Performance Trend
Revenue for FY2026 (ending March 2026) was ¥1,331 million (down 2.5% year on year), marking a decline in 3 of the past 5 fiscal years. The closure of Cinema Qualite (January 2026) reduced Movie Business revenue by 8.6%. Operating profit was ¥68 million (down 1.5% year on year), remaining roughly flat, as improvement in gross profit margin (from ¥680 million to ¥731 million) was offset by an increase in SG&A expenses (from ¥611 million to ¥663 million). Net income surged to ¥360 million due to the recognition of a ¥376 million gain on sale of investment securities. For FY2027 (ending March 2027), a sharp decline in profit is forecast, with operating profit projected at ¥10 million and net income at ¥30 million, mainly due to the drop-off of the extraordinary gain and the contraction of the Movie Business. Operating profit over the past 5 fiscal periods has ranged between ¥21 million and ¥80 million, indicating that the core earning power of the business remains limited.
Growth Strategy
Rebuilding the earnings base through consolidation into a single Musashinokan theater and strengthening the Real Estate Business
With the closure of Cinema Qualite in January 2026, movie theater operations have been consolidated into the single Musashinokan theater. The company aims to improve profitability in the Movie Business through fixed cost reductions and more focused film selection. In FY2026 (ending March 2026), segment profit turned positive at ¥16 million (versus a loss of ¥28 million in the previous period), indicating that the closure effect has materialized to a certain extent.
The 6th "Shinjuku East Exit Film Festival 2026" is scheduled to be held in May 2026. Through revitalization of the local trading area and expansion of the film fan base, the company aims to maintain and enhance Musashinokan's brand recognition and customer attraction. The company will continue building linked added value through screenings held after nationwide theatrical runs, among other initiatives.
While continuing facility upgrades and maintenance of key tenant buildings, the company has clearly stated its policy to actively strengthen income-producing properties. In the real estate sales division, expansion of brokerage transactions continues. Segment profit for FY2026 (ending March 2026) remained stable at ¥316 million, functioning as the primary pillar of company-wide earnings.
Through the effect of raising fees for regular vehicle driving lessons and steady income from contracted elderly driver training services, the company is building a revenue structure that offsets the decline in the number of enrollees. It continues to acquire new enrollees from surrounding areas by enhancing its pickup and drop-off route network, and to capture demand for driving lessons among professional drivers seeking large and medium vehicle licenses, among other categories. Structural headwinds from the declining birthrate and reduced demand for regular driver's licenses are expected to continue.
Last updated: July 19, 2026