To Our Shareholders and Investors
We would like to express our sincere gratitude to our shareholders for their continued support. This is the report on the fiscal year ended March 31, 2026. .
In FY2026, the Japanese economy showed signs of a gradual recovery against the backdrop of improvements in employment and income conditions. However, the outlook remained uncertain due in part to concerns over continued price increases, labor shortages, energy issues arising from the situation in the Middle East, and instability in Japan-China relations.
In the pachinko parlor industry, which is the Group's major customer base, expectations for the revitalization of the industry are rising due to the increasing prevalence of smart gaming machines and the introduction of new machines offering enhanced gameplay features, such as the "Lucky Trigger 3.0 Plus" pachinko machine and the "Bonus Trigger" slot machine.
In the pachinko parlor advertising market, demand for services that help attract customers and for online advertising is growing, indicating a gradual recovery in the market.
In the advertising fields other than pachinko parlors, demand for advertising is still on an increasing trend, mainly in the mainstay fitness facilities and housing-related advertising fields.
In this environment, the Group focused on selling highly effective promotional campaigns that attract customers, such as those featuring industry personalities, and expanding sales of highly profitable online advertising, in the mainstay pachinko parlor advertising field. In the advertising fields other than pachinko parlors, we actively promoted the acquisition of clients in sectors with promising demand.
As a result of these efforts, profit at each level increased significantly from the previous year. However, profit growth slowed in the second half due to a larger-than-expected drop in paper-based advertising from the third quarter onward and an increase in selling, general and administrative expenses resulting from investment in human capital (hiring, wage increases, etc.) aimed at sustainable growth.
Net sales for FY2026 were ¥7,531 million (down 1.9% year on year), gross profit was ¥2,702 million (up 11.7% year on year), operating income was ¥674 million (up 61.2% year on year), ordinary income was ¥680 million (up 63.3% year on year), and net income attributable to parent company's shareholders was ¥473 million (up 32.0% year on year).
Based on these operating results, we have decided that the year-end dividend will be ¥12, and the annual dividend per share will be ¥24, including the interim dividend of ¥12.
Breakdown by Business Segment
Advertising Business
In FY2026, the pachinko parlor advertising market was booming due to the spread of smart gaming machines and the introduction of machines equipped with new functions, with growing demand for promotional campaigns featuring industry personalities and for online advertising. On the other hand, due to the faster-than-expected shift toward digital customer-attraction methods, paper-based advertising, including newspaper inserts, which represented a significant portion of transaction volume, showed a sharp decline from the third quarter onward. Under these circumstances, "Advertising and Promotion Guidelines, third edition," published in May 2025 by the four pachinko industry organizations, further clarified the practicable scope of advertising methods and customer attraction support services, which had previously been ambiguous. As a result, the risk of sudden self-imposed restrictions on advertising that could affect the Group’s performance has been reduced.
In this environment, the Group focused on the development and sale of customer attraction solutions in accordance with the Guidelines, while expanding sales of high-value-added DSP advertising and original services on its own website, "Pachiseven," in order to respond to the decline in the sales of paper media. Although the growth of these highly profitable services improved the gross profit margin, it was not sufficient to fully offset the decline in gross profit resulting from the sharp decrease in paper-based advertising. In addition, selling, general and administrative expenses increased due to investments in human capital (hiring, wage increases, etc.) aimed at achieving sustainable growth, and as a result, segment income fell short of our initial expectations.
The transformation of the revenue structure is progressing steadily, and the penetration of high-value-added services in the market has resulted in continuous orders.
As a result, net sales were ¥7,431 million (down 2.5% year on year), and segment income was ¥907 million (up 30.6% year on year).
Real Estate Business
In FY2026, the segment recorded rental income from the land in Kashiwa, Chiba Prefecture, owned by our consolidated subsidiary Land Support Inc., and ¥48 million in commission revenue from the delivery of rental brokerage properties. As a result, net sales were ¥99 million (up 75.7% year on year), and segment income was ¥47 million (up 140.3% year on year).
Medium to Long-term Management Strategies
The Group will ceaselessly pursue enhancement of the added value and productivity of its advertising services in the mainstay pachinko parlor advertising field and work to maximize profitability despite the adverse business environment. At the same time, the Group will continuously seek out new business opportunities and proactively work on business development to avoid excessive dependence on any particular industry and diversify its revenue sources in order to achieve sustained growth for the entire Group.
The main strategic issues to be addressed in order to achieve sustained growth are as follows.
- Develop markets in fields other than pachinko parlor advertising
- Work to firmly establish digital media market for customer-drawing commercial facilities
- Expand business domain
As we work to maximize our corporate value, we will disclose information to all of our shareholders and investors in a proactive and timely manner and follow a policy of providing returns to shareholders that reflect our business performance.
We look forward to your continued understanding and support.