UNITED,Inc. Q4 FY2025 earnings call

• Overall 2025 March Full Year Performance • Consolidated revenue and profit declined YoY primarily due to lower volume of securities sales in the Investment Business, even though HR Matching and AdTech & Content both delivered YoY revenue growth. • Actual revenue exceeded the November 2024 upward revised forecast range driven by growth at Fog Co., while operating and ordinary income came in slightly below the forecast range due to expanded losses in the Education Business; net income landed within the forecast range.

• Investment Business Operational Highlights • New investments reached 45 companies, exceeding the full-year target of 30 companies; ranked 1st among corporate/CVC investors for investment volume in calendar 2024, driven by improved capitalist productivity. • Capitalist productivity rose to 9 investments per capitalist annually (up from prior periods), and increased deal outreach expanded the firm's startup contact rate. • Held 131 unlisted stocks at period-end with a fair value of 7.4 billion yen; the investment multiple for holdings from 2013-2020 March fiscal years reached 22x including unrealized gains, meeting the 3x target with substantial upside. • Expanding Zenshin (good progress) Investment, a new initiative focused on startups solving social issues, acting as lead investor and providing hands-on value creation support; the leading example NEWGREEN is accelerating growth with a new automatic weeding robot model and a joint project with BASF Japan.

• Education Business (Bestco Inc.) Operational Highlights • Bestco, which operates the "Best Individual" cram school chain focused on the Tohoku region, was consolidated in December 2024; it has delivered 13 consecutive years of revenue growth with expanding classroom and student counts. • Bestco's strategy is to provide high-quality tutoring at low prices in underserved non-urban areas to reduce the academic achievement gap between urban and regional Japan. Its competitive advantages include standardized service quality across all directly operated locations, low-cost operations via suburban locations and efficient student-teacher ratios, and strong corporate culture penetration. • Future growth will come from new store openings targeting non-metropolitan white space markets and blended online-offline learning to reach students unable to attend in-person classes. The business will return to profitability in 2026 March fiscal year via the integration of Brewers Co. and Kiramex Co.

• AdTech & Content Business (Fog Co.) Operational Highlights • Fog's online raffle business "RAFFLE" grew 77% YoY to hit a record high revenue, driving overall segment revenue growth, even as the legacy AdTech business declined to pull down segment profit. • Fog's strategy is to build a platform to maximize IP monetization for IP holders, building on its online raffle track record. Its competitive advantages include 1,000+ past campaigns of user data to capture fan demand, in-house design and engineering for operational excellence, and a broad network of entertainment industry IP holders. The business targets an IPO in the longer term, with near-term priorities of expanding the online raffle business and launching overseas expansion, followed by new business development in the medium term.

• HR Matching Business (United Recruitment Co.) Operational Highlights • Growth was driven by expansion of general recruitment services and designer-focused matching, growing revenue 28% YoY and shrinking operating losses; the business combines RPO and recruitment agency know-how with AI-powered operational efficiency to deliver high cost-effectiveness for corporate clients.

• Shareholder Return Update • The dividend policy was revised to increase the target from 4% DOE to 5% DOE (or 50% consolidated payout ratio, whichever is higher) to improve capital efficiency and deliver more stable dividends insulated from short-term investment business volatility.

1. Investment Business: Revenue 4.974 billion yen, -25% YoY; Operating profit 3.907 billion yen, -34% YoY. Revenue contribution: 41.3% of total consolidated revenue. 2. Education Business: Revenue 1.781 billion yen, -1% YoY; Operating loss 438 million yen, with loss expanding 404 million yen YoY. Revenue contribution: 14.8% of total consolidated revenue. 3. HR Matching Business: Revenue 662 million yen, +28% YoY; Operating loss 155 million yen, with loss shrinking 265 million yen YoY. Revenue contribution: 5.5% of total consolidated revenue. 4. AdTech & Content Business: Revenue 4.622 billion yen, +27% YoY; Operating profit 323 million yen, -12% YoY. Revenue contribution: 38.4% of total consolidated revenue. Total consolidated revenue: 12.035 billion yen, -4% YoY; Total consolidated operating profit: 2.646 billion yen, -46% YoY.

• 2026 March fiscal year (FY2026) overall guidance expects a temporary operating loss, primarily due to no large planned securities sales in the Investment Business. The company maintains a strong financial position and high financial health despite the temporary loss, and targets profitable operations across all business segments from FY2027 onward.
• Investment Business FY2026 guidance: Revenue 50 million yen, operating loss 400 million yen (no large securities sales expected at this time).
• Education Business FY2026 guidance: Revenue 4.0 billion yen (driven by consolidation of Bestco), and expects to return to operating profit following the integration of Brewers and Kiramex.
• HR Matching Business FY2026 guidance: Revenue 800 million yen (continuing growth of core business lines), operating loss 80 million yen (further loss reduction).
• AdTech & Content Business FY2026 guidance: Revenue 5.15 billion yen, operating profit 360 million yen (continuing expansion of Fog's business, delivering both revenue and profit growth).
• FY2026 dividend guidance: Under the new 5% DOE policy, the regular dividend per share will stay at 23 yen (flat YoY); no special dividend will be paid (compared to a 1 yen special dividend in FY2025), for a total planned dividend of 24 yen per share in FY2025, 23 yen per share in FY2026.

• The Investment Business has significant revenue and profit volatility tied to the timing and volume of securities exits, which creates a risk of large near-term earnings swings if planned exits do not materialize.
• The Education Business faced expanding losses in FY2025 from declines in its legacy development and Tech Academy businesses, and there is execution risk in integrating the newly acquired Bestco and the merged Brewers/Kiramex to return to profitability.
• The AdTech & Content segment relies heavily on growth of Fog's online raffle business; slower-than-expected expansion of this business or increased competition could lead to missed growth and profit targets.
• While the company maintains a strong balance sheet, the temporary FY2026 loss could pressure short-term capital ratios, though management does not expect this to threaten financial stability.

No question and answer section is included in the provided earning call transcript.