3939.T

• Core Business and Strategic Milestones

  • Achieved all-time highest revenue and profit since listing, with all segments growing both revenue and profit. Post-M&A PMI for acquired companies is progressing smoothly, with all acquired companies generating sufficient profit without goodwill impairment.
  • Launched the 10-year medium-to-long term plan Kanamic Vision 2035 (2026-2035), focused on growth expansion and profit margin improvement, with the goal of becoming a global leading company in medical and nursing care DX by 2035.
  • Completed development and release of core AISaaS product AI100-Vision, launched billing starting from the 2026 September fiscal year. The product currently has 30+ released AI functions, with full 100-function completion targeted for June 2026.

• Operational Key Performance Indicators

  • Paid users reached 220,000, free users reached 117,000, and installed locations exceeded 52,000, all growing steadily. URBAN FIT24 expanded to 24 stores, with 4 stores now open in Tokyo including the new flagship Iidabashi Station front store.
  • Kanamic Cloud is the only private company approved to provide both input/output and connection functions for National Health Insurance Central Association care plan data linkage, driving strong growth in free users.
  • Expanded domestic sales network to 7 locations nationwide with the opening of the Hokkaido sales office.

• M&A Strategy

  • Continues ongoing M&A sourcing across 4 areas: physical retail, IT services, healthcare, and insurance. Conducts full due diligence and abandons deals with identified risks, maintaining a disciplined approach.
  • Currently sees a large pipeline of deals ranging from hundreds of millions of yen to tens of billions of yen, especially in the global healthcare and health tech spaces. Plans to pursue larger scale M&A as the company grows.

• Capital Allocation and Shareholder Return

  • Maintains a target payout ratio of 30% or higher, with the 2026 September fiscal year targeted dividend of 9 yen, extending the streak of consecutive dividend increases. Will continue to offer existing shareholder perks including lottery-based perks and URBAN FIT24 discount tickets.
  • Follows a 30% shareholder return / 70% growth investment and M&A allocation framework. Expects cumulative net profit of 38 billion yen to 60 billion yen over the 10-year Vision 2035 period, allocating 11.5 billion yen to 18 billion yen to cumulative shareholder return and 26.5 billion yen to 42 billion yen to growth investment and M&A.

• 2026 September Fiscal Year Guidance

  • Expects to achieve another all-time high revenue and profit, targeting total revenue of 6.35 billion yen, EBITDA of 2.5 billion yen, and operating profit of 2.05 billion yen, with an operating margin target of 32.3%.
  • Expects AISaaS transformation to gradually increase existing customer ARPU, but does not expect dramatic revenue contribution from AI until after the 2027 fiscal year, as only 30+ of 100 planned AI functions are complete as of the start of the period.
  • Expects significant replacement demand from competitors exiting the nursing care software market to drive growth, with upcoming regulatory changes likely accelerating competitor exit and creating a large market opportunity.
  • Expects already secured large customer orders and the contracted Singaporean Ministry of Internal Affairs project to contribute meaningfully to revenue. For URBAN FIT24, expects store count growth, expanded franchised store openings, and continued profit margin improvement.
  • Notes that Q1 2026 will see temporary higher expenses from multiple large event exhibitor participations and the company's 25th anniversary commemorative event, but full year results remain on track for growth.

• Medium and Long-Term Guidance (Kanamic Vision 2035)

  • 2030 targets: Revenue of 10 billion yen to 12 billion yen, operating profit of 3.5 billion yen to 4 billion yen, operating margin of 33.3% to 35%.
  • 2035 targets: Revenue of 20 billion yen to 30 billion yen, operating profit of 8 billion yen to 12 billion yen, operating margin of 40%. Targets a 10-year CAGR of 13.6% to 18.8% for revenue, built on a base of organic growth supplemented by M&A.
  • Segment level long-term targets: Medical & Nursing Cloud Platform to reach 50% profit margin by 2035; Healthy Life Extension to reach 25% profit margin by 2035; Solution Development to drive profit margin improvement via AI-driven productivity gains and global expansion.

1. Medical and Nursing Care Cloud Platform: Revenue of 3.58 billion yen, profit of 1.49 billion yen, growing 6.5% and 9.5% year-over-year respectively. It contributed 65.1% of total consolidated revenue, with segment profit margin improving from 40.7% to 41.8%.
2. Healthy Life Extension (URBAN FIT24): Revenue and profit both grew year-over-year, with segment profit margin improving sharply from 5.8% to 13.2%. All segment profit margin now exceeds 10%.
3. Solution Development: Revenue and profit both grew steadily year-over-year, after integrating newly acquired Ruby Kaihatsu and The World Management. The World Management was only consolidated for 3 quarters in the period, and PMI is progressing smoothly. Segment profit margin improved from 9% to 10.5%, and all segment profit margin now exceeds 10%.

Total consolidated revenue for the period was 5.5 billion yen (+9.9% YoY), EBITDA was 2.024 billion yen (+12.8% YoY), operating profit was 1.606 billion yen, recurring profit was 1.612 billion yen, and net profit was 1.111 billion yen. All three segments achieved both revenue and profit growth, with all segment profit margins improving.

• 2024 April regulatory changes cut nursing care industry reimbursements, combined with inflation and high prices driving a record high number of nursing care provider bankruptcies. This created some headwinds for cloud service growth, though the impact was limited due to the company's large share of mid-sized and enterprise customers.
  • Macro industry pressure: 70% of Japanese hospitals are currently unprofitable, and widespread bankruptcies among nursing care operators continue amid elevated inflation and reduced reimbursements. While this creates acquisition opportunity for the company, it also creates near-term uncertainty for customer demand and retention.
  • Proposed early regulatory changes (potentially in April 2026) to address industry stress could accelerate competitor exit timelines, creating market opportunity but also near-term market volatility.

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