QUICK CO.,LTD. Q3 FY2026 earnings call

• Corporate Identity & Core Values

  • Mission is "Make all connected people happy", business purpose is "Contribute to society through human resources and information businesses"
  • Core guiding principle is "Do clean, good work", balancing strong ethical/philosophical alignment with profit growth
  • Selected for 4 consecutive years to the JPX Nikkei Small-Mid Cap Index; ranked 20th overall and 2nd in the human resources services sector in OpenWork's 2025 "Companies with Meaningful Work" ranking, with a 4.4/5 employee satisfaction score

• Organizational Culture & Talent Development

  • Rigorous new graduate hiring process: over 20,000 applicants annually, filtered via aptitude testing and 4-5 interviews to select candidates aligned with corporate values, resulting in minimal pre/post hire expectation gap
  • Nurtures an open, frank culture; follows a "role-based position model" that emphasizes functional responsibility over hierarchical ranking, with teamwork as a core priority
  • Invests heavily in training: ~30 dedicated in-house trainers develop role-specific programs; new hires complete an immersive retreat at the company's historic training facility in Toyama, which includes cultural education and local community service
  • Maintains a centralized internal knowledge sharing platform where best practices and case studies from consultants across the country are curated and shared company-wide

• Human Resources Introduction Competitive Strategy

  • Unlike most competitors that use a split model (separate account managers for employers and job seekers), Quick uses a fully integrated model where one consultant manages both sides of the match
  • 80% of segment revenue comes from cross-consultant collaborative matching, prioritizing high match quality over individual consultant output
  • Focuses exclusively on high-demand, specialized niches: holds leading market share for licensed construction management technicians (current effective job opening ratio of 5.76x), with growing focus on nurses, pharmaceutical industry specialists, IT/electronics engineers, executive roles (annual salary over 10 million yen), and corporate back-office roles
  • Manages a database of past candidates, with repeat business and referrals from past placements currently accounting for ~10% of total closed contracts, a share that is expected to grow as service quality improves

• Market Context

  • Japan faces structural labor shortage: forecasts project a 11 million worker supply gap by 2040, driven by declining labor supply and steady growing labor demand
  • Rising job turnover is a long-term growth driver: average lifetime job turnover in Japan is currently 2.63, and is expected to rise to UK-levels (4.79) amid the decline of lifetime employment, growth of job-based hiring, and increasing corporate demand for external skilled talent

• Financial Position (as of December 11, 2025)

  • 2025 March fiscal year: total revenue 32.5 billion yen, operating profit 4.53 billion yen, ROE 20.92%
  • Market capitalization 48.7 billion yen; PBR 2.47x, PER 13.07x, dividend yield 4.02%
  • 15 billion yen in cash and cash equivalents on balance sheet; 6 billion yen earmarked for M&A activity
  • Implemented a 3-for-1 stock split in November 2025 to improve accessibility for retail investors
  • 2026 March fiscal year projected dividend: 52.6% payout ratio, over 10% on a DOE basis, with maintained strong shareholder return commitments
  • Enhanced shareholder benefits for investors holding 300+ shares, with enhanced benefits for long-term holders holding for over 3 years

1. Human Resources Services: Contributes 70% of total revenue. For the 2025 March fiscal year, total company revenue is 32.5 billion yen, so this segment's revenue is approximately 22.75 billion yen. It is composed of two core sub-segments: (a) Human Resources Introduction: Majority of the segment revenue, specialized in niche high-demand industries, with a fully integrated end-to-end collaborative operating model; (b) Recruiting Advertising: Handles job advertisement placements including Indeed (top-tier agency performance) and求人ボックス (top 5 agency ranking within 2 years of partnership), provides end-to-end recruitment support from strategy development to post-offer retention. 2. Regional Information Services: 100% No.1 market share for free local publications in the Hokuriku region, also the top local-focused human resources introduction firm in the region. 3. HR Platform Business: Operates Japan's leading HR information site "Nihon no Jinjiibu" with over 390,000 registered members (covering ~90% of listed company HR managers) and the annual HR Conference that draws 40,000 attendees per year. 4. Overseas Business: Currently has 6 operating locations across the US, UK, Netherlands, Mexico, Thailand, Vietnam; a new location in Düsseldorf, Germany will launch operations in March 2026, accounting for the remainder of total revenue.

• The 2025 fiscal year moderate operating profit decline is intentional, driven by planned aggressive upfront investment for future growth
  • Mid-term management plan uses a rolling three-year framework that allows flexible annual adjustment of business plans
  • Management expects to continue large-scale investments into growth areas while delivering steady sales and profit growth going forward
• Management sees significant room for improvement in current enterprise value relative to the current share price; will expand and intensify IR activities for both retail and institutional investors, and plans to publicly disclose capital allocation strategy (specifically for the 15 billion yen cash holding) in the near future
• Quick will continue deepening penetration in existing specialized niches while expanding into adjacent high-demand niches, and will continue expanding its global footprint with new overseas locations to support Japanese corporate expansion abroad
• Management expects the human resources industry to increasingly split between large-scale generalist players and small-to-mid sized specialized niche players, and Quick's niche-focused strategy is well positioned to capture long-term growth in this segmented market

• The company's core competitive advantage relies on retaining skilled, industry-specialized human resources consultants; while current turnover is much lower than industry average due to strong corporate culture, the risk of consultant poaching by competitors or independent consultancy exits remains a ongoing operational risk
• The human resources introduction market is already highly competitive, and growing barriers to entry mean the market is increasingly splitting between large generalist players and small niche players, requiring continued investment to maintain market position in Quick's target niches
• Candidate registration volume is the core constraint on business growth: rising demand for specialized talent means the company must continue investing in candidate acquisition to match growing employer demand

Q: What is Quick's M&A strategy, given the large cash balance on the balance sheet? / A: Quick is actively receiving M&A opportunities and proactively targeting potential targets. The priority is to acquire companies that add missing end-to-end recruitment capabilities (from upstream strategy to post-hire onboarding), target companies that have strong positions in specialized niches Quick has not yet entered, and AI-focused companies with existing development capabilities and technical talent. The company has earmarked 6 billion yen for M&A activity, and will actively pursue aligned opportunities as they arise.

Q: How is Quick addressing the key constraint of candidate registration growth amid rising employer demand? / A: Candidate growth is the top priority for business expansion. Quick will continue expanding content on existing niche candidate portals and launch new niche-specific portals, and will proactively consider expanding promotion from current online listing ads to mass promotion including TV advertising. The company will also more actively leverage third-party candidate databases to source and headhunt qualified candidates, while continuing to improve service quality to drive repeat and referral business.

Q: Is there risk of high consultant turnover from poaching or independent exits given the strong reputation of Quick's consultants? / A: While Quick's consultants do receive frequent external outreach, the company's turnover rate is far lower than the industry average. This is driven by the strong corporate culture built around the core principle of "do clean, good work", high levels of teamwork and job satisfaction, and the supportive work environment that retains talent. Most consultants do not leave for competitor roles due to alignment with Quick's culture and values.

Q: How does Quick view the competitive environment in the human resources market, and what is its winning strategy? / A: Competition in the human resources market is very intense, and the industry will see increasing bifurcation going forward: large players need massive investment to scale, while low barriers to entry mean many small niche players will enter the market. Quick's focused strategy on specialized high-demand niches, paired with its proprietary end-to-end collaborative matching model and strong culture, positions it well to succeed in this segmented market.