4929.T

Core Business & Value Creation Principles

• The company focuses on salon-centered professional cosmetics, with a mission to deliver "dreams and emotion to all people through beauty and health", centered on improving the value and productivity of salon professionals.
• Product development prioritizes gentleness to skin and hair, using formulas centered on simple sugars and minerals, with 35 years of focus on safety and quality. The company operates the "ADJUVANT Total Beauty Method", a salon-originated total care model that connects in-salon treatment to at-home care across hair, skincare, makeup, and body care categories.
• In-house R&D with a foundation in basic research supports end-to-end product development from concept to commercialization.

2026 March Fiscal Year Aggregate Financial Performance

• Total consolidated revenue was 3.813 billion yen, a 6.9% year-over-year decrease, missing the original full-year plan of 4.365 billion yen by 12.6%.
• Aggressive selling, general and administrative (SG&A) expense reduction offset gross profit declines from lower revenue. Operating income reached 170 million yen, a 44 million yen year-over-year increase, exceeding the original operating income plan of 126 million yen by 35.4%. Net income attributable to parent company shareholders reached 141.182 million yen, exceeding the original plan of 73 million yen by 93.4%.
• Year-over-year SG&A expense cuts included 48 million yen in IT costs, 46 million yen in outsourcing fees, 35 million yen in personnel costs, 33 million yen in advertising, and 27 million yen in R&D expenses. Compared to plan, SG&A was 130 million yen lower in sales promotion, 109 million yen lower in personnel costs, 33 million yen lower in IT costs, and 24 million yen lower in advertising.
• The company maintains a strong balance sheet: total assets of 5.148 billion yen, total liabilities of 929 million yen, net assets of 4.218 billion yen, and an equity ratio of 81.9%.

2026 March Fiscal Year Operational Achievements

• Rolled out 27 combined new and counseling seminars to strengthen counseling content as part of the "Beauty Education 2025" initiative, advanced awareness building and version updates for the Mite Photo customer support tool.
• Strengthened sales support for the three main new product lines launched in June 2025 via in-salon touch-up promotions and limited-edition product sets, and advanced preparation for next fiscal year new product launches.
• Improved repeat rates via CRM enhancements for the ADJUVANT LINK platform, and completed system upgrades for salon management operating environments.
• Drove operational efficiency via the Miteppli mobile app to centralize information distribution, announcements, and video content access for salon partners.

• For the 2027 March fiscal year, management is targeting total revenue of 4.052 billion yen, a 238 million yen (6.2% year-over-year) increase, relying on sales growth from one new haircare product line and two new skincare product lines, paired with DX initiatives to strengthen salon value delivery.
• Management forecasts operating income of 50 million yen and net income attributable to parent company shareholders of 24 million yen, representing a year-over-year decrease in operating income, as projected increases in SG&A (for new product promotion, personnel costs, and IT investments) will offset the earnings impact of revenue growth.
• The company has set capital efficiency targets of achieving an 8% ROE as soon as possible and maintaining a PBR above 1x, to align performance with capital cost and shareholder value expectations.
• Growth strategy priorities include expanding revenue by leveraging the stable long-term growth of Japan's salon cosmetics market, which has grown 34.6% cumulatively since 2010, and expanding into underpenetrated adjacent categories beyond core haircare.

Adjuvant Holdings operates two core product segments for the 2026 March fiscal year: 1) Skincare: Skincare products accounted for 33.0% of total revenue. Total segment revenue declined 11.2% year-over-year, with an absolute year-over-year revenue decrease of 170 million yen. 2) Haircare: Haircare products accounted for 65.0% of total revenue. Total segment revenue declined 2.6% year-over-year, with an absolute year-over-year revenue decrease of 71 million yen. While new product launches and new customer initiatives performed well for both segments, they were not able to offset declining sales from existing product lines, leading to an overall company revenue decline.

• The overall Japanese cosmetics market has seen growing competition from an increasing number of market participants, leading to market fragmentation and intensifying competitive pressure.
• The company missed its original 2026 March fiscal year revenue target by a significant 12.6%, as strong performance from new products could not offset declines from existing product lines, creating execution risk for the 2027 fiscal year revenue growth plan.
• Current ROE remains below the company's target cost of equity capital, and has trended downward alongside lower net income, creating pressure to improve returns to meet shareholder expectations.

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