7097.T

• Company Overview & Mission

  • Sakurasaku Plus is a pure holding company for child-rearing support services, founded in 2017 and listed on the Tokyo Exchange Growth Market, with 1,804 total employees as of end-July 2025.
  • Corporate mission: "Unlock Japan's growth potential" by supporting dual-income households, which have become the dominant household structure in Japan; 77% of women now continue working after childbirth, creating growing demand for comprehensive child-rearing support.
  • Strategic evolution: Expanding from only providing childcare "space" to building a full solution platform that improves dual-income families' "time" and quality of life (QOL).

• Market Environment Tailwinds

  • The Japanese government has made reversing falling birth rates a top policy priority, with the full implementation of the Kodomo Mirai Strategy Acceleration Plan starting April 2025, which adds expanded financial support for pregnancy, childbirth, and childcare, improves childcare staffing ratios, expands work-life balance policies, and offers full tuition waivers for children from families with 3+ children.
  • The femcare/femtech market is rapidly growing: global market is projected to hit 5.5 trillion yen in 2025, with domestic PMS care supplements projected to grow 430% from 2023 levels to 3.4 billion yen by 2030.
  • Sakurasaku Plus is the 5th largest player in the Japanese childcare and related services market by revenue, behind only four larger industry competitors.

• Operational & Competitive Strengths

  • Childcare Quality Improvement: Operates with strict safety protocols including an operating committee with external advisors, a public-facing complaint process, and mandatory hierarchical staff training (11-56 hours annually per employee). Developed the in-house CLiP play-based early childhood education program, which has collected over 1,000 practical activity reports, and conducts collaborative research on childcare practice with the University of Tokyo Graduate School of Education.
  • In-House Real Estate Expertise: Leverages subsidiary Sakurasaku Powers to handle site selection, development, and approval for new childcare facilities entirely in-group. 94% of authorized childcare facilities in Tokyo are within 10 minutes walk of a train station, improving convenience for both parents and staff, and enabling efficient new facility openings.
  • Cross-Segment Synergy: All adjacent services draw on insights and user connections from the core childcare business, creating a one-stop support network for dual-income families from pregnancy through early childhood.

• FY2026 July (next fiscal year): Management projects revenue of 17.81 billion yen, a 3.1% decrease year-over-year, due to the temporary impact of outsized real estate sales in FY2025 that will not repeat. Operating income is projected to be 986 million yen, a 13.4% decrease year-over-year.
• Medium-Term (FY2027-FY2028 July): Growth is expected to resume, with revenue projected to reach 19.14 billion yen in FY2027 and 20.158 billion yen in FY2028. Operating income is projected to rise to 1.208 billion yen in FY2027 and 1.339 billion yen in FY2028, driven by growth in adjacent services and rising occupancy at newly opened childcare facilities.
• Capital Return Guidance: Management plans a 5th consecutive year of dividend increases, with a full-year dividend of 28 yen per share for FY2026 July, up 4 yen from FY2025. The projected payout ratio is 14.9% for FY2026. The existing shareholder benefit program (20,000 yen annually in QUO cards) will be maintained.
• Operational Next Steps: One new childcare facility is planned for opening in Chuo-ku, Osaka, and an existing facility in Harumi will be expanded to increase capacity. A new child support housing development project is planned for FY2026.

1. 保育サービス (Childcare Services, Core Segment): Operates 88 childcare facilities (87 authorized) as of end-FY2025 July, serving 4,899 children. Contributes the majority of consolidated revenue, which reached 18.388 billion yen for full FY2025 July, up from 5.154 billion yen in FY2019 July. Operating income for the full consolidated group hit 1.139 billion yen in FY2025 July, up from 45 million yen in FY2019 July.
2. 不動産サービス (Real Estate Services, via Sakurasaku Powers): Leverages in-house real estate expertise to develop childcare facilities and child-friendly support housing. Completed two child support housing projects by 2025 (Nishiazabu, Minato-ku 2024; Asakusa, Taito-ku 2025), and operates a buy-renovate-sell business for condominiums. One-time large real estate sales in FY2025 July drove above-plan revenue for this segment.
3. ICT情報サービス (ICT Information Services, via Mirai Palette): Develops parent/childcare provider digital tools, including the "Sakurasaku Photo" service, integrated communication tool mierun, and the new parent community platform "Sakurasaku Park". No separate revenue contribution percentage is disclosed.
4. 保育研修サービス (Training Services, via保育のデザイン研究所): Provides professional development training for childcare workers, with 370+ on-demand content modules, 616 subscription contracts as of July 2025, and 247 in-person training sessions annually. Had 15 contracted career-up training projects in FY2024, and 16 projects from April-July 2025, with 16,565 registered system users in that period. No separate revenue contribution percentage is disclosed.
5. フェムケア・フェムテック (Femcare/Femtech, via YELL): New segment added via full M&A acquisition in September 2024, sells the "Mama Yell" supplement for women trying to conceive, during pregnancy, and post-partum. No separate revenue contribution percentage is disclosed.
6. Other Segments: Includes cram school services (via VAMOS) and food education services (via Minna no Mirai), no separate financials are disclosed.

• Talent Shortage Risk: Difficulty hiring qualified childcare workers, nutritionists, and nurses could slow new facility openings, increase labor costs, or reduce subsidy eligibility, hurting profitability. Management mitigates this by incorporating hiring projections into opening plans, using multiple hiring channels, and optimizing recruiting costs via digital outreach.
• Falling Demand Risk: Accelerating population decline and falling birth rates could reduce demand for childcare services, hurting core business performance. Management mitigates this by carefully evaluating local demand before opening new facilities, and building a diversified business portfolio of adjacent child-rearing support services to reduce exposure to falling childcare demand.
• Operational Safety Risk: Accidents at childcare facilities could lead to regulatory suspensions or loss of user trust, reducing revenue and profitability. Management mitigates this by enforcing strict hygiene, food safety, and security protocols, maintaining up-to-date operational manuals, conducting regular mandatory safety training, and strengthening internal auditing to proactively identify safety hazards.

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