AlphaPurchase Corporation Q4 FY2025 earnings call

• Overall 2025 Performance

  • Despite the negative impact of the Askul ransomware attack on MRO segment revenue, the benefits of the Mugen Catalog strategy allowed the company to achieve 11 consecutive periods of profit growth.
  • All quarters recorded year-over-year revenue growth, though total full-year revenue came in 600 million yen below the November 2024 forecast of 59.5 billion yen.
  • Operating profit beat the February 2025 forecast but missed the November 2024 forecast due to extra costs in the FM segment.
  • ROE improved approximately 1 percentage point year-over-year, driven by a 0.2 percentage point improvement in operating margin.

• Ransomware Impact Recovery Status

  • Indirect sales to small and medium-sized businesses via Askul began recovering in mid-November 2025 (one month after the October 19 attack disclosure) and has gradually returned to pre-attack levels.
  • Direct sales to large enterprise customers that source products from Askul experienced larger-than-expected impacts: shipments from Askul's logistics center to Alpha Purchase customers were originally scheduled to resume in December 2025, but only restarted in mid-January 2026. While most customer demand shifted to other suppliers in the Alpha Purchase catalog, a portion of demand moved to off-catalog alternative procurement routes, leading to a larger-than-forecast drop in large enterprise sales.

• Mugen Catalog Growth Initiatives

  • The Mugen Catalog electronic catalog initiative, launched in September 2023, launched a dedicated website in July 2025, and now ranks at the top of search engine results, making it easy for potential customers to access.
  • The dedicated website now hosts numerous case studies of successful customer implementations, and will continue adding more cases to attract new customers.
  • Following feedback from shareholders, the company has added specific concrete examples of the economic benefits of Mugen Catalog implementation, including item cost reduction, process man-hour reduction, and procurement lead time shortening, and will continue expanding content to better highlight the value of the offering.

• Dividend Policy

  • For FY2025, the company maintains its planned total dividend of 37 yen per share, consisting of a 32 yen ordinary dividend (a 2 yen increase from the February forecast) and a 5 yen commemorative dividend for the company's 25th anniversary, to be submitted for approval at the March 2026 shareholder meeting. This plan remains unchanged despite a slight negative miss on profit relative to the November forecast.

Overall: Total company revenue for the 2025 December period reached 58.9 billion yen, a 5.3% increase year-over-year. Operating profit was 1.468 billion yen, ordinary profit was 1.483 billion yen, and EBITDA was 2.155 billion yen, all achieving approximately 20% year-over-year growth and extending the streak of consecutive profit increases to 11 periods. MRO Segment: MRO segment revenue grew 7.5% year-over-year. Growth was held back by two factors: the negative impact of Askul's ransomware attack, and a 3% year-over-year drop in average selling price from the first full year of Mugen Catalog implementation. Despite the slower revenue growth, gross margin improved by approximately 1 percentage point year-over-year because sales became concentrated in products that Alpha Purchase can source in bulk at lower costs due to the Mugen Catalog effect. As a result, MRO segment operating profit increased sharply year-over-year, and operating profit met original forecasts even with larger-than-expected revenue declines. FM Segment: FM segment revenue was flat year-over-year. Through the third quarter, weak sales to food service outlets caused underutilization of indirect department staff. In the fourth quarter, demand for store materials surged far beyond initial forecasts, driving a sharp sales recovery, with full-year fourth quarter revenue exceeding November 2024 forecasts. However, the unexpected demand surge required emergency procurement and extra delivery costs, which increased costs more than the revenue gain, pulling full-year operating profit down sharply year-over-year and leading to a 400 million yen miss versus the November 2024 operating profit forecast.

• For the 2026 December period, the company forecasts total revenue of 65.3 billion yen, representing over 10% year-over-year growth. It projects that operating profit and ordinary profit will both reach 1.65 billion yen, and net income will reach 1.13 billion yen, with operating margin expected to stay roughly flat year-over-year.
  • Segment-level revenue and profit breakdowns will not be published until mid-2026, when forecast accuracy improves.
  • For 2027, the company plans to maintain a full-year dividend of 37 yen per share, with only an ordinary dividend (no commemorative dividend, matching the total FY2025 payout amount).
  • The company has committed to continuing to improve and maintain high ROE to grow shareholder value. For FY2026, it will focus on expanding revenue while maintaining the improved operating profit margin achieved in FY2025.
  • The company has set a long-term target to reach 100 billion yen in total revenue by FY2029 (the 2029 December period).

• The October 2025 ransomware attack on partner Askul caused unexpected disruptions to Alpha Purchase's MRO segment operations, leading to larger-than-forecast revenue declines in both indirect sales via Askul and direct sales to large enterprise customers that source Askul products.
  • FM segment demand for store materials is heavily dependent on the store renovation policies of multi-location chain clients, and can experience much larger volatility than initially forecast, leading to unexpected extra costs when demand surges, as seen in the FY2025 fourth quarter.
  • Weak demand in the food service outlet sector can lead to underutilization of indirect department personnel, creating negative operating leverage that pressures profitability in slow demand periods.

All question and answer content from the briefing (including questions received before and after the presentation) is published as a separate answer collection on Alpha Purchase's IR website, and no Q&A content is transcribed in this earnings call document.