9039.T

Corporate & Strategic Direction

• The company has shifted fully to group management, accelerating M&A as a "New Life Support Group", targeting a total group revenue of 140 billion yen by the FY2027 March term, with a long-term target of maintaining 12% operating profit margin.
• Strategic vision is to become the world's best new life support group, with the tagline "More SAKAI in daily life!", built on a core of high-quality moving services to expand market share, become the industry price leader, and grow through investment in DX and improved employee compensation.
• The three core non-moving growth pillars (electrical construction, reuse, clean service) each have a 10 billion yen sales target, and all three performed on track in the half-year, receiving a positive performance rating.

Industry & Market Conditions

• The moving industry is undergoing increasing oligopolization; Sakai is the only domestic industry player with over 100 billion yen in annual revenue, and leads competitors by a wide margin, with smaller third-tier players seeing flat or declining performance.
• New housing starts fell sharply this period due to the pullback after pre-demand for 2025 regulatory changes, but overall population mobility has remained flat, providing stable underlying demand for moving services.
• Road freight industry bankruptcies declined for the first time in 5 years this half-year, with labor and successor shortages remaining the top industry-wide challenges, which Sakai views as an opportunity to gain market share through strong recruitment capabilities.

Operational Performance

• Moving work orders grew 1.7% year-over-year, indicating the company continues to gain market share despite industry headwinds from COVID-19 after-effects and logistics regulatory changes. Corporate demand is particularly strong.
• Average moving prices saw a slight increase: core moving prices (transport + labor) and ancillary service prices both rose, though overall average price growth plateaued due to a higher mix of lower-priced single-person moves, which the company has been prioritizing for volume growth.
• Price pass-through for cost increases has proceeded smoothly, and hired vehicle and material costs have been well controlled in the first half, with results in line with management expectations.

Human Resources & Supply Chain

• Continued compensation improvements reduced employee turnover by 0.5 percentage points year-over-year; new initiatives including family-focused branch events are credited for helping lower turnover. New graduate hiring for next year is on track overall, with high school hiring very strong but university hiring facing slight headwinds.
• The company is running a trial program for foreign worker hiring: 21 foreign drivers from Indonesia are currently employed, with this number expected to rise to 30 by March 2026, and an additional 20 assistant moving staff to be hired next term. Pre-arrival training on Japanese language, culture and moving service standards is conducted to ensure service quality.
• The company is upgrading its dispatch management system to improve productivity and meet new logistics regulatory requirements for full supply chain tracking.

Segment-specific Operational Updates

• Electrical Construction: Leverages synergy with moving services, and now accepts orders outside of moving for disaster prevention, EV-related, and general electrical work. Management expects special demand for air conditioner replacement from 2025-2026 due to new regulatory requirements for refrigerant management, and is expanding product offerings for the company's 55th anniversary "Magokoro (Sincerity) Year".
• Reuse: The market is large, and the number of items collected during moving has increased 139% year-over-year, but the business is still in a transition period with sales challenges on the distribution side. The company recently opened a collaborative store with Jimoty to expand sales channels through both physical locations and online EC platforms.
• Clean Service: Sales are growing steadily, and contracts with rental property managers are increasing. Pest control services have strong demand, but house cleaning and overall sales capabilities remain key areas for improvement. The company is prioritizing BtoB growth before expanding to BtoC.
• Corporate Channel Expansion: The company is gradually expanding into BtoB and BtoG large-scale moving, which has a total addressable market of around 100 billion yen. It has already won large hospital relocation contracts and election-related work for governments, which often turn into recurring exclusive contracts, and the company will continue to pursue this segment cautiously while maintaining its core BtoC business.

Capital Return

• The company has twice revised its dividend policy since 2024, increased its payout ratio, announced a share repurchase program in August 2025 which is currently underway, and has expanded its popular rice shareholder benefit program, with a planned full-year dividend of 98 yen per share and a 45% payout ratio.

• Full-year consolidated and standalone earnings guidance remains unchanged from previous projections, with no upward or downward revision.
• The company maintains its long-term target of 140 billion yen in total group revenue by the FY2027 March term, and a 12% long-term operating profit margin target.

1. Moving Business: 51.289 billion yen, +2.4% year-over-year, 84.46% of total consolidated revenue
2. Electrical Construction Business: 2.666 billion yen, +4.6% year-over-year, 4.39% of total consolidated revenue
3. Clean Service Business: 2.909 billion yen, +7.3% year-over-year, 4.79% of total consolidated revenue
4. Reuse Business: 3.472 billion yen, -1.2% year-over-year, 5.72% of total consolidated revenue
5. Other Businesses: 0.386 billion yen, +11.9% year-over-year, 0.64% of total consolidated revenue

Total consolidated revenue for the half-year ended September 2025 is 60.724 billion yen, +2.6% year-over-year.

• New 2025 logistics industry regulations require full tracking of all contractors and clients in multi-layered subcontracting structures, which mandates significant additional IT investment; non-compliant firms are expected to be forced out of the industry, though Sakai views this as an opportunity for market share gain for compliant players.
• Intense competition among major moving firms as the industry consolidates, requiring continued investment to maintain market leadership.
• The reuse business is still in a transition period, with underdeveloped sales capabilities that are limiting current performance.
• Clean service has weaknesses in house cleaning operations and overall sales capacity that need to be addressed.
• University graduate hiring is currently facing challenges, falling behind target as of October 2025.
• Moving demand is heavily concentrated in the fourth calendar quarter, so failure to prepare sufficient capacity for the peak season could hurt full-year results.

Q: After recent acquisitions and partnerships including SD Holdings and Style Moving Center, what are the key priorities for Sakai's future M&A strategy?

A: Management will focus exclusively on M&A of businesses that create synergy with Sakai's core moving business, and will not pursue unrelated diversification. Key target sectors are international moving, general logistics, clean services, reuse, electrical construction, and living environment maintenance, which align with the company's three existing growth pillars.

A: Sakai has strong procurement capabilities but recognizes gaps in national-scale reuse sales distribution, as current acquired sales operations are only limited to the Kinki region, so the company will prioritize M&A to expand reuse sales reach nationwide. The company also sees opportunity in property management and related moving-adjacent services such as move-in/move-out repairs, all of which can be handled entirely within the Sakai group to capture full value.