Nihon M&A Center Holdings Inc. Q4 FY2025 earnings call

• Celebrated 35th anniversary, aiming for $30 billion ordinary profit in 2032 (Vision 300 next Genesis). - Restored to performance achievement cycle of peaking in December and preparing for next fiscal year in fourth quarter. - Budget-achieving departments ratio increased from 29.7% last fiscal year to 67.4% this fiscal year. - Took actions regarding employee turnover, including clarifying midterm plan 'next genesis', revising budget and follow-up for employees with less than three years tenure, and reinforcing recruitment activities. - Redesigned sales organization into three groups: alliance division, corporate business division, regional and industry strategy division. - PMI consulting business grew over 40% year-on-year with 132 mandates. - Overseas business entered third phase of authentic profit generation with establishment of J Capital.

Sales ended at $50.25 billion, up 14% year-on-year. Ordinary profit was $19.15 billion, up 13.2% year-on-year. Batons, an equity method affiliate, listed on the growth segment of TSE. For FY26, sales guidance is 52.8 billion yen, ordinary profit guidance is 19.3 billion yen. Sales target for FY26 is 5% increase from FY25 actual, ordinary profit target is 0.8 percentage points increase from FY25 actual.

• For FY26, sales guidance is 52.8 billion yen, ordinary profit guidance is 19.3 billion yen. - Aim to exceed the FY26 guidance numbers. - Expect ordinary profit margin to slightly decline due to investments in human resources, IT, and branding for 35th anniversary. - Mid-term plan 'next genesis' aims to achieve $30 billion ordinary profit in 2032.

• Decline in number of transactions closed. - Decline in new sales side mandates. - M&A consultants declined in number. - Turnover rate for employees with less than three years tenure remains an issue. - Possibility of other M&A supporting companies collaborating with partners and affecting business.

Q: About initiatives about hiring and retaining M&A consultants, issues and net increase plan.

A: Takeuchi involved in final interviews, hires matching personnel, plans 10% net increase in FY26 with 25% growth through recruitment and 15% resignation.

Q: Risk of partners shifting collaboration with other M&A supporting companies.

A: For financial institutions, long-lasting relationships built by top management and field staff protect business; for accounting firms, focus on best practice for clients and long-term relationships make it hard for others to break.

Q: Decrease in number of transactions closed while focusing on quality.

A: Focus on quality mandates, improve ratio of completion through value promotion department and meticulous actions, expect to increase closed transactions in V or U shape.

Q: Number of active pipeline projects at end of March 2026.

A: Pipeline projects grew from 305 last fiscal year to 425, with 425 in negotiation now.

Q: Growth in net income for March 2027.

A: Fund business exit extraordinary profit contributes to net income growth.

Q: Initiatives toward FY2032.

A: Refined strategy and tactics, introduce new stock-based compensation system, plan to grow overseas business and fund business, aim for huge leap in sales and profit by 2032.