Hennge (4475) Q4 2025 earnings summary

Executive summary

• Net sales for FY2025 rose 30.6% year-over-year to JPY 10.92B, driven by strong growth in the HENNGE One business, which accounted for 93.9% of total sales.

• Operating income increased 76.7% year-over-year to JPY 1.79B, with a margin improvement to 16.4%.

• Profit attributable to owners of parent grew 64.2% year-over-year to JPY 1.36B, with net income margin rising to 12.4%.

• Achieved JPY 10 billion in ARR for FY2025, marking a key milestone and setting the stage for the next growth phase.

• Initiatives focused on strengthening recruitment, branding, and customer acquisition contributed to business expansion.

Financial highlights

• Gross profit increased 34.3% year-over-year to JPY 9.45B, with gross margin improving to 86.5%.

• Operating expenses and SG&A rose due to increased hiring, personnel costs, and advertising investments.

• Cash and cash equivalents at period end increased to JPY 7.32B.

• Net increase of 79 employees, surpassing the initial target, with low resignation rates.

• Initiated first dividend from FY2024, beginning profit returns to shareholders.

Outlook and guidance

• FY2026 net sales forecasted to rise 17.5% year-over-year to JPY 12.83B, with operating income expected to reach JPY 2.06B.

• Targeting JPY 20 billion in ARR by FY2029, with FY2026 as a preparatory year for the next growth cycle.

• Long-term ambition to reach JPY 100 billion in ARR and a 50% operating profit margin by FY2035–FY2037, requiring 20–30% annual ARR growth.

• Plans to proactively invest in service enhancement, organizational structure, and branding to support future growth.

• Basic earnings per share for the next fiscal year is projected at JPY 50.06.