Prored Partners (7034): FY2025 Results Summary — Net Sales Up 158.7% on Fund Exit Gains

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

Prored Partners Co., Ltd. (Securities code 7034; TSE Prime Market) engages in management consulting, environmental consulting, and PE funds, with group companies Knowledge Lean Co., Ltd. and Bluepass Capital Inc. (PE fund). The company’s accounting period is October. For FY2025, consolidated net sales were 12,302 million yen (year-on-year +158.7%), consolidated operating profit was 4,945 million yen (year-on-year +395.1%), and profit attributable to owners of parent was 205 million yen (year-on-year -35.6%). Gains and losses related to exits from funds’ investees, which were previously classified as non-operating income and expenses, are now reflected in net sales.

Consolidated Results (Full-Year Actual)

According to the performance highlights, exits from investees during the third and fourth quarters resulted in an increase in both net sales and operating profit. Gains and losses related to exits from investees include those related to the interests of limited partner investors in funds, and these are recorded in profit attributable to non-controlling interests; as a result, profit attributable to owners of parent was low in the FY2025 compared to operating profit, but it moved into positive territory. On a non-consolidated basis, fixed-fee consulting saw a slightly higher than expected landing due to steady growth, and performance-based consulting also landed slightly higher than expected, while the operating deficit widened as hiring progressed smoothly in the first half of the fiscal year, leading to increased hiring and personnel costs. Among group companies, Knowledge landed slightly below expectations, and Bluepass recorded a gain on a share transfer in an investment project.

Item (million yen)	FY2024 Results	FY2025 Results	YoY rate of change %
Net sales	4,755	12,302	158.7%
Cost of sales	2,289	4,770	108.3%
Gross profit	2,465	7,531	205.5%
Selling, general and administrative expenses	1,466	2,586	76.4%
Operating profit	998	4,945	395.1%
Ordinary profit	1,275	4,947	287.8%
Profit Attributable to Owners of Parent	319	205	-35.6%

The gross profit margin improved from 51.8% in FY2024 to 61.2% in FY2025, and the operating profit margin improved from 21.0% to 40.2%. On the balance sheet, total assets stood at 14,425 million yen (up 10.0% from FY2024), net assets at 11,892 million yen (up 5.0%), and cash and deposits at 5,843 million yen (up 5.9%); non-controlling interests were 4,997 million yen.

Item (million yen)	FY2024 Results	FY2025 Results	Percentage increase/decrease (%)
Total assets	13,114	14,425	10.0%
Current assets	12,376	12,782	3.3%
Cash and deposits	5,519	5,843	5.9%
Non-current assets	738	1,642	122.5%
Liabilities	1,791	2,532	41.4%
Net assets	11,323	11,892	5.0%
Non-controlling interests	4,923	4,997	1.5%

Consultant Headcount and Service Lines

The consultant headcount at the end of the FY2025 was 195 on a non-consolidated basis, and the company states it will continue aggressive recruitment activities to achieve a workforce of 300 by the end of FY2026. Taking a thorough hands-on approach, Prored offers implementation support services based on a wide range of themes, particularly Business Digital Consulting, spanning M&A/DD/PMI, growth strategy, cost management, human capital development, and DX promotion.

FY2026 Forecast

For the consolidated FY2026 forecast, the figures for net sales, operating profit, and profit attributable to owners of parent are shown as undisclosed in the materials. For the Consulting Business (Prored/Knowledge), expecting growth in fixed fee consulting, net sales, operating profit, and profit attributable to owners of parent are forecast to be 5,256 million yen, -493 million yen, and -521 million yen, respectively. For the Fund Business (Bluepass), the company will not disclose forecasts, given the difficulty in reasonably predicting the timing and amount of future accruals for profit and loss caused by the management of the investment limited partnership.

Consulting Business (million yen)	FY2024 Results	FY2025 Results	FY2026 Forecast
Net sales	3,205	4,122	5,256
Net sales: Prored	2,604	3,580	4,641
Net sales: Knowledge	602	544	615
Operating profit	-79	-1,067	-493
Operating profit: Prored	-165	-1,102	-553
Operating profit: Knowledge	116	65	80

The materials note that, due to amortization of goodwill and elimination of internal transactions, the Consulting Business figures differ from the aggregates of figures for Prored and Knowledge. On a non-consolidated basis, revenue from fixed-fee consulting is expected to increase due to strong inquiries in the digital, human resource development, and operations areas, while the forecast for performance-based consulting (including SaaS) assumes a revenue decline due to prevailing uncertainties. For Pro-Sign CRE, the company’s SaaS offering, the company will capture demand related to companies’ preparation for the adoption of the new lease accounting standard.

Non-Consolidated (million yen)	FY2024 Results	FY2025 Results	FY2026 Forecast
Fixed-fee consulting	1,330	2,591	3,739
Performance-based consulting (including SaaS)	1,273	988	902
Annual	2,604	3,580	4,641

Medium-Term Plan and Prime Market Listing Criteria

The mid-term management plan is scheduled to be disclosed along with the “Status of Progress in Plan to Meet the Criteria for maintaining listing on the Prime Market,” which is scheduled to be disclosed at the end of January 2026. Prored disclosed a plan to meet the criteria for maintaining its listing by the fiscal year ending October 31, 2030, in a notice titled “An Updated Plan for Compliance with the Criteria for Maintaining Listing” issued on March 31, 2023. As a transitional measure, if a company discloses a plan to meet the criteria on a target date after the first record date following March 2026, its stock will remain under supervision as an exception until it is determined whether the criteria have been met on the target date; thus, Prored will not be delisted even if it does not meet the criteria by October 31, 2026. Dividend information is not included in the materials and cannot be confirmed from them.

Fund Business: Progress of Bluepass Capital

The appendix presents the Bluepass Capital portfolio, noting that only projects that may be disclosed to the public are shown. The portfolio includes companies engaged in the manufacture and sale of hair removal equipment and weight reduction machines, cat cafes (25 locations in Japan), a car-related credit creation service called Kuruma terrace, temporary staffing services for construction site management, outsourced hair salons (approximately 50 directly operated salons in the Tokyo metropolitan area and suburbs), fashion apparel brands including VANQUISH and #FR2, retail concession operators selling fresh vegetables and fruits inside nearly 30 stores, and sales representative services for overseas and domestic brands, primarily in the apparel sector.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.