LITALICO (7366): FY2025 Results Summary — Sales Up 17.7% and Operating Profit Up 32.8% on Child Welfare Turnaround

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

LITALICO Inc. reported FY2025 net sales of 38,247 million yen, up 17.7% year on year, with operating profit of 4,576 million yen, up 32.8%, and profit attributable to owners of parent of 2,738 million yen, up 14.0% (IFRS). The Child Welfare segment returned to profit at 1,017 million yen from a loss of 98 million yen a year earlier, an improvement of 1,115 million yen. For FY2026 the company forecasts net sales of 44,000 million yen, operating profit of 5,500 million yen and profit attributable to owners of parent of 3,300 million yen, and plans to raise the year-end dividend to 15 yen from 11 yen.

Consolidated Results (Full-Year Actual)

The materials present consolidated results on an IFRS basis in millions of yen. Figures for FY2024 and FY2025 marked with an asterisk do not include the non-continuous business, pursuant to item no. 5 of IFRS. The company summarised the year as 38.2 bln yen in sales (+18% YoY), 4.58 bln yen in operating profit (+33% YoY) and 2.74 bln yen in profit (+14% YoY), and noted that 195 million yen was allocated as a quarterly loss from discontinued business.

Item (million yen, IFRS)	FY2024	FY2025	% YoY
Net Sales	32,484*	38,247*	+ 17.7%
Operating Profit	3,455*	4,576*	+ 32.8%
Profit Attributable to Owners of Parent	2,402	2,738	+ 14.0%

*Pursuant to item no. 5 of IFRS, figures for FY2024 and FY2025 do not include the non-continuous business.

Segment Results

LITALICO reports five segments: Vocational Welfare, Child Welfare, Platform, Overseas and Others. Vocational Welfare sales rose 13.0% while segment profit declined 5.2%, as marketing investment, personnel training measures and investment in corporate culture enhancement were conducted. Child Welfare sales rose 24.3% and the segment swung to a profit of 1,017 million yen, an improvement of 1,115 million yen, as facility operation rates stabilised on a return to the short-duration support program. Platform sales rose 20.9% and profit rose 30.7%, and Overseas sales rose 28.7% and profit rose 13.9% as DDCN, acquired in the prior year, contributed to the full year’s profit.

Segment (million yen, IFRS)	Metric	FY2024	FY2025	% YoY
Vocational Welfare	Sales	12,538	14,162	+13.0%
Vocational Welfare	Profit	4,598	4,358	-5.2%
Child Welfare	Sales	8,812*	10,951*	+24.3%
Child Welfare	Profit	-98*	1,017*	+1,115 mln. yen
Platform	Sales	4,530	5,476	+20.9%
Platform	Profit	1,369	1,789	+30.7%
Overseas	Sales	2,840	3,655	+28.7%
Overseas	Profit	755	860	+13.9%
Others	Sales	3,764*	4,003*	+6.4%
Others	Profit	502*	391*	-22.2%

In Vocational Welfare, two facilities were launched as planned, bringing the total to 164 facilities (LITALICO Works: 159, HumanGrow: 5), with 2,595 total job placements. In Child Welfare, 19 facilities were opened, reaching a total of 186 facilities. In the Platform business, 35,002 facilities were contracted as of the end of FY2025. In Overseas, the company stated that performance at DDCN in Nebraska is proceeding stably and is steadily moving towards achievement of the plan.

FY2026 Forecast

For FY2026 the company plans 27 new facility launches in vocational welfare and 18 in child welfare. It expects to continue investing in strengthening sales ability and product development in the Platform business, and to proceed with service expansion and a strengthened service lineup in Nebraska for persons with severe behavioral disorder. New business development is also planned to be actively implemented.

Item (million yen, IFRS)	FY2025 ACT	FY2026 FCT	% YoY
Net Sales	38,247*	44,000	+ 15.0%
Operating Profit	4,576*	5,500	+ 20.2%
Profit Attributable to Owners of Parent	2,738	3,300	+ 20.5%
Year-end Dividend	11 yen	15 yen	+ 36%

*Figure excluding the non-continuous business based on item no. 5 of IFRS.

Shareholder Returns

The term-end dividend is expected to be 15 yen for FY2026, against 11 yen for FY2025. During FY2025 a stock repurchase for a total of 1.3 bln yen was completed, and a stock repurchase with a cap of 1 bln yen is scheduled in FY2026. The company disclosed that the new repurchase covers up to 1,000,000 common shares, equal to 2.9% of the total number of issued shares, for a total repurchase price of up to 1,000 million yen, over a period from May 12, 2026 to September 30, 2026, by market purchase on the Tokyo Stock Exchange through an appointed securities dealer with transaction discretion. The stated purpose is enhancement of capital efficiency and the provision of returns to shareholders.

Medium-Term Policies and Network Expansion

LITALICO states its business policy as becoming the No. 1 company in the world for supporting people with disabilities. Its investment policy is to continue growth investment towards maximisation of the mid- to long-term business value of existing major businesses, while developing new businesses in surrounding sectors selectively alongside the core disability welfare sector. On financial and capital allocation, the company states that while prioritising growth investment, shareholder return measures will be strengthened in association with stable profit growth, with stable dividend increases and agile stock repurchase continued while maintaining financial health. Its management foundation policy calls for continuous investment in re-strengthening the consistency of corporate culture and in the development of human resources.

Facilities (number of sites)	FY25	FY26 FCT
Vocational Welfare	164	191
Child Welfare	186	202
Others	53	54
Total	403	447

The company states that an approximate total of 450 sites are planned to be launched by the end of FY2026. New services launched during FY2025 include the group home LITALICO Residence Inogashira-koen, opened in May 2025 and already at its capacity of 10 people with three facilities planned for FY2026, and LITALICO High School, opened in April 2025.

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