Strike Co., Ltd. (6196): FY2025 Results Summary — Sales Up 12% but Profit Falls Short of Plan

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

Note on year labels: the company designates the fiscal year ended September 30, 2025 as “FY25/9” and the fiscal year ending September 30, 2026 as “FY26/9”; those labels are retained in the text and tables below. All figures are non-consolidated.

Strike Co., Ltd., an M&A brokerage listed on the Prime Market of the Tokyo Stock Exchange, posted net sales of 20,314 million yen for FY25/9, up 12.0% year on year and an 11th consecutive year of sales growth. Operating profit fell 6.5% to 6,332 million yen. The number of deals closed totaled 275, falling short of the plan of 310, so net sales came in at 91.1% of the plan and operating profit at 75.3% of the plan. The company attributes the shortfall to a larger-than-expected number of deals that required additional adjustments or management decisions at the final stage, causing delays that prevented them from being completed within the quarter.

Full-Year Results (FY25/9)

Cost of sales rose 28.6% on higher personnel expenses from a larger number of consultants, lifting the cost of sales ratio to 41.3% from 36.0%. SG&A expenses increased 15.5%, mainly on higher personnel expenses from the increase in employees and greater advertising expenses. As a result the operating profit margin declined to 31.2% from 37.3%. Ordinary profit was 6,341 million yen (-6.4%) and profit was 4,719 million yen (-4.7%).

Item (million yen)	FY24/9	FY25/9	YoY change
Net sales	18,138	20,314	+12.0%
Cost of sales	6,527	8,395	+28.6%
Cost of sales ratio	36.0%	41.3%	–
SG&A expenses	4,838	5,586	+15.5%
SG&A ratio	26.7%	27.5%	–
Operating profit	6,772	6,332	-6.5%
OPM	37.3%	31.2%	–
Ordinary profit	6,772	6,341	-6.4%
Profit	4,955	4,719	-4.7%
Number of deals closed	252	275	+23
Number of new contracts	923	1,181	+258
Employees	368	452	+84

Variance from the Full-Year Plan

The company states that activities were carried out on the assumption of a certain level of sales, and that cost of sales and expenses were generally in line with the plan; however, due to insufficient cost control in response to actual sales performance, profit declined. Within cost of sales, incentive bonuses came in 387 million yen below plan on lower-than-expected sales, while referral fees exceeded plan by 29 million yen. Within SG&A, advertising expenses ran 211 million yen above plan partly because of the postal rate hike, and other expenses were 277 million yen above plan mainly due to a 165 million yen increase in recruitment expenses.

Item (million yen)	FY25/9 plan	FY25/9 results	Variance
Net sales	22,300	20,314	-1,985
Total cost of sales	8,714	8,395	-319
Gross profit	13,585	11,918	-1,666
(Gross margin)	(60.9%)	(58.7%)	–
Total SG&A expenses	5,178	5,586	+408
Operating profit	8,407	6,332	-2,074
(Operating profit margin)	(37.7%)	(31.2%)	–

Operating KPIs

New contract acquisitions were strong, increasing by 76 year on year in Q4 and by 258 for the full year, which lifted the contract backlog to 1,247. The average expected sales per new contract decreased from 82 million yen in FY24/9 to 77 million yen in FY25/9, mainly due to an increase in referral-based mandates. The number of MoU signed rose by 30 year on year; the company notes that approximately 80% of deals that reach an MoU are successfully closed. The consultant headcount increased by 74 against an annual target of 61, and there has been no significant change in the turnover rate. In Q4 both the number of deals closed and net sales reached record highs on a quarterly basis.

Metric	FY24/9	FY25/9
Number of deals closed	252	275
Number of new contracts	923	1,181
Contract backlogs	980	1,247
Number of MoU signed	311	341
Average sales per deal closed (million yen)	72.0	73.9
Employees (fiscal year-end)	368	452
Consultants (included in cost of sales)	269	328
Consultants (included in SG&A expenses)	34	49
Non-consultants	65	75

FY26/9 Forecast

For FY26/9 the company plans to close 329 deals and take on 1,270 new contracts. While assuming a decline in the closing rate, steady growth in new contract acquisitions is expected to drive a 20% increase in the number of closed deals and a 20% rise in net sales. Average sales per deal closed is planned at approximately 74 million yen, based on the FY25/9 actual average. Operating profit is expected to improve significantly through strict cost control, including reducing the volume of direct mail and reviewing recruitment costs, and the planned headquarters expansion originally scheduled for FY26/9 has been postponed to FY27/9 or later. The company notes that the forecast assumes it continues its activities as before, and that any impact from the planned transition to a holding company structure will be disclosed once confirmed.

Item (million yen)	FY25/9	FY26/9 forecast	YoY change
Net sales	20,314	24,346	+19.8%
Cost of sales	8,395	9,763	+16.3%
COS ratio	41.3%	40.1%	–
Gross profit	11,918	14,582	+22.4%
SG&A expenses	5,586	6,211	+11.2%
SG&A ratio	27.5%	25.5%	–
Operating profit	6,332	8,370	+32.2%
OPM	31.2%	34.4%	–
Ordinary profit	6,341	8,402	+32.5%
Profit before income taxes	6,368	8,402	+31.9%
Profit	4,719	5,738	+21.6%
Number of deals closed	275	329	+54
Number of new contracts	1,181	1,270	+89
Employees	452	509	+57

Medium-Term Management Plan

The company reviewed its medium-term management plan based on FY25/9 performance and targets a net sales CAGR of 10 to 20%. The plan is stated on a non-consolidated basis on the assumption that the company continues its activities as before; a consolidated medium-term plan following the transition to a holding company structure scheduled for April 1, 2026 will be announced once finalized. The company plans to increase the proportion of new graduate hires among consultants for the time being, so productivity is expected to decline slightly through FY27/9 before improving from FY28/9 onward, and it expects a higher cost of sales ratio related to referral fees as referral-based mandates increase.

Item	FY25/9	FY26/9 (Target)	FY27/9 (Target)	FY28/9 (Target)
Net sales (million yen)	20,314	24,346	27,195	30,003
Operating profit (million yen)	6,332	8,370	8,882	10,089
Deals closed	275	329	370	411
New contracts	1,181	1,270	1,445	1,639
Employees	452	509	574	645

Shareholder Returns

The company revised its dividend policy to enhance ROE, raising the dividend payout ratio from 35% to 50%. To further return surplus funds to shareholders, the dividend per share will be fixed at 180 yen up to FY27/9, with further increases to be implemented if the payout ratio falls below 50%. The dividend for FY25/9 was raised from the initially planned 102 yen to 180 yen per share, giving a payout ratio of 73.2%. ROE for FY25/9 was 23.6% versus 30.1% in FY24/9, and the company targets an ROE in the range of 25-30%, listing flexible consideration of share buybacks, review of the payout ratio and use of debt among its measures. PBR was 4.0 times at the end of FY25/9 (4.5 times at the end of FY24/9) and PER was 18.0 times (16.8 times).

Item	FY23/9	FY24/9	FY25/9	FY26/9 (Target)	FY27/9 (Target)	FY28/9 (Target)
Dividend per share (yen)	51.00	91.00	180.00	180.00	180.00	180.00
Dividend payout ratio	25.3%	35.3%	73.2%	60.2%	56.8%	50.0%

Topics and Market Environment

Annual topics for FY25/9 include the planned transition to a holding company structure, under which the M&A brokerage business is to be transferred to a wholly owned subsidiary through an absorption-type company split with an effective date of April 1, 2026 (tentative), with the listed parent renamed Strike Group; the company will remain listed after the transition. The company also launched a cross-border M&A business targeting SMEs and completed its first cross-border deal, supporting a University of Tokyo-originated startup, LocationMind Inc., in acquiring the U.S.-based company Irys. In addition, it established dedicated in-house teams for financial advisory (FA) services and strategic consulting, and held 42 seminars during FY25/9 (counting only those promoted through its website).

On the market environment, the number of M&A transactions in Japan based on timely disclosures of listed companies rose 11% year on year to 985 in January-September 2025, an increase of 96. Of these, 812 were M&A between Japanese companies (+90 year on year) and 173 involved overseas companies (+6). The company also cites its network of more than 1,700 partners, an internal database covering the acquisition needs of nearly 19,000 companies, and over 5,800 annual inquiries through its M&A brokerage site SMART.

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.