ARCS (9948) investor relations material

Executive summary

• Revenue for Q1 FY2027 reached a record ¥158.5 billion, up 2.7% year-over-year, driven by higher unit prices despite a slight decrease in per-customer purchase volume.

• Operating profit rose 5.9% to ¥4.1 billion, and net income attributable to shareholders increased 3.0% to ¥2.88 billion year-over-year.

• The company focused on product innovation, cost control, and digital transformation, with notable expansion in private label and collaborative products.

• Store count reached 374, with ongoing investments in new stores and renovations to enhance competitiveness.

Financial highlights

• Gross profit increased 1.8% to ¥39.3 billion, while SG&A expenses rose 1.4%, mainly due to higher personnel costs.

• Operating margin improved slightly to 2.6%, and net margin remained stable at 1.8%.

• Cash and equivalents at quarter-end were ¥90.8 billion, down ¥0.36 billion from the previous year-end but up ¥4.9 billion year-over-year.

• Operating cash flow was ¥9.5 billion, down 21.7% year-over-year, mainly due to increased receivables and tax payments.

Outlook and guidance

• Full-year revenue is forecast at ¥648 billion (+3.4% YoY), with operating profit of ¥18 billion (+5.6%) and net income of ¥12.4 billion (−0.4%).

• No changes were made to previously announced guidance.