[MFS (196A)] FY2026 Full-Year Financial Results & Growth Strategy Deep Dive Report

Based on the full-year financial results for the fiscal year ending June 2026 released by MFS, Inc. (TSE Growth: 196A), this report provides an objective analysis of the company's performance summary, key KPI trends, changes in cost structure, and future growth strategies.

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1. FY2026 Full-Year Financial Summary and Achievement Status

The consolidated financial results for the fiscal year ending June 2026 exceeded company forecasts across both revenue and profit lines . This strong performance was driven by successful revenue structure reforms and rigorous cost control in both the core mortgage comparison service, "Moge Check," and the online real estate investment service, "INVASE."

Specific performance figures are as follows:

• Net Sales : 8,317,996 thousand JPY (+185.0% YoY, 102.8% of forecast) *Note: Net sales after gross-up deduction were 2,295,480 thousand JPY (-21.4% YoY)
• Operating Profit : 222,408 thousand JPY (+12.7% YoY, 111.1% of forecast)
• Ordinary Profit : 215,503 thousand JPY (+8.6% YoY, 112.7% of forecast)
• Net Profit : 308,811 thousand JPY (+92.8% YoY, 204.5% of forecast)

The slide below provides a summary of the FY2026 full-year results compared to the previous year and the initial plan.

[Slide Commentary: Importance of the Financial Summary]

This slide is critical for understanding the company's comprehensive performance for FY2026. While net sales surged approximately 2.85x year-on-year, this is largely due to the "gross-up effect" resulting from the full-scale launch of the "real estate trading model (a transaction method where the total transaction amount for property procurement and sales is recorded as revenue)" in the INVASE business. Conversely, while net sales on a gross-up deduction basis declined, the company successfully achieved an operating profit of 222 million JPY (111.1% of the plan) through improved SG&A efficiency and profitability in both business segments, demonstrating a steady increase in operating margins and overall profit growth.

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2. Segment Performance Trends and KPI Analysis

The company's operations are primarily divided into the "Moge Check" business and the "INVASE" business. The revenue structures and current status of each are as follows:

(1) Moge Check Business: Revenue Model Revamp and Marketing Efficiency

• Net Sales : 1,251,858 thousand JPY (-36.8% YoY, 102.2% of forecast)
• Full-Year Operating Profit : 149,153 thousand JPY (Established full-year profitability)

In the Moge Check business, top-line growth slowed due to external factors, specifically financial institutions reducing online advertising spend amid rising interest rates. However, the transition from the traditional "referral fee model" to the "loan execution fee model (deferred billing point)" is largely complete, strengthening the foundation for profitability.

The slide below illustrates the trends in unit price and Customer Acquisition Cost (CPA) , which are key KPIs affecting the profitability of the Moge Check business.

[Slide Commentary: Data Background on CPA and Marketing Efficiency]

This slide visualizes the shift in the Moge Check business from a strategy focused on chasing sales growth to an "efficiency-oriented strategy prioritizing profit." As a result of increased organic traffic (SEO effects) and optimized advertising operations, the CPA per loan application dropped sharply from 12,881 JPY in the previous year to 5,617 JPY (-56.4% YoY) . Furthermore, ROAS (Sales/Advertising Expenses) jumped to 476% (+265% YoY) , reflecting the expansion of profit margins to record levels.

(2) INVASE Business: Stabilization of Trading Model and Three Consecutive Quarters of Profit

• Net Sales : 7,066,137 thousand JPY (+654.5% YoY, 102.9% of forecast) *Note: After gross-up deduction: 1,043,622 thousand JPY (+91.8% YoY)
• Full-Year Operating Profit : 58,340 thousand JPY (Achieved first full-year profit)

Capitalizing on rising real estate prices due to inflation, the "INVASE" real estate investment service's trading model gained traction, achieving its first full-year profit (58,340 thousand JPY) . Although some contract delays occurred in Q3 due to temporary factors such as changes in bank loan screening criteria, the business has maintained three consecutive quarters of profit , indicating a solid growth trend.

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3. Cost Structure and Personnel Trends

SG&A expenses were reduced through the strategic suppression and optimization of advertising costs. Total general administrative expenses in Q4 of FY2026 were -17.3% YoY .

• Reduction in Advertising Expense Ratio : The advertising expense ratio for the Moge Check business fell from a peak of over 70% to 21.0% . In the INVASE business, it was also contained at 10.7% , signaling the success of the shift toward organic customer acquisition (accumulation of member base).
• Personnel Structure : The number of full-time employees increased to 57 (as of the end of June 2026) . While focusing on hiring for sales, property management, and procurement teams, the company maintains an engineer/designer ratio of approximately 30% , supporting in-house product development and AI integration.

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4. FY2027 Consolidated Earnings Forecast and Seasonality

For the fiscal year ending June 2027, the company anticipates further performance expansion and significant growth in operating profit.

• Net Sales : 10,241,392 thousand JPY (+23.1% YoY) *Note: After gross-up deduction: 2,651,992 thousand JPY (+15.5% YoY)
• Operating Profit : 371,369 thousand JPY (+67.0% YoY)
• Ordinary Profit : 369,834 thousand JPY (+71.6% YoY)
• Net Profit : 368,354 thousand JPY (+19.3% YoY)

The summary of the company-wide earnings forecast for the next fiscal year is shown in the slide below.

[Slide Commentary: Targets and Composition of FY2027 Earnings Forecast]

This slide outlines an aggressive plan to surpass the 10 billion JPY sales milestone while increasing operating profit by 67.0% YoY . While the Moge Check business adopts a profit-focused, flat-to-slight-growth strategy (sales forecast 1.206 billion JPY, operating profit 202 million JPY) in anticipation of a challenging environment, the INVASE business is positioned as the growth driver, with a scenario projecting sales of 9.035 billion JPY (1.445 billion JPY after gross-up) and operating profit of 168 million JPY. Note that the first half of the year incorporates the impact of policy interest rates, seasonal factors (Obon/year-end slow periods), and hiring periods for new sales staff, leading to a forecast where performance is heavily weighted toward the second half .

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5. Mid-to-Long-Term Growth Strategy and Topics

The company aims to evolve into a "comprehensive real estate tech service centered on finance in the AI era" and plans to promote the following key initiatives for FY2027:

1. "AI Agent" Evolution for Moge Check : Following the completion of internal process automation, the company will evolve its mortgage comparison and diagnostic functions into AI agents to improve customer experience and further reduce costs.
2. Integration of INVASE Business Functions : The functions of the INVASE business, currently split between MFS and its subsidiary Condominium Co., Ltd., will be integrated by October 2026. This will create a one-stop system providing everything from finance for investment properties to property selection, purchase, and subsequent property management.
3. Entry into Real-Demand Brokerage using "CAPS" AI Appraisal : Utilizing "CAPS," released in July 2026, the company will launch brokerage services for real-demand (residential) real estate by providing property price information. By expanding beyond investment properties into the residential market, the company aims to cultivate a new revenue pillar leveraging its credit analysis capabilities.

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6. Summary (10 Key Topics)

The 10 key points extracted from this report are summarized below:

1. FY2026 Full-Year Results : Achieved 8.317 billion JPY in sales and 222 million JPY in operating profit, exceeding budget and achieving profit growth .
2. Impact of Gross-Up Accounting : Net sales surged approximately 2.85x due to the expansion of the real estate trading model.
3. Moge Check Profitability : Secured 149 million JPY in full-year operating profit; transition to the loan execution fee model is complete .
4. First Full-Year Profit for INVASE : Achieved full-year profitability (58 million JPY) as the trading model stabilized amid rising real estate prices.
5. Dramatic Improvement in Marketing Efficiency : Moge Check CPA dropped significantly to 5,617 JPY (-56.4% YoY) .
6. Optimization of SG&A : General administrative expenses in Q4 decreased by 17.3% YoY due to a lower advertising expense ratio.
7. Accumulation of Member Base : Moge Check members increased by 121,000 and INVASE members by 7,000 year-on-year.
8. FY2027 Profit Growth Forecast : Planning significant growth with 10.241 billion JPY in sales and 371 million JPY in operating profit (+67.0% YoY) .
9. Second-Half Weighted Seasonality & Investment Plan : Performance is projected to be weighted toward the second half, considering interest rate trends and sales hiring periods.
10. Evolution of "AI x Finance x Real Estate" : Expanding into a comprehensive tech company through AI agent integration, INVASE functional consolidation, and entry into real-demand brokerage via CAPS.