KeePer Technical Lab FY2026 Earnings Deep Dive Report

KeePer Technical Lab (Ticker: 6036) reported record-high revenue for the fiscal year ending June 2026. While operating profit appeared to decline slightly year-on-year, this was the result of deliberate, forward-looking investments aimed at exponential future growth . This report provides a detailed analysis of the company's actual performance, the rationale behind these growth investments, business transformations across segments, and the outlook for the future.

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1. FY2026 Full-Year Performance Highlights and Underlying Profitability

For the fiscal year ended June 2026, consolidated results showed revenue of ¥25.959 billion (+12.4% YoY) , operating profit of ¥6.914 billion (-2.6% YoY) , ordinary profit of ¥6.930 billion (-2.8% YoY) , and net income of ¥9.830 billion (+101.1% YoY) .

Revenue reached a record high, with growth across all segments. The doubling of net income compared to the previous year was primarily due to a ¥6.762 billion extraordinary gain from the sale of investment securities.

The following slide summarizes the full-year and Q4 performance for FY2026.

[Slide Commentary: Importance of the Full-Year Performance Table]

The most critical point to note in this slide is the "Reference value excluding growth investment expenses" listed in the middle and bottom sections of the table.

This fiscal year, the company utilized proceeds from the sale of investment securities to inject a total of ¥1.093 billion in "future-oriented growth investment expenses" as SG&A. When looking at the underlying profitability excluding these expenses, operating profit stands at ¥8.070 billion (+12.8% YoY) , with an operating margin of 30.8% (+0.1pt YoY) , confirming that the core business remains exceptionally healthy and robust.

Furthermore, Q4 operating profit alone surged by 52.5% YoY to ¥2.636 billion , indicating that the pace of growth accelerated significantly toward the end of the fiscal year.

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2. Factors Behind Operating Profit Fluctuations: Breakdown of ¥1.09 Billion in Growth Investment

To understand the factors behind the slight decline in operating profit (-2.6%), we break down the increases in gross profit and SG&A expenses.

The following slide shows the waterfall chart for operating profit fluctuations.

[Slide Commentary: Structure of Operating Profit Fluctuations]

This slide clearly illustrates how top-line expansion in the core business drove profit growth:

• Increase in LABO customer visits : Visits rose 8.3% YoY (from 747,851 to 809,831), contributing +¥846 million to profit.
• Expansion of the FC business : Accelerated franchise store openings led to increased royalties and chemical sales, contributing +¥308 million .
• Expansion of the Product business : Strong sales in the new car market contributed +¥1.249 billion .

Against these revenue-driven gains, operating profit was tempered by personnel costs for new store openings (-¥690 million), store-related expenses (rent, depreciation, etc., -¥1.171 billion), and the ¥1.093 billion in growth investments funded by extraordinary gains, resulting in a reported operating profit of ¥6.914 billion.

The specific breakdown of growth investments is as follows:

1. Brand Marketing (¥435 million) : TV commercials, LABO app development, KeePer Championship promotions, and Auto Salon exhibitions to strengthen brand awareness and customer acquisition.
2. Human Capital (¥477 million) : Training and special bonuses for staff in preparation for the "Mobility Base" initiative.
3. Store/Format Development (¥76 million) : Store relocations, new LABO format development, and overseas market research.
4. Other (¥150 million) : M&A and mid-term plan-related expenses, tax compliance, etc.

These are strategic costs incurred to capture long-term market share at the expense of short-term profit, demonstrating that the company's fundamental earning power remains intact.

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3. Segment Overview (1): KeePer LABO Operations

KeePer LABO Operations reported revenue of ¥14.028 billion (+10.5% YoY) and operating profit of ¥2.170 billion (-20.2% YoY) (Operating profit excluding growth investment expenses was ¥2.954 billion, +8.8% YoY ).

Dual Growth Engines: Direct and Franchise Stores

• Direct Stores : Revenue of ¥13.563 billion (+8.2% YoY). The network expanded to 149 stores . Annual customer visits reached 809,831 (+8.3% YoY) , with an average unit price maintained at a high level of ¥16,757 (+0.1% YoY) .
• FC Stores : Revenue of ¥4.65 billion (+196.2% YoY). Following the full-scale launch of franchise recruitment , the FC network expanded rapidly from 19 to 34 stores .
• National Network : Totaling 184 stores (150 direct + 34 FC).

Adding High-Value Services via the "Mobility Base" Initiative

The "Mobility Base" initiative has been launched to evolve KeePer LABO from a car coating specialty shop into a comprehensive car care hub:

• Heat-shielding KeePer Film : High-performance film that blocks 94.0% of infrared rays to suppress cabin temperature rise.
• Paint Repair / Window Repair : Services for the rapid repair of minor scratches and stone chips on bodies and windshields.
• Car Sales/Purchase (Car Flea Market) : A partnership with "Kababa" (operated by Aracan Co., Ltd.) to maximize vehicle value through a peer-to-peer trading platform.

These new services are designed to increase customer visit frequency and average spend.

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4. Segment Overview (2): KeePer Products and the B2B New Car Market Breakthrough

KeePer Products and Related Businesses performed exceptionally well, with revenue of ¥11.931 billion (+14.7% YoY) and operating profit of ¥4.744 billion (+8.2% YoY) .

The following slide shows the shift in revenue composition by sub-segment for the Products business.

[Slide Commentary: The Rapid Expansion Story of the New Car Market]

This slide strongly confirms the significant transformation in the revenue structure of the product business. In FY2022, the "Aftermarket" (gas stations and pro shops) accounted for 81.8% of the total , while the "New Car Market" (new car dealers) was only 13.5%. However, due to rapid adoption by automakers and implementation at dealer locations, New Car Market revenue surged to ¥4.085 billion (+29.4% YoY) in FY2026 , raising its revenue share to 34.2% .

Looking at KeePer coating penetration by major manufacturer (company estimates), TOYOTA is at 12.5% (+21.3% revenue growth) , HONDA at 26.7% , SUBARU at 54.5% (+32.6% revenue growth) , and Imported Brands (Mercedes, Volvo, etc.) saw a +714.7% revenue increase , indicating explosive brand penetration in B2B channels.

Furthermore, starting in Q4, the company launched "LX KeePer" and "LX KeePer Premium," high-performance products exclusive to new car dealers. These target the core price range for new car purchases (approx. ¥100,000 for M-size vehicles like the Prius) and are expected to be a powerful driver for further share expansion in the new car market.

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5. Future Growth Strategy and FY2027 Earnings Forecast

Mid-to-Long-Term Strategy: Establishing a 500-Store Network and All-Weather Facilities

The company aims to establish a 500-store network (250 direct + 250 FC) by FY2031. For FY2027, it plans ¥3.14 billion in investment for new openings and renovations.

• New Store Investment : Plan for 20 new stores (¥2.39 billion), expanding direct stores to 170.
• All-Weather Renovation : Plan for approx. 20 stores (¥400 million). To cope with recent extreme heat, the company is introducing booth air conditioning efficiency upgrades, electric sheet shutters, and "Easter curtains." This ensures stable construction quality and high utilization rates regardless of weather conditions.

FY2027 Full-Year Forecast: Path to V-Shaped Recovery

With the ¥1.09 billion in growth investments from the previous year bearing fruit, FY2027 is planned as a phase of significant profit growth.

• Revenue : ¥29.38 billion (+13.2% YoY)
  • Product Business: ¥13.84 billion (+16.0% YoY)
  • LABO Business: ¥15.54 billion (+10.8% YoY)
• Operating Profit : ¥9.012 billion (+30.3% YoY)
• Ordinary Profit : ¥9.012 billion (+30.0% YoY)
• Net Income : ¥6.222 billion (-36.7% YoY) (Due to the absence of the previous year's extraordinary gain from securities sales)

With the completion of the initial investment phase, the operating margin is expected to recover to 30.7% , significantly exceeding the previous record for operating profit.

Shareholder Return Policy

For FY2026, the company paid an annual dividend of ¥100 per share (¥60 ordinary + ¥40 special dividend), funded by profits after deducting growth investments from the extraordinary gain. For FY2027, the company plans to maintain the same level of ¥100 per share (payout ratio of 43.9%) , supported by cash generated from business growth, demonstrating a strong commitment to shareholder returns.

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6. Conclusion

KeePer Technical Lab's FY2026 results, while showing a flat headline operating profit, represent a year where the company successfully planted seeds for future growth: improved core profitability (+12.8% in real operating profit) , expansion of the LABO network via FC recruitment , rapid growth in the new car dealer channel (share up to 34.2%) , and service diversification through the "Mobility Base" initiative .

As these measures bear fruit in FY2027, the company is projected to return to a high-growth trajectory with operating profit exceeding ¥9 billion (+30.3% YoY). The evolution of the company's business model remains a key point to watch.