v3.26.3
SEGMENT REPORTING
 6 Months Ended
Jun. 30, 2026
Segment Reporting [Abstract]  
SEGMENT REPORTING

Note 6 — SEGMENT REPORTING

 

The Company follows ASC 280, “Segment Reporting,” to report information about operating segments. The Company’s reportable segments are components of the Company for which separate financial information is available and evaluated regularly by the Company’s Chief Executive Officer, the Chief Operating Decision-Maker (“CODM”), Mr. Kiyotaka Ito, the representative director and CEO of the Company, in deciding how to allocate resources and in assessing performance. The Company has identified two reportable segments as follows:

 

Sports school business: This segment focuses on providing services related to the operation of sports schools and organizing events for children.

 

Social business: This segment provides services including managing extracurricular activities in schools, sports therapy for children with disabilities, and health exercise guidance.

 

Segment profit or loss measure

 

The CODM evaluates segment performance based on “direct operating profit,” which is defined as segment net revenue less directly attributable cost of revenue and segment-specific selling, general and administrative expenses. Segment-specific expenses include, but are not limited to, instructor salaries, facility leasing costs, and local marketing expenses. Certain corporate-level selling, general and administrative expenses are excluded from segment results and instead reported within “corporate expenses.” These corporate expenses consist primarily of headquarters-related administrative costs, professional fees (such as audit and legal fees), and other general expenses that are not specifically identifiable to any reportable segment. These costs are not allocated to the reportable segments.

 

Segment assets

 

The CODM does not regularly review segment assets for the purposes of making decisions about allocating resources or assessing performance. Accordingly, no measure of segment assets is disclosed.

 

Adoption of ASU 2023-07

 

In accordance with ASU 2023-07, the Company has identified “salaries and welfare expenses” as a significant segment expense (“SSE”) for both segments. These expenses are regularly reviewed by the CODM, are included in the measure of segment profit or loss, and serve as the primary driver in evaluating segment performance and determining resource allocation, as the Company’s business model is highly dependent on specialized human resources. This expense is presented for each reportable segment in the segment disclosure tables below. “Other Expenses” within the segment results primarily consist of travel expenses, communication costs, and small-tool supplies required for local operations.

 

Segment performance

 

The following table summarizes financial information by reportable segment, presents SSE, and reconciles total segment profit to consolidated income from operations and net income for the six months ended June 30, 2025 and 2026.

 

                       
    For the Six Months ended June 30,  
    2025     2026     2026  
    JPY
(Unaudited)		     JPY
(Unaudited)		     US$
(Unaudited)		  
Sports school business                        
Revenue     3,937,704,322       4,148,517,523       25,512,069  
Salaries and welfare expenses (SSE)     1,729,391,903       1,681,753,647       10,342,252  
Other Expenses     1,362,689,842       1,599,794,457       9,838,230  
Segment Profit     845,622,577       866,969,419       5,331,587  
                         
Social Business                        
Revenue     1,551,106,499       1,830,269,518       11,255,578  
Salaries and welfare expenses (SSE)     979,913,683       1,328,933,142       8,172,518  
Other Expenses     465,156,481       229,177,133       1,409,367  
Segment Profit     106,036,335       272,159,243       1,673,693  
                         
Total segments                        
Total Revenue     5,488,810,821       5,978,787,041       36,767,647  
Total Segment Profit     951,658,912       1,139,128,662       7,005,280  
                         
Total Segment Profit     951,658,912       1,139,128,662       7,005,280  
Corporate Expenses*     883,729,668       1,046,818,977       6,437,605  
Consolidated Income from operations     67,929,244       92,309,685       567,675  
Other Income / (Expenses), net     (19,375,906 )     20,411,865       125,527  
Income Tax Expense     5,152,860       (35,644,710 )     (219,204 )
Consolidated Net Income     53,706,198       77,076,840       473,998  

 

 
* Corporate expenses primarily consist of corporate administrative expenses and other general and administrative costs that are not allocated to segments for internal reporting purposes. Accordingly, reportable segment results are presented on a pre-allocation basis of such corporate overhead.