BRIDGE REPORT
(6181)

東証マザーズ

Partner Agent, Inc. (6181)
President Shigeru Sato
President Shigeru Sato
Corporate Profile
Company
Partner Agent, Inc.
Code No.
6181
Exchange
TSE Mothers
Industry
Service industry
President
Shigeru Sato
Address
Imasu Osaki Building, 1-20-3 Osaki, Shinagawa-ku, Tokyo
Year-end
End of March
URL
Stock Information
Share Price Shares Outstanding Market cap ROE (actual) Trading Unit
¥624 9,823,200 shares ¥6,129 million yen 14.8% 100 shares
DPS (Est.) Dividend Yield (Est.) EPS (Est.) PER (Est.) BPS (Act.) PBR (Act.)
¥0.00 - ¥37.80 16.5times ¥70.05 8.9times
* The share price is the closing price on July 27th. The number of shares issued was taken from the brief financial report for the latest period.
ROE and BPS are those for the previous term.
 
Earnings Trends
Fiscal Year Net Sales Operating
      Income
Ordinary
      Income
Net
    Income
EPS DPS   
Mar.2014 (Actual) 2,164 51 39 17 2.04 -
Mar.2015 (Actual) 2,664 146 132 79 8.98 -
Mar.2016 (Actual) 3,644 445 434 285 30.95 -
Mar.2017 (Actual) 3,812 204 212 107 11.37 0.00
Mar.2018 (Forecast) 4,649 405 501 355 37.80 0.00
*The forecasted values were provided by the company. On Jan. 1, 2017, the company conducted 3-for-1 stock split. EPS was adjusted retroactively.
*From the term ended Mar. 2016, net income is profit attributable to owners of the parent. Hereinafter the same apply.

We would like to report an overview of the financial statement of the fiscal year (FY) March 2017 of Partner Agent, Inc.
 
Key Points
 
 
 
Company Overview
 
The Company offers various services to support marriage hunting activities. Their key business, "Partner Agent Business", supports the marriage hunting efforts of the registered members. The "Fast Marriage Hunting Business" includes planning and operation of marriage hunting events and affordable marriage hunting support services. The "Solution Business" organizes marriage hunting events, provides matching systems for the corporations and local governments that are promoting marriage hunting, help companies to establish new marriage hunting support businesses, and create local environment that is conducive to marriage. The "QOL Business" includes introduction of wedding halls, sales of marriage rings, revision of insurance contracts, and operation of a childcare facility. The Company offers various services based on the corporate philosophy of "Bringing more smiles and more happiness to the world." The Company's major feature is its high marriage rate which is achieved by marriage hunting supports through detailed follow-ups by dedicated concierges and unique systems.
 
1-1 Corporate history
In June 2004, the Company was established to start a marriage hunting support business as a 100% subsidiary of Take and Give Needs, Co. Ltd. (4331, Tokyo Stock Exchange 1st Section, hereinafter "T&G"), which is specialized in wedding planning and wedding hall operation. At the time of the Company's establishment, Mr. Shigeru Sato was appointed to be the President for his abundant experiences and achievements at a major marriage hunting company.
Later, when the business of T&G slowed down and continuous investment became difficult, President Sato, the executive staff and the employees collaboratively purchased the shares of Partner Agent, Inc., and the Company became independent from the T&G Group in May 2008.
The customers highly regard the Company's high marriage rate, which is the result of "pursuing customers' goals" and the Company's business has been growing steadily. It was listed on the TSE Mothers in October 2015.
 
1-2 Corporate ethos, etc.
"Pursuing the customers' goals" has been the philosophy of President Sato since the establishment of the Company. Based on this philosophy, the Company holds the following mission and visions.
 
 
President Sato believes that these philosophies will penetrate into the employees only when they return to and think about the philosophy whenever they encounter specific issues or troubles.
 
1-3 Market environment
<Situations of unmarried people>
Growing percentage of unmarried people
According to the national census conducted by the Ministry of Internal Affairs and Communications, the percentage of unmarried people between 25 and 34 years of age has been increasing for both men and women in Japan.
 
 
Intention to marry among unmarried people: "Intention to marry" remains at a high level.
According to the "2015 National Institute of Population and Social Security Research <National Survey on Marriage and Childbirth>, the 15th Basic Survey on Childbirth Trend", the percentage of unmarried people who want to marry were 85.7% and 89.3% among male and female between the ages 18 and 34, respectively. These data indicate that there are still many unmarried people who "want to marry."
 
 
Although the percentages of unmarried people who responded "Will never marry" have been rising, among them, 44.1% of men and 49.8% of women responded that they might eventually change their intention to "Will marry." This indicates that about half of the people who are currently not intending to marry may change their mind and look for their marriage partners in the future.
 
Reasons for being single: It is hard to meet an appropriate person for marriage after 25 years of age
The reasons for the unmarried people between 18 and 24 years of age to stay single were "I am too young" and "I do not feel the need," indicating that their motivation to marry is not so high. On the other hand, a higher percentage of unmarried people between 25 and 34 years of age responded that "I have not met an appropriate person yet," indicating that the needs for the opportunities to meet potential partners are high in this age group.
 
 
<Other companies in the industry>
There are about 3,000 marriage hunting agencies in Japan. 90% of them are operated by individual business owners. There are only a few agencies including the Company that runs the businesses across Japan.
Following are the companies listed on the stock exchange in the marriage hunting industry, including Partner Agent.
 
 
1-4 Business contents
In addition to the existing Partner Agent Business, the Company began operation of the Fast Marriage Hunting Business, Solution Business and QOL Business in full swing from FY March 2017. From the following fiscal year, it will divide the reporting segment by 4 businesses.
 
① Partner Agent Business
The Partner Agent Business provides information to the members, introduces potential partners and provides opportunities to meet.
Each member has a concierge who is exclusively assigned to the member to support their marriage hunting activities, develop plans for actions and supports the customers professionally. Also, in order to provide opportunities to meet, the Company plans and hosts events for the members.
There are more female members, with the member composition ratio of male to female being between 4:6 and 3:7.
 
 
(Characteristics of services)
A concierge with high coaching skills works with a "customer who wants to find a marriage partner within 1 year". The concierge responds to the needs of the customer who desires cost-effective services without wasting time and effort. The activities are designed based on the PDCA cycle.
The concierges are mostly women who are done raising children, willing to help others through marriage hunting support and share joys. As of the end of June 2016, there are 171 concierges.
As for the concierge's activities, the Company has the motto of "pursuing customers' goals" and the concierges are evaluated based on the "customers' satisfaction" including the engagement rate and early withdrawal rate.
 
<Image of support based on the PDCA cycle>
(1) Before becoming a member: Clearly show service contents and fee structures
A customer who is considering to be a member and comes to the store for the first time is greeted by an account executive whose role is to encourage him/her to become a member. The account executive explains the service contents and fee structures in details so that the customer can accurately understand them.
If it seems difficult to continue introducing partners to the customers based on certain criteria, the customer may be declined to be a member.
This is to avoid the situations where the customers are not satisfied with the services such as they cannot reach a contact (meeting) or go steady with a partner, even though they pay monthly membership fees.
 
(2) After becoming a member: Support by a concierge who is exclusively assigned to a member.
Once a customer becomes a member, an interview is conducted by a designated concierge in charge of the customer to understand the customer's sense of value and expectations.
At this time, using the coaching skills, the concierge tries to have the customer's expectations and ideal model of marriage as clear as possible. This way, instead of helping the customers to find their partners abstractly, the concierges can help them find someone with specific criteria.
In addition to the conventional matching mechanism through data, the Company offers concierge services. This has differentiated the Company's service from the others. With this system, the Company can offer cost-effective services without making a detour and wasting time and efforts of the customers.
During the marriage hunting process, the designated concierges help the members to modify the path as needed using a PDCA cycle. This way, the members can proactively work on the marriage hunting activities, even if they fail in the process.
Furthermore, the concierges ask for comments and impression after each contact meeting from the members, provide consultation to the members during dating period and provide follow-ups after engagement (*) to walk with the members until they reach engagement.
The follow-up period after an engagement is 1 year. This way, they can support the members for a long time until they marry.
(*) Engagement (Withdrawal from the membership)
This means that a member withdraws from the membership after both members expressed their intention of continuation of dating with the intent to marry the partners they are dating.
 
(3) Setting up contact (marriage meeting) : Support by the staff other than concierges
As the process advances, the members have contacts (marriage meetings) with the matched members. The specialized team supports them to coordinate the date, time and place of these contacts so that they can set up the meetings effortlessly and efficiently.
The support team helps the members to carry out the activities smoothly. For example, even if the members are lost on the way to the contact venue or cannot find the person that they are supposed to meet, the Company's staff provides support via phone or e-mail so that the members do not miss the chance to meet. Furthermore, when the customers seek second opinions, the Company provides third-party advice through a service desk.
 
 
An unlimited number of potential partner is introduced to the members within the fee structure. In principle, the Company introduces at least 2 cases per month.
 
(Additional services)
(1) Events for the members
In addition to the introduction by a concierge, the Company develops and hosts various events such as marriage hunting parties.
They are organized by the staff members who are specialized in organizing events to provide opportunities to meet among the members. Many members have met their partners through these events and reached engagement.
Since the company's stores have space for holding events, they can hold events flexibly, without renting a hall for events.
 
(2) Option services
The Company offers photography (fee-based) for the members with extra charges. The first impression is crucial for marriage hunting. Therefore, in collaboration with professional camera operators and make-up artists, the Company offers photo sessions in their studios or within the Company's premises. Because the photography is specifically for marriage hunting, the Company can offer advices concerning appropriate clothing and facial expression based on their experiences.
To provide the preliminary knowledge and information about marriage hunting to the members, the Company offers seminars (fee-based) on such as color coordination, fashion advisory and, communication for the members.
 
② Fast Marriage Hunting Business
The Fast Marriage Hunting Business is based on the concept of offering affordable marriage hunting services to enable the members to start using the service without hesitation. It consists of 3 types of services.
 
 
(1) "OTOCON" marriage hunting parties
Marriage hunting parties for general members are called "OTOCON" and planned and operated under this business.
Although these parties are targeting general members, some non-members show interest in the Company through these events and become members. Thus, OTOCON is also working as a venue to increase new members.
Furthermore, similar to the event services for the members of the Partner Agent Business, there are staff members who are dedicated to event planning, and the events take place in the spaces within the Company's premises. The events promote efficient utilization of the Company facilities and also work as a channel to solicit new members. In other words, the OTOCON parties not only bring earnings to the Fast Marriage Hunting Business but also work in synergy with other services.
 
(2) "OTOCON Members marriage hunting counter"
This affordable service began in May 2016 for single people who are interested in both marriage hunting parties and matching services.
As dedicated stores, the company opened Shinjuku Store (in Tokyo) and Shinsaibashi Store (in Osaka) in May 2016, and then Nagoya Store (in Aichi). As party participants are increasing more steadily than expected, the company is opening stores at an accelerated pace, and improving them. As of the end of Mar. 2017, the company is running 20 stores.
 
(3) Yahoo! Marriage hunting concierge plan
This is a marriage information service of the Company offered on the "Yahoo! Marriage Hunting Concierge" site, a marriage hunting portal site operated by Yahoo! Japan Corporation. The high-quality meeting opportunities supported by a marriage agency are offered for a reasonable price, and it is a collaborative business model.
The characteristics of this plan are "Support from a designated concierge," "Highly accurate matching system," "On-line registration," "Credible members," and "Affordable cost (i.e. the initial cost is less than 10% of the general marriage agencies)."
Announcement to the users and gathering customers are done online, which reduces the cost for operating stores. The service is provided only by the cost for customer support to achieve the low price.
 
③ Solution Business
(1) Consultation services for business enterprises and local governments
As indicated below, under the Solution Business, the Company offers a wide range of services, including support for enterprises that are entering into the marriage hunting industry to start their business and support for local governments that are planning to offer marriage hunting support activities to the community people, from startup and introduction to operation. Depending on the needs and situation of the customers, the Company offers optimized solution services.

The major achievements with the local governments are as follows.
 
(2) "CONNECT-ship", a platform for the members to introduce each other
The "CONNECT-ship" is a platform for marriage hunting support agencies to introduce the members each other. It has been launched in June 2017.
 
(Overview)
Started with the following 6 companies and 7 services.
 
The "CONNECT-ship" has more than 50,000 members (total members of all participating agencies). It is the first attempt in the marriage hunting support industry to enhance marriage rate through the mutual introduction of a large number of members between businesses with a certain scale to find their partners and enhance the results and customer satisfaction.
The platform (system) to achieve mutual introduction among members was developed by the Company. The other agencies will use the "CONNECT-ship" service which is being operated and maintained by the Company. The Company is also in charge of operating the executive secretariat of the "CONNECT-ship."

It will increase its scale by including other companies that have the same vision (i.e. to maximize the marriage opportunities), which is the ultimate goal of the customers.
Each participating agency can offer its unique services and operations without being interfered by other participating agencies including the executive secretariat (the Company).

The revenue sources of the Company which provides and operates the system are 1) monthly usage fees per member and 2) marriage meeting fee when a marriage meeting is established from each participating company.
 
(Purposes)
The purposes of the "CONNECT-ship" for the Company are to develop the industry by facilitating sales competition among the participating companies and by learning from each other in an effort to promote marriage among the members to raise customer satisfaction, within a new framework. At the same time, the Company is aiming to bring about changes in the industry so that healthy service quality competition is created.
 
④ Quality of Life (QOL) Business
To the customers who become members through the Partner Agency Businesses, the Company offers various services at their major life transition by maintaining relationship with the members even after they withdraw from the membership after their engagement. This is to enhance customer satisfaction and increase revenue opportunities.

The members of the "Anniversary Club" are the ones who withdrew from the membership after their engagement. To those members, the following services are provided.
 
Regarding wedding ceremony introduction, until now, the company had tied up directly with wedding halls and introduced them to engaged members in the Kanto area, but they began introducing them to the "Zexy Konkatsu Counter" operated by Recruit Zexy Navi. With this, it became possible to offer wedding hall introduction service to engaged members nationwide. Also for housing, the company had been sending customers to rental housing brokerage services only, but it started introducing "Zexy Konkatsu Counter," which is operated by Recruit Sumai Company Ltd. to engaged members who are planning to buy custom-built houses.

As for the business of operating enterprise-led childcare facilities, which is promoted by the Cabinet Office, the company opened "Mebae Childcare Room Mitakadai" in Jun. 2016, and plans to open 7 facilities in FY March 2018. The company is planning to open other facilities to meet the needs for childcare services. In cooperation with local communities, the company aims to improve the childcare environment.
 
1-5 Characteristics and strengths
High engagement rate as a result of "pursuing customers' goal".
One of the key features of the Company is its "high engagement rate."
The engagement rate for FY March 2017 was 28.6%. The engagement rate is steadily increasing every year.
 
 
Although other companies in the industry are not announcing exact figures, the average engagement rate is suspected to be about 10%. In comparison, the Company's engagement rate is exceptionally high.

The "engagement rate" shows a rate of members who withdrew from the membership after their engagement during a specific period. Because the rate may also raise a question about the need for marriage hunting companies, many companies in the marriage hunting industry prefer not to use the engagement rate as an indicator.
However, President Sato has been focusing on the idea of "pursuing customers' goals" as a corporate strategy and philosophy from the foundation of the Company.
He believes that the goal that the customers want to reach through the Company's services is the "marriage." Thus, making efforts to reach the highest rate of "getting married" is the social value of the Company.
In order to achieve this purpose, the Company carries out all activities including employment, education, development, training, knowledge sharing, management, and evaluation system based on the philosophy of "pursuing customers' goals". This stance leads to the outstanding "engagement rate" in this field.
 
 
Fiscal Year March 2017 Earnings Results
 
 
Sales grew, but profit declined because expenditure was not offset by the sales growth.
Sales were 3,812 million yen, up 4.6% year on year. The number of members for the Partner Agent Business, which is the mainstay of the company, was 12,193, up 1.7% year on year. Engagement rate increased from 27.2% in the previous term to 28.6%, marking a record high. Sales decrease from stopping charging monthly membership fees after the shutdown of the new system is 184 million yen.
Operating income was 204 million yen, down 54.1% year on year. In addition to the decline in sales, the profit margin dropped sharply as a result of the large consulting projects that had been carried out in the previous term.
This happened despite the company streamlining the promotion expenses and controlling the number of recruits by improving the productivity of concierges.
Both sales and profit did not reach the revised forecasts.
 
 
(Partner Agent Business)
The number of new members decreased 4.6% year on year, but grew 0.4% year on year in the 4th quarter (Jan. to Mar.).
On the other hand, the number of existing members rose 1.7% year on year, although the number of members who have cancelled the membership after getting engaged increased due to the rise in engagement rate.
Engagement rate, which is most prioritized by the company, grew from 27.2% in the previous term to 28.6%.
As for the opening of new stores, the company opened Takasaki Store (Gunma Prefecture) in Nov. 2016, Mito Store (Ibaraki Prefecture) in Jan. 2017, and Himeji Store (Hyogo Prefecture) in Mar. 2017, and the number of stores as of the end of the term was 25.
 
(Fast Marriage Hunting Business)
The cumulative number of participants in the marriage hunting party "OTOCON" increased 111.7% year on year to 136,491.
The number of participants in the "OTOCON" party also grew 43.2% year on year to 2,386.
In response to the growth of demand for marriage hunting parties, the company opened Funabashi Store (Chiba Prefecture) and Ginza Store (Tokyo) in Oct. 2016, and Ikebukuro Store (Tokyo) in Nov. 2016. The number of stores as of the end of the term was 20.
 
(Solution Business)
In Aug. 2016, the company concluded an agreement for cooperation in empowering women and improving the marriage environment with Kawakami Village, Minamisaku District, Nagano Prefecture, and got entrusted with a comprehensive support task for the marriage support project of Fukushima Prefecture in Sep. 2016.
"CONNECT-ship" was suspended because a failure occurred at the time of the release of a new system, but resumed in Jun. 2017.
 
(QOL Business)
As mentioned in Section 1-4 "Business Contents," the company strived to enrich services by increasing items and expanding target areas based on alliances.
As another project, the company opened the enterprise-led childcare facility "Mebae Childcare Room Mitakadai" in Jul. 2016.
 
 
Current assets grew 32 million yen from the end of the previous term. Noncurrent assets increased 276 million yen from the end of the previous term, through equipment investment for developing new systems and opening new stores. Total assets were 2,263 million yen, up 308 million yen from the end of the previous term.
Total liabilities augmented 436 million yen from the end of the previous term to 1,602 million yen, due to the augmentation of short and long-term debts, etc.
Net assets were 660 million yen, down 128 million yen from the end of the previous term, as retained earnings grew, but treasury shares increased.
As a result, equity ratio dropped 11.3% from 40.4% to 29.1%.
 
 
Operating CF became negative, due to the decline in profit, etc.
The deficit of investing CF augmented, due to the increase in expenditure for acquiring property, plant and equipment, including stores, and free CF became negative.
The surplus of financing CF expanded due to the augmentation of short and long-term debts, etc. The cash position is nearly unchanged.
 
(4) Topics
◎ Organizational reform for streamlining the decision making process and growing business
On Apr. 1, 2017, the company was reorganized by dividing it into 4 departments.
Authority was delegated and concentrated to each department head, so that each department can deal with business issues swiftly. The objective of this reform is to streamline the decision-making process and then actualize further business growth.

(Outline of changes)
① The company is constituted by the four departments: the Partner Agent (PA) business department, the business plan promotion department, the QOL business department, and the business support department. The authority to make a decision is delegated to the head of each department.

② The Partner Agent Business belongs to the PA business department, the Fast Marriage Hunting Business and Solution Business belong to the business plan promotion department, and the QOL Business belongs to the QOL business department. In addition, the functions to support all kinds of business, including company-wide management, are concentrated in the business support department.

The President Sato also serves as head of the PA business department, to lead the further expansion and growth of the Partner Agent Business, which is the mainstay.
 
 
Fiscal Year March 2018 Earnings Estimates
 
 
Sales and profit are estimated to grow considerably.
Sales are estimated to be 4,649 million yen, up 22% year on year. In the Partner Agent Business, which is the mainstay, the number of new members will be stagnant, but the Fast Marriage Hunting Business is expected to grow considerably. For CONNECT-ship, the company will first strive to increase the rate of utilization. Operating income is estimated to rise 98.1% year on year to 405 million yen.
 
(2) Activities from now on
①Partner Agent Business
This term, sales are forecasted to grow about 10%.
It is considered imperative to boost popularity.
The rate of awareness of the company among those who want to use a marriage agency is 28%, lower than half the rate of leading competitors.
When we asked would-be users who know the company "Which company's service do you want to use if necessary?" more people chose Partner Agent because engagement rate is high, than competitors.
Accordingly, the key for growing the business is to improve popularity, and so the company will concentrate on CI strategies, etc.

The company plans to open 8 stores, including those in Yaesu and Shibuya which have been already decided.
While competitors operate 40-60 stores, the company has the potential to open over two times more stores than competitors. The company will keep opening 6 to 8 stores annually.

②Fast Marriage Hunting Business
The sales for this term are estimated to grow considerably 1.6 times from the previous term.
By increasing the participants in marriage hunting parties, the company strives to increase the subscribers to the members-only services.
Accordingly, the company plans to open 10 new stores this term and in the following terms, too.
It is forecasted that the cumulative number of participants in "OTOCON" will be 212,779, up 55.8% year on year, and the term-end number of subscribers to fast marriage hunting services is planned to be 2,386, up 43.2% year on year.

The company will also increase affiliated firms to offer the alliance-based marriage hunting services, in which tasks are outsourced, matchmaking parties are arranged, fees are charged and collected, and infrastructure is provided based on the system of the company.

③Solution Business
The sales for this term are estimated to be nearly equal to those in the previous year.
The company emphasizes profitability, and has decided to concentrate on the ASP-based provision of matching systems to municipalities.

As for "CONNECT-ship," which was started in Jun. 2017, the company will first prioritize the increase of the rate of utilization by members and marriage hunting supporting companies, and then take flexible measures, including the setting and revision of fees, according to the usage situation.
Accordingly, the revenue from "CONNECT-ship" is not included in the earnings forecast for this term.

The system of CONNECT-ship is now easy to use, because its user interface was upgraded repeatedly, but other companies are accustomed at using their currently used systems, and so it may take time for them to master the use of CONNECT-ship. This is why the company gives priority for customers to use CONNECT-ship.
It has been already verified in en-Konkatsu (en-Japan), Zexy Enmusubi Counter (Recruit), Mie Prefecture, etc., that the merits of the system will be understood just by using it one time.

④QOL Business
While enriching the quality and quantity of services for engaged members, the company plans to open 7 enterprise-led childcare facilities this term.
 
 
Interview with President Sato
 
We asked President Sato about his future efforts, message to investors, etc.
 
Q: "Please tell us about your efforts to increase the degree of recognition."
A: "We are planning to introduce corporate identity (CI)."
One of the efforts to increase recognition is the corporate identity strategy.
Our company recognizes two issues to be solved, and is considering introducing corporate identity.

One is that it is necessary to clearly divide the business as a company and the brand name.
"Partner Agent" as a business is a service that receives a certain fee and provides client with services with a high marriage rate. On the other hand, Fast Marriage Hunting Business such as "OTOKON", a marriage hunting party, is a service aimed at expanding the field by letting people who are hesitant to use the marriage hunting service give it a try with a reasonable fee.
There is concern that the brand of "Partner Agent" as a service will be damaged, because the service domains are different but "Partner Agent Inc." handles both.

The other is that we found out that in order to post advertisement for popularization, there are various problems about the company name "Partner Agent Inc.", such as the fact that it is long, hard to read because it is in English, and that the lines of its logo are too thin.
There is no problem if the advertisement is for promoting the use of services as before, but if we want people to know about our company, it is necessary to discuss the company name as well.
I personally have had an emotional attachment to the company name since the foundation, but I cannot say such a thing when I intend to raise recognition that hasn't been greatly improved since the second year of foundation.
Currently, this has been discussed with a consultant, and if we decide to implement it, we will need a certain amount of investment.

When further developing stores in regions such as Chugoku and Tohoku from now on, we will promote various efforts such as broadcasting commercials via local TV and radio commercials, and using TV personalities in order to improve recognition, because the effect of the Internet is limited.
 
Q: "In the previous interview, you mentioned that you had launched the HR (Human Resources) project since it is essential to strategically strengthen human resources in the labor-intensive industry. How is the progress?"
A: "We are in the process of building strategies in each phase, such as recruitment, development, institutions, company benefits and labor."
We have established the department of human resources development as a specialized department.
We are currently building strategies in each phase, such as recruitment, development, institutions, company benefits and labor.
It is an extremely important part for our company to achieve continuous growth, so we have been taking our time to work on it carefully.
 
Q: "It seems that the child rearing facility management business has been busier than initially expected."
A: "We have extensive know-how, knowledge and experience in management such as forming an organization, building a corporate culture and an evaluation system. It is our great strength and advantage. I feel that this business has significant social meanings, so I will continue to put efforts into it."
We have originally planned and worked to finish one thing before working on another, but the demand is great and we have been able to proceed with the operation smoothly. So, we plan to open seven facilities this term.

As it is said that there is a shortage of nursery teachers as a problem with managing nursery schools, it means that it is not easy to fill vacancies after resignation. There are a sufficient number of possible nursery teachers, and if we recruit them, manpower will be secured.

The primary reason for resignation is the dissatisfaction with nursery school's culture. However, in the case of our company, we have had extensive know-how, knowledge and experience in management such as hiring concierges, the way of forming an organization which we cultivated through the process of development, building a corporate culture and an evaluation system since the foundation. It is our great strength and advantage, and hiring and securing nursery teachers will not be a bottleneck.
I feel that this is a business with great social significance in terms of creating an ideal working environment for women, so I will continue to put efforts into it.
 
Q: "Lastly, please give a message to investors."
A: "It is finally time for the Partner Agent Business to have a showdown. This is our company's breadwinner after all, so we must work firmly, but we are thrilled with both the sense of responsibility and excitement that comes from the fact that we are about to have a showdown."
Until a few years ago, we only had the Partner Agent Business, but now the share of new business has risen to about 20% of sales. We will continue to expand it steadily including M&A.

On the other hand, the main Partner Agent Business is in intense competition, and the time for a showdown has finally come.
We will improve our strength, a high marriage rate, by raising recognition, and acquire a large number of members as it does in major companies not only in urban areas but also in regions where there is great room for starting branch stores.
This is our company's breadwinner after all, so we must work firmly, but we are thrilled with both the sense of responsibility and excitement that comes from the fact that we are entering the competition.

I would like you to count on our company's future and support us.
 
 
Conclusions
 
On Jun. 15, 2017, the operation of the new system of CONNECT-ship began as scheduled. The company prioritizes the increase in the rate of utilization, and so it will take time before it contributes to revenue, but it is an epoch-making service based on its managerial vision, and we would like to expect the future growth.
As the president mentioned in the interview, their core Partner Agent Business will face a turning point.
The speed of the increase in popularity is unclear, but we would like to pay attention to the performance of president Sato, who also serves as the head of the PA division, and the company.
 
 
<Reference: Regarding corporate governance>
 
 
◎ Corporate Governance Report
The company submitted the latest corporate governance report on Jul. 2, 2016.

<Reasons for Non-compliance with the Principles of the Corporate Governance Code (Excerpts)>
The Company states that it will carry out all basic principles of corporate governance code as a company listed on the TSE Mothers.
 
Disclaimer
This report is intended solely for information purposes, and is not intended as a solicitation to invest in the shares of this company. The information and opinions contained within this report are based on data made publicly available by the Company, and comes from sources that we judge to be reliable. However we cannot guarantee the accuracy or completeness of the data. This report is not a guarantee of the accuracy, completeness or validity of said information and or opinions, nor do we bear any responsibility for the same. All rights pertaining to this report belong to Investment Bridge Co., Ltd., which may change the contents thereof at any time without prior notice. All investment decisions are the responsibility of the individual and should be made only after proper consideration.
Copyright(C) 2017 Investment Bridge Co., Ltd. All Rights Reserved.
 
 
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