■Future Outlook LeTech <3497> expects an increase in sales and ordinary income of more than 20%, with sales of 2.14 billion yen (+33.8% YoY), operating income of 150 million yen (+7.7% YoY), ordinary income of 100 million yen (+21.7% YoY), and net income of 1.03 billion yen (-11.4% YoY) for the July 2024 term, and has maintained its initial forecast (announced in September 2023).

Actively expanding the education solutions business to correct education disparities.

Jyonan Shingaku Kenkyusha <4720> aims to improve profitability by actively expanding the education solutions business, which becomes a BtoBtoC business model. Focus on expanding the franchise business of "Jyonan Cobetts", introducing the Kubota-style childcare method for nursery schools and kindergartens for infants, and expanding the franchise business of "Kids Brain Park" and "Ringo Juku".Focusing on providing online learning materials such as "Dekitas" and online English conversation lessons "Prime Talk" for elementary and junior high school students, and providing video lectures of "comprehensive and school-recommended selection tests" for high school students. Furthermore, they put effort into service development for the project "Minna ni Manabi o Project", which was launched in October 2023 as a new initiative to eliminate educational and regional disparities and provide educational opportunities to everyone. The project provides affordable and online education services for infants to high school students. The first in the series, the digital learning portal site "Minna no Manabi Library", was released in October 2023. It is intended for corporate and organizational clients to use as a welfare service. The company works to expand the service as a solution leading to "education disparity elimination", as it enables children of employees who cannot attend cram schools or extracurricular classes due to economic or geographical issues to easily access learning from their homes.

In addition, the "Minna ni Manabi o Project" was launched in October 2023 as a new initiative to eliminate educational and regional disparities and provide educational opportunities to everyone under the concept of providing educational services with both "affordable" and "online" elements for infants to high school students. As the first part of the project, the digital learning portal site "Minna no Manabi Library" was released in October 2023. It is intended for corporate and organizational clients to use as a welfare service. They work to promote expansion by tackling the issues behind the "education disparity elimination" as a solution. They aim to introduce the following five services: "Kids Brain Work" for infants, "Dekitas" for elementary and junior high school students, "Dekitas Commu" for high school and high school graduates, "Speed Master version of Screen Test Video Course for Selection by Comprehensive and School-recommended Type" and "TOEIC Study Course" for college students and working adults. They also offer lectures for parents to help with childcare and education on a regular basis, and although several companies have adopted their services, the sales are still small.

The company offers five services: "Kids Brain Workout" for infants, "Dekitas" for elementary and junior high school students, "Dekitas Commu" and the "Speed Master version of Screen Test for Selection by Comprehensive and School-recommended Type" for high school and high school graduates, and the "TOEIC Study Course" for college students and working adults. They offer these services at lower prices* and regularly hold lectures for parents to help with childcare and education. Although a number of corporations have already adopted the service, the revenue is still small. *Introduced companies pay a predetermined usage fee to the company for each specific number of IDs, and the monthly amount is allocated and recorded for the contract period.

Enterprises that have adopted the service pay a predetermined usage fee to the company for every specific number of IDs, and allocate recorded sales monthly for the contract period.

Starting from the fiscal year March 2021, they have been working on improving their profit structure through measures like revitalizing unprofitable classrooms and streamlining organization by introducing RPA tools. They aim to continue the ongoing profit structure reform through strategies such as constructing an operational system focused on maximizing LTV and synergy not only within the company but also with its related companies and business alliances. They aim to expand their business with cooperative alliances that maximize synergy, e.g. cross-promoting and developing jointly with Meiko Network Japan for children's and infants' education brands like "Ringo Juku", as well as considering other joint development and mutual provision. They have been experimenting with an online tutoring room using the metaverse in partnership with Gakken Holdings <9470>, which they have made a business capital alliance with. They plan to start offering "Ringo Juku" at "Gakken After School Hachioji", a childcare facility operated by Gakken Coco Fan Nursery and preschool facility, from January 2024 onwards. The trial for the online tutoring service using the metaverse has been operational there. They plan to continue discussions considering further collaboration beyond the fiscal year 2025.

Another strategy they are pursuing is promoting the revitalization of unprofitable businesses and building a high-productivity head office organization. They collaborate with their child companies and business alliance partners not only within the company but also within related companies to maximize LTV and synergy. In order to achieve the maximum synergy, they work to expand their business through cooperation with alliance partners, e.g. cross-promoting and developing jointly with "Meiko Network Japan" for children's and infants' education brands like "Ringo Juku", as well as considering other joint development and mutual provision. They are promoting the productivity improvements of their head office work by streamlining unprofitable classrooms and organizing commodities, along with rationalizing management tasks - including the consolidation of their child companies - and promoting DX. "Cheer Plus (Kabu)", which ran non-authorization childcare institutions where English could be learned at non-consolidated child companies, was dissolved at the end of March 2024 as a part of this initiative. There is a slight impact on the consolidated performance on account of "Cheer Plus" dissolution of the fiscal year 2025 as a debiting reserve was already prepared in the past years.

Enterprises that have adopted the service pay a predetermined usage fee to the company for every specific number of IDs, and allocate recorded sales monthly for the contract period.

They strive to continue the ongoing profit structure reform and introduce an operational system focused on maximizing LTV and synergy not only within the company but also with its related companies and business alliances, building a high-productivity head office organization.

In March 2023, the "Business Philosophy and Human Resource Development Committee" was established to formulate a strategy for developing the next generation of leaders and investing in human capital. By promoting communication between management and employees and fostering the development of future leaders, the company aims to improve its corporate value through personnel development based on its creed (code of conduct). As part of its investment in human capital, the organization "iconet" was established in 2023 to strengthen the development of part-time lecturers, and a new personnel system focusing on performance-based evaluation will start in April 2025, expected to lead to improved engagement and revitalization of the organization.

(Written by FISCO guest analyst, Jo Sato)