Digital Garage, Inc. (TSE: 4819), the Tokyo-based payments, marketing and internet-investment group, reported consolidated full-year results for the fiscal year ended March 31, 2026 on May 14, 2026. After a deeply loss-making FY2025, the company returned firmly to the black on an IFRS basis. Revenue rose 7.0% year-on-year to ¥40,971 million, from ¥38,306 million. Pre-tax profit came in at ¥2,966 million, a sharp reversal from the prior year's ¥10,216 million pre-tax loss. Profit for the period was ¥1,097 million (versus a ¥7,476 million loss), and profit attributable to owners of the parent reached ¥1,283 million, against a ¥7,190 million loss a year earlier.
Basic earnings per share recovered to ¥27.96 from a loss of ¥155.29, with diluted EPS of ¥27.57. Total comprehensive income for the period was ¥1,978 million, compared with a ¥7,981 million comprehensive loss in FY2025. The pre-tax profit margin stood at 7.2%, a stark improvement on the prior year's −26.7%, while return on equity attributable to owners recovered to 1.7% from −8.7%.
Investment earnings and the swing back to the black
Digital Garage operates across a fintech and payment-processing business, a marketing-technology business, and a long-term incubation portfolio of startup and internet investments. The prior year's heavy loss was driven largely by valuation write-downs across that investment portfolio; the FY2026 recovery reflects the absence of those one-off impairments alongside steady top-line growth in the core operating businesses. Equity-method investment income contributed ¥3,094 million to the result, down from ¥4,317 million the previous year, underscoring that associate and affiliate gains remain a meaningful — if more moderate — earnings driver for the group.
Balance sheet steady; equity ratio edges up
Total assets stood at ¥218,703 million at year-end, down from ¥226,344 million a year earlier. Total equity was little changed at ¥77,696 million, with equity attributable to owners of the parent of ¥75,584 million. The ratio of equity attributable to owners rose to 34.6% from 33.3%, and book value per share edged up to ¥1,645.80 from ¥1,645.49. The modest balance-sheet contraction is consistent with a year in which the group realised and unwound parts of its investment portfolio rather than expanding it.
Cash flow turns negative on investment and financing outflows
Operating cash flow was an outflow of ¥4,939 million, a marked reversal from the ¥31,726 million inflow in FY2025, which had been boosted by large one-off movements. Investing activities used a further ¥7,259 million and financing activities a net ¥3,449 million. As a result, cash and cash equivalents fell to ¥40,469 million at year-end, from ¥56,354 million twelve months earlier — a reduction of roughly ¥15.9 billion that reflects the group's net investment and capital-return activity during the year.
Dividend trimmed to ¥47; FY2027 guidance withheld
For FY2026, Digital Garage declared an annual dividend of ¥47.00 per share (paid entirely as a year-end dividend, with no interim payout), down from ¥53.00 in FY2025 — though the prior-year figure had included a ¥10.00 special/commemorative dividend, leaving the ordinary dividend broadly comparable. Total dividends came to ¥2,165 million, with a payout ratio of 168.1% on the recovered earnings and a dividend-on-equity ratio of 2.9%. For FY2027, the company has declined to disclose consolidated earnings guidance, citing the difficulty of reasonably estimating the fair value of the startup securities held across its investment portfolio at the next year-end; its FY2027 dividend forecast is similarly undecided.
| Metric | FY2026 | FY2025 | YoY |
|---|---|---|---|
| Revenue (¥ million) | 40,971 | 38,306 | +7.0% |
| Pre-tax profit (¥ million) | 2,966 | −10,216 | Turn to profit |
| Profit for the period (¥ million) | 1,097 | −7,476 | Turn to profit |
| Profit attributable to owners (¥ million) | 1,283 | −7,190 | Turn to profit |
| Total comprehensive income (¥ million) | 1,978 | −7,981 | Turn to profit |
| Basic EPS (¥) | 27.96 | −155.29 | Turn to profit |
| Diluted EPS (¥) | 27.57 | −155.29 | Turn to profit |
| Equity-method investment income (¥ million) | 3,094 | 4,317 | −28.3% |
| Pre-tax profit margin | 7.2% | −26.7% | +33.9pp |
| Return on equity | 1.7% | −8.7% | +10.4pp |
| Total assets (¥ million) | 218,703 | 226,344 | −3.4% |
| Total equity (¥ million) | 77,696 | 77,695 | ±0.0% |
| Equity ratio (owners) | 34.6% | 33.3% | +1.3pp |
| Book value per share (¥) | 1,645.80 | 1,645.49 | +0.0% |
| Operating cash flow (¥ million) | −4,939 | 31,726 | — |
| Cash & equivalents, year-end (¥ million) | 40,469 | 56,354 | −28.2% |
| Annual dividend (¥) | 47.00 | 53.00 | −11.3% |
| FY2027 earnings guidance | Not disclosed | — | — |
JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.