Lead Real Estate Co., Ltd Announces Fiscal Year 2025 Results

Net income attributable to common shareholders increased by 35.1% to JPY846.8 million, or $5.9 million

TOKYO, Nov. 03, 2025 (GLOBE NEWSWIRE) -- Lead Real Estate Co., Ltd (Nasdaq: LRE) ("LRE" or the "Company"), a Japanese real estate developer of luxury residential properties, including single-family homes and condominiums across Tokyo, Kanagawa prefecture and Sapporo, and which develops and operates the ENT TERRACE brand of extended-stay hotels, today announced financial results for the fiscal year ended June 30, 2025.

Total revenue was JPY18.8 billion ($130.7 million) for the fiscal year ended June 30, 2025, compared to JPY19.0 billion for the fiscal year ended June 30, 2024, a decrease of 0.6%.

The primary revenue component, real estate sales, was JPY18.3 billion ($127 million), compared to JPY18.5 billion in the prior fiscal year, representing a 1.0% year-over-year decline in the fiscal year ended June 30, 2025. This reflects the Company’s strategic initiative to build out its hotel business as well as a stable performance amid fewer unit deliveries and higher average selling prices for single-family homes and condominiums. Real estate sales included the following.

Units Delivered (FY2025)Units Delivered (FY2024)FY2025 Average Sale Price (USD thousands)FY2025 Average Sale Price (JPY thousands)% Change
Y-YSingle-Family Home (Land)7071$618 ¥89,108 16.0% Single-Family Home (Building)2441$233 ¥33,574 10.7% Condominium (Land)2033$2,225 ¥320,736 -9.2% Condominium (Building)54$364 ¥52,460 57.4% Hotels (Land)4—$7,817 ¥1,126,984 n/mHotels (Building)1—$549 ¥79,120 n/m

Other revenue increased by 15.5% to JPY535.3 million ($3.7 million), compared to JPY463.6 million in the prior fiscal year, primarily driven by the continued ramp-up of the Company's hotel operations and an increase in average daily rates.

The cost of revenue for real estate sales declined by 6.1% to JPY14.8 billion ($102.4 million), from JPY15.7 billion for the fiscal year ended June 30, 2024.

Gross margin increased to 19.8% from 15.6% in the prior year, reflecting a more favorable sales mix and higher-margin hotel transactions.

Selling, general, and administrative expenses were JPY2.3 billion ($15.6 million), an increase of 9.9% from JPY2.1 billion in the prior fiscal year. As a percentage of revenue, these expenses increased to 12.0% from 10.8% in fiscal year 2024.

Operating income increased by 64.1% year over year to JPY1,475 million ($10.2 million), compared to JPY898.6 million in the fiscal year ended June 30, 2024. The operating profit margin was 7.8%, compared to 4.7% in the prior fiscal year.

Interest expenses were JPY44.5 million ($309 thousand), compared to JPY18.3 million in the fiscal year ended June 30, 2024, reflecting higher market interest rates.

Other expense was JPY35.9 million ($249 thousand), compared to other income of JPY73.8 million in the prior year, primarily due to a non-recurring impairment loss on equity securities of JPY23.5 million.

Total other income (expense) was a net expense of JPY80.4 million ($558 thousand), compared to net income of JPY55.5 million in the prior year.

Net income attributable to common shareholders increased by 35.1% to JPY846.8 million ($5.9 million), or earnings per ADS of JPY62.07 ($0.43), compared to JPY627 million, or earnings per ADS of JPY46.93, in the fiscal year ended June 30, 2024.

Cash and cash equivalents were JPY2.7 billion ($18.4 million) as of June 30, 2025, compared to JPY1.3 billion as of June 30, 2024.

"We are pleased with the improved profitability we were able to achieve in 2025, which reflected Lead Real Estate's strong positioning in the Japanese real estate market, sustained demand from both individual and institutional buyers, and our increased focus on high-value locations and stylish, luxury designs and finishes," said Mr. Eiji Nagahara, Chief Executive Officer of LRE. "We are committed to delivering quality products to our customers and generating long-term value for our shareholders, as demonstrated by our recent payment of our third consecutive annual dividend."

Business Outlook

“Building on another year of solid revenue and continued improvement in our bottom line, we enter fiscal year 2026 with confidence and focus,” said Mr. Nagahara. “Market conditions remain favorable — inbound tourism has reached record levels, and housing demand in Tokyo’s core wards continues to strengthen amid rising land values."

“We will continue to target prime real estate opportunities, leveraging our strong brand and trusted relationships with local partners to drive growth. In Japan, our strategy centers on expanding hotel operations nationwide, extending beyond our flagship ENT TERRACE brand with two new concepts and the continued rollout of our Master Lease model."

“This fiscal year we also expect to make progress in expanding our presence internationally. We plan to acquire condominium units in the Philippines and Malta as part of our risk-hedging strategy and our commitment to identifying high-value opportunities both locally and globally. We continue to evaluate opportunities for expansion in the United States as well."

“Supported by strong market fundamentals, we expect to deliver renewed revenue growth in fiscal 2026, and further enhance profitability while maintaining disciplined execution and a commitment to delivering long-term shareholder value through sustained earnings growth and continued dividend payments.”

Conference Call Details

The Company will host a conference call to discuss its financial results for the fiscal year ended June 30, 2025, and business outlook on Monday, November 3, 2025, at 8:30 a.m. Eastern Time (10:30 p.m. Japan Standard Time).

To access the live call, participants in the United States should dial 1-877-407-9208, and international participants should dial 1-201-493-6784, approximately 15 minutes prior to the start time and use conference ID:13756898. The call will also be broadcast live over the Internet at https://viavid.webcasts.com/starthere.jsp?ei=1741003&tp_key=2c0fb29124.

For those unable to participate in the live event, a telephone replay will be available approximately three hours after the call concludes and will remain accessible until 11:59 p.m. Eastern Time on November 17, 2025, by dialing 1-844-512-2921 (U.S.) or 1-412-317-6671 (International) and entering the conference ID: 13756898.

The fiscal year 2025 earnings release will be available on the Company's website prior to the event: https://www.lead-real.co.jp/en/.

Exchange Rate Information

The Company's functional currency and reporting currency are the Japanese yen. Convenience translations included in this press release of Japanese yen into U.S. dollars have been made at the exchange rate of JPY144.1700 = $1.00, which was the foreign exchange rate on June 30, 2025, as reported by the Board of Governors of the Federal Reserve System in its weekly release on July 1, 2025.

About Lead Real Estate Co., Ltd

Lead Real Estate Co., Ltd is a Japanese developer of luxury residential properties, including single-family homes and condominiums, across Tokyo, Kanagawa prefecture, and Sapporo. In addition, the Company operates hotels in Tokyo and leases apartment building units to individual customers in Japan and Dallas, Texas.

The Company's mission is to serve its customers by offering stylish, safe, and luxurious living. The Company's vision is to adopt the Kaizen (continuous improvement) approach to seek to improve its operations, and to leverage its nationally recognized, award-winning luxury homes and strong market position in the luxury residential property market in Tokyo, Kanagawa prefecture, and Sapporo to create a global transaction platform allowing access to prime Japanese condominiums as well as overseas condominiums, including in the U.S. and Hong Kong.

For more information, please visit the Company's website at https://www.lead-real.co.jp/en/.

About "ENT TERRACE"

"ENT TERRACE" Series is an extended-stay hotel brand operated by Lead Real Estate Co., Ltd. The Company will continue to develop its hotels with the aim of providing a space where guests can relax as if they were at home while ensuring privacy and easing the burden of long-term stays.

Learn more at https://ent-terrace.com/en/.

Forward-Looking Statements

Statements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the uncertainties related to market conditions and other factors that may affect its future results in the Company's registration statement and in its other filings with the U.S. Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof, and the Company specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.

Contact Information

For Media and Investor Relations:
Daisuke Takahashi
Chief Financial Officer
Lead Real Estate Co., Ltd
[email protected]
+81 3-5784-5127

AUM Advisors
Crocker Coulson
Email: [email protected]
Tel: (646) 652-7185

Summary Financial Tables

LEAD REAL ESTATE CO., LTD CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2025 AND 2024
(Japanese yen in thousands, except share data) June 30, 2025 2024 ASSETS Current assets: Cash and cash equivalents ¥2,656,860 ¥1,300,684 Accounts receivable, net 38,523 22,859 Real estate inventory 10,134,739 9,267,825 Contract assets 141,418 236,499 Prepaid and other current assets 381,581 493,819 Total current assets 13,353,121 11,321,686 Property and equipment, net 5,796,381 5,449,101 Intangible asset, net 35,396 54,138 Investments in marketable securities 25,303 20,844 Right-of-use assets, operating lease, net 820,786 154,613 Investments 122,101 46,394 Other assets 326,746 170,588 Total assets ¥20,479,834 ¥17,217,364 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable ¥1,035,712 ¥602,013 Current portion of notes payable 7,599,606 6,815,181 Contract liabilities 337,483 130,259 Current portion of operating lease liabilities 201,313 67,938 Accrued expenses and other current liabilities 764,920 356,856 Total current liabilities 9,939,034 7,972,247 Notes payable, net of current portion 4,557,855 4,598,151 Deferred tax liabilities, net 89,638 85,018 Operating lease liabilities, net of current portion 621,962 91,471 Other liabilities 240,632 233,109 Total liabilities 15,449,121 12,979,996 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY Common stock, 50,000,000 shares authorized, 15,628,000 shares issued and 13,641,900 shares outstanding as of June 30, 2025 and 2024 with no stated par value 1,207,055 1,206,765 Retained earnings 3,965,673 3,159,815 Treasury stock, at cost, 1,986,100 shares as of June 30, 2025 and 2024 (154,121) (154,121) Non-controlling interest (8,456) (7,558) Accumulated translation gain 20,562 32,467 Total shareholders’ equity 5,030,713 4,237,368 Total liabilities and shareholders’ equity ¥20,479,834 ¥17,217,364

LEAD REAL ESTATE CO., LTD
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE FISCAL YEARS ENDED JUNE 30, 2025, 2024, AND 2023
(Japanese yen in thousands, except share and per share data) For the Fiscal Years Ended June 30, 2025 2024 2023 (as restated)Revenue: Real estate sales ¥18,307,409 ¥18,487,074 ¥17,098,308 Other revenue 535,254 463,609 316,940 Total revenue 18,842,663 18,950,683 17,415,248 Expenses: Cost of sales – real estate 14,756,750 15,721,271 14,466,459 Cost of sales – other 357,279 279,806 191,544 Selling, general and administrative 2,253,653 2,051,040 1,817,970 Total expenses 17,367,682 18,052,117 16,475,973 Operating income 1,474,981 898,566 939,275 Other income (expense): Interest expenses (44,544) (18,286) (16,731)Other, net (35,881) 73,759 6,268 Total other income (expense), net (80,425) 55,473 (10,463)Income before income taxes 1,394,556 954,039 928,812 Income taxes 548,331 327,869 317,418 Net income 846,225 626,170 611,394 Net loss attributable to the noncontrolling interests (559) (789) (524)Net income attributable to common stockholders 846,784 626,959 611,918 Foreign currency translation gain (loss) (11,905) 10,512 5,241 Total Comprehensive income ¥834,879 ¥637,471 ¥617,159 Earnings per share: Basic ¥62.07 ¥46.93 ¥48.96 Diluted ¥62.07 ¥46.93 ¥48.96 Weighted average shares outstanding: Basic 13,641,900 13,360,834 12,498,900 Diluted 13,641,900 13,360,834 12,498,900

LEAD REAL ESTATE CO., LTD
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED JUNE 30, 2025, 2024, AND 2023
(Japanese yen in thousands) For the Fiscal Years Ended June 30, 2025 2024 2023 (as restated)Cash flows from operating activities: Net income ¥846,225 ¥626,170 ¥611,394 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 110,448 102,713 82,865 Loss on disposal of assets 320 5,852 — Gain on sales of assets (1,000) — — Impairment loss on property and equipment 14,741 — — Impairment loss on real estate inventories 6,013 — — Non-cash finance lease expense 28,503 23,847 20,523 Investment revaluation (gain) loss (4,459) 1,965 96 Impairment loss on equity securities without readily determinable fair values 23,509 — — Deferred income taxes, net 4,418 50,993 3,334 Changes in assets and liabilities: Accounts receivable, net (15,664) (16,246) (3,302)Real estate inventory 1,204,545 1,122,406 (1,569,350)Contract assets 95,081 199,522 (178,305)Prepaid and other current assets 112,238 (290,238) 47,429 Operating lease, net (2,307) 2,655 (805)Other assets (156,158) 15,890 11,963 Accounts payable 433,699 (130,709) 50,699 Contract liabilities 207,224 (130,271) 4,552 Accrued expenses and other current liabilities 405,722 (12,654) (730)Net cash provided by (used in) operating activities 3,313,098 1,571,895 (919,637)Cash flows from investing activities: Purchases of property and equipment (2,521,787) (2,221,499) (1,250,451)Proceeds from sale of property and equipment 3,182 — — Purchases of intangible assets (2,351) (6,359) (2,438)Purchase of investments and investments in marketable securities (100,841) (15,203) (8,150)Proceeds from sale of investments in marketable securities — — 5,000 Net cash used in investing activities (2,621,797) (2,243,061) (1,256,039)Cash flows from financing activities: Proceeds from notes payable 14,734,600 15,014,801 14,580,822 Payments on notes payable (13,969,871) (14,745,923) (11,944,327)Payments on IPO costs — (229,046) (63,702)Proceeds from common stock issuance — 1,187,428 — Dividend payments (40,926) (24,998) — Purchases of noncontrolling interest (49) — — Repayments of principal portion of finance lease liability (27,999) (25,689) (18,262)Net cash provided by financing activities 695,755 1,176,573 2,554,531 Effect of exchange rate change on cash and cash equivalents (30,880) 8,904 4,410 Net increase in cash and cash equivalents 1,356,176 514,311 383,265 Cash and cash equivalents, beginning of year 1,300,684 786,373 403,108 Cash and cash equivalents, end of year ¥2,656,860 ¥1,300,684 ¥786,373 Supplemental disclosures of cash flow information: Cash paid during the year for Interest ¥44,544 ¥352,355 ¥292,581 Income taxes ¥309,482 ¥316,050 ¥396,669 Non-cash investing and financing activities Operating lease right-of-use assets obtained in exchange for operating lease liabilities ¥747,616 ¥2,613 ¥103,771 Finance lease right - of - use assets obtained in exchange for finance lease liabilities ¥38,066 ¥38,673 ¥50,685