Exhibit 99.1
Tokyo
Lifestyle Co., Ltd. Reports Fiscal Year 2026 Financial Results
Tokyo,
Japan, July 10, 2026 /PRNewswire/ -- Tokyo Lifestyle Co., Ltd. (“Tokyo Lifestyle”
or the “Company”) (Nasdaq: TKLF), a retailer and wholesaler of Japanese beauty and health products, sundry products, luxury
products, electronic products, collectible cards, trendy toys as well as other products in Hong Kong, Japan, North America, Thailand,
Vietnam, the United Kingdom and Australia, today announced its financial results for the fiscal year ended March 31, 2026 (“fiscal
year 2026”).
Mr. Mei
Kanayama, Principal Executive Officer of Tokyo Lifestyle, commented: “Fiscal year 2026 was a year of strong execution across our
business, resulting in robust revenue growth driven by continued expansion of our directly-operated stores, franchise network, and wholesale
operations, all of which achieved double-digit growth. We believe that these results demonstrate the effectiveness of our strategy to
diversify our product portfolio, broaden our customer base, and accelerate our global market expansion. Tokyo Lifestyle is evolving beyond
a traditional retailer into a diversified consumer lifestyle platform with complementary retail, franchise, wholesale, and luxury goods
businesses, pursuing multiple drivers for sustainable long-term growth.
“As
part of this transformation, we continued to advance our asset-light growth strategy by accelerating the expansion of our franchise and
wholesale businesses, particularly in the high-end merchandise segment. While these businesses generally carry lower gross margins than
our directly-operated retail operations, they require significantly less capital investment and operating expenses, enabling faster,
more efficient scaling. Accordingly, the changes in our revenue mix should be viewed as a deliberate optimization of our business model
designed to enhance long-term returns, rather than a reflection of weaker operating performance.
“A
key highlight was the outstanding performance of our luxury goods business, which quickly emerged as a meaningful growth driver. At the
same time, continued expansion of our wholesale customer base and broader distribution network strengthened market reach, diversified
our revenue streams, and enhanced the resilience of our business.
“Our
total assets increased by 48% during fiscal year 2026 while we remained profitable for the third consecutive year, reflecting our continued
business expansion and growing market presence.
“We
also continued strengthening our international platform by expanding our international presence. During the year, we opened new stores
in Hong Kong and Australia, expanded strategic partnerships, and continued investing in local talent and performance-based incentive
programs. These initiatives further strengthen our organizational capabilities to support continued global expansion efficiently.
“In
addition, we continued optimizing our omnichannel retail network by converting selected underperforming directly-operated stores into
franchise locations operated by experienced local partners.
“Looking
ahead, we remain focused on executing our long-term growth strategy through continued customer acquisition, broader global brand recognition,
an increasingly diversified product portfolio, and deeper customer engagement.”
Mr.
Youichiro Haga, Principal Accounting and Financial Officer of Tokyo Lifestyle, remarked: “We are pleased to report a 77.6% year-over-year
increase in revenue, and more importantly, this strong growth was achieved along with disciplined cost management. Although we continued
investing in marketing, brand development, and global expansion initiatives, operating expenses grew at a significantly slower pace than
revenue -- 29.6% versus 77.6% -- reducing operating expenses as a percentage of revenue from 9.1% to 6.7%. This demonstrates the scalability
of our operating model and our ability to generate increasing operating leverage as the business expands.
“Specifically,
during the fiscal year, revenue from our directly-operated physical stores increased by 15.7%, demonstrating the resilience of our core
retail business, while franchise and wholesale revenue grew by 86.9%, driven primarily by more than 320% growth in our luxury goods business
and the addition of 68 new wholesale customers. This balanced growth across both retail and asset-light channels underscores the increasing
diversification and scalability of our business.
“Accounts
receivable increased by 74.1% year over year, broadly in line with our revenue growth. This primarily reflects the rapid expansion of
our wholesale and franchise businesses, together with the continued growth of our international distribution network. Although higher
accounts receivable and increased working capital requirements temporarily affected cash balances and operating cash flow, we view these
changes as a natural consequence of the continued rapid growth rather than a deterioration in earnings quality or financial fundamentals.
“Beyond
revenue growth, we delivered meaningful improvements in profitability. Gross profit from directly-operated physical stores and online
business each increased by over 20%, supported by improved gross margins resulting from a more optimized product mix and disciplined
inventory management. Gross profit from franchise and wholesale business also increased by 15.5%. While this segment carries a comparatively
lower gross margin, it requires significantly lower operating costs and capital investment, further enhancing the efficiency, scalability,
and returns of our overall business model. As a result of the changes in our business structure, particularly the increased proportion
of wholesale and luxury goods, our gross profit increased by 17.5% with a moderate decline in gross margin. Despite a limited short-term
impact on operating profit, we believe the existing strategy will improve capital efficiency, accelerate market expansion, strengthen
our digital capabilities, and further enhance the flexibility and scalability of our business model over the long term.
“Our
international expansion also continued to gain momentum, with overseas sales accounting for 47.1% of total revenue. This was supported
by increasing contributions from Hong Kong and other overseas markets, along with continued expansion of our global retail footprint.
We believe our growing international presence will further strengthen brand recognition, diversify revenue base, and create additional
long-term growth opportunities.
“Overall,
fiscal year 2026 results demonstrate the resilience, scalability, and financial quality of our business model. While reported net income
and earnings per share declined year over year, this was primarily attributable to tax-related factors rather than changes in our underlying
operating performance. Excluding these items, our core business continued to deliver solid operating performance, supported by strong
revenue growth, healthy customer demand, and disciplined execution.
“As
macroeconomic conditions continue to improve with recovering consumer demand across our key markets, we remain confident in our ability
to generate sustainable, profitable growth through disciplined capital allocation, prudent financial management, and continued operational
excellence.”
Fiscal
Year 2026 Financial Summary
| ● | Total
revenue was $373.2 million for fiscal year 2026, which increased by 77.6% from $210.1
million for the fiscal year ended March 31, 2025 (“fiscal year 2025”). |
| ● | Gross
profit was $28.1 million for fiscal year 2026, which increased by 17.5% from $23.9
million for fiscal year 2025. |
| ● | Income
from operations was $3.2 million for fiscal year 2026, compared to $4.7
million for fiscal year 2025. |
| ● | Net
income decreased to $0.7 million for fiscal year 2026, compared to $6.6 million for
fiscal year 2025. |
| ● | Net
cash provided by investing activities increased to $6.1 million for fiscal year
2026, from net cash used in investing activities of $1.0 million for fiscal year
2025. |
| ● | Basic
earnings per share was $0.02 for fiscal year 2026. Diluted earnings per share was $0.02 for
fiscal year 2026. |
Fiscal
Year 2026 Financial Results
Revenue
Revenue increased
by 77.6%, to $373.2 million for fiscal year 2026, from $210.1 million for fiscal year 2025. The increase in the Company’s
revenue consisted of increased revenue from directly-operated physical stores and franchise stores and wholesale customers, which was
partially offset by the decreased revenue from online stores and services. Revenue generated from companies located in Japan accounted
for 52.9% and 70.5% of the Company’s total revenue for fiscal years 2026 and 2025, respectively. Revenue generated from companies
located in Hong Kong and others accounted for 47.1% and 29.5% of the Company’s total revenue for fiscal years 2026 and 2025, respectively.
| | |
For the Fiscal Years Ended March 31, | | |
Variance | |
| (in millions) | |
2026 | | |
% | | |
2025 | | |
% | | |
Amount | | |
% | |
| Directly-operated physical stores | |
$ | 19.8 | | |
| 5.3 | % | |
$ | 17.1 | | |
| 8.1 | % | |
$ | 2.7 | | |
| 15.7 | % |
| Online stores and services | |
| 6.7 | | |
| 1.8 | % | |
| 7.5 | | |
| 3.6 | % | |
| (0.8 | ) | |
| (10.7 | )% |
| Franchise stores and wholesale customers | |
| 346.7 | | |
| 92.9 | % | |
| 185.5 | | |
| 88.3 | % | |
| 161.2 | | |
| 86.9 | % |
| Total Revenue | |
$ | 373.2 | | |
| 100.0 | % | |
$ | 210.1 | | |
| 100.0 | % | |
$ | 163.1 | | |
| 77.6 | % |
Revenue
denominated in Japanese Yen increased by 75.7%, to ¥56,134.8 million for fiscal year 2026, from ¥31,952.8 million for fiscal
year 2025. The increase was mainly due to increased revenue from franchise stores and wholesale customers by 84.9%, to ¥52,170.1
million for fiscal year 2026, from ¥28,215.6 million for fiscal year 2025, as well as increased revenue from directly-operated physical
stores by 14.2%, to ¥2,965.5 million for fiscal year 2026, from ¥2,597.6 million for fiscal year 2025. The increase was partially
offset by the decreased revenue from online stores and services by 12.3%, to ¥999.3 million for fiscal year 2026, from ¥1,139.6
million for fiscal year 2025.
| | |
For the Fiscal Years Ended March 31, | | |
Variance | |
| (in millions) | |
2026 | | |
% | | |
2025 | | |
% | | |
Amount | | |
% | |
| Directly-operated physical stores | |
¥ | 2,965.5 | | |
| 5.3 | % | |
¥ | 2,597.6 | | |
| 8.1 | % | |
¥ | 367.9 | | |
| 14.2 | % |
| Online stores and services | |
| 999.3 | | |
| 1.8 | % | |
| 1,139.6 | | |
| 3.6 | % | |
| (140.3 | ) | |
| (12.3 | )% |
| Franchise stores and wholesale customers | |
| 52,170.1 | | |
| 92.9 | % | |
| 28,215.6 | | |
| 88.3 | % | |
| 23,954.5 | | |
| 84.9 | % |
| Total Revenue | |
¥ | 56,134.8 | | |
| 100.0 | % | |
¥ | 31,952.8 | | |
| 100.0 | % | |
¥ | 24,182.0 | | |
| 75.7 | % |
Note:
Amounts may not sum due to rounding.
Revenue
from directly-operated physical stores increased by 15.7%, to $19.8 million for fiscal year 2026, from $17.1 million for
fiscal year 2025. The increase was mainly due to increased revenue generated from the Company’s existing directly-operated physical
stores in Hong Kong as a result of their full-year operations, as well as the opening of two new physical stores in Hong Kong during
fiscal year 2026. In addition, the Company offered promotion activities and price discounts, which attracted more customers to make purchases
at the Company’s physical stores, and revenue from the Company’s existing physical stores in Hong Kong also increased in
fiscal year 2026, compared to the prior year. The above-mentioned increase was partially offset by a decrease in revenue from directly-operated
physical stores in Japan, resulting from the closure of one physical store and the transformation of another physical store during fiscal
year 2026. The Company proactively optimized its store structure and converted this underperforming physical store in Japan into a franchise
store, in order to improve the Company’s cash flow and working capital. Following the change, the store began purchasing products
from the Company like other franchise stores, and accordingly, the related revenue was recorded under franchise stores and wholesale
customers.
Revenue
from online stores and services decreased by 10.7%, to $6.7 million for fiscal year 2026, from $7.5 million for fiscal year 2025. The
decrease was mainly due to a reduction in the number of online stores, as the Company closed certain underperforming online stores to
improve the Company’s profitability. The decrease was partially offset by an increase in revenue from services, which resulted
from new customers that the Company developed.
Revenue
from franchise stores and wholesale customers increased by 86.9%, to $346.7 million for fiscal year 2026, from $185.5 million for
fiscal year 2025. The increase was mainly due to the substantial growth in revenue from sales of luxury products. During fiscal year
2026, the Company successfully achieved a strategic expansion that more than doubled revenue from franchise stores and wholesale customers
and meaningfully expanded the Company’s market share. This deliberate strategy strengthens the Company’s wholesale platform
and supplier relationships. In addition, there was increased revenue from the new wholesale customers as the Company continued to expand
the Company’s customer base by entering into business relationships with new wholesale customers during fiscal year 2026.
Cost
of Revenue
Total
cost of revenue increased by 85.3%, to $345.1 million for fiscal year 2026, from $186.2 million for fiscal year 2025.
Gross
Profit and Gross Margin
Gross
profit increased by 17.5%, to $28.1 million for fiscal year 2026, from $23.9 million for fiscal year 2025. The increase
was mainly attributable to the overall increase in revenue.
Gross
margin decreased by 3.9 percentage points to 7.5% for fiscal year 2026, from 11.4% for fiscal year 2025. The decrease in overall gross
margin was primarily attributable to shifts in the Company’s revenue mix, as revenue from franchise stores and wholesale customers,
which carry relatively lower gross margins, accounted for a significantly larger proportion of total revenue during fiscal year 2026.
Operating
Expenses
Operating
expenses consist of selling and marketing expenses and general and administrative expenses, which primarily include payroll, employee
benefit expenses and bonus expenses, shipping expenses, promotion and advertising expenses, and other facility-related costs, such as
store rent, utilities, and depreciation.
Operating
expenses increased by 29.6%, to $24.9 million for fiscal year 2026, from $19.2 million for fiscal year 2025. Operating
expenses as a percentage of total revenue improved to 6.7% for fiscal year 2026 from 9.1% for fiscal year 2025. This 2.4 percentage points
decline reflects early operating leverage across the Company’s business, as the Company’s revenue scaled faster than the
Company’s operating cost base. The increase in operating expenses was primarily attributable to the following factors:
| 1. | an
increase in other expenses by 46.4%, to $8.4 million for fiscal year 2026, from $5.7
million for fiscal year 2025. The increase was mainly due to higher shipping expenses
and other costs resulting from the growth in the scale of the Company’s operations; |
| 2. | an
increase in provision for credit losses by 515.4%, to a provision for credit losses of $0.9
million for fiscal year 2026, from a net recovery of credit losses of $0.2 million
for fiscal year 2025. The increase in the provision for credit losses was mainly due to the
significant increase in revenue and accounts receivable from franchise stores and wholesale
customers, which resulted in a larger provision for credit losses during fiscal year 2026; |
| 3. | an
increase in payroll, employee benefit expenses, and bonus expenses by 13.1%, to $7.4
million for fiscal year 2026, from $6.5 million for fiscal year 2025. The
increase was mainly due to the increased headcount caused by the expansion of the Company’s
business operations; |
| 4. | an
increase in professional service fees by 19.4%, to $3.9 million for fiscal year
2026, from $3.2 million for fiscal year 2025. The increase was mainly due to higher
service fees incurred to accelerate the collection of accounts receivable, partially offset
by a decrease in professional fees paid for a series of financial investigation services
that were required by banks in connection with the Company’s borrowings; |
| 5. | an
increase in promotion and advertising expenses by 361.9%, to $0.8 million for fiscal
year 2026, from $0.2 million for fiscal year 2025. The increase was mainly due
to the Company’s intensified advertising and promotional efforts during fiscal year
2026 to drive sales revenue growth; |
| 6. | an
increase in lease expenses by 13.3%, to $2.8 million for fiscal year 2026, from $2.5
million for fiscal year 2025. The increase was mainly due to the opening of new physical
stores in Hong Kong and Australia in fiscal year 2026; and |
| 7. | a
decrease in transaction commission paid to third-party e-commerce marketplace operators by
39.4%, to $0.8 million for fiscal year 2026, from $1.3 million for fiscal year 2025. The
Company paid third-party e-commerce marketplace operators transaction commission ranging
from 1.8% to 3.0% based on the Company’s sales amount. The decrease in transaction
commission was in line with the decrease in the Company’s online sales. |
Interest
Expenses, net
Interest
expenses, net included interest expenses calculated at interest rate per loan agreements and loan service costs, which were directly
incremental to the loan agreements and amortized over the loan periods. Interest expenses, net increased by 15.2%, to $2.0 million for
fiscal year 2026, from $1.7 million for fiscal year 2025. The increase was mainly due to an increase in interest expenses of
$0.6 million, which was mainly due to the increased weighted average interest rate for fiscal year 2026, which was partially offset by
the decrease in amortized loan service costs in relation to the Company’s syndicated loans by $0.3 million.
Additional
and Delinquent Tax Due to Consumption Tax Correction
Since
January 2022, the Tokyo Regional Taxation Bureau had conducted a tax examination into the Company’s consumption tax filing for
the period from July 2018 to December 2021. As a result of the examination, the Company was required to return consumption tax refund
for export transactions that were determined not to meet the tax exemption requirements due to incomplete submission of relevant export
documents. As the failure in submission of relevant export documents was caused by the Company’s suppliers and customers, the Company
entered into agreements with relevant suppliers and customers to claim compensation for damages from the additional consumption tax payment.
On July 31, 2023, the Company received a reassessment notice from the Tokyo Regional Taxation Bureau, for additional consumption tax
liability on a period-by-period basis. Based on this reassessment, the Company recognized the additional tax for understatement and delinquent
tax of $0.6 million during fiscal year 2024. However, the Company contested this reassessment and filed a request for review with the
National Tax Tribunal on February 22, 2024, challenging the legality of the reassessment decision and the imposition of additional tax
penalties. On February 13, 2025, the Company received a ruling from the National Tax Tribunal, dated February 12, 2025, which upheld
the Company’s request and annulled the disposition. Accordingly, the Company recorded a recovery of $3.9 million during fiscal
year 2025, representing the reversal of upward consumption tax adjustments and the corresponding understatement surcharges and delinquent
taxes imposed under the now-annulled reassessment. As the annulment also invalidated the downward consumption tax adjustments granted
by the tax bureau for certain other filing periods, the Company was required to reinstate those tax liabilities to the amounts set forth
in its original amended return. Therefore, during fiscal year 2026, the Company recognized $2.2 million in additional consumption tax
and related understatement surcharges.
Other
Income, net
Other
income, net primarily includes tax refund, disposal gain or loss from property and equipment, government subsidy, and other immaterial
income and expense items. Other income, net increased by 700.7%, to $2.9 million for fiscal year 2026, from $0.4 million for
fiscal year 2025. The increase was mainly due to the increased gain from disposal of property and equipment as compared to the same period
last year.
Gain
(loss) from Foreign Currency Exchange
Gain
from foreign currency exchange was $0.4 million for fiscal year 2026, as compared to a loss from foreign currency exchange
of $0.4 million for fiscal year 2025. The gain from foreign currency exchange was mainly due to the fluctuations in foreign
exchange rates on the Company’s accounts receivable that denominated in foreign currencies such as the U.S. dollar during fiscal
year 2026. It was also due to the gain from foreign currency exchange by the Company’s Hong Kong subsidiaries, which was mainly
due to the significant fluctuations of foreign exchange rate on its payables that were denominated in Japanese Yen during fiscal year
2026.
Provision
(Benefit) for Income Taxes
Provision
for income taxes was $3.1 million for fiscal year 2026, compared to an income tax benefit of $1.9 million for
fiscal year 2025. The provision for income taxes increased by 264.8%. The increase was mainly due to (i) higher current income tax expenses
resulting from increased taxable income during fiscal year 2026; (ii) the refund of tax recognized in the prior fiscal year following
the ruling from the National Tax Tribunal, dated February 12, 2025, which increased the income tax benefit for fiscal year 2025; and
(iii) increased deferred income tax expenses arising from additional deferred tax liabilities resulting from the increase in the change
in fair value of warrants liabilities during fiscal year 2026.
Net
Income
Net
income decreased to $0.7 million for fiscal year 2026, compared to $6.6 million for fiscal year 2025.
Basic
and Diluted Earnings per Share
Basic
earnings per share was $0.02 for fiscal year 2026, compared to $0.16 for fiscal year 2025. Diluted earnings per share
was $0.02 for fiscal year 2026, compared to $0.16 for fiscal year 2025.
Financial
Condition
As
of March 31, 2026, the Company had $2.1 million in cash as compared to $4.8 million as of March 31, 2025.
As of March 31, 2026, the Company also had approximately $186.8 million in account receivable balance due from third parties.
Approximately 22.3% of the March 31, 2026 balance has subsequently been collected, and the majority of the remaining balance
is expected to be collected by December 31, 2026. The collection of such receivables made cash available for use in the Company’s
operations as working capital, if necessary.
Net
cash used in operating activities was $10.3 million for fiscal year 2026, mainly derived from net income of $0.7 million for the year,
and net changes in the Company’s operating assets and liabilities, which mainly included increased accounts receivable of $87.3
million, increased merchandise inventories of $10.7 million, decreased accounts payable to related parties of $2.7 million and decreased
operating lease liabilities of $2.5 million, which was partially offset by the increased accounts payable of $86.3 million, increased
deferred revenue of $1.3 million and increased other payables and other current liabilities of $1.2 million.
Net
cash provided by investing activities amounted to $6.1 million for fiscal year 2026, mainly due to proceeds from disposal of property
and equipment in the aggregate amount of $7.0 million, partially offset by an investment in a life insurance policy of $0.6 million,
and purchases of property and equipment of $0.3 million.
Net
cash provided by financing activities was $4.2 million for fiscal year 2026, which primarily consisted of proceeds from short-term borrowings
of $19.4 million, proceeds from long-term borrowings of $14.0 million, proceeds from related parties borrowings of $3.4 million, and
capital contribution from non-controlling shareholders of $0.2 million, partially offset by repayments of short-term borrowings of $24.2
million, repayments of long-term borrowings of $7.8 million, payment of dividend distribution of $0.5 million, and repayment of obligations
under finance leases of $0.2 million.
Conference
Call Information
The
Company will host an earnings conference call at 8:30 am U.S. Eastern Time (9:30 pm Japan Standard Time) on July
10, 2026. Dial-in details for the conference call are as follows:
| Dial-in
details for the conference call are as follows: |
| |
| Date: |
July
10, 2026 |
| Time: |
8:30
am U.S. Eastern Time |
| International: |
1-412-902-4272 |
| United
States Toll Free: |
1-888-346-8982 |
| Conference
ID |
Tokyo
Lifestyle Co., Ltd. |
Please
dial in at least 15 minutes before the commencement of the call to ensure timely participation.
For
those unable to participate, an audio replay of the conference call will be available from approximately one hour after the end of the
live call until July 17, 2026. The dial-in for the replay is 1-855-669-9658 within the United States or 1-412-317-0088
internationally. The replay access code is 5582239.
A
live and archived webcast of the conference call will also be available at the Company’s investor relations website at https://www.ystbek.co.jp/irlibrary/.
About
Tokyo Lifestyle Co., Ltd.
Headquartered
in Tokyo, Japan, Tokyo Lifestyle Co., Ltd. (formerly known as Yoshitsu Co., Ltd) is a retailer and wholesaler of Japanese beauty and
health products, sundry products, luxury products, electronic products, collectible cards, trendy toys, and other products in Hong Kong,
Japan, North America, Thailand, Vietnam, the United Kingdom and Australia. The Company offers various beauty products (including cosmetics,
skincare, fragrance, and body care products), health products (including over-the-counter drugs, nutritional supplements, and medical
supplies and devices), sundry products (including home goods), collectible cards and trendy toys (including Pokémon cards, BE@RBRICK
and other trendy products) and other products (including food and alcoholic beverages). The Company currently sells its products through
directly-operated physical stores, through online stores, and to franchise stores and wholesale customers. For more information, please
visit the Company’s website at https://www.ystbek.co.jp/irlibrary/.
Forward-Looking
Statements
Certain
statements in this press release are forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of
1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve
known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends
that the Company believes may affect its financial condition, results of operations, business strategy, and financial needs. Investors
can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate,"
"aim," "estimate," "intend," "plan," "believe," "potential," "continue,"
"is/are likely to," or other similar expressions. The Company undertakes no obligation to update forward-looking statements
to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the
Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations
will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results
and encourages investors to review other factors that may affect its future results in the Company's annual report on Form 20-F and in
its other filings with the U.S. Securities and Exchange Commission.
For
more information, please contact:
Tokyo
Lifestyle Co., Ltd.
Investor
Relations Department
Email: ir@ystbek.co.jp
Ascent
Investor Relations LLC
Tina
Xiao
President
Phone: +1-646-932-7242
Email: investors@ascent-ir.com
TOKYO
LIFESTYLE CO., LTD.
CONSOLIDATED BALANCE SHEETS
| | |
March 31, | | |
March 31, | |
| | |
2026 | | |
2025 | |
| ASSETS | |
| | |
| |
| CURRENT ASSETS: | |
| | |
| |
| Cash | |
$ | 2,115,342 | | |
$ | 4,819,639 | |
| Accounts receivable, net | |
| 186,830,286 | | |
| 107,305,580 | |
| Accounts receivable - related parties, net | |
| 4,866 | | |
| 117 | |
| Merchandise inventories, net | |
| 14,433,760 | | |
| 4,370,803 | |
| Due from related parties | |
| 1,216,953 | | |
| 1,208 | |
| Compensation receivable for consumption tax, current, net | |
| 8,707,457 | | |
| 7,178,775 | |
| Prepaid expenses and other current assets, net | |
| 6,127,587 | | |
| 13,542,183 | |
| TOTAL CURRENT ASSETS | |
| 219,436,251 | | |
| 137,218,305 | |
| | |
| | | |
| | |
| Property and equipment, net | |
| 4,492,810 | | |
| 10,763,020 | |
| Operating lease right-of-use assets | |
| 7,935,439 | | |
| 6,031,284 | |
| Life insurance policy, cash surrender value | |
| 527,873 | | |
| - | |
| Compensation receivable for consumption tax, non-current, net | |
| - | | |
| 2,039,840 | |
| Long-term prepaid expenses and other non-current assets, net | |
| 1,243,382 | | |
| 1,777,736 | |
| TOTAL ASSETS | |
$ | 233,635,755 | | |
$ | 157,830,185 | |
| | |
| | | |
| | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |
| | | |
| | |
| | |
| | | |
| | |
| CURRENT LIABILITIES: | |
| | | |
| | |
| Short-term borrowings | |
$ | 50,319,318 | | |
$ | 57,903,207 | |
| Current portion of long-term borrowings | |
| 1,790,579 | | |
| 706,531 | |
| Accounts payable | |
| 105,635,444 | | |
| 25,057,104 | |
| Accounts payable - related parties | |
| 154 | | |
| 2,678,588 | |
| Due to related parties | |
| 426,156 | | |
| 27,678 | |
| Deferred revenue | |
| 2,336,812 | | |
| 8,027,153 | |
| Taxes payable | |
| 1,123,404 | | |
| 349,671 | |
| Operating lease liabilities, current | |
| 2,433,468 | | |
| 2,068,399 | |
| Finance lease liabilities, current | |
| 86,270 | | |
| 138,180 | |
| Warrants liabilities | |
| 1,001,178 | | |
| 2,502,718 | |
| Other payables and other current liabilities | |
| 3,215,841 | | |
| 1,998,713 | |
| TOTAL CURRENT LIABILITIES | |
| 168,368,624 | | |
| 101,457,942 | |
| | |
| | | |
| | |
| Due to related parties, non-current | |
| 2,842,433 | | |
| - | |
| Operating lease liabilities, non-current | |
| 5,670,073 | | |
| 4,003,366 | |
| Finance lease liabilities, non-current | |
| 73,053 | | |
| 119,068 | |
| Long-term borrowings | |
| 11,516,741 | | |
| 6,501,772 | |
| Other non-current liabilities | |
| 1,291,866 | | |
| 1,470,135 | |
| Deferred tax liabilities, net | |
| 2,707,787 | | |
| 1,263,872 | |
| TOTAL LIABILITIES | |
$ | 192,470,577 | | |
$ | 114,816,155 | |
| | |
| | | |
| | |
| COMMITMENTS AND CONTINGENCIES | |
| | | |
| | |
| | |
| | | |
| | |
| SHAREHOLDERS’ EQUITY | |
| | | |
| | |
| Ordinary shares, no par value,100,000,000 shares authorized; 42,327,806 shares and 42,220,206 shares issued and outstanding as of March 31, 2026 and 2025, respectively | |
| 81,150 | | |
| 81,150 | |
| Capital reserve | |
| 26,946,116 | | |
| 26,946,116 | |
| Retained earnings | |
| 27,877,884 | | |
| 27,695,268 | |
| Accumulated other comprehensive loss | |
| (13,839,803 | ) | |
| (11,708,504 | ) |
| TOTAL SHAREHOLDERS’ EQUITY | |
| 41,065,347 | | |
| 43,014,030 | |
| Non-controlling interest | |
| 99,831 | | |
| - | |
| TOTAL EQUITY | |
| 41,165,178 | | |
| 43,014,030 | |
| | |
| | | |
| | |
| TOTAL LIABILITIES AND EQUITY | |
$ | 233,635,755 | | |
$ | 157,830,185 | |
TOKYO
LIFESTYLE CO., LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
| | |
For the Fiscal Years Ended March 31, | |
| | |
2026 | | |
2025 | | |
2024 | |
| REVENUE | |
| | |
| | |
| |
| Revenue - third parties | |
$ | 373,219,124 | | |
$ | 202,278,304 | | |
$ | 189,674,322 | |
| Revenue - related parties | |
| 4,695 | | |
| 7,840,934 | | |
| 6,006,993 | |
| Total revenue | |
| 373,223,819 | | |
| 210,119,238 | | |
| 195,681,315 | |
| | |
| | | |
| | | |
| | |
| COSTS AND OPERATING EXPENSES | |
| | | |
| | | |
| | |
| Merchandise costs | |
| 345,118,553 | | |
| 186,201,939 | | |
| 172,306,308 | |
| Selling, general and administrative expenses | |
| 24,883,467 | | |
| 19,198,116 | | |
| 17,597,125 | |
| Total costs and operating expenses | |
| 370,002,020 | | |
| 205,400,055 | | |
| 189,903,433 | |
| | |
| | | |
| | | |
| | |
| INCOME FROM OPERATIONS | |
| 3,221,799 | | |
| 4,719,183 | | |
| 5,777,882 | |
| | |
| | | |
| | | |
| | |
| OTHER INCOME (EXPENSE) | |
| | | |
| | | |
| | |
| Interest expense, net | |
| (1,986,483 | ) | |
| (1,723,819 | ) | |
| (1,611,141 | ) |
| Additional and delinquent tax due to consumption tax correction | |
| (2,181,256 | ) | |
| 3,905,908 | | |
| (628,876 | ) |
| Gain from disposal of equity method investment | |
| - | | |
| - | | |
| 190,571 | |
| Gain from disposal of a subsidiary | |
| 51,639 | | |
| - | | |
| 341,139 | |
| Cash surrender value loss | |
| (71,448 | ) | |
| - | | |
| - | |
| Other income, net | |
| 2,916,749 | | |
| 364,294 | | |
| 760,435 | |
| Gain (loss) from foreign currency exchange | |
| 364,116 | | |
| (440,055 | ) | |
| 3,065,971 | |
| Change in fair value of warrants liabilities | |
| 1,438,866 | | |
| (2,050,211 | ) | |
| 109,173 | |
| Loss from equity method investments | |
| - | | |
| (20,049 | ) | |
| (69,444 | ) |
| Total other income, net | |
| 532,183 | | |
| 36,068 | | |
| 2,157,828 | |
| | |
| | | |
| | | |
| | |
| INCOME BEFORE INCOME TAX PROVISION (BENEFIT) | |
| 3,753,982 | | |
| 4,755,251 | | |
| 7,935,710 | |
| | |
| | | |
| | | |
| | |
| PROVISION (BENEFIT) FOR INCOME TAXES | |
| 3,102,686 | | |
| (1,883,237 | ) | |
| 456,774 | |
| | |
| | | |
| | | |
| | |
| NET INCOME | |
| 651,296 | | |
| 6,638,488 | | |
| 7,478,936 | |
| | |
| | | |
| | | |
| | |
| Less: net loss attributable to non-controlling interest | |
| (65,434 | ) | |
| - | | |
| - | |
| | |
| | | |
| | | |
| | |
| NET INCOME ATTRIBUTABLE TO TOKYO LIFESTYLE CO., LTD. | |
$ | 716,730 | | |
$ | 6,638,488 | | |
| 7,478,936 | |
| | |
| | | |
| | | |
| | |
| OTHER COMPREHENSIVE INCOME | |
| | | |
| | | |
| | |
| Net income | |
| 651,296 | | |
| 6,638,488 | | |
| 7,478,936 | |
| Foreign currency translation gain (loss) | |
| (2,131,299 | ) | |
| 284,522 | | |
| (3,923,683 | ) |
| Total comprehensive income (loss) | |
| (1,480,003 | ) | |
| 6,923,010 | | |
| 3,555,253 | |
| Less: comprehensive loss attributable to non-controlling interest | |
| (60,053 | ) | |
| - | | |
| - | |
| | |
| | | |
| | | |
| | |
| TOTAL COMPREHENSIVE INCOME (LOSS) | |
$ | (1,540,056 | ) | |
$ | 6,923,010 | | |
| 3,555,253 | |
| | |
| | | |
| | | |
| | |
| Earnings per ordinary share | |
| | | |
| | | |
| | |
| - basic | |
$ | 0.02 | | |
$ | 0.16 | | |
$ | 0.20 | |
| - diluted | |
$ | 0.02 | | |
$ | 0.16 | | |
$ | 0.20 | |
| | |
| | | |
| | | |
| | |
| Weighted average shares | |
| | | |
| | | |
| | |
| - basic | |
| 42,327,806 | | |
| 42,242,610 | | |
| 37,264,162 | |
| - diluted | |
| 42,327,806 | | |
| 42,242,610 | | |
| 37,264,162 | |
TOKYO
LIFESTYLE CO., LTD.
CONSOLIDATED
STATEMENTS OF CASH FLOWS
| | |
For the Fiscal Years Ended March 31, | |
| | |
2026 | | |
2025 | | |
2024 | |
| Cash flows from operating activities: | |
| | |
| | |
| |
| Net Income | |
$ | 651,296 | | |
$ | 6,638,488 | | |
$ | 7,478,936 | |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |
| | | |
| | | |
| | |
| Depreciation and amortization | |
| 1,150,519 | | |
| 952,126 | | |
| 1,232,611 | |
| Gain from disposal of property and equipment | |
| (2,393,351 | ) | |
| (178,152 | ) | |
| (712,685 | ) |
| Impairment of property and equipment | |
| - | | |
| 143,621 | | |
| - | |
| Gain from unrealized foreign currency translation | |
| (89,191 | ) | |
| (13,986 | ) | |
| (412,728 | ) |
| Provision for (reversal of) credit losses | |
| 915,388 | | |
| (220,368 | ) | |
| (2,043,939 | ) |
| Addition (reversal) of merchandise inventories written down | |
| (92,100 | ) | |
| 61,935 | | |
| (68,361 | ) |
| Amortization of operating lease right-of-use assets | |
| 2,639,989 | | |
| 2,049,635 | | |
| 1,711,978 | |
| Deferred tax provision (benefit) | |
| 1,606,325 | | |
| (955,082 | ) | |
| (1,778,277 | ) |
| Change in fair value of warrants liabilities | |
| (1,438,866 | ) | |
| 2,050,211 | | |
| (109,173 | ) |
| Investment loss from equity method investment | |
| - | | |
| 20,049 | | |
| 69,444 | |
| Gain from disposal of equity method investment | |
| - | | |
| - | | |
| (190,571 | ) |
| Loss on cash surrender value | |
| 71,448 | | |
| - | | |
| - | |
| Accrued interest expense | |
| 62,912 | | |
| 100,416 | | |
| - | |
| Changes in operating assets and liabilities: | |
| | | |
| | | |
| | |
| Accounts receivable | |
| (87,270,000 | ) | |
| (1,073,737 | ) | |
| (24,747,655 | ) |
| Accounts receivable - related parties | |
| (4,773 | ) | |
| 25,698 | | |
| 277,005 | |
| Merchandise inventories | |
| (10,667,514 | ) | |
| (13,596 | ) | |
| 2,355,034 | |
| Compensation receivable for consumption tax | |
| - | | |
| 696,224 | | |
| 11,284,665 | |
| Prepaid expenses and other current assets | |
| (339,634 | ) | |
| (10,772,468 | ) | |
| 949,043 | |
| Long term prepaid expenses and other non-current assets | |
| 465,056 | | |
| 501,659 | | |
| 315,809 | |
| Accounts payable | |
| 86,279,085 | | |
| 567,502 | | |
| 13,816,414 | |
| Accounts payable - related parties | |
| (2,669,723 | ) | |
| 2,372,722 | | |
| 299,591 | |
| Deferred revenue | |
| 1,302,736 | | |
| 8,006,135 | | |
| 35,027 | |
| Taxes payable | |
| 818,845 | | |
| (8,943,973 | ) | |
| (6,977,961 | ) |
| Other payables and other current liabilities | |
| 1,212,727 | | |
| (281,729 | ) | |
| 1,078,396 | |
| Operating lease liabilities | |
| (2,514,494 | ) | |
| (2,040,884 | ) | |
| (1,711,398 | ) |
| Other non-current liabilities | |
| 5,261 | | |
| (291,185 | ) | |
| (239,250 | ) |
| Net used in provided by (used in) operating activities | |
| (10,298,059 | ) | |
| (598,739 | ) | |
| 1,911,955 | |
| | |
| | | |
| | | |
| | |
| Cash flows from investing activities: | |
| | | |
| | | |
| | |
| Purchase of property and equipment | |
| (313,995 | ) | |
| (992,068 | ) | |
| (929,308 | ) |
| Proceeds from disposal of property and equipment | |
| 6,988,761 | | |
| 39,367 | | |
| 3,104,387 | |
| Investment in an equity method investment | |
| - | | |
| (20,049 | ) | |
| - | |
| Investment in life insurance policy | |
| (601,771 | ) | |
| - | | |
| - | |
| Proceeds from disposal of equity method investment | |
| - | | |
| - | | |
| 276,800 | |
| Proceeds from disposal of a subsidiary | |
| - | | |
| - | | |
| 34,600 | |
| Disposal of a subsidiary, net of cash | |
| - | | |
| - | | |
| (171,788 | ) |
| Repayments of loans to related parties | |
| 23,788 | | |
| 8,557 | | |
| 399,223 | |
| Net cash provided by (used in) investing activities | |
| 6,096,783 | | |
| (964,193 | ) | |
| 2,713,914 | |
| | |
| | | |
| | | |
| | |
| Cash flows from financing activities: | |
| | | |
| | | |
| | |
| Capital contribution from non-controlling shareholders | |
| 159,884 | | |
| - | | |
| - | |
| Payment of dividend distribution | |
| (530,957 | ) | |
| - | | |
| - | |
| Proceeds from issuance of ordinary shares for warrants redemption | |
| - | | |
| 29,482 | | |
| - | |
| Proceeds from issuance of ordinary shares, net of issuance costs | |
| - | | |
| - | | |
| 3,747,282 | |
| Proceeds from short-term borrowings | |
| 19,427,417 | | |
| 5,781,612 | | |
| 1,384,000 | |
| Repayments of short-term borrowings | |
| (24,228,319 | ) | |
| (1,446,786 | ) | |
| (2,076,000 | ) |
| Proceeds from long-term borrowings | |
| 13,992,820 | | |
| - | | |
| - | |
| Repayments of long-term borrowings | |
| (7,771,119 | ) | |
| (204,024 | ) | |
| (4,186,712 | ) |
| Proceeds from (repayments of) related parties borrowings | |
| 3,359,437 | | |
| (15,346 | ) | |
| (228,966 | ) |
| Repayment of obligations under finance leases | |
| (166,428 | ) | |
| (177,320 | ) | |
| (420,910 | ) |
| Net cash provided by (used in) financing activities | |
| 4,242,735 | | |
| 3,967,618 | | |
| (1,781,306 | ) |
| | |
| | | |
| | | |
| | |
| Effect of exchange rate fluctuation on cash | |
| (2,745,756 | ) | |
| (60,585 | ) | |
| (2,135,466 | ) |
| | |
| | | |
| | | |
| | |
| Net increase (decrease) in cash | |
| (2,704,297 | ) | |
| 2,344,101 | | |
| 709,097 | |
| Cash at beginning of year | |
| 4,819,639 | | |
| 2,475,538 | | |
| 1,766,441 | |
| Cash at end of year | |
$ | 2,115,342 | | |
$ | 4,819,639 | | |
$ | 2,475,538 | |
| | |
| | | |
| | | |
| | |
| Supplemental cash flow information | |
| | | |
| | | |
| | |
| Cash paid for income taxes | |
$ | 872,707 | | |
$ | 4,207,552 | | |
$ | 880,308 | |
| Cash paid for interest | |
$ | 1,637,499 | | |
$ | 1,072,273 | | |
$ | 798,353 | |
| | |
| | | |
| | | |
| | |
| Supplemental non-cash operating activities | |
| | | |
| | | |
| | |
| Purchase of property and equipment financed under finance leases | |
$ | 77,295 | | |
$ | - | | |
$ | - | |
| Right of use assets obtained in exchange for operating lease liabilities | |
$ | 4,715,753 | | |
$ | - | | |
$ | 3,118,676 | |
| Reduction of right-of-use assets and operating lease obligations due to early termination of lease agreement | |
$ | 233,202 | | |
$ | - | | |
$ | - | |
