I extend my sincerest gratitude to our shareholders for your continued understanding and support.

As of March 31, 2025, the Group’s assets under management (AUM) decreased by 0.9% year on year to JPY 1,872 billion (Note 1). However, the average AUM for the fiscal year increased to JPY 1,912 billion, resulting in a JPY 1.599 billion increase in management fees, reached a total of JPY 15.857 billion. We set a new record for the second consecutive year for base earnings (Note 2) at JPY 6.722 billion (up from JPY 6.348 billion in FY3/2024), representing our stable earnings power and substantially reinforcing the foundation that underpins SPARX. Additionally, the Mirai Creation Funds posted JPY 1.897 billion, including our first-ever JPY 800 million in performance fees, resulting in operating profit increasing to JPY 7.717 billion (up 3.2% from the previous fiscal year). We have found success and maintained robust profitability with our hybrid earnings model of management and performance fees based on our platform of traditional investment strategies—including the Japan Equity Focus All Cap and Japan Equity Mid & Small Cap strategies—with alternative approaches—including the Japan Equity Long-Short, Japan Equity Value Creation, Renewable Energy, and Private Equity investment strategies.
We have carefully nurtured all our investment strategies on their own terms and made them pillars of our business. As of March 31, 2025, 25% of our AUM was allocated to the Real Asset and Private Equity strategies. These strategies involve long-term contracts, enhancing earnings stability and enabling us to maintain a well-prepared business portfolio that is resilient to unforeseen circumstances, such as significant fluctuations in the stock market. We intend to continually enhance and expand the unique characteristics that define SPARX.

AUM has been stagnant since reaching a record high in the previous fiscal year. Objectively speaking, our goal of achieving AUM of JPY 3 trillion by March 31, 2026, remains extremely challenging. However, we believe that we can accomplish a record-high AUM of JPY 2,024 billion ahead of schedule by continuing to meet the expectations of our clients both in Japan and abroad. Through efforts worthy of the SPARX name, we will continue to develop innovative investment strategies that contribute to a sustainable society. Despite the potential delay, we will continue to work toward our goal of achieving an AUM of JPY 3 trillion.

Finally, we will continue to strive to realize our mission: “to make the world wealthier, healthier, and happier” as SPARX becomes “the most trusted and respected investment company in the world.” We appreciate your continued guidance and encouragement in the future.