| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue | ¥1384.3B | ¥1316.6B | +5.1% |
| Operating Income | ¥204.1B | ¥183.1B | +11.4% |
| Ordinary Income | ¥207.7B | ¥183.7B | +13.1% |
| Net Income | ¥133.3B | ¥124.1B | +7.4% |
| ROE | 9.9% | 10.1% | - |
For the fiscal year ended March 2026, revenue was ¥1384.3B (¥+67.7B YoY +5.1%), Operating Income was ¥204.1B (¥+20.9B YoY +11.4%), Ordinary Income was ¥207.7B (¥+24.0B YoY +13.1%), and Net Income was ¥133.3B (¥+9.2B YoY +7.4%), achieving both revenue and profit growth. Operating margin improved to 14.7% (prior year 13.9%), up +0.8pt, and gross margin also improved to 18.5% (prior year 17.9%), up +0.6pt. The Construction Business led consolidated revenue growth with sales up +14.0%, while the Development Business and others, despite revenue decline of -6.1%, sustained a high margin of 24.7% and helped lift consolidated profitability. SG&A ratio fell to 3.8% (prior year 4.0%), demonstrating operating leverage. Operating Cash Flow (OCF) of ¥172.4B exceeded Net Income of ¥133.3B, generating cash above accounting profit and securing Free Cash Flow (FCF) of ¥96.9B.
[Revenue] Revenue was ¥1384.3B (¥1316.6B prior year, +5.1%). By segment, the Construction Business at ¥836.7B (+14.0%) was the primary driver of consolidated revenue growth. Progress on completion of contracted construction (Completed Contract Amount ¥836.2B) and completion progress of started projects contributed. The Development Business and others posted ¥548.1B (-6.1%) in revenue but, at a 39.6% share and high-margin profile, underpinned consolidated profitability. The rise in Construction weighting (prior year 55.6% → current year 60.4%) caused a change in project mix.
[Profitability] Gross profit was ¥256.2B (gross margin 18.5%, improved +0.6pt from 17.9% prior year). SG&A was ¥52.1B (SG&A ratio 3.8%, prior year 4.0%) reflecting cost control, resulting in Operating Income of ¥204.1B (Operating margin 14.7%, prior year 13.9%). Construction operating margin improved significantly to 9.4% (prior year 7.0%), while Development remained high at 24.7% (prior year 24.4%). Ordinary Income was ¥207.7B, aided by non-operating income of ¥3.7B including interest income of ¥3.1B; non-operating expenses were negligible, carrying operating-stage profits through to the ordinary stage. Pre-tax profit of ¥207.7B incurred income taxes of ¥55.5B (effective tax rate 26.7%), yielding Net Income of ¥133.3B (Net margin 9.6%, prior year 9.4%). In summary, revenue and profit increased, driven by Construction revenue expansion and gross profit improvement, and maintained high margins in Development.
The Construction Business reported revenue of ¥836.7B (¥733.7B prior year, +14.0%), Operating Income of ¥79.0B (¥51.1B prior year, +54.8%), and margin of 9.4% (prior year 7.0%), a substantial improvement. Increased completed contract amounts and gross margin improvement (11.8%, up +2.4pt from 9.4% prior year) contributed, with progress in cost management driving profit expansion. The Development Business and others recorded revenue of ¥548.1B (¥583.9B prior year, -6.1%) and Operating Income of ¥135.5B (¥142.4B prior year, -4.8%). Despite revenue and operating income declines, it maintained high margin of 24.7% (prior year 24.4%), limiting the impact of lower sales. Development accounts for approximately 66% of consolidated Operating Income, functioning as the earnings pillar. The balance of Construction growth and Development’s high margin supports consolidated earnings stability.
[Profitability] Operating margin of 14.7% improved +0.8pt from 13.9% prior year, supported by improvements in gross margin (18.5% vs 17.9% prior year) and SG&A ratio (3.8% vs 4.0% prior year). ROE of 9.9% is slightly lower than historical performance (10.9% prior year) but remains solid. [Cash Quality] Operating Cash Flow ¥172.4B exceeds Net Income ¥133.3B; OCF/Net Income is 1.29x, indicating good cash backing for profits. Accrual ratios are low and revenue quality is healthy. OCF/EBITDA (Operating Income + Depreciation) is 0.83x and below the benchmark 0.9x due to working capital absorption, but an increase in advances received on uncompleted construction contracts of 78.4% contributed to improved capital efficiency. [Investment Efficiency] Total asset turnover is 0.75x, roughly in line with prior year; large cash and deposits of ¥958.2B (51.7% of total assets) suppress turnover. Capital expenditures of ¥5.3B are roughly balanced with depreciation of ¥4.8B, indicating modest growth investment focused on maintenance. [Financial Soundness] Equity Ratio is 72.6% (prior year 70.7%), an improvement, with Debt-to-Equity ratio 0.38x at a low level. Current ratio 350.6% and Quick ratio 350.6% show very strong liquidity buffers and minimal maturity mismatch risk.
Operating Cash Flow was ¥172.4B (¥26.5B prior year, +549.7%), a significant increase reflecting operating profit growth and improved working capital management. Starting from a subtotal of ¥225.0B, after deducting corporate tax payments of ¥56.0B, improved collection of trade receivables of ¥56.2B contributed cash in, while inventory increases of ¥44.6B and decreases in accounts payable of ¥17.9B were cash outflows. An increase in advances received on uncompleted construction contracts of ¥36.2B (effect of customer deposits) improved cash efficiency and contributed to OCF strength. Investing Cash Flow was -¥75.5B, with modest investments in tangible fixed assets ¥5.3B and intangible assets ¥2.5B; the main driver was cash movement due to term deposit placements and withdrawals. Financing Cash Flow was -¥35.2B, mainly dividend payments of ¥35.1B. Free Cash Flow of ¥96.9B covers dividends of ¥32.8B (Payout Ratio 25.6%) comfortably, with FCF coverage 2.96x, indicating high dividend sustainability. Cash and cash equivalents at end of period rose to ¥548.2B (prior period ¥486.5B, +¥61.7B), further strengthening liquidity.
Operating Income of ¥204.1B was supplemented by non-operating income of ¥3.7B (interest income ¥3.1B, dividends ¥0.4B) and non-operating expenses ¥0.0B, producing Ordinary Income of ¥207.7B; one-off or non-recurring items are small and most earnings are core-business derived. No extraordinary gains/losses were reported; pre-tax profit ¥207.7B is entirely composed of ordinary activities. After income taxes ¥55.5B (effective tax rate 26.7%), Net Income reached ¥133.3B and Comprehensive Income was ¥157.4B, ¥24.1B higher than Net Income. This difference arises from ¥4.3B in valuation differences on available-for-sale securities and ¥0.9B in adjustments related to retirement benefits. Given OCF exceeding Net Income and Comprehensive Income exceeding Net Income, earnings quality is solid with low dependence on one-offs, indicating high sustainability.
Full Year guidance projects Revenue ¥1560.0B (YoY +12.7%), Operating Income ¥255.0B (+25.0%), Ordinary Income ¥260.0B (+25.2%), and EPS ¥299.20. Compared with current period results (Revenue ¥1384.3B, Operating Income ¥204.1B, Ordinary Income ¥207.7B), the increases are Revenue +¥175.7B, Operating Income +¥50.9B, Ordinary Income +¥52.3B, implying significant upside premised on accelerated order intake and completion progress in Construction and revenue recovery in Development. Full-year Operating margin is projected at 16.3% versus current 14.7%, assuming further gross margin improvement and SG&A control. Progress ratio (actual/forecast) stands at 88.7% for revenue and 80.0% for Operating Income, suggesting a concentration of project deliveries and completed contract amounts toward Q4. Achieving guidance will hinge on maintaining a high proportion of high-profit Construction projects, smooth execution of Development sales plans, and thorough cost pass-through.
Annual dividend consists of interim ¥30 and year-end ¥37 (including ¥3 commemorative dividend), totaling ¥67, with Payout Ratio 25.6%, a conservative level. Against Net Income ¥133.3B, total dividends of ¥32.8B are paid in cash; no share buybacks were conducted, so Total Return Ratio equals Payout Ratio at 25.6%. Free Cash Flow ¥96.9B comfortably exceeds dividends ¥32.8B, with FCF coverage 2.96x, indicating robust dividend sustainability. Cash and deposits ¥958.2B and Equity Ratio 72.6% imply ample financial capacity, supporting dividend maintenance even under economic volatility. Full-year forecast dividend ¥38 is below current year realized dividend but, excluding the ¥3 commemorative dividend, the baseline dividend of ¥34 implies a normal dividend increase of ¥4, indicating scope for continued dividend growth.
Compression of gross margin risk: Although gross margin improved to 18.5%, it remains below 20%; continued increases in raw material and labor costs could exert downward pressure on Construction operating margin (currently 9.4%). Completed contract gross margin of 11.8% improved +2.4pt from 9.4% prior year, but reversal of the improvement trend due to adverse project mix or delays in cost pass-through could make maintaining 14.7% operating margin difficult.
Segment mix fluctuation risk: The Construction revenue share rose to 60.4%; a reduced contribution from high-margin Development (24.7% margin) could compress consolidated margins. Continued delay in Development revenue recovery (currently -6.1%) would increase Construction weighting and dilute gross margin, posing downside risk to consolidated profit growth.
Seasonality of working capital risk: Although OCF improved to ¥172.4B, OCF/EBITDA at 0.83x is below benchmark 0.9x; increases in inventory ¥44.6B and decreases in accounts payable ¥17.9B absorbed cash. Uncompleted construction expenditures +122.9% and advances received on uncompleted construction contracts +78.4% show large volatility; depending on project progress and delivery timing, quarterly cash flows may fluctuate and rely on period-end concentration of cash conversion. Project delays or weather events could cause intra-period cash flows to fall short of plans.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 14.7% | 5.5% (3.5%–7.2%) | +9.2pt |
| Net Margin | 9.6% | 3.5% (2.5%–4.4%) | +6.1pt |
Profitability significantly exceeds industry medians, with Development’s high-margin structure and Construction’s gross margin improvement creating a strong competitive position.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 5.1% | 9.8% (-2.1%–15.1%) | -4.8pt |
Growth is slightly below industry median, with Development revenue decline restraining consolidated growth. Balancing Construction growth with Development revenue recovery is a future challenge.
※Source: Company compilation
Operating margin of 14.7% establishes profitability well above industry levels, supported by Construction gross margin improvement (11.8% vs 9.4% prior year) and Maintenance of Development’s high margin (24.7%), forming the foundation of consolidated profit growth. The projected full-year Operating margin improvement to 16.3% assumes deeper cost control and realization of scale benefits; progress toward this target warrants monitoring.
With Operating Cash Flow ¥172.4B and Free Cash Flow ¥96.9B, cash generation exceeds accounting profit, and with Payout Ratio 25.6% and FCF coverage 2.96x, shareholder return sustainability is solid. Equity Ratio 72.6% and cash and deposits ¥958.2B indicate very strong financial resilience, enabling both dividend maintenance and growth investment through economic cycles. Future focus points include scope for dividend increases and improvement in capital efficiency (raising ROE from 9.9%).
This report is an earnings analysis document automatically generated by AI analyzing XBRL financial statement data. It is not a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company from public financial statements. Investment decisions are your responsibility; consult advisors as needed before making investment decisions.