Timee,Inc. FY2025 Q4 Earnings Report

Financial Highlights

• Net Sales: ¥34.29B
• Operating Income: ¥6.75B
• Net Income: ¥5.33B
• EPS: ¥53.53

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Full Year Forecast

Disclaimer

This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.

AI Financial Analysis

Executive Summary

Timee (215A0) delivered strong top-line and operating performance in FY2025 Q4 on a consolidated JGAAP basis, with revenue of 342.89 and YoY growth of 27.6%. Gross profit reached 323.77, implying an exceptionally high gross margin of 94.4%, consistent with a platform/intermediation model with limited cost of sales. Operating income rose 59.4% YoY to 67.47, driving a calculated operating margin of about 19.7%, indicating meaningful operating leverage as fixed costs scale. Ordinary income increased 70.5% YoY to 66.70, while non-operating items were immaterial (non-op income 0.38, expenses 1.15). Despite robust operating metrics, net income declined 18.0% YoY to 53.10, suggesting tougher bottom-line comps likely related to prior-year non-recurring items or tax effects; the effective tax rate this period was 20.2%. DuPont analysis shows ROE of 36.5% (net margin 15.5%, asset turnover 1.02x, financial leverage 2.31x), an excellent return profile for a growth-stage platform. Cash generation lagged earnings: operating cash flow was 26.74 (OCF/NI 0.50x), pointing to working capital investment or timing effects; still, free cash flow was positive at 13.94. The balance sheet is liquid and conservatively positioned: current ratio 165.9%, quick ratio 165.9%, and net cash of roughly 24.46 (cash 142.25 minus total borrowings 117.79). Total assets were 336.09 and total equity 145.40, implying an equity ratio we calculate at roughly 43.3%, despite the XBRL field being unreported. Debt-to-equity (total liabilities to equity) stands at 1.31x, but strong cash balances and high interest coverage (59.29x) mitigate solvency risk. EBITDA of 70.06 (20.4% margin) and modest D&A of 2.59 underscore low capital intensity. The company did not disclose dividends; payout and DOE are therefore not assessable this quarter. Reported XBRL ratios for operating margin and ROA (ordinary) appear non-standard vs our calculations; we rely on direct computation from the provided statements. Overall, the business is scaling efficiently with expanding operating profit, albeit with weaker cash conversion near term. Key watchpoints are working capital dynamics, the drivers of YoY net income decline, and the sustainability of high gross margins amid competitive and regulatory environments. Data gaps exist in SG&A detail, dividends, and certain investment and securities line items, but available figures support a solid profitability and balance sheet assessment.

Profitability Analysis

ROE decomposition (DuPont): Net profit margin 15.5% (53.10 / 342.89), asset turnover 1.02x (342.89 / 336.09), and financial leverage 2.31x (336.09 / 145.40), yielding ROE of ~36.5%. Operating margin calculated from statements is ~19.7% (67.47 / 342.89), higher than the reported 0.2% metric, which likely reflects reporting taxonomy rather than economics. Gross margin is 94.4%, highlighting a highly asset-light, take-rate driven model; cost of sales is minimal at 19.13. EBITDA of 70.06 implies an EBITDA margin of 20.4%, with D&A at 2.59 indicating limited depreciation drag. Operating leverage is evident: revenue grew 27.6% YoY while operating income rose 59.4% YoY, suggesting SG&A grew slower than revenue. SG&A was 256.29 (74.8% of revenue); while high, it is leveraging down as scale increases. Non-operating items were small (net -0.77), so operating performance largely dictates earnings. Effective tax rate of ~20.2% is moderate and supportive to net margins. Interest burden is minimal with coverage of ~59x, indicating finance costs are not constraining profitability. Margin quality appears strong given high gross margins and rising operating margins; however, sustainability depends on maintaining take-rates and controlling customer acquisition and support costs embedded in SG&A.

Growth Assessment

Revenue expanded 27.6% YoY to 342.89, a healthy growth rate consistent with adoption of the platform model. Operating income increased 59.4% YoY to 67.47, outpacing revenue growth as fixed cost absorption improved. Ordinary income rose 70.5% YoY, reinforcing that growth is fundamentally operational rather than reliant on non-operating gains. Net income declined 18.0% YoY to 53.10 despite stronger operations, implying a tough comparison period (likely one-offs in the prior year) or mix/tax changes this period; profit before tax of 66.54 aligns closely with operating income, so the delta likely sits below operating line or in prior-year items. EBITDA at 70.06 supports underlying earnings growth with low D&A, indicating limited capital intensity. The sustainability of revenue growth hinges on user and client cohort expansion, retention, and take-rate stability; the ultra-high gross margin suggests pricing power or favorable economics, but also potential sensitivity to competitive pricing. Profit quality is solid at the operating level but clouded by weaker cash conversion (OCF/NI 0.50x), which may reflect working capital investment for growth. Near-term outlook is constructive if SG&A efficiency persists and revenue momentum continues; key is balancing growth marketing spend with unit economics. Given limited disclosure on R&D and SG&A breakdown, assessing the durability of cost discipline by category is constrained. Longer-term, scaling should continue to improve margins if network effects strengthen and fraud/claims costs remain contained within SG&A.

Financial Health

Liquidity is strong: current assets 305.29 vs current liabilities 184.00 yield a current and quick ratio of 165.9% (no inventory disclosed). Cash and deposits of 142.25 cover short-term loans of 111.10, leaving a liquidity buffer. Net cash position is approximately 24.46 when offsetting all interest-bearing loans (short-term 111.10, long-term 6.69) against cash. Working capital is 121.29, providing operational flexibility. Total assets 336.09 and total equity 145.40 imply an equity ratio of about 43.3% (our calculation), and total liabilities/equity of 1.31x. Interest coverage is robust at ~59.3x (operating income 67.47 / interest expense 1.14), indicating low refinancing risk under current conditions. Asset composition is largely current (cash 142.25, receivables 38.60), with limited noncurrent intangibles (goodwill/intangibles 3.45). The reliance on short-term borrowings is notable but mitigated by ample cash; duration mismatch risk remains manageable. No material exposure to investment securities (3.70) is observed, reducing market risk on the balance sheet. Overall solvency and liquidity are comfortable, with capacity to support growth.

Cash Flow Quality

Operating cash flow was 26.74 versus net income of 53.10, yielding an OCF/NI ratio of 0.50x, indicating weaker cash conversion this period. EBITDA was 70.06, so OCF/EBITDA stands at ~38%, suggesting working capital outflows or timing effects (e.g., receivables growth or settlement cycles common in marketplace models). Free cash flow was positive at 13.94 despite investment cash outflows of -12.80, reflecting modest capex (-4.77) and restrained non-capex investments. The low D&A (2.59) relative to EBITDA indicates limited non-cash add-backs, so OCF softness is not due to accounting accruals but likely working capital movements. With current assets substantially exceeding current liabilities and receivables at 38.60, monitoring days sales outstanding and payables timing is key to diagnosing cash conversion. Given the net cash balance, near-term cash flow risk is contained, but persistent OCF shortfalls versus earnings would be a concern. Absence of detailed working capital components (e.g., accounts payable, accrued liabilities) limits a more granular bridge from EBITDA to OCF.

Dividend Sustainability

Dividend-related disclosures (DPS, payout ratio, total dividends) are unreported, preventing a quantitative payout assessment. Based on available data, net income of 53.10 and free cash flow of 13.94 would imply capacity for distributions is present but not necessarily a policy priority given growth investments and working capital needs. The company holds a net cash position (~24.46) and strong liquidity, which could support future shareholder returns if adopted. Without a stated dividend policy or historical DPS, sustainability cannot be inferred. FCF coverage of dividends is not calculable due to missing data. For a growth-stage, high-ROE platform, reinvestment may be prioritized over cash returns; confirmation requires management guidance.

Risk Assessment

Business Risks:

• Competitive intensity in gig/work-matching platforms potentially pressuring take-rates and margins
• Regulatory and labor-law changes affecting worker classification, compliance costs, and platform liability
• Macroeconomic slowdown reducing job postings and shifts filled on the platform
• Customer concentration risk if large enterprise clients drive a disproportionate share of GMV
• Operational risks including fraud prevention, trust and safety, and dispute resolution costs embedded in SG&A
• Technology and cybersecurity risks impacting platform uptime and data protection
• Brand and user acquisition efficiency risks leading to higher marketing costs

Financial Risks:

• OCF/Net income at 0.50x indicates cash conversion risk from working capital swings
• Reliance on short-term borrowings (111.10) despite net cash; rollover and interest-rate exposure
• Potential volatility in effective tax rate affecting bottom-line comparability
• Limited disclosure of SG&A breakdown reduces visibility into fixed vs variable cost structure
• Potential dilution from share issuance (average shares 99.19m vs outstanding 100.31m)

Key Concerns:

• Net income declined 18.0% YoY despite strong operating growth, implying non-recurring or below-the-line factors
• Weaker cash conversion (OCF/NI 0.50x) relative to earnings growth
• High dependence on SG&A efficiency to maintain operating leverage
• Short-term debt usage, though mitigated by cash holdings

Investment Implications

Key Takeaways:

• Strong revenue growth (+27.6% YoY) with expanding operating income (+59.4% YoY) and ~19.7% operating margin
• Exceptional ROE of 36.5% driven by high net margin, adequate asset turnover, and moderate leverage
• High gross margin (94.4%) validates asset-light platform economics
• Cash conversion lagging earnings (OCF/NI 0.50x) due to working capital dynamics
• Healthy liquidity and net cash (~24.46) despite reported debt-to-equity of 1.31x
• Positive FCF (13.94) and low capital intensity (D&A 2.59, capex 4.77)
• Dividend policy undisclosed; capital allocation skew likely toward growth

Metrics to Watch:

• OCF/Net income and OCF/EBITDA as indicators of cash conversion
• Receivables and payables days; settlement cycle trends
• SG&A ratio to revenue and cohort-based unit economics
• Take-rate and gross margin stability amid competition
• Net cash position and short-term debt rollover profile
• Effective tax rate volatility and below-the-line items that influence net income

Relative Positioning: Within Japan-listed internet/platform peers, Timee exhibits superior ROE and gross margins with solid operating leverage, offset by weaker cash conversion and heavier reliance on SG&A efficiency; balance sheet liquidity and net cash compare favorably.

Disclaimer

This analysis was auto-generated by AI. Please note the following:

• No Guarantee of Accuracy: The accuracy and completeness of this analysis are not guaranteed. For accurate financial data, please refer to the original disclosure documents published on TDnet or other official sources
• Not Investment Advice: This analysis is for general informational purposes only and does not constitute investment advice under applicable securities laws. It is not a recommendation to buy or sell any specific securities
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis