NIPPON PARKING DEVELOPMENT Co.,Ltd. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥9.21B
• Operating Income: ¥1.93B
• Net Income: ¥1.37B
• EPS: ¥4.34

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment 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

Nippon Parking Development (TSE: 2353) delivered steady top-line expansion in FY2026 Q1, with revenue up 4.9% YoY to ¥9.206bn, while operating income slipped 1.8% YoY to ¥1.928bn, indicating some near‑term cost pressure or adverse mix despite healthy gross profit. Gross profit of ¥3.584bn implies a robust 38.9% gross margin, supporting the company’s defensible economics in its core operations. Operating margin of roughly 21.0% remains strong, but the minor YoY decline in operating income versus rising sales suggests modest operating deleverage in the quarter. Ordinary income of ¥2.047bn exceeded operating income by about ¥119m, pointing to net non‑operating gains that more than offset ¥32.5m in interest expense. Net income was ¥1.378bn, down a slight 0.4% YoY, highlighting resilient profitability despite softer operating leverage. The DuPont breakdown shows a 14.97% net margin, 0.180x asset turnover, and 2.44x financial leverage, yielding an ROE of 6.57% for the period. Leverage (assets/equity) at 2.44x aligns with a computed equity ratio of about 40.9% (equity ¥20.982bn over assets ¥51.271bn), though the reported equity ratio line item is unfilled (0.0%). Liquidity appears strong, with a current ratio of 291% and a quick ratio of 269%, backed by sizeable working capital of ¥17.699bn. Debt-to-equity of 1.29x (total liabilities ¥27.109bn vs. equity ¥20.982bn) indicates a balanced capital structure for a service-heavy business. Interest coverage is very comfortable at roughly 59x, underscoring low financing risk at present operating levels. The effective tax rate shown as 0.0% in the calculated metrics is inconsistent with the disclosed figures; based on ordinary income and taxes, it is approximately 31.5% (¥645m/¥2,047m). Cash flow line items (OCF, capex/ICF, FCF) and depreciation are not disclosed this quarter, limiting assessment of earnings quality and reinvestment needs; the zeros in these lines should be read as “not reported,” not as actual zero values. EPS was ¥4.34, but the share count line items are unreported; thus, per-share valuation context is limited. Dividend data (DPS and payout) are also unreported this quarter, so distribution policy and coverage cannot be assessed from this release alone. Overall, fundamentals show stable profitability and ample liquidity, with modest top-line growth offset by slight operating margin pressure, and data gaps on cash flows and depreciation temper the depth of analysis for Q1.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 14.97%
• asset_turnover: 0.180x
• financial_leverage: 2.44x
• calculated_ROE: 6.57%
• commentary: ROE reflects strong margins and moderate leverage but is dampened by low asset turnover (note: Q1 revenue vs. period-end assets can understate turnover vs. full-year). margin_quality: Gross margin is 38.9% (¥3,584m GP on ¥9,206m revenue), supporting structurally attractive unit economics. Operating margin is ~21.0% (¥1,928m/¥9,206m). Net margin at 14.97% remains solid, aided by non-operating gains that more than offset interest expense. Slight YoY decline in operating income versus rising sales suggests incremental cost pressure or less favorable mix this quarter. operating_leverage: Revenue grew 4.9% YoY while operating income declined 1.8% YoY, signaling negative operating leverage in Q1. This may reflect higher SG&A, inflationary inputs, or lower margin business mix. Monitoring whether operating margin reverts in subsequent quarters will be key.

Growth Assessment

revenue_sustainability: Top-line growth of 4.9% YoY is steady. Without segment granularity, sustainability must be inferred cautiously; the current run-rate indicates stable demand and contract performance in core operations. profit_quality: Ordinary income exceeds operating income by ~¥119m, indicating supportive non-operating items, while interest expense is modest (¥32.5m). Tax expense of ~¥645m implies an effective tax rate near 31.5%. Net income stability (-0.4% YoY) despite lower operating income suggests some buffer from non-operating gains. outlook: Near-term growth depends on restoring operating leverage and maintaining gross margin resilience. If cost normalization or pricing improves, operating margin could track revenue growth more closely. Data limitations (no CF or depreciation disclosure) constrain visibility into reinvestment pace and capacity-led growth.

Financial Health

liquidity: Current ratio 291.4% and quick ratio 269.4% indicate strong near-term liquidity. Working capital is ¥17.699bn, providing a sizeable buffer for operations and commitments. solvency: Debt-to-equity is 1.29x (proxy using total liabilities/equity), with interest coverage at ~59x, suggesting low current solvency risk. Computed equity ratio is ~40.9% (vs. reported 0.0% placeholder), indicating a healthy capital cushion. capital_structure: Assets ¥51.271bn, liabilities ¥27.109bn, equity ¥20.982bn imply financial leverage of 2.44x, consistent with DuPont. The structure appears balanced for service assets; absent cash flow and debt maturity detail, refinancing risk cannot be fully assessed.

Cash Flow Quality

earnings_quality: Operating CF, investing CF, and depreciation were not disclosed (zeros indicate unreported). As such, we cannot triangulate accrual intensity (e.g., OCF/NI), nor assess non-cash contributors to earnings. FCF_analysis: Free cash flow cannot be derived this quarter due to missing OCF and capex data. The strong working capital position suggests headroom, but FCF conversion remains unassessed. working_capital: Current assets of ¥26.945bn vs. current liabilities of ¥9.246bn support liquidity; inventories are modest at ¥2.038bn, indicating limited inventory risk relative to total CA.

Dividend Sustainability

payout_ratio_assessment: DPS and payout ratio are unreported this quarter (shown as 0.00). With net income of ¥1.378bn, the capacity for distributions cannot be judged without policy guidance and cash flow data. FCF_coverage: FCF is unreported, so coverage of dividends cannot be evaluated. Historically relevant metrics (OCF/NI, capex cadence) are unavailable for Q1. policy_outlook: No disclosure this quarter on dividends. Future assessment will hinge on OCF recovery/visibility, capex intensity, and management’s stated payout policy once reported.

Risk Assessment

Business Risks:

• Operating margin pressure despite revenue growth, implying potential cost inflation or mix headwinds
• Dependence on non-operating gains to bridge operating softness in the quarter
• Potential seasonality affecting asset turnover and quarterly profitability metrics
• Limited visibility into reinvestment needs due to undisclosed depreciation and capex

Financial Risks:

• Moderate leverage (liabilities/equity 1.29x) could magnify downside if operating income weakens
• Interest rate risk, albeit current interest burden is small (32.5m) and coverage is high
• Cash flow opacity this quarter (OCF/FCF unreported) limits assessment of funding self-sufficiency

Key Concerns:

• Negative operating leverage in Q1 despite +4.9% revenue growth
• Absence of cash flow and depreciation disclosure, constraining earnings quality analysis
• Reliance on non-operating items to sustain ordinary income above operating income

Investment Implications

Key Takeaways:

• Solid top-line growth with slight operating margin compression: operating income -1.8% YoY on +4.9% revenue
• Strong liquidity and ample working capital underpin low short-term financial risk
• High interest coverage (~59x) and balanced leverage (2.44x assets/equity) support solvency
• ROE of 6.57% driven by strong margins and moderate leverage but muted by low asset turnover
• Data gaps on OCF, FCF, and depreciation limit assessment of cash conversion and reinvestment

Metrics to Watch:

• Operating margin trajectory and SG&A efficiency in coming quarters
• OCF/Net income and FCF once cash flow statements are disclosed
• Capex intensity and depreciation trends to gauge maintenance vs. growth investment
• Non-operating income components and sustainability
• Asset turnover normalization on a full-year basis

Relative Positioning: Within service-oriented peers, the company shows above-average margins and strong liquidity with moderate leverage; however, near-term operating deleverage and unreported cash flow data temper visibility compared to peers with fuller disclosure.

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
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