| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥9100.0B | ¥522.9B | +5.7% |
| Operating Income / Operating Profit | ¥446.8B | ¥375.8B | +18.9% |
| Ordinary Income | ¥460.6B | ¥426.6B | +8.0% |
| Net Income | ¥175.5B | ¥125.2B | +40.2% |
| ROE | 4.4% | 3.0% | - |
For the fiscal year ended March 2026, Revenue / Net Sales was ¥9100.0B (YoY +5.7%), Operating Income / Operating Profit was ¥446.8B (YoY +18.9%), Ordinary Income was ¥460.6B (YoY +8.0%), and Net Income attributable to owners of the parent was ¥167.8B (YoY +55.8%). Revenue growth coupled with cost-efficiency initiatives improved profitability, with an Operating Margin of 4.9% (approx. 3.9% prior year, +1.0pt improvement). Non-operating income of ¥61.1B (dividends received ¥22.2B, foreign exchange gains ¥14.3B, etc.) supported earnings; although special losses of ¥105.6B were recorded, these declined from ¥174.3B in the prior year, resulting in a substantial increase in Net Income. Operating Cash Flow was ¥683.6B (YoY -17.1%) but remained robust, Free Cash Flow was ¥542.8B, and the company paid dividends of ¥117B and repurchased shares of ¥100B. By region, domestic gross profit increased by +2.5%, and the reduction in overseas losses contributed to consolidated profit growth.
【Revenue】Revenue / Net Sales of ¥9100.0B (YoY +5.7%) reflects progress in securing projects domestically and internationally. By region, Japan external revenue declined to ¥6,389.7B (from ¥7,148.9B, -10.6%) but gross profit rose to ¥3,046.5B (from ¥2,970.9B, +2.5%), suggesting a shift to higher value-added projects. Overseas revenue declined to ¥2,220.3B (from ¥2,384.2B, -6.9%), while gross profit remained resilient at ¥1,073.6B (from ¥1,078.9B, -0.5%). Consolidated gross profit was ¥4,060.4B (from ¥3,995.9B, +1.6%), maintaining a gross margin of 44.6% (same as prior year). Goodwill amortization decreased to ¥102.6B (from ¥125.8B, -18.4%), and salaries and allowances were controlled at ¥1,547.9B (from ¥1,566.0B, -1.2%), indicating structural cost efficiency progress.
【Profitability】Operating Income / Operating Profit of ¥446.8B (YoY +18.9%) was driven by gross profit growth and suppression of SG&A (¥3,613.6B, YoY -0.1%). SG&A ratio improved to 39.7% (from 40.5%, -0.8pt), and Operating Margin rose to 4.9% (from approx. 3.9%, +1.0pt). By region, Japan Operating Income was ¥861.9B (from ¥819.5B, +5.2%), while overseas reported an Operating loss of ¥22.2B (improved from a loss of ¥75.3B previously). Ordinary Income of ¥460.6B (YoY +8.0%) was supported by Non-operating income of ¥61.1B (dividends received ¥22.2B, forex gains ¥14.3B, gains from investment partnership operations ¥10.4B, etc.) which exceeded Non-operating expenses of ¥47.2B (interest expenses ¥15.6B, etc.), underpinning operating profit gains. Profit before income taxes was ¥377.4B (from ¥313.4B, +20.4%), but income taxes of ¥201.0B (effective tax rate 53.3%) were heavy, leaving Net Income attributable to owners of the parent at ¥167.8B (YoY +55.8%). Special losses totaled ¥105.6B (impairment on marketable securities ¥13.5B, loss on disposal of fixed assets ¥12.7B, impairment losses ¥10.8B, etc.), down from ¥174.3B the prior year, and the reduction in one-off items contributed to higher Net Income. In summary, the company delivered revenue and profit growth.
The company operates a single segment (advertising operations and related services); therefore, segment profit analysis is substituted with regional information. In Japan, external revenue was ¥6,389.7B (YoY -10.6%), gross profit ¥3,046.5B (YoY +2.5%), and Operating Income ¥861.9B (YoY +5.2%), achieving profit growth through gross margin improvement and cost efficiency despite revenue decline. Overseas external revenue was ¥2,220.3B (YoY -6.9%), gross profit ¥1,073.6B (YoY -0.5%), and Operating loss ¥22.2B (improved from a loss of ¥75.3B), showing a positive trend. Consolidated Operating Income after eliminations was ¥446.8B (YoY +18.9%), with domestic high profitability and reduced overseas losses both contributing to company-wide profit growth.
【Profitability】Operating Margin was 4.9% (from approx. 3.9%, +1.0pt), and Net Margin improved to 1.9% (from approx. 1.1%, +0.8pt). ROE was 4.4% (from approx. 2.8%, +1.6pt), though a high effective tax rate of 53.3% is suppressing bottom-line margins. Gross margin remained high at 44.6%, and SG&A ratio improved to 39.7% (from 40.5%, -0.8pt), reflecting efficiency gains. EBITDA (Operating Income + depreciation + goodwill amortization, adding goodwill amortization of ¥102.6B) was approximately ¥692B, yielding an EBITDA margin of 7.6%. 【Cash Quality】Operating Cash Flow (OCF) was ¥683.6B, about 99% of EBITDA, and Operating Cash Flow / Net Income is approximately 4.0x, indicating very healthy conversion of profits to cash. Free Cash Flow was ¥542.8B, sufficient to cover dividends of ¥117B and capex of ¥33.9B. Cash conversion ratio (OCF/EBITDA) was about 0.99x, a strong level. 【Investment Efficiency】Total asset turnover was 0.85x (from 0.91x, declining), with accounts receivable of ¥4,248B (DSO approx. 170 days) dampening asset efficiency. EPS was ¥46.09 (from ¥29.32, +57.2%), and BPS was ¥1,083.83 (from ¥1,062.25, +2.0%), reflecting steady improvement in per-share value. 【Financial Soundness】Equity Ratio was 37.2% (same as prior year) and stable; current ratio was 138.7% (from 151.7%, down but still healthy); Debt/Equity ratio was approx. 24.1%, low, indicating conservative leverage. Cash and deposits were ¥2,389.6B versus interest-bearing debt totaling ¥1,254.8B (short-term borrowings ¥71.7B, current portion of long-term borrowings ¥229.9B, long-term borrowings ¥653.2B, bonds ¥300B), resulting in net cash of ¥1,134.8B.
Operating Cash Flow was ¥683.6B (YoY -17.1%), derived from profit before income taxes of ¥377.4B plus depreciation ¥142.6B and goodwill amortization ¥102.6B, yielding an operating cash subtotal of ¥930.1B, adjusted for working capital changes (decrease in inventories ¥59.2B, increase in accounts receivable -¥16.8B, decrease in accounts payable -¥3.2B, etc.) and income taxes paid of ¥233.6B. Operating Cash Flow / Net Income is about 4.0x, indicating excellent cash realization quality and high accrual quality. Investing Cash Flow was -¥140.9B, comprising capital expenditures -¥33.9B, software investments -¥80.5B, purchases of marketable securities -¥42.9B, sales proceeds ¥87.9B, etc. Free Cash Flow (Operating CF + Investing CF) was ¥542.8B, ample to cover total shareholder returns of ¥217.3B (dividends ¥117.3B and share buybacks ¥100B) by 2.5x. Financing Cash Flow was -¥306.6B, primarily due to dividends -¥117.3B, share buybacks -¥100B, long-term borrowings repayments -¥6.1B, bond issuance +¥300B, lease liability repayments -¥15.2B, etc. Cash and cash equivalents increased from ¥207.5B at the beginning of the period to ¥233.1B at the end (+¥255.6B), leaving liquidity strong. Working capital remains a focus due to prolonged accounts receivable of ¥4,248B (DSO approx. 170 days); optimizing collections remains an ongoing task. Inventories of ¥226B are light and inventory risk is limited.
Recurring earnings are centered on gross profit and Operating Income from advertising operations. Non-operating income of ¥61.1B (0.7% of Revenue) comprises dividends received ¥22.2B, interest received ¥5.0B, foreign exchange gains ¥14.3B, etc., indicating a balance between sustainable financial income and operations-related income. One-off items resulted in net special items of -¥83.2B (special gains ¥22.4B, special losses ¥105.6B), improved from -¥113.2B in the prior year. Major special losses include impairment on marketable securities ¥13.5B, loss on disposal of fixed assets ¥12.7B, and impairment losses ¥10.8B, reflecting one-time costs related to M&A and asset rationalization. Comprehensive income of ¥259.6B exceeded Net Income of ¥175.5B by ¥84.1B, supported by Other Comprehensive Income of ¥83.1B (net valuation difference on available-for-sale securities ¥41.9B, remeasurement of defined benefit plans ¥41.4B, deferred hedge P/L -¥14.8B, etc.). Accrual quality is high as Operating Cash Flow of ¥683.6B significantly exceeds Net Income of ¥175.5B (approx. 3.9x), and the accrual ratio is about -4.8x, indicating cash-driven earnings. The gap between Ordinary Income of ¥460.6B and Net Income attributable to owners of the parent ¥167.8B is largely due to a high effective tax rate of 53.3% and special losses; stabilizing the tax rate and reducing one-off costs are necessary for sustained bottom-line improvement.
Full year guidance is Revenue / Net Sales ¥9100.0B (YoY +5.7%), Operating Income / Operating Profit ¥467.0B (YoY +4.5%), Ordinary Income ¥470.0B (YoY +2.0%), Net Income attributable to owners of the parent ¥260.0B, EPS guidance ¥72.42, and dividend guidance ¥16.00 (annual ¥32 assumed). Versus guidance, Revenue ¥9100.0B is on plan; Operating Income ¥446.8B represents 95.7% progress against the plan of ¥467.0B; Ordinary Income ¥460.6B is 98.0% of the plan ¥470.0B, broadly in line with expectations. However, Net Income attributable to owners of the parent ¥167.8B reached only 64.5% of the ¥260.0B plan, a significant shortfall. The primary causes were special losses of ¥105.6B and a high effective tax rate of 53.3%, highlighting structural difficulty in translating operating improvements into bottom-line results. Dividends were executed as a year-end payment of ¥16, making the annual dividend ¥32, maintaining shareholder returns as planned.
Annual dividend was ¥32 (interim ¥16, year-end ¥16), totaling ¥117.3B in dividend payments. Payout Ratio relative to Net Income attributable to owners of the parent (¥167.8B) is approximately 70%, somewhat high, but dividend coverage by Free Cash Flow (¥542.8B) is about 4.6x, leaving a wide safety margin and no immediate sustainability concerns. Share buybacks of ¥100B were executed, bringing total shareholder returns to ¥217.3B and a Total Return Ratio of approximately 129% relative to Net Income attributable to owners of the parent. Evaluated against FCF, total returns represent about a 40% return rate, balancing growth investments and shareholder returns. The disclosed payout ratio 1.091 indicates continuity with historical practice and suggests a corporate policy of stable dividends. Mid-term, given stable Operating Cash Flow and FCF generation, the company is expected to maintain dividends and pursue opportunistic share buybacks.
Risk of delayed profitability improvement: Although Operating Margin improved to 4.9% (+1.0pt YoY), it remains -3.2pt below the industry median of 8.1%. If reduction of overseas losses lags or the shift to higher value-added domestic projects stalls, structural profitability improvement may be delayed, constraining ROE upside. SG&A ratio of 39.7% remains high, and ongoing optimization of personnel costs and goodwill amortization is required.
Tax burden and pressure on Net Income: A high effective tax rate of 53.3% (improved from 60.5% prior year but still high) suppresses Net Margin to 1.9%; without tax optimization, operating profit gains may not translate into shareholder returns or ROE improvement. Deferred tax assets ¥114.7B and deferred tax liabilities ¥111.4B largely offset, limiting scope for future tax relief.
Working capital and liquidity management risk: Prolonged accounts receivable of ¥4,248B (DSO approx. 170 days) poses a risk of collection delays or credit costs during advertising market volatility. Advances received (custody deposits) of ¥794.5B (from ¥570.3B, +39%) reflect transaction expansion but may introduce sharp working capital swings and cash flow pressure in the event of project cancellations or contract changes. While the current ratio of 138.7% remains healthy, it declined from 151.7%, increasing the importance of short-term cash management.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 4.9% | 8.1% (3.6%–16.0%) | -3.2pt |
| Net Margin | 1.9% | 5.8% (1.2%–11.6%) | -3.9pt |
Both Operating Margin and Net Margin are below the industry median, placing profitability in the lower tier among peers.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 5.7% | 10.1% (1.7%–20.2%) | -4.4pt |
Revenue growth is below the industry median, placing the growth pace in the mid-to-lower range among peers.
※Source: Company aggregation
Sustainability of profitability improvement: Operating Margin improved by +1.0pt to 4.9% but remains -3.2pt below the industry median of 8.1%, making structural profitability enhancement a focal point going forward. With declining goodwill amortization (¥102.6B), SG&A ratio improvement (-0.8pt), and continued reduction of overseas deficits, mid-term achievement of Operating Margins in the 6% range is conceivable. Progress on both higher value-added project mix and cost efficiency is key to ROE improvement.
Cash generation and capacity for shareholder returns: Strong cash generation (Operating CF ¥683.6B, Free CF ¥542.8B) supports dividends of ¥117B and share buybacks of ¥100B while leaving significant headroom. Operating CF / Net Income approx. 4.0x and FCF / Dividends approx. 4.6x indicate high sustainability of shareholder returns and potential for mid-term dividend increases. However, a high effective tax rate of 53.3% constrains Net Income; tax optimization could free additional capacity for shareholder returns.
Balancing working capital management and growth investment: Long-standing receivables with DSO approx. 170 days make working capital efficiency a medium-term priority. Strengthening collection management and credit optimization would shorten the cash conversion cycle and expand funds available for growth investment and shareholder returns. With cash ¥2,389B and interest-bearing debt ¥1,254B yielding net cash ¥1,134B, the financial position supports active M&A and strategic investments in digital areas.
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 particular security. Industry benchmarks are reference information compiled by the company from publicly available financial statements. Investment decisions are your responsibility; please consult professionals as needed before making investment decisions.