ICHIMASA KAMABOKO CO.,LTD. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥7.43B
• Operating Income: ¥-216M
• Net Income: ¥8M
• EPS: ¥-6.65

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

Ichimasa Kamaboko (TSE:2904) reported FY2026 Q1 revenue of ¥7.433bn, up 1.2% YoY, indicating modest top-line resilience in a challenging input cost environment. Gross profit was ¥1.418bn, yielding a gross margin of 19.1%, which appears tight for a processed foods manufacturer and suggests ongoing raw material and energy cost pressure. Operating income deteriorated to a loss of ¥216m (operating margin: -2.9%), down 21.9% YoY, highlighting negative operating leverage as limited price/mix gains failed to offset costs. Ordinary income was a loss of ¥235m, and net income a loss of ¥121m (net margin: -1.63%), implying some non-operating drag but not substantially different from operating trends. DuPont metrics show net margin -1.63%, asset turnover 0.232x, and financial leverage 2.18x, producing ROE of -0.82% for the quarter. The asset turnover level is typical for a food processor with significant fixed assets, while the negative margin is the primary ROE driver. Liquidity appears adequate with a current ratio of 116.6% and quick ratio of 104.8%, supported by working capital of ¥1.274bn. Capital structure is moderate with total liabilities of ¥15.505bn versus equity of ¥14.692bn, implying a debt-to-equity of 1.06x and an implied equity ratio of roughly 45.9% (derived from reported assets and equity), despite the disclosed equity ratio field being unreported. Interest expense was ¥14.7m, and the interest coverage ratio is negative (-14.6x) due to operating losses; sustained losses could pressure financial flexibility if prolonged. Inventory stood at ¥904m, which looks reasonable against the quarterly revenue base, but the lack of detailed working capital components limits deeper insight. Cash flow statements were not disclosed this quarter (OCF/FCF reported as 0 indicates unreported, not actual zero), so earnings-to-cash conversion cannot be assessed. Depreciation and amortization were also undisclosed, limiting EBITDA and underlying operating cash cost visibility. No dividend was reported (DPS 0), aligning with a loss-making quarter and a cautious cash stance. Overall, the quarter reflects persistent cost headwinds and negative operating leverage offsetting modest sales growth, with liquidity and solvency still acceptable but interest coverage weak due to losses. Seasonality in the fish-paste/processed seafood category may imply Q1 is softer than year-end holiday quarters, but confirmation requires full-year cadence. Data limitations (cash flows, D&A, share data) constrain precision, so trends should be reassessed upon fuller disclosure in subsequent quarters.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: -0.0163
• asset_turnover: 0.232
• financial_leverage: 2.18
• calculated_ROE: -0.0082 margins:
• gross_margin: 0.191
• operating_income: -216000000
• operating_margin: -0.029
• ordinary_margin: -0.0316
• net_margin: -0.0163 margin_quality_commentary: Gross margin at 19.1% suggests input cost pressure (surimi, energy, packaging, logistics, labor) remains a headwind; the gap between gross and operating margin indicates SG&A intensity that did not flex down with volume. The negative ordinary margin close to operating margin implies limited non-operating relief. operating_leverage: Revenue grew 1.2% YoY but operating income worsened to -¥216m, evidencing negative operating leverage; modest price/mix/volume gains were insufficient to cover fixed costs and inflation. Without disclosed D&A, assessing fixed-cost absorption precisely is constrained.

Growth Assessment

revenue_sustainability: Top-line growth of 1.2% YoY is modest but positive, likely reflecting incremental price adjustments and stable demand in staple fish-paste products. Sustainability hinges on consumer price acceptance and competitive dynamics in private label vs. branded channels. profit_quality: Profit quality is weak this quarter: negative operating and net income with no supporting cash flow disclosure. The presence of tax expense alongside a net loss suggests non-deductible items or local taxes; however, the effective tax rate metric is uninformative given the loss. outlook: If input cost inflation moderates and further calibrated price revisions/mix upgrades are implemented, operating leverage could turn positive in stronger seasonal quarters. Conversely, if raw material or utility costs re-accelerate, margins may remain compressed. Near-term focus should be on gross margin recovery and SG&A control.

Financial Health

liquidity:

• current_assets: 8952309000
• current_liabilities: 7678501000
• current_ratio: 1.166
• quick_ratio: 1.048
• working_capital: 1273808000
• commentary: Short-term liquidity looks adequate with a current ratio above 1.1x and positive working capital. Quick ratio above 1.0x indicates manageable reliance on inventory for liquidity. solvency:
• total_assets: 31971000000
• total_liabilities: 15504758000
• total_equity: 14692000000
• debt_to_equity: 1.06
• implied_equity_ratio: 0.459
• interest_expense: 14748000
• interest_coverage: -14.6
• commentary: Leverage is moderate for the sector, and the implied equity ratio (~46%) indicates a solid capital base. However, negative EBIT results in weak interest coverage; sustained losses would erode cushions over time. capital_structure: Liabilities are roughly on par with equity (D/E ~1.06x), consistent with a balanced funding mix. The company appears to have capacity to absorb near-term volatility, but loss-making quarters should not persist.

Cash Flow Quality

earnings_to_cash_conversion: Operating cash flow was not disclosed this quarter (reported as 0 = unreported), preventing direct assessment of earnings quality and cash conversion. free_cash_flow: FCF was not disclosed (reported as 0). Without capex and OCF, FCF coverage of obligations and dividends cannot be evaluated. working_capital_dynamics: Inventories of ¥904m seem proportionate relative to quarterly sales, but the absence of receivables/payables data prevents analysis of cash tied in trade working capital. Monitoring inventory turns and any seasonal build ahead of peak demand will be important. additional_notes: D&A was not disclosed, limiting insight into non-cash expense content of EBIT and the maintenance capex baseline.

Dividend Sustainability

payout_ratio_assessment: DPS was reported as ¥0. Given negative net income and undisclosed cash flows, a conservative dividend stance is sensible for cash preservation. FCF_coverage: FCF was unreported; thus FCF coverage cannot be calculated. With operating losses, coverage would likely be weak if dividends were paid. policy_outlook: Until operating profitability stabilizes and OCF visibility improves, scope for cash returns appears constrained. Any future resumption would depend on margin repair and clearer cash generation.

Risk Assessment

Business Risks:

• Raw material cost volatility (surimi/fish paste inputs) and energy/utilities inflation pressuring gross margins
• Pricing power constraints in value-oriented retail channels and potential pushback from customers
• Seasonality in demand (year-end holiday products) creating quarter-to-quarter earnings volatility
• Competitive pressure from private label and regional manufacturers compressing margins
• Product mix risk if premium/value-added items underperform

Financial Risks:

• Negative operating income leading to weak interest coverage (-14.6x) if losses persist
• Potential cash flow shortfalls due to lack of OCF generation data and current quarterly loss
• Exposure to refinancing or interest rate risk if borrowing needs increase
• Working capital swings (inventory and receivables) that could strain liquidity in weaker quarters

Key Concerns:

• Gross margin at 19.1% insufficient to cover SG&A, resulting in operating loss
• Limited visibility due to undisclosed OCF, capex, and D&A
• Sustained cost inflation could delay margin normalization despite modest revenue growth

Investment Implications

Key Takeaways:

• Top-line growth of 1.2% YoY but negative operating leverage produced an operating loss
• Gross margin remains compressed at 19.1%, underscoring input cost pressure
• Liquidity acceptable (current ratio 1.17x; quick ratio 1.05x) and leverage moderate (D/E 1.06x)
• Interest coverage negative due to losses; improvement hinges on margin recovery
• Cash flow metrics unreported; visibility on earnings quality is limited this quarter

Metrics to Watch:

• Gross margin trajectory and price/mix realization vs. raw material and energy costs
• Operating margin and SG&A efficiency to assess operating leverage reversal
• OCF and FCF disclosure in subsequent quarters to gauge cash conversion
• Inventory levels and turns ahead of peak seasonal demand
• Interest coverage and net debt/EBITDA once D&A and cash flows are disclosed

Relative Positioning: Within Japan’s processed seafood/fish-paste peer set, Ichimasa’s Q1 shows weaker profitability due to negative operating leverage, while its balance sheet leverage appears moderate and broadly in line with peers; near-term relative performance will hinge on cost pass-through efficacy and seasonality benefits in subsequent quarters.

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
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