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| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| 売上高 | ¥213.0B | ¥160.9B | +32.4% |
| 営業利益 | ¥34.9B | ¥23.1B | +51.5% |
| 経常利益 | ¥34.5B | ¥20.9B | +65.3% |
| 純利益 | ¥24.2B | ¥14.2B | +70.3% |
| ROE | 7.7% | 4.8% | - |
Executive Summary
For the consolidated results for Q1 of the fiscal year ending February 2026, Revenue was ¥213.0B (YoY +¥52.1B +32.4%), Operating Income was ¥34.9B (YoY +¥11.9B +51.5%), Ordinary Income was ¥34.5B (YoY +¥13.7B +65.3%), and Net Income attributable to owners of the parent for the quarter was ¥24.2B (YoY +¥10.0B +70.3%). Driven primarily by expanded sales and improved gross margin in the Renovation Condominium Business, profit growth exceeded top-line growth; the operating margin improved to 16.4% (up +2.1pt from 14.3% a year ago) and the net margin to 11.4% (up +2.5pt from 8.8%), indicating a material improvement in profitability. Progress against the full-year guidance (Revenue ¥847.1B, Operating Income ¥93.0B, Ordinary Income ¥74.9B, Net Income ¥50.9B) shows Revenue at 25.1% while Operating Income is 37.6% and Net Income 47.5%, indicating profits are running ahead of schedule.
Drivers of Performance
[Revenue] Strong sales in the Renovation Condominium Business led to Revenue of ¥213.0B (+32.4%). By segment, Renovation Condominium Business was ¥209.2B (+33.3%), Advisory Business was ¥6.9B (+53.9%), both expanding healthily, while the Investment Business contracted to ¥0.1B (-93.6%). Revenue from the Renovation Condominium Business accounted for 98.2% of total Revenue, with increased closing volumes in that business the primary driver of higher sales. The Advisory Business also grew by ¥2.4B YoY, a modest but high-growth contribution. [Profitability] Cost of sales was ¥164.7B resulting in gross profit of ¥48.3B (gross margin 22.7%, improved +2.8pt from 19.9%), with margin expansion driven by optimizing procurement conditions and improving project mix. SG&A was ¥13.3B (+48.5%), outpacing Revenue growth (+32.4%), but the SG&A-to-Revenue ratio was 6.3% (up +0.7pt from 5.6%), a modest rise absorbed by gross margin improvement. Operating Income of ¥34.9B (+51.5%) increased materially due to the combined effects of Revenue growth and gross margin improvement. Non-operating items included derivative valuation gains of ¥3.5B and higher interest income (¥0.06B → ¥0.16B), boosting non-operating income to ¥3.7B. Interest expense rose to ¥3.5B (up ¥0.9B from ¥2.6B) with increased borrowings, but the interest coverage ratio remained at a healthy 10.0x, indicating interest costs are manageable. Ordinary Income was ¥34.5B (+65.3%), reflecting operating gains plus improved non-operating items. After corporate taxes of ¥10.3B (effective tax rate 29.9%), Net Income landed at ¥24.2B (+70.3%), resulting in a year-over-year increase in both revenue and profit.
Segment Analysis
The Renovation Condominium Business reported Revenue of ¥209.2B (YoY +33.3%), Segment Profit of ¥31.8B (YoY +55.8%), and a margin of 15.2% (improved +2.2pt from 13.0%), generating the majority of corporate profit as the core business. Increased closing volumes, higher unit prices, and improved gross margins contributed to margin expansion. The Advisory Business recorded Revenue of ¥6.9B (+53.9%), Segment Profit of ¥4.9B (+74.0%), and margin of 70.7% (improved +8.1pt from 62.6%), expanding its high-profit contribution. The Investment Business contracted to Revenue of ¥0.1B (-93.6%) and reported a Segment Loss of ¥0.1B (turning from a ¥1.4B profit a year ago), becoming small-scale and loss-making, but its limited size means minimal impact on the group. Revenue composition: Renovation Condominium Business 98.2%, Advisory 3.2%, Investment 0.0%, indicating very high dependence on the Renovation Condominium Business and sensitivity of corporate results to that market.
Key Financial Metrics
[Profitability] Operating margin improved to 16.4% (up +2.1pt from 14.3% a year ago) and Net margin to 11.4% (up +2.5pt from 8.8%). ROE was 7.7%; DuPont decomposition yields Net margin 11.4% × Total Asset Turnover 0.170 × Financial Leverage 3.98x, indicating margin improvement as the primary driver. Total Asset Turnover of 0.170 reflects the real-estate nature of carrying large inventories (Inventory for sale ¥1,142B), and short-term improvement is unlikely. Interest coverage remained healthy at 10.0x (Operating Income ¥34.9B ÷ Interest Expense ¥3.5B). [Cash Quality] OCF data is undisclosed, but balance sheet trends suggest cash and deposits increased to ¥41.5B (from ¥34.0B, +¥7.5B), implying cash generation from operations. Inventory for sale rose to ¥1,142B (from ¥1,050B, +¥92B +8.7%), indicating continued investment in procurement and development. [Investment Efficiency] The low total asset turnover of 0.170 is characteristic of real estate and improving inventory turnover is key to capital efficiency. [Financial Soundness] Equity Ratio was 25.1% (down -0.6pt from 25.7% a year ago) and D/E ratio 2.98x (Interest-bearing debt ¥941.1B ÷ Net Assets ¥315.3B), indicating a high-leverage structure. Current ratio was 871% (Current assets ¥1,204B ÷ Current liabilities ¥138B), showing very high short-term liquidity; however, most current assets are inventories for sale, so realizable liquidity depends on sales progress. Long-term borrowings were ¥802.9B (up ¥67.4B from ¥735.5B), short-term borrowings ¥17.5B (up ¥16.2B from ¥1.3B), and interest-bearing debt is on an increasing trend; attention is needed for higher funding costs in a rising-rate environment.
Cash Flow Analysis
Although the cash flow statement is not disclosed, balance sheet movements suggest cash and deposits rose to ¥41.5B (from ¥34.0B, +¥7.5B), implying cash generation from operating activities. At the same time, inventories for sale increased substantially to ¥1,142B (from ¥1,050B, +¥92B), indicating ongoing procurement and development investment. Interest-bearing debt rose to ¥941.1B (from ¥808.0B, +¥133.1B), with borrowings used to fund inventory investment. Inventory turnover is the key to cash generation, and the improved gross margin of 22.7% suggests higher cash-in per sale. Interest expense has risen to ¥3.5B, and if inventories stagnate, cash outflows could increase and interest burden could become heavier. Capital expenditures were limited (Tangible fixed assets ¥0.12B, Intangible fixed assets ¥0.18B), and the main capital requirements are for working capital (inventory) and debt repayment/interest.
Quality of Earnings
Primary earnings are point-in-time recognition from property sales and rental income. The gross margin improvement to 22.7% is judged structural, driven by project mix improvements and optimized procurement. Non-operating income of ¥3.7B included derivative valuation gains of ¥3.5B, which boosted Ordinary Income but are a market/interest-rate-sensitive, non-recurring element with limited repeatability. Interest income ¥0.16B rose slightly but is likely sustainable. Non-operating expenses of ¥4.1B were mainly interest expense ¥3.5B (up +34.6% YoY), reflecting structural cost increases from higher borrowings. The gap between Ordinary Income ¥34.5B and Net Income ¥24.2B (-29.9%) is due to corporate taxes of ¥10.3B (effective tax rate 29.9%) and is not abnormal. Comprehensive income of ¥25.7B exceeded Net Income by ¥1.5B, attributable to improvement in deferred hedge gains (¥0.9B → ¥1.5B), reflecting improved valuation of interest-rate hedges. The quality of operating income is high; excluding temporary non-operating factors, Operating Income of ¥34.9B represents underlying earning power.
Earnings Forecasts & Guidance
Against the full-year forecast (Revenue ¥847.1B, Operating Income ¥93.0B, Ordinary Income ¥74.9B, Net Income ¥50.9B, EPS ¥149.58円), Q1 progress rates were: Revenue 25.1% (¥213.0B ÷ ¥847.1B), Operating Income 37.6% (¥34.9B ÷ ¥93.0B), Ordinary Income 46.1% (¥34.5B ÷ ¥74.9B), Net Income 47.5% (¥24.2B ÷ ¥50.9B). Compared with a typical quarterly progress rate of 25%, Operating Income is +12.6pt and Net Income +22.5pt ahead, indicating material front-loading. This acceleration is attributed to better-than-expected gross margins, high-margin contribution from the Advisory Business, and a one-off boost from derivative valuation gains of ¥3.5B in non-operating income. Quarter-to-quarter progress can vary with Renovation Condominium closing timing, but at present there appears to be upside to the full-year plan. However, derivative valuation gains may normalize over the full year, and the contribution from non-operating items may decline going forward. There are no revisions to the earnings forecast or dividend forecast for this quarter.
Shareholder Returns
Full-year dividend forecast is maintained at ¥22.50 per share (no interim dividend, year-end payment only). The payout ratio versus forecast EPS ¥149.58円 is approximately 15.0%, a conservative level. The prior fiscal year dividend was ¥15.00 per share, so the full-year plan represents an increase of ¥7.50 (+50.0%). Net income as dividend source is progressing well: ¥24.2B in Q1 against the full-year forecast of ¥50.9B (progress 47.5%). Given high leverage (interest-bearing debt ¥941.1B), prioritizing inventory turnover and leverage reduction over excessive dividends is rational, and the current payout ratio of 15% has high sustainability. There is no share buyback disclosure; shareholder returns are via dividends only.
Risk Factors
- Inventory turnover risk (quantified: inventories for sale ¥1,142B, YoY +8.7%): Inventories for sale account for 90.9% of total assets, so slower inventory turnover could worsen gross margin and cash flows. If housing demand weakens due to rising rates or competition intensifies, sales may fall short of expectations, posing risks of inventory valuation losses and higher interest burden.
- Interest rate rise risk (quantified: interest-bearing debt ¥941.1B, interest expense ¥3.5B, Interest Coverage 10.0x): With long-term borrowings ¥802.9B and short-term borrowings ¥17.5B totaling ¥941.1B, a 1% rise in rates would increase annual interest expense by roughly ¥9.4B, compressing Ordinary Income by about 27%. If the share of variable-rate debt is high, profit margins could deteriorate in a rising-rate environment.
- Segment concentration risk (quantified: Renovation Condominium revenue composition 98.2%): Revenue dependence on the Renovation Condominium Business at 98.2% is extremely high; deterioration in the Tokyo metropolitan used-condominium market, intensified procurement competition, or regulatory changes could directly impact corporate performance.
Industry Benchmark (Reference — Company Analysis)
[Industry Positioning] (reference information — company analysis) With typical operating margins in real estate around 10%, the company’s operating margin of 16.4% is high within the industry. Focus on renovation and an integrated procurement-to-sales structure created added value supporting high profitability. ROE 7.7% is slightly below the real estate industry average (around 8–10%), attributable to the low total asset turnover of 0.170 inherent to an inventory-heavy business model. Equity Ratio 25.1% is average within the real estate sector and typical for a high-leverage, growth-investment-oriented business. Revenue growth of +32.4% classifies as high growth within the industry, supported by market share expansion and a larger project pipeline.
Key Points in the Financial Results
Key points are as follows. First, notable improvements in gross margin to 22.7% (YoY +2.8pt) and operating margin to 16.4% (YoY +2.1pt) confirm structural profitability improvements from optimized procurement and improved project mix. Second, progress against full-year forecasts shows Operating Income at 37.6% and Net Income at 47.5%, significantly ahead of schedule, suggesting upside to the full-year plan. However, derivative valuation gains of ¥3.5B in non-operating income are one-off and may normalize in subsequent quarters. Third, interest-bearing debt of ¥941.1B (D/E 2.98x) and higher interest expense of ¥3.5B (YoY +34.6%) warrant caution regarding increased funding costs and margin compression in a rising-rate environment. Fourth, inventory turnover of inventories for sale ¥1,142B is critical for sustaining performance, so monitoring future closing progress and margin levels is essential.
This report was auto-generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on publicly disclosed financial data. Investment decisions are your responsibility; consult a professional advisor as needed.