RACCOON HOLDINGS,Inc. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥3.13B
• Operating Income: ¥574M
• Net Income: ¥289M
• EPS: ¥15.86

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

Raccoon Holdings (3031) reported FY2026 Q2 consolidated results under JGAAP with modest top-line growth and resilient bottom-line performance. Revenue rose 2.7% year on year to ¥3,134 million, while operating income declined 7.3% to ¥574 million, indicating some cost pressure or investment ahead of growth. Ordinary income was ¥519 million and net income increased 11.5% to ¥322 million, lifting net margin to 10.27% despite the weaker operating result. Gross profit margin remains structurally high at 78.5%, consistent with a fee- and platform-driven business model. Operating margin (approximately 18.3%) compressed versus last year given opex growth outpacing revenue. The DuPont profile shows a reported ROE of 6.89%, driven by a 10.27% net margin, low asset turnover of 0.189x, and financial leverage of 3.56x. Cash generation was solid: operating cash flow was ¥626.6 million, equating to 1.95x net income, which supports earnings quality. Interest burden is very light (interest expense ¥4.2 million) and interest coverage is strong at 135.8x, implying ample headroom even if rates or borrowings rise. The balance sheet shows total assets of ¥16,618 million, liabilities of ¥11,633 million, and equity of ¥4,673 million; on these figures, the calculated equity ratio is approximately 28.1% even though the reported metric is blank/undisclosed. Liquidity appears adequate with a current ratio of 124.5% and positive working capital of ¥2,618.6 million, though cash and equivalents were not disclosed in the XBRL. Investing cash flow and free cash flow are not available, limiting visibility on capital intensity and reinvestment needs this period. Dividend information (DPS and payout) is undisclosed for the period; EPS was ¥15.86. Overall, the quarter suggests steady revenue in core businesses with a deliberate increase in operating costs, strong cash conversion, and limited financial risk from interest-bearing debt. Key uncertainties stem from missing disclosures (cash balance, investing outflows, dividend policy detail) and the inherently low asset turnover profile of the model. Monitoring expense discipline, take rates, and cohort metrics will be important to assess margin recovery. The financial position is sound, but the sustainability of improved net income amid softer operating income will depend on operating leverage and cost management in H2.

Profitability Analysis

ROE of 6.89% decomposes into net margin 10.27%, asset turnover 0.189x, and financial leverage of 3.56x. The margin component is the primary driver of ROE given very high gross margin of 78.5% and solid operating margin near 18.3% (¥574m OI on ¥3,134m revenue). YoY, revenue grew 2.7% while operating income fell 7.3%, implying SG&A growth ahead of sales—likely higher personnel, technology, or marketing spend. Ordinary income of ¥519m is slightly below operating income, indicating small net non-operating costs; interest expense is minimal at ¥4.2m, so the delta likely reflects other non-operating items. Net income rose 11.5% to ¥322m, suggesting supportive tax and/or non-operating dynamics versus the prior year; based on ordinary income (¥519m) and income tax (¥187m), the effective tax rate is approximately 36%, even though a reported effective tax rate was not disclosed. EBITDA was ¥648.6m, yielding a 20.7% EBITDA margin; the spread between EBITDA margin and operating margin reflects modest D&A (¥74.6m), consistent with an asset-light platform. Operating leverage appears negative in the period (OI declined despite higher revenue), indicating near-term margin compression; recovery depends on scaling revenue faster than fixed costs in subsequent quarters. With asset turnover at 0.189x (on period-end assets), efficiency is structurally low, typical for platforms holding sizable current assets relative to revenue; ROE thus relies on margin discipline rather than asset intensity.

Growth Assessment

Revenue growth of 2.7% YoY indicates steady but moderate expansion. Given the high gross margin, growth is likely derived from fee-based services or platform volumes rather than product sales; sustainability hinges on customer acquisition, retention, and transaction volume growth. The decline in operating income (-7.3% YoY) points to increased operating expenses, suggesting investment in growth or cost inflation outweighing revenue gains in the half. Net income growth (+11.5% YoY) outperformed operating income, supported by below-the-line factors and tax dynamics; this may not be repeatable if operating leverage remains negative. With EBITDA margin at 20.7% and operating margin at ~18.3%, the business retains significant profitability headroom if expense growth normalizes against revenue. Asset turnover at 0.189x is low; scaling revenue without proportional asset growth is key to improving ROE. Outlook: near-term growth appears steady but not accelerating; margin recovery requires tighter expense control or stronger topline in H2. Visibility is constrained by undisclosed investing cash flows and segment detail; monitoring cohort/GMV trends and take rates would refine sustainability assessment.

Financial Health

Total assets are ¥16,618m, liabilities ¥11,634m, and equity ¥4,673m, implying a calculated equity ratio of ~28.1% despite the reported equity ratio being undisclosed. Current assets are ¥13,313m versus current liabilities of ¥10,694m, yielding a current ratio of 124.5% and positive working capital of ¥2,618.6m; inventories were undisclosed, so the quick ratio matches at 124.5%. Debt-to-equity is 2.49x (based on total liabilities), but interest expense is minimal (¥4.2m) and interest coverage is 135.8x, implying that a large share of liabilities are non-interest-bearing or operational in nature. Solvency therefore appears adequate with moderate balance-sheet leverage and strong ability to service interest. Cash and equivalents were not disclosed, limiting assessment of immediate liquidity buffers and cash runway. Overall, the capital structure is acceptable for the business model, but improvements in the equity buffer and transparency on cash composition would strengthen the profile.

Cash Flow Quality

Operating cash flow was ¥626.6m, 1.95x net income (¥322m), indicating strong earnings-to-cash conversion and limited accrual risk this period. D&A was ¥74.6m, modest relative to EBITDA, consistent with an asset-light model. Investing cash flow and cash balances were not disclosed; therefore, free cash flow cannot be reliably calculated for the period (the reported FCF of zero reflects missing investing data, not true FCF). Working capital dynamics are not detailed, but positive OCF alongside modest revenue growth suggests stable collections and payables management; however, without cash flow detail by component, we cannot attribute OCF strength to specific drivers. Financing cash flow was an outflow of ¥174.9m, possibly reflecting dividends, debt service, or share-related cash movements, but the split is undisclosed. Overall, cash flow quality appears strong from an OCF perspective, but full-cycle FCF assessment requires capex and investment activity disclosure.

Dividend Sustainability

Dividend data are not disclosed for the period (DPS and payout ratio shown as zero indicate unreported values). EPS was ¥15.86 on net income of ¥322m, implying capacity for distributions if the company so chooses, but we cannot confirm actual payouts or policy cadence. With OCF at ¥626.6m, coverage of potential dividends by operating cash appears ample; however, the absence of investing cash flow data prevents assessment of true free cash flow coverage. Financing cash outflow (¥174.9m) could include dividend payments, but details are unavailable. Policy outlook is therefore indeterminate based on disclosed data; we would monitor management guidance, historical payout tendencies, and capital allocation commentary in the next disclosure.

Risk Assessment

Business Risks:

• Slower revenue growth (+2.7% YoY) may signal maturation or competitive pressure in core platforms.
• Operating leverage turned negative in the period, risking further margin compression if costs stay elevated.
• High gross margin model depends on sustaining fee rates and transaction volumes; pricing pressure could erode margins.
• Customer acquisition and retention risks if marketing efficiency declines.
• Regulatory or credit risk exposure if services involve B2B credit evaluation or guarantees.

Financial Risks:

• Moderate leverage on a total-liability basis (D/E 2.49x), though interest-bearing debt appears limited.
• Undisclosed cash balance constrains liquidity assessment and stress testing.
• Investing cash flows undisclosed, obscuring capex/reinvestment needs and true free cash flow.
• Potential tax rate volatility (calculated ~36% this period) affecting net income.

Key Concerns:

• Margin compression despite revenue growth (OI -7.3% YoY).
• Low asset turnover (0.189x) restrains ROE absent stronger margins.
• Data gaps: cash, investing CF, dividends, and equity ratio disclosure.

Investment Implications

Key Takeaways:

• Top-line grew modestly while operating profit declined, indicating cost pressure or front-loaded investment.
• Cash conversion is strong (OCF/NI 1.95x), supporting earnings quality.
• Balance sheet shows adequate liquidity and strong interest coverage despite moderate leverage.
• ROE at 6.89% is margin-driven; efficiency improvements or margin recovery are needed for uplift.
• Visibility on capital allocation and FCF is limited due to undisclosed investing cash flows and cash balance.

Metrics to Watch:

• Operating margin trajectory and SG&A growth vs revenue in H2.
• OCF drivers: receivables, payables, and deferred revenue movements.
• Take rates/fee yields and transaction volume growth in core platforms.
• Effective tax rate normalization and below-the-line items vs prior year.
• Cash balance and capex/investing outflows to triangulate true FCF.
• Equity ratio (calculated ~28.1%) and any changes in interest-bearing debt.

Relative Positioning: Within Japanese platform/fintech-like service peers, Raccoon exhibits structurally high gross margins and strong cash conversion but slower revenue growth and lower asset turnover, resulting in mid-single-digit ROE absent margin expansion; financial risk appears contained given minimal interest burden, but incomplete disclosures limit comparative precision.

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