KICHIRI HOLDINGS & Co.,Ltd. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥4.16B
• Operating Income: ¥264M
• Net Income: ¥67M
• EPS: ¥13.11

Income Statement

Balance Sheet

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

Kichiri Holdings (30820) delivered a strong FY2026 Q1 with clear profit recovery and operating leverage. Revenue rose 14.3% YoY to ¥4,158m, supported by robust same-store trends and/or disciplined pricing and mix improvements implied by margin performance. Gross profit reached ¥2,581.5m, translating to a high gross margin of 62.1%, indicating favorable cost of goods dynamics (food and beverage costs) and product mix. Operating income jumped 124.5% YoY to ¥264m, demonstrating meaningful SG&A leverage on top-line growth. Ordinary income was ¥249m, reflecting modest non-operating costs, including interest expense of ¥6.35m. Net income doubled YoY to ¥148m (+118.4%), with EPS at ¥13.11, underscoring an improved earnings profile. DuPont metrics point to a calculated ROE of 6.76%, driven by a 3.56% net margin, 0.558x asset turnover, and 3.40x financial leverage. The balance sheet shows total assets of ¥7,446m and total liabilities of ¥4,985m, implying an equity base of roughly ¥2,190m and leverage (liabilities/equity) of 2.28x. Liquidity appears adequate with a current ratio of 131% and working capital of ¥796m, suggesting a manageable short-term funding position. Interest coverage is strong at 41.6x, indicating low interest burden relative to operating earnings at the quarterly run-rate. The implied effective tax based on disclosed taxes and profits is around the high teens, consistent with normalized levels. Cash flow figures are not disclosed at the quarter level in the provided XBRL snapshot (zeros reflect non-disclosure), so OCF/FCF assessments rely on earnings quality proxies rather than reported cash data. Dividend was not indicated for the quarter (DPS reported as 0.00, likely timing/non-disclosure), and payout/FCF coverage metrics are therefore not meaningful this period. Overall, the quarter reflects improving profitability, scaling benefits, and controlled financing costs, albeit with limited visibility on cash conversion and capex due to undisclosed CF components. Investors should monitor sustainability of high gross margins, SG&A discipline, and store-level economics to gauge whether the step-up in profitability is durable. Given operating momentum and leverage, incremental gains in margin and asset turnover would flow through to ROE, but tighter cost control is key if growth moderates.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 3.56%
• asset_turnover: 0.558x
• financial_leverage: 3.40x
• calculated_ROE: 6.76%
• commentary: ROE improvement is primarily driven by higher operating margin flow-through (124.5% YoY increase in operating income on 14.3% revenue growth), with asset turnover steady at ~0.56x and leverage at 3.40x amplifying returns. margin_quality: Gross margin at 62.1% is strong for casual dining, implying effective procurement, menu pricing, and mix. The spread between gross and operating margin suggests improved SG&A efficiency YoY. Net margin of 3.56% reflects modest non-operating burden (interest expense ~¥6.35m) and normalized taxation. operating_leverage: Revenue +14.3% YoY vs operating income +124.5% YoY indicates substantial operating leverage from SG&A fixed-cost absorption. Continued leverage is contingent on sustained traffic and pricing; a slowdown could compress margins if fixed costs remain elevated.

Growth Assessment

revenue_sustainability: The double-digit revenue growth likely reflects continued demand normalization and possibly new store contributions, with potential pricing/mix effects given margin strength. Sustainability hinges on same-store sales, capacity utilization, and competitive pricing in urban locations. profit_quality: Operating profit outpaced sales on improved cost discipline, suggesting genuine efficiency gains. Ordinary profit closely tracks operating profit, indicating limited non-recurring effects this quarter. Tax at ~¥46m points to a normalized tax burden, supporting earnings quality. outlook: If high gross margins and SG&A restraint persist, mid- to high-single-digit sales growth could still translate into outsized operating profit growth. Watch for wage and food cost inflation, rent escalations, and any ramp-up in new openings that could temporarily pressure margins.

Financial Health

liquidity: Current assets ¥3,369.9m vs current liabilities ¥2,573.4m yield a current ratio of 131% and working capital of ¥796.5m, indicating adequate short-term liquidity. Quick ratio is shown as 131%, but inventory was not disclosed; treat quick ratio as an approximation. solvency: Total liabilities ¥4,985.2m vs equity ¥2,190.0m imply debt-to-equity (broad liabilities/equity) of 2.28x. Interest coverage at 41.6x suggests manageable financial risk at current earnings levels. capital_structure: Leverage (assets/equity) of 3.40x reflects a moderately levered profile for a restaurant operator. Equity ratio is not disclosed, but implied equity/asset would approximate 29% based on provided totals. notes: Balance sheet subtotals may be affected by rounding or classification timing; use the above ratios as directional.

Cash Flow Quality

earnings_quality: Cash flow statements were not disclosed in the provided dataset for the quarter (zeros indicate undisclosed values). As such, OCF/NI and FCF metrics are not interpretable this period. FCF_analysis: Free cash flow cannot be assessed due to missing OCF and capex data. Given the operating leverage observed, cash conversion will be a key validation point in subsequent quarters. working_capital: Positive working capital of ¥796.5m suggests headroom, but without cash flow details we cannot assess changes in receivables/payables or inventory turns. Monitor payables days and prepayments (e.g., rent) typical in the sector.

Dividend Sustainability

payout_ratio_assessment: Annual DPS is shown as 0.00 and payout ratio as 0.0%, likely reflecting timing or non-disclosure for Q1 rather than a definitive annual policy. EPS for the quarter is ¥13.11. FCF_coverage: FCF coverage cannot be computed due to undisclosed OCF/FCF. Future payout decisions should be evaluated against multi-quarter FCF and leverage targets. policy_outlook: Given leverage and the sector’s need for reinvestment (store refurbishments and openings), a conservative payout stance would be consistent until stable multi-quarter cash generation is confirmed.

Risk Assessment

Business Risks:

• Same-store sales volatility due to consumer sentiment and seasonality
• Food and beverage cost inflation impacting gross margin
• Labor cost pressures and staffing shortages
• Urban rent escalations and lease renewals affecting fixed costs
• Competitive intensity in casual dining and bar concepts
• Execution risk in new store openings/closures and format transitions

Financial Risks:

• Moderate leverage (liabilities/equity ~2.28x) heightening sensitivity to earnings downturns
• Refinancing risk and interest rate exposure, albeit currently low interest burden
• Limited disclosed cash flow data, reducing visibility on cash conversion and capex needs
• Working capital swings (payables/receivables) that could affect short-term liquidity

Key Concerns:

• Sustainability of high gross margin amid input cost volatility
• Maintaining SG&A discipline as growth investments resume
• Visibility on OCF and FCF to support reinvestment and potential shareholder returns

Investment Implications

Key Takeaways:

• Strong profit recovery with significant operating leverage: OI +124.5% on sales +14.3%
• High gross margin (62.1%) supports improved unit economics
• Adequate liquidity (current ratio 131%) and strong interest coverage (41.6x)
• Moderate leverage (2.28x liabilities/equity) magnifies ROE to 6.76%
• Cash flow disclosure is limited this quarter; confirmation of cash conversion is pending

Metrics to Watch:

• Same-store sales growth and traffic vs pricing/mix
• Food cost and labor cost ratios (gross margin drivers)
• SG&A ratio trajectory and store-level EBITDA margins
• Net openings/closures and capex per store
• Operating cash flow, capex, and FCF once disclosed
• Effective tax rate and interest expense trend

Relative Positioning: Within Japan’s casual dining peer set, the quarter shows above-peer margin momentum and healthy coverage ratios, with leverage and limited near-term cash flow disclosure being areas to monitor.

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