| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥11174.4B | ¥10616.3B | +5.3% |
| Operating Income / Operating Profit | ¥849.4B | ¥820.8B | +3.5% |
| Ordinary Income | ¥898.5B | ¥862.7B | +4.2% |
| Net Income / Net Profit | ¥167.8B | ¥200.1B | -16.2% |
| ROE | 3.1% | 3.8% | - |
For the fiscal year ended March 2026, Revenue was ¥11174.4B (YoY +¥558.1B +5.3%), Operating Income was ¥849.4B (YoY +¥28.6B +3.5%), Ordinary Income was ¥898.5B (YoY +¥35.8B +4.2%), and Net Income attributable to owners of the parent was ¥557.8B (YoY -¥34.3B -16.2%). Revenue growth was driven by recovery in customer traffic at existing stores and expansion in the healthcare & beauty categories; gross margin held at 35.2% year-on-year. Operating Income growth lagged Revenue due to an increase in SG&A expenses (+6.5%), resulting in an Operating Margin of 7.6% (down 0.1pt from 7.7% in the prior year). Net Income declined significantly by 16.2% year-on-year due to special losses including income taxes of ¥319.0B (effective tax rate 36.3%) and impairment losses of ¥16.8B, though operating and ordinary income stages maintained a solid profit-increase trend.
[Revenue] Revenue of ¥11174.4B (YoY +5.3%) was led by the Matsumoto Kiyoshi Group Business at ¥7110.3B (+6.6%), comprising 63.6% of total. The Cocokara Fine Group Business recorded ¥3899.8B (-0.3%), a slight decline, comprising 34.9%. The And Company Business, consolidated from Q3, newly contributed ¥129.5B (1.2% of total). Management Support Business external sales were limited to ¥3.53B, mainly handling intra-group transactions. The primary drivers of the revenue increase were recovery in existing-store customer numbers and steady demand for prescriptions and healthcare, with inbound demand contributing partially.
[Profitability] Gross profit was ¥3937.8B (gross margin 35.2%), broadly flat year-on-year, supported by mix effects from private brand products and higher-value categories. SG&A expenses were ¥3088.5B (27.6% of sales), up +6.5% YoY; key drivers were salaries and allowances ¥1126.2B (+7.0%), rents ¥793.4B (+6.7%), and goodwill amortization ¥66.8B (+3.0%). Structural increases in labor and rent pushed up SG&A ratio slightly, resulting in an Operating Margin of 7.6% (down 0.1pt from 7.7% prior). Net non-operating income of ¥51.8B (including dividend income ¥4.6B and other ¥12.6B) less non-operating expenses of ¥2.6B yielded Ordinary Income of ¥898.5B (+4.2%). Special gains were ¥6.1B (gain on sale of investment securities ¥5.9B) and special losses ¥24.6B (including impairment loss ¥16.8B and loss on disposal of fixed assets ¥4.1B), leading to Profit Before Tax of ¥880.1B. After income taxes of ¥319.0B (effective tax rate 36.3%), Net Income was ¥167.8B, while Net Income attributable to owners of the parent was ¥557.8B (YoY -16.2%). In summary, the company achieved revenue and operating/ordinary income growth, but Net Income decreased due to special losses and tax burden.
The Matsumoto Kiyoshi Group Business posted Operating Income of ¥608.2B (YoY +4.9%, Operating Margin 8.5%), representing 71.6% of consolidated Operating Income and maintaining solid profit growth as the core business. The Cocokara Fine Group Business recorded Operating Income of ¥234.6B (-1.5%, Operating Margin 6.0%), a slight decline, composing 27.6% of the total. The newly consolidated And Company Business reported Operating Income of ¥2.0B (Operating Margin 1.5%) and is in the startup phase. The Management Support Business saw Operating Income of ¥171.4B (-15.1%, Operating Margin 2.5%), a decline reflecting cost reallocation with company-wide optimization. Margin dispersion across segments is large, with Matsumoto Kiyoshi’s high profitability driving consolidated margins.
[Profitability] Operating Margin of 7.6% decreased 0.1pt from 7.7% but remained high, as the rise in SG&A ratio was absorbed by revenue growth. ROE was 3.1% (prior year 3.9%), primarily due to a decline in Net Profit Margin to 1.5% (prior year 1.9%). ROA (on Ordinary Income basis) improved to 12.2% from 12.0% prior, helped by a high Total Asset Turnover of 1.48x. EBITDA was ¥1,019B (Operating Income ¥849B + depreciation ¥170B), and an EBITDA margin of 9.1% indicates solid performance. [Cash Quality] Operating Cash Flow (OCF) was ¥732.0B, 4.36x Net Income ¥167.8B (1.31x compared with Net Income attributable to owners of the parent ¥557.8B), indicating strong cash generation, though working capital outflows from inventory increase ¥105.6B and accounts receivable increase ¥79.2B occurred. OCF/EBITDA ratio of 0.72x reflects heavy inventory and has room for improvement. [Investment Efficiency] EPS was ¥139.94 (up from ¥133.85, +4.5%), BPS was ¥1,365.78, indicating a solid build in equity serving as the basis for PBR (current share price ÷ BPS). Total asset turnover of 1.48x is high for retail, supporting profitability through asset efficiency. [Financial Soundness] Equity Ratio was 72.0% (prior 73.1%), an extremely high level; Current Ratio 220.8%, Quick Ratio 132.7% indicate ample short-term liquidity. Interest-bearing debt is limited to short-term borrowings ¥18.8B and lease liabilities ¥11.5B, and Cash and Deposits of ¥1,197.5B result in Net Cash of ¥1,167.2B, effectively debt-free.
Operating Cash Flow was ¥732.0B (down -10.2% from ¥814.7B prior). Starting from Profit Before Tax ¥880.1B, addbacks included Depreciation ¥169.8B and goodwill amortization ¥66.8B as non-cash charges. Changes in working capital caused outflows: inventory increase ¥105.6B and accounts receivable increase ¥79.2B, partially offset by accounts payable increase ¥68.9B. After payment of income taxes ¥304.5B, OCF after working capital adjustments was ¥732.0B (from an OCF subtotal of ¥1,026.5B). Investing Cash Flow was -¥342.2B, mainly capital expenditures ¥132.7B, acquisition of intangible assets ¥68.7B, and acquisition of subsidiary shares ¥102.6B. Free Cash Flow was ¥389.8B (OCF + Investing CF), a healthy level. Financing Cash Flow was -¥341.4B, reflecting share buybacks ¥153.0B and dividend payments ¥188.6B as shareholder returns. Cash and cash equivalents rose ¥79.2B from ¥1,117.5B at the beginning of the period to ¥1,196.7B at year-end, leaving ample liquidity. The OCF / Net Income multiple was 4.36x (1.31x on a Net Income attributable to owners of the parent basis), indicating high quality of earnings, but OCF/EBITDA ratio of 0.72x reflects inventory inefficiency; next fiscal year focus should be on inventory compression and improving cash conversion.
Of Ordinary Income ¥898.5B, Non-operating income ¥51.8B (0.46% of Revenue) is minor and mainly consists of interest income ¥3.1B and dividend income ¥4.6B, indicating a stable income structure. Extraordinary items resulted in net special losses of -¥18.5B (special gains ¥6.1B — gain on sale of investment securities ¥5.9B; special losses ¥24.6B — impairment loss ¥16.8B, loss on disposal of fixed assets ¥4.1B), so the temporary impact on Net Income is limited. OCF materially exceeds Net Income (OCF ¥732.0B ÷ Net Income attributable to owners of the parent ¥557.8B = 1.31x), and the accrual ratio ((Net Income - OCF) / Total Assets) is -7.6%, a low level indicating high quality of earnings. However, OCF/EBITDA ratio of 0.72x is pressured by inventory increases, and working capital management will determine sustainability. Comprehensive Income was ¥580.8B, substantially above Net Income ¥167.8B, contributed by Other Securities Valuation Difference ¥18.5B and Foreign Currency Translation Adjustments ¥1.2B, primarily due to Net Income attributable to owners of the parent ¥557.8B. The divergence between Ordinary Income and Net Income is due to tax burden and special losses; structural distortion is limited.
Full-year guidance projects Revenue ¥11550.0B (YoY +3.4%), Operating Income ¥875.0B (+3.0%), Ordinary Income ¥915.0B (+1.8%), Net Income attributable to owners of the parent ¥590.0B (+5.8%), and EPS ¥148.02. Actuals achieved Revenue ¥11174.4B (achievement rate 96.7%), Operating Income ¥849.4B (97.1%), Ordinary Income ¥898.5B (98.2%), showing progress in line with plan. Net Income achievement rate was 94.5%, slightly below forecast, possibly affected by the timing of special loss recognition. Remaining shortfall relative to the full-year forecast corresponds to the remaining Q4, and continued revenue growth plus normalization of SG&A should keep forecast achievement within reach. Dividend forecast is ¥28 per year, which is below the actual dividend of ¥50 (interim ¥24 + year-end ¥26).
Annual dividend was ¥50 (interim ¥24 + year-end ¥26), yielding a Payout Ratio of 35.7% against EPS ¥139.94. Based on Net Income attributable to owners of the parent ¥557.8B, the total dividend amount equates to approximately ¥199.3B, implying a payout ratio of about 35.7%. Actual dividend paid was ¥188.6B, giving a payout ratio of 32.9% (dividend paid ÷ Net Income attributable to owners of the parent). Share buybacks amounted to ¥153.0B, and combined with dividends total shareholder returns were ¥341.6B, representing a Total Return Ratio of 61.2% relative to Net Income attributable to owners of the parent. Free Cash Flow of ¥389.8B comfortably covers total returns, indicating high sustainability of shareholder returns. With Cash and Deposits ¥1,197.5B and an effectively debt-free balance sheet, the company can simultaneously maintain stable dividends and execute opportunistic buybacks.
Inventory efficiency deterioration risk: Inventories of ¥1,600.0B increased +10.9% YoY, and Days Inventory Outstanding is approximately 81 days (Inventories ÷ Cost of Goods Sold × 365), a heavy level. If inventory accumulation continues beyond seasonal causes, markdown pressure could reduce gross margin and trigger impairment losses, potentially further depressing the OCF/EBITDA ratio of 0.72x. SKU optimization and improved demand forecasting to compress inventory are urgent.
Margin pressure from rising fixed costs: Salaries and allowances ¥1,126.2B (+7.0%) and rents ¥793.4B (+6.7%) are increasing faster than Revenue growth (+5.3%). Structural increases in labor and rent have high persistence and could drive down Operating Margin if revenue growth slows. Investment in digitization/automation and labor scheduling optimization are needed to contain SG&A ratio.
Impairment risk for goodwill and intangible assets: Goodwill of ¥983.1B (18.1% of equity) and intangible fixed assets ¥1,296.3B (17.2% of total assets) are recorded, posing impairment risk if operating conditions deteriorate. In particular, goodwill attributable to the Cocokara Fine Group Business of ¥930.3B (94.6% of total goodwill) assumes maintenance of that segment’s Operating Margin of 6.0%. Monitoring store profitability and realizing integration synergies are key to avoiding impairments.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 7.6% | 4.6% (1.7%–8.2%) | +3.0pt |
| Net Profit Margin | 1.5% | 3.3% (0.9%–5.8%) | -1.8pt |
Operating Margin exceeds the industry median by 3.0pt, reflecting highly efficient operations for a major drugstore chain. Net Profit Margin is 1.8pt below the median, partly due to special losses and high tax burden.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 5.3% | 4.3% (2.2%–13.0%) | +1.0pt |
Revenue growth outperformed the median by 1.0pt, driven by existing-store recovery and contributions from new businesses.
※ Source: Company compilation
Notable is the combination of top-tier industry profitability with an Operating Margin of 7.6%, effectively debt-free management (Net Cash ¥1,167.2B), and strong shareholder return capacity (Total Return Ratio 61.2%, FCF coverage 1.90x). High financial soundness—Equity Ratio 72.0% and Current Ratio 220.8%—provides resilience to external shocks and flexibility for growth investment and enhanced returns.
Days Inventory Outstanding of 81 days and OCF/EBITDA ratio of 0.72x lag peer leaders; improving inventory efficiency is key to preserving margins and enhancing cash conversion. Working capital outflows (Inventory +¥105.6B, Accounts Receivable +¥79.2B) pressured OCF; successful SKU optimization and improved demand forecasting could generate additional OCF and expand dividend/share buyback capacity.
This report was auto-generated by AI analyzing XBRL financial statement data to produce an earnings analysis. 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 statements. Investment decisions are your own responsibility; consult a professional advisor as necessary.