Yashima Denki Co.,Ltd. FY2026 FY Earnings Report

クイックビュー

Executive Summary

For FY2026, Revenue was 745.7B (+84.9B YoY +12.9%), Operating Income was 72.9B (+20.4B +38.8%), Ordinary Income was 74.4B (+20.6B +38.4%), and Net Income was 39.6B (+7.3B +22.6%). Operating margin improved to 9.8% from 7.9% a year earlier, a 1.9pt improvement, with revenue and profit growth across all segments. Gross margin rose to 24.3% from 22.2% a year earlier (+2.1pt), driven by improved project profitability and a higher mix of the Plant Business. Operating Cash Flow was 62.1B (+78.1% YoY), showing a substantial improvement in cash generation, while an increase in inventories centered on work-in-progress of 24.3B temporarily weighed on working capital. ROE improved to 10.9% due to expansion in net profit margin, and Equity Ratio remained healthy at 49.9%.

業績変動要因

[Revenue] Revenue reached 745.7B (+12.9%), achieving double-digit growth. By segment, the Plant Business was 288.2B (+7.8%) with a high margin of 17.4%, and the Public & Facilities Business was the largest growth driver at 328.9B (+20.8%). The Transportation Business also performed steadily at 161.3B (+11.1%), with broad-based project wins contributing. By region, domestic sales account for over 90%, with both public investment and private capital expenditure supporting demand. Contract liabilities increased to 40.4B from 21.5B a year earlier, up 18.9B, indicating accumulated advance receipts serving as short-term revenue source.

[Profitability] Gross profit was 181.5B (gross margin 24.3%) versus 146.9B (22.2%) a year earlier, a 2.1pt improvement. This was driven by a higher share of high-margin Plant Business projects and disciplined price pass-through and cost control. SG&A was 108.6B (SG&A ratio 14.6%) versus 94.4B (14.3%) a year earlier, up 14.3B, mainly due to higher personnel costs: salaries and allowances 44.1B (+3.2B), bonus accruals up 0.25B, and retirement benefit costs 3.4B (+1.5B). Goodwill amortization increased to 0.7B from 0.2B but had limited impact on Operating Income. Non-operating items were neutral with non-operating income 1.6B and non-operating expenses 0.1B, including dividend income received of 0.4B. Extraordinary items were minor: extraordinary gains 0.1B (gain on sale of investment securities) and extraordinary losses 0.3B (loss on retirement of fixed assets). Income taxes amounted to 22.3B (effective tax rate 30.1%), within a normal range. After deducting non-controlling interests of 0.4B, Net Income attributable to owners of the parent was 39.6B. In conclusion, revenue and profit growth was achieved through top-line increases and gross margin improvement across all segments.

セグメント別分析

The Plant Business recorded Revenue of 288.2B (+7.8%) and Operating Income of 50.1B (+17.9%), maintaining the highest profitability with an operating margin of 17.4%. Demand for electrical control, power generation equipment, and energy-saving/environmental technology products remained robust, and a higher mix of high-value-added projects pushed up margins. The Public & Facilities Business posted Revenue of 328.9B (+20.8%) and Operating Income of 37.3B (+59.4%), with an operating margin of 11.4%. Large project wins in monitoring & control systems, substation systems, and HVAC drove a large increase in revenue, and improved project profitability also contributed to margin expansion. The Transportation Business achieved Revenue of 161.3B (+11.1%) and Operating Income of 15.7B (+17.0%), with an operating margin of 9.8%. Stable demand persisted for vehicle electrical components, substation equipment, and station maintenance, and the business absorbed 0.7B of goodwill amortization to generate higher profits. All segments posted revenue and profit growth, realizing balanced growth across the business portfolio.

主要財務指標

[Profitability] Operating margin of 9.8% improved 1.9pt from 7.9% a year earlier, primarily due to improvement in gross margin to 24.3% (22.2% prior year). ROE of 10.9% rose from the prior year due to expansion in net profit margin. Return on Assets (ROA) was 10.9%, remaining at a high level. [Cash Quality] Operating Cash Flow (OCF) of 62.1B is 1.57x Net Income of 39.6B, indicating good cash backing of profits, but OCF/EBITDA (Operating Income + Depreciation) was 0.79x, temporarily suppressed by inventory increases. [Investment Efficiency] Capital expenditures were 2.4B, only 40% of depreciation expense of 6.0B, reflecting a conservative investment stance. Intangible asset acquisitions were 14.8B, indicating active software investment. [Financial Soundness] Equity Ratio 49.9%, Current Ratio 159.3%, Quick Ratio 144.2% indicate good liquidity. Interest-bearing debt was 7.5B (short-term borrowings 7.0B + long-term borrowings 0.5B) versus cash and deposits of 174.5B, resulting in net cash and Debt/EBITDA of 0.10x, an extremely healthy level.

キャッシュフロー分析

Operating Cash Flow was 62.1B, up 78.1% from 34.8B a year earlier, and generated an operating cash subtotal before working capital changes of 84.2B from profit before tax and other adjustments of 74.2B. Within working capital, decreases in trade receivables of 25.7B contributed positively, while inventory increase of 24.3B (mainly accumulation of WIP) and decrease in accounts payable of 5.0B were offsetting factors. After payment of income taxes of 22.7B, OCF was 62.1B, 1.57x Net Income of 39.6B, demonstrating solid cash generation. Investing Cash Flow was ▲38.3B, primarily due to capex 2.4B, intangible asset acquisitions 14.8B, net increase in time deposits 4.8B, and acquisition of subsidiary shares 9.1B. Sale of investment securities 0.6B and acquisition 1.0B were roughly offset. Free Cash Flow was positive at 23.8B. Financing Cash Flow was ▲8.2B, mainly dividend payments 7.6B (including 0.1B to non-controlling interests), net increase in short-term borrowings 0.1B, long-term borrowings repayments 0.5B, and proceeds from disposal of treasury stock 3.6B. Cash and cash equivalents increased by 15.6B from 148.7B at the beginning of the period to 164.3B at the end, maintaining ample liquidity.

収益の質

Ordinary Income of 74.4B comprises Operating Income of 72.9B plus non-operating income of 1.6B (including dividend income received of 0.4B), so the contribution of non-operating items was a modest and recurring 1.5B. Extraordinary items were 0.1B of net gains (gain on sale of investment securities 0.1B and loss on retirement of fixed assets 0.2B net), indicating limited one-off effects. Comprehensive income was 59.3B, 19.7B higher than Net Income of 39.6B, reflecting other comprehensive income of 4.3B from valuation differences on available-for-sale securities, actuarial adjustments related to retirement benefits of 3.1B, and 0.4B attributable to non-controlling interests. The increase in valuation differences on securities boosted comprehensive income, but this is unrealized gain on holdings and does not affect cash flow. On the accrual side, OCF of 62.1B was below Operating Income of 72.9B, and the inventory increase of 24.3B was a temporary absorption of working capital that warrants attention. Days Sales Outstanding (DSO) is approximately 123 days, up from a year earlier, reflecting larger and longer-term projects and extended collection periods. Overall, earnings are largely derived from core operations and are recurring, but improvements in working capital management are key to enhancing cash quality.

業績予想・ガイダンス

For FY2027, full-year forecasts are: Revenue 780.0B (+4.6% YoY), Operating Income 79.0B (+8.4%), Ordinary Income 80.0B (+7.6%), and Net Income 54.5B (+5.8%; based on current period 39.6B this implies +37.6%). Progress rates stand at 95.6% for Revenue, 92.3% for Operating Income, and 93.0% for Ordinary Income, indicating a second-half weighted pattern but steady performance. The company plan is based on conservative assumptions; given current gross margin improvements and ongoing profit growth by segment, achievability is high. Forecast EPS is ¥254.57 versus current-period actual ¥241.62, so additional profit accumulation is required in H2, but the release of contract liabilities of 40.4B and backlog progress should provide support. Dividend forecast is year-end 56 yen (regular dividend 50 yen + 80th anniversary commemorative dividend 6 yen), an increase from current-period 45 yen. Forecast payout ratio is 23.5% up from 19.1% this period, and given FCF generation and accumulation of equity, this is a sustainable level. On a full-year basis, if OCF remains at current levels, FCF should remain positive after dividend payments.

株主還元

Year-end dividend was 45 yen (composition: regular dividend 43 yen + 80th anniversary commemorative dividend 2 yen), with a payout ratio of 19.1%. Total dividend payments were 7.6B versus Free Cash Flow of 23.8B, giving FCF coverage of 3.1x and ample room. For FY2027, the company plans an increased year-end dividend of 56 yen (regular 50 yen + commemorative 6 yen), raising the payout ratio to an estimated 23.5%. Treasury stock decreased from 4.9B at the beginning of the period to 3.6B at the end, with 3.6B of treasury stock disposals reclassified to capital surplus. No share buybacks were executed; shareholder returns consist only of dividends, and the 19–24% payout ratio range is conservative. Retained earnings increased to 321.1B from 277.3B a year earlier (+43.8B), supporting future return capacity. With cash of 174.5B, Free Cash Flow of 23.8B, and low leverage (Debt/EBITDA 0.10x), dividend sustainability is high and there is room for future dividend increases.

リスク要因

1. Working capital management risk: Inventories are 54.2B, up 27.4B from 26.8B a year earlier (+102.5%). Mainly due to accumulation of WIP, mismatches in project progress and acceptance timing have temporarily tightened working capital. DSO at approximately 123 days has lengthened from the prior year, and if collection periods continue to extend due to larger and longer projects, volatility in OCF could increase.

2. Dependence on public investment and capex cycles: Over 90% of sales are domestic and the Public & Facilities Business accounts for 44% of total revenue. If public investment budgets are cut or private-sector capex is restrained, order declines and project delays could materialize. While contract liabilities of 40.4B serve as short-term revenue source, medium-to-long-term order trends will determine performance.

3. Rising personnel costs and expense management risk: SG&A increased to 108.6B, up 14.3B YoY (+15.1%), outpacing revenue growth of 12.9%. Increases in salaries and allowances, bonus accruals, and retirement benefit costs are the main drivers. If competition for talent intensifies and wage pressure continues, the pace of operating margin improvement could slow. Tangible investment is restrained with capex 2.4B versus depreciation 6.0B, but amortization burden from aggressive intangible investment of 14.8B could become a future cost-increase factor.

業種ベンチマーク（参考・当社調べ）

収益性・リターン

Profitability ranks in the upper tier within the industry, with both operating margin and net margin substantially above medians.

成長性・資本効率

Revenue growth exceeds the industry median by 7.1pt, indicating high growth among peers.

※Source: Company aggregation

決算上の注目ポイント

1. Structural improvement in profitability: Operating margin improved to 9.8% from 7.9% (+1.9pt), primarily due to gross margin increase to 24.3% (22.2% prior year). A higher share of high-margin Plant Business projects and disciplined price pass-through and cost control drove this, with margin improvements across all segments. Versus industry benchmarks, operating margin is +6.4pt and net margin +3.0pt, reflecting a clear advantage; as long as this profit structure persists, it should raise the floor for ROE.

2. Financial soundness and shareholder return capacity: Equity Ratio 49.9%, Debt/EBITDA 0.10x, and cash 174.5B indicate an extremely solid financial base. Payout ratio 19.1% and FCF coverage 3.1x show strong shareholder return capacity, and the planned dividend increase to year-end 56 yen for FY2027 is within sustainable bounds. Accumulation of retained earnings of 321.1B and low leverage provide flexibility for future dividend increases or share buybacks.

3. Improving working capital efficiency is key: Inventories +27.4B (mainly WIP) and extended DSO have temporarily suppressed OCF. OCF/EBITDA remains at 0.79x, so project progress/acceptance management and shortening collection periods are crucial for next-period cash quality improvement. While contract liabilities of 40.4B will serve as short-term revenue source when released, WIP accumulation suggests revenue recognition may be deferred, warranting attention to quarterly CF volatility.

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This report is an earnings analysis document automatically generated by AI based on XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmark figures are reference information compiled by the Company based on public financial statements. Investment decisions are your responsibility; please consult an expert as necessary before making investment decisions.