These are mechanically computed values based on a residual income model. They are not a forecast of market prices or a recommendation of any investment action, and do not predict or guarantee future share prices. Historical values are computed retrospectively using current guidance-achievement statistics.
| Metric | Current Period | Same Period of Prior Year | YoY |
|---|---|---|---|
| Revenue | ¥66.3B | ¥60.1B | +10.4% |
| Operating Income | ¥6.2B | ¥5.5B | +10.8% |
| Ordinary Income | ¥7.2B | ¥6.3B | +15.8% |
| Net Income | ¥4.8B | ¥4.0B | +20.8% |
| ROE | 3.5% | 3.0% | - |
The key point this quarter was that, in addition to higher revenue and earnings, cost efficiencies absorbed the decline in gross margin. Revenue was ¥66.3B (+10.4% YoY), Operating Income was ¥6.2B (+10.8%), Ordinary Income was ¥7.2B (+15.8%), and Net Income was ¥4.8B (+20.8%), with the magnitude of earnings growth expanding at each level. Although the gross margin declined from the prior year to 66.1%, an improvement in the SG&A expense ratio offset this decline, allowing the Operating Income margin to remain at 9.3%.
【Revenue】Revenue was ¥66.3B, representing a 10.4% YoY increase. The Food and Beverage Business, which is the sole reportable segment, was the main contributor, and expanding demand in the existing business appears to have driven the revenue growth.
【Profit and Loss】Gross profit was ¥43.8B. Although the gross margin of 66.1% declined from the prior year, SG&A expenses grew at a slower pace than revenue (+7.8%), improving the SG&A expense ratio to 56.8%. As a result, Operating Income expanded to ¥6.2B (+10.8%), outpacing the revenue growth rate, indicating positive operating leverage. Driven by ¥1.1B in non-operating income, including compensation income, Ordinary Income reached ¥7.2B (+15.8%). Extraordinary gains and losses were immaterial (net gain of +¥0.18B), and Net Income of ¥4.8B (+20.8%) was based largely on recurring earnings. Both revenue and earnings increased.
The reportable segments consist solely of the “Food and Beverage Business”; disclosure of the “Construction and Interior Business” and “Investment Business” has been omitted because they are not material. Accordingly, the analysis of changes by business is based on consolidated company-wide metrics rather than comparisons between segments.
【Profitability】The Operating Income margin was 9.3%, showing a slight improvement from the prior year, while the Net Income margin increased to 7.2%. Although the gross margin declined from the prior year to 66.1%, the improvement in the SG&A expense ratio to 56.8% absorbed the impact.【Cash Flow Quality】Non-operating income was limited to 1.6% of revenue, and extraordinary gains and losses were also immaterial. Accordingly, most earnings were generated by the core business, indicating good earnings quality.【Investment Efficiency】ROE was 3.5%. Improvements in the total asset turnover ratio of 0.387x and the Net Income margin of 7.2% contributed to the increase, while the high equity base, reflected in an Equity Ratio of 79.4%, expanded the denominator, leaving ROE at a low level.【Financial Soundness】With an Equity Ratio of 79.4%, cash and deposits of ¥114.9B, and current liabilities of ¥27.8B, both liquidity and the capital structure are at extremely conservative levels.
Although a separate cash flow statement disclosure is not available, an analysis of balance sheet trends indicates that cash and deposits were ¥114.9B, remaining almost flat compared with ¥115.8B in the prior year. On the liabilities side, income taxes payable declined significantly from ¥6.6B in the prior year to ¥2.1B, while total liabilities contracted from ¥39.4B to ¥35.2B. This reflects progress in tax payments and can be viewed as an indication of stable cash management. Accounts receivable and notes receivable were ¥4.9B, down from the prior year; the progress in collections despite the increase in revenue suggests an improvement in working capital efficiency.
Net Income of ¥4.8B was calculated by adding Operating Income of ¥6.2B and non-operating income of ¥1.1B, including ¥0.2B in compensation income, and adding and subtracting extraordinary income of ¥0.2B and extraordinary losses of ¥0.05B. Non-operating income was limited to 1.6% of revenue, indicating a high degree of reliance on the core business. The difference between Ordinary Income of ¥7.2B and Net Income of ¥4.8B was primarily attributable to ¥2.6B in income taxes and other taxes, resulting in an effective tax rate of 35.5%, a normal level. Extraordinary gains and losses were also immaterial, indicating that the earnings growth for the period was not driven by temporary factors but by an improvement in recurring earnings power.
Q1 progress against the full-year forecasts of revenue of ¥285.5B, Operating Income of ¥31.3B, and Ordinary Income of ¥34.5B was approximately 23.2%, 19.7%, and 21.0%, respectively. Compared with simple one-quarter progress of 25%, revenue was behind by -1.8pt and Operating Income by -5.3pt, indicating that earnings are progressing somewhat more slowly. There were no revisions to the earnings forecast or dividend forecast, and management maintained its full-year plan of +10.2% revenue growth and +4.4% Operating Income growth. The Q1 Operating Income growth rate (+10.8%) exceeded the full-year plan (+4.4%), suggesting potential upside to the full-year plan, excluding the effects of seasonality and expense allocation.
The full-year dividend forecast is ¥32 per share. Based on forecast EPS of ¥230.1, the Payout Ratio is approximately 13.9%, remaining at a conservative level. There has been no revision to the dividend forecast. The substantial net cash position, with cash and deposits of ¥114.9B, and the high capital flexibility reflected in an Equity Ratio of 79.4% provide a foundation supporting dividend sustainability.
Risk of continued pressure on the gross margin: The gross margin was 66.1%, a decline of -1.35pt from the prior year. If fluctuations in raw material and energy costs or product mix continue, it may become more difficult to offset the impact through SG&A efficiency improvements.
Risk of dependence on a single business: The only reportable segment is the Food and Beverage Business, while the Construction and Interior Business and Investment Business are not material. The concentration of the business portfolio in a single segment is a structural characteristic.
Low capital efficiency: ROE was 3.5%, a low level relative to the substantial equity base represented by an Equity Ratio of 79.4%. The company’s policy for utilizing ¥114.9B in cash and deposits could affect capital efficiency going forward.
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Income Margin | 9.3% | 3.3% (0.9%–7.7%) | +6.0pt |
| Net Income Margin | 7.2% | 2.2% (0.3%–6.1%) | +5.0pt |
Both the Operating Income margin and Net Income margin are well above the industry median, placing profitability in the upper tier of the industry.
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 10.4% | 7.5% (0.4%–14.5%) | +2.9pt |
The revenue growth rate exceeds the industry median but remains below the upper bound of the IQR (14.5%), placing the company in the upper-middle range of the industry.
※Source: Based on our research
The improvement in the SG&A expense ratio (-1.38pt) almost completely offset the decline in the gross margin (-1.35pt), allowing the Operating Income margin to remain at 9.3%. This is a structural characteristic demonstrating the effectiveness of cost management.
Q1 progress toward the full-year plan was 19.7% for Operating Income, below simple progress of 25%, and may reflect seasonality and the timing of expense allocation. Progress from Q2 onward will be a continued focus of financial results monitoring.
Despite the strong financial base represented by an Equity Ratio of 79.4% and cash and deposits of ¥114.9B, ROE remained at 3.5%. The direction of capital utilization will therefore remain a structural issue to monitor.
This is a reference range mechanically calculated solely from publicly disclosed data using a residual income model (Ohlson-type model with an explicit five-year fade). It is not a forecast of the market price or a recommendation to take any specific investment action.
| Scenario | Theoretical Stock Price |
|---|---|
| bear | ¥1,541 |
| base | ¥1,663 |
| bull | ¥1,730 |
| Calculation Assumption | Value |
|---|---|
| Book Value per Share (BPS) | ¥1,326 |
| Adjusted Forecast EPS | ¥236.4 |
| Cost of Equity r | 9.77% (10-year Japanese government bond 2.77% + equity risk premium 6.00% + size premium 1.00%) |
| Residual Income Persistence Coefficient ω / Explicit Forecast Period | 0.62 / 5 years |
| Assumed Payout Ratio | 13.9% |
| Forecast EPS Confidence Adjustment | ×1.028 (based on the track record of guidance achievement among peer companies in the same industry) |
| implied PBR / PER |
Sensitivity: ¥1,614–¥1,714 at ±1% for the cost of equity, and ¥1,654–¥1,676 at ±0.1 for ω.
Note:
(Calculation model: Residual income model / Interest rate reference month: 2026-07 / This value does not predict or guarantee future stock prices)
This report is an earnings analysis document automatically generated by AI based on XBRL financial results data. It does not recommend investment in any specific security. The industry benchmarks are reference information compiled by our company based on publicly disclosed financial results data. Investment decisions should be made at your own responsibility, after consulting with a professional advisor as necessary.
---End of Report---
| 1.25x / 7.0x |