Hoosiers Holdings Co.,Ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥34.60B
• Operating Income: ¥329M
• Net Income: ¥245M
• EPS: ¥-23.57

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

Fujiers Holdings (3284) reported FY2026 Q2 consolidated results under JGAAP showing strong top-line growth but materially weaker profitability and negative bottom-line performance. Revenue rose 35.3% YoY to ¥34.6bn, indicating robust project deliveries or sales bookings in the half. Despite higher sales, gross profit was ¥6.24bn with an 18.0% gross margin, which appears modest for a real estate developer and suggests either mix effects, cost inflation, or timing-related margin compression. Operating income declined 41.1% YoY to ¥0.33bn, pointing to operating leverage going the wrong way as SG&A and other cost items outpaced gross profit growth. Ordinary income fell into a ¥0.64bn loss, largely explained by high interest expense of ¥0.70bn that overwhelmed thin operating earnings. Net income was a loss of ¥0.86bn (EPS -¥23.57), with an effective tax rate near zero consistent with losses. EBITDA was ¥1.12bn (3.2% margin), offering limited buffer relative to interest costs and highlighting weak interest coverage. The DuPont profile shows a negative net margin of -2.47%, low asset turnover of 0.164x, and high financial leverage of 4.05x, culminating in a reported ROE of -1.64%. The balance sheet lists total assets of ¥211.2bn and total equity of ¥52.1bn, implying a debt-to-equity ratio of 2.53x, which is elevated but not uncommon in developer models; however, the reported equity ratio of 0.0% reflects a data omission rather than actual zero. Liquidity ratios look strong on paper (current ratio 261%), but inventories are unreported (shown as 0), so the quick/current parity is not economically meaningful for a developer and limits interpretability. Operating cash flow was deeply negative at -¥23.75bn, likely driven by land acquisitions and work-in-progress accumulation ahead of deliveries; financing cash inflow of ¥17.62bn suggests reliance on borrowings to fund working capital. Investing cash flow and cash balances were unreported, constraining a full cash and liquidity assessment. Dividend per share is 0, consistent with losses and sizable funding needs; payout and FCF coverage metrics are not meaningful given data gaps. Overall, H1 shows strong sales momentum offset by margin pressure, rising financing costs, and heavy working-capital absorption, with a back-half recovery dependent on closings and margin realization.

Profitability Analysis

ROE_decomposition: DuPont indicates ROE -1.64% = Net Margin (-2.47%) × Asset Turnover (0.164x) × Financial Leverage (4.05x). The main drag is negative net margin, while asset intensity remains high and leverage amplifies outcomes. margin_quality: Gross margin at 18.0% is modest for a developer and suggests either cost inflation (construction, materials), project mix (lower-margin units), or timing effects (revenue recognized with cost catch-ups). Operating margin compressed to 0.9% (¥329m/¥34.6bn), indicating SG&A and other operating costs grew faster than gross profit. Tax burden is negligible due to losses. operating_leverage: Despite 35.3% revenue growth, operating income fell 41.1% YoY, signaling negative operating leverage this half. This likely reflects higher pre-sales/marketing costs, delivery timing mismatches, and limited gross margin expansion. Interest expense of ¥702m further eroded ordinary earnings, with EBITDA/interest coverage at approximately 1.6x (¥1,120m/¥702m) but EBIT-based coverage only ~0.5x.

Growth Assessment

revenue_sustainability: Top-line growth of +35.3% YoY indicates strong contract take-up or accelerated deliveries; sustainability hinges on the contracted backlog and scheduled handovers in H2, especially for large projects. profit_quality: Revenue growth did not translate into proportional profit growth; gross margin was only 18.0% and operating margin 0.9%. The negative ordinary income underscores sensitivity to financing costs. Profitability depends on H2 mix shift to higher-margin closings and cost control. outlook: With developers, H2 is typically delivery-heavy; a margin and earnings recovery is contingent on closing schedules and construction progress. Elevated interest costs will continue to pressure ordinary profit unless operating earnings expand meaningfully. Cost normalization and price discipline are key to restoring margins.

Financial Health

liquidity: Reported current ratio is 261.2% and working capital ¥94.98bn, but inventories are unreported (shown as 0), making the quick/current equivalence not economically valid for a developer. Liquidity adequacy cannot be fully assessed without cash and inventory details, though the business model relies on inventory and project finance availability. solvency: Total liabilities ¥131.96bn versus equity ¥52.12bn implies D/E of 2.53x and financial leverage (assets/equity) of 4.05x. Interest coverage is weak (EBIT/interest ~0.5x), indicating vulnerability if operating performance does not improve in H2. capital_structure: Funding appears tilted to interest-bearing debt given ¥17.62bn financing inflow to fund -¥23.75bn OCF. The balance sheet scale (assets ¥211.2bn) relative to equity indicates high asset intensity; maintaining covenants will depend on timely project monetization.

Cash Flow Quality

earnings_quality: Negative OCF of -¥23.75bn alongside a net loss of -¥0.86bn yields an OCF/NI ratio reported at 27.78, which is not meaningful given both are negative. For developers, negative OCF can reflect inventory build and land procurement; however, concurrent weak profitability elevates risk. FCF_analysis: Free cash flow is shown as 0 due to unreported investing cash flows; therefore, true FCF cannot be computed. Given large negative OCF, underlying FCF before financing is likely negative absent significant asset sales. working_capital: Working capital increased materially (implied by OCF outflow), likely from land bank additions and WIP build ahead of handovers. The eventual reversal depends on successful closings and collections in H2.

Dividend Sustainability

payout_ratio_assessment: Annual DPS is 0.00 with a payout ratio of 0.0%, appropriate given net losses. With ordinary income negative and interest coverage weak, sustaining dividends would be challenging in the near term. FCF_coverage: With OCF significantly negative and investing CF unreported, FCF coverage cannot be established; indications point to insufficient internal cash generation to fund distributions. policy_outlook: Given the funding needs to support inventory and the priority to stabilize earnings and leverage, capital allocation likely remains conservative, focusing on liquidity and project execution over distributions.

Risk Assessment

Business Risks:

• Housing demand cyclicality and sensitivity to mortgage rates.
• Construction cost inflation and subcontractor availability impacting margins.
• Project concentration risk and timing of handovers causing earnings volatility.
• Price discounting pressure in slower markets affecting gross margins.
• Regulatory/permit and zoning delays impacting delivery schedules.
• Inventory valuation risk in a market downturn.

Financial Risks:

• High leverage (D/E 2.53x) and weak EBIT-based interest coverage (~0.5x).
• Refinancing risk and dependence on continued access to project finance.
• Working-capital liquidity gaps due to large OCF outflows.
• Interest rate increases raising financing costs and lowering ordinary income.
• Covenant breach risk if margins or asset values deteriorate.

Key Concerns:

• Negative ordinary and net income despite strong revenue growth.
• Elevated interest expense relative to operating earnings.
• Large negative operating cash flow requiring debt funding.
• Limited visibility on inventories, cash balances, and investing flows due to unreported items.

Investment Implications

Key Takeaways:

• Top-line growth (+35.3% YoY) did not translate into profit due to margin compression and higher financing costs.
• EBITDA margin (3.2%) and EBIT margin (0.9%) are thin, leaving little cushion against interest expense.
• Leverage is elevated (financial leverage 4.05x; D/E 2.53x), amplifying earnings volatility.
• Operating cash outflow (-¥23.75bn) indicates heavy inventory build/land procurement; H2 monetization is critical.
• Data gaps (inventories, cash, investing CF) constrain a full liquidity assessment; caution in interpreting quick/current ratios is warranted.

Metrics to Watch:

• Contracted backlog and scheduled handovers for H2 and FY close.
• Gross margin trajectory and SG&A-to-sales ratio.
• Ordinary income vs. interest expense; EBIT and EBITDA interest coverage.
• Net debt, available liquidity lines, and covenant headroom.
• Operating cash flow in H2 and inventory turnover (when disclosed).
• Land bank additions and acquisition discipline.

Relative Positioning: Positioned as a leveraged, asset-intensive developer with lower current profitability and weak interest coverage versus typical mid-cap domestic peers; H2 delivery execution and margin recovery are pivotal to closing the gap.

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
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