Mirairo Inc. FY2025 Q4 Earnings Report

Financial Highlights

• Net Sales: ¥832M
• Operating Income: ¥142M
• Net Income: ¥81M
• EPS: ¥9.15

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

Mirairo (335A0) reported strong topline and operating performance for FY2025 Q4 on a non-consolidated JGAAP basis, with revenue up 17.3% YoY to ¥832m and operating income up 21.6% to ¥142m. Gross margin remained high at 55.3%, signaling solid pricing and mix or favorable cost control, while operating margin expanded to 17.1%. Despite healthy operating metrics, net income fell 54.4% YoY to ¥81m, indicating material non-operating or extraordinary drags under JGAAP classification. Ordinary income of ¥123m sits below operating income, implying net non-operating expenses; combined with a reported negative tax line (tax credit of ¥57.5m), the bridge from ordinary income to net income suggests sizable extraordinary losses in the period. The DuPont profile shows a 9.74% net margin, 0.711x asset turnover, and 1.33x financial leverage, yielding a calculated ROE of 9.19%. Liquidity is robust with a current ratio of 231.7% and working capital of ¥306m, indicating ample short-term coverage. Leverage appears modest with debt-to-equity of 0.41x and very strong interest coverage of 45x, reflecting manageable financial risk. Cash generation quality is solid: operating cash flow of ¥179m is 2.21x net income, and free cash flow of ¥138m is positive after ¥41m investing outflows. Financing cash inflow of ¥344m indicates external capital access, but without cash balance disclosure, period-end liquidity buffers cannot be precisely assessed. EPS was ¥9.15; based on this and net income, the implied basic share count is roughly 8.9 million, although outstanding shares were not disclosed in XBRL. The reported equity ratio of 0.0% is clearly an undisclosed value, not an actual ratio; balance sheet figures imply an equity ratio around 75% (¥881m equity / ¥1,171m assets). Dividend data are not disclosed (DPS and payout shown as 0.00 are placeholders), so distribution policy cannot be inferred from this filing alone. Overall, operating fundamentals and cash conversion are healthy, but headline net income volatility due to extraordinary items and tax normalization requires monitoring. Given the non-consolidated scope and several undisclosed items (equity ratio, cash, shares, dividends), conclusions rely on available non-zero data and standard JGAAP bridge logic.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 9.74% (¥81m / ¥832m)
• asset_turnover: 0.711x (¥832m / ¥1,171m)
• financial_leverage: 1.33x (¥1,171m / ¥881m)
• calculated_ROE: 9.19% (matches reported) margin_quality: Gross margin at 55.3% underscores strong value-add and/or low direct cost intensity. Operating margin of 17.1% (¥142m / ¥832m) expanded faster than revenue (+21.6% OI vs +17.3% sales), suggesting positive operating leverage and cost discipline. Ordinary margin of 14.8% trails operating margin, indicating net non-operating expense. Net margin of 9.7% is depressed by extraordinary losses despite a tax credit. operating_leverage: Revenue growth of +17.3% yielded operating income growth of +21.6%, evidencing operating leverage. EBITDA margin of 20.4% (¥169.7m) and modest D&A (¥27.7m) indicate a relatively light asset base supporting scalability.

Growth Assessment

revenue_sustainability: Double-digit sales growth (+17.3%) reflects healthy demand; sustainability will depend on order intake, retention, and mix given a service-heavy gross margin profile. profit_quality: Core profitability improved at the operating level, but net income declined 54.4% due to non-operating/extraordinary factors. The negative tax line suggests timing-related credits rather than structural tax rate changes; underlying earnings quality is better reflected by operating and ordinary income. outlook: With high gross and operating margins and strong OCF conversion, prospects for continued operating earnings growth are favorable if the revenue trajectory holds. Normalization of non-operating and extraordinary items could lift net income closer to ordinary income in subsequent periods.

Financial Health

liquidity: Current ratio 231.7% and working capital ¥306m (¥538.9m CA − ¥232.6m CL) denote strong near-term liquidity. Quick ratio equals current ratio due to undisclosed inventories, implying limited inventory exposure. solvency: Debt-to-equity 0.41x and interest coverage 45x point to low financial risk and substantial headroom vs. interest costs. capital_structure: Implied equity ratio is approximately 75% (not the reported 0.0% placeholder). Financial leverage of 1.33x is conservative for a service-oriented balance sheet.

Cash Flow Quality

earnings_quality: OCF/Net Income of 2.21 indicates strong conversion and limited accrual risk in this period. EBITDA of ¥169.7m provides a healthy cash earnings base versus minimal interest burden. FCF_analysis: Free cash flow of ¥138m (OCF ¥179m less investing outflows ¥41m) is positive, comfortably covering maintenance investment needs. Financing inflow of ¥344m boosted funding capacity, though the end-period cash balance was not disclosed. working_capital: High current ratio and positive OCF suggest effective working capital management; detailed drivers (receivables, payables, contract assets) are not disclosed, limiting granularity.

Dividend Sustainability

payout_ratio_assessment: Payout ratio shown as 0.0% and DPS 0.00 are undisclosed placeholders; no conclusion on payout policy can be drawn from this dataset. FCF_coverage: With FCF of ¥138m and undisclosed dividends, theoretical coverage appears ample, but actual distributions (if any) are unknown. policy_outlook: Given growth and recent financing inflows, capital allocation may prioritize reinvestment and balance sheet flexibility; confirmation requires explicit management guidance.

Risk Assessment

Business Risks:

• Revenue concentration and project timing risk typical of service-driven models
• Dependence on public/private client budgets and procurement cycles
• Execution risk on scaling while sustaining 55%+ gross margin
• Potential sensitivity to macro slowdown affecting discretionary projects
• Non-consolidated reporting may omit subsidiary dynamics if any

Financial Risks:

• Volatility from non-operating and extraordinary items under JGAAP
• Tax credit/timing effects creating net income swings versus operating trends
• Reliance on external financing inflows in the period (¥344m) amid undisclosed cash balance
• Small-cap liquidity and potential cost of capital sensitivity

Key Concerns:

• Large gap between operating/ordinary income and net income implies significant extraordinary losses
• Undisclosed key items (equity ratio, cash balance, shares outstanding, dividends) constrain precision
• Sustainability of double-digit sales growth needed to maintain operating leverage benefits

Investment Implications

Key Takeaways:

• Strong operating performance: revenue +17.3% YoY, operating income +21.6%, operating margin 17.1%
• High gross margin at 55.3% supports pricing power and service mix quality
• Net income down 54.4% due to extraordinary/non-operating items despite a tax credit
• Healthy balance sheet: D/E 0.41x, interest coverage 45x, working capital ¥306m
• Robust cash conversion: OCF/NI 2.21, FCF ¥138m
• Financing inflow ¥344m enhances flexibility, but period-end cash undisclosed
• ROE 9.19% driven by high margin and modest leverage; room to improve via turnover and normalization of below-the-line items

Metrics to Watch:

• Order backlog and revenue visibility to sustain growth
• Ordinary-to-net income bridge: extraordinary items magnitude and recurrence
• Tax rate normalization trajectory post-credit
• OCF conversion and working capital days (DSO/DPO) as disclosures allow
• Capex and investment outflows relative to growth initiatives
• True equity ratio and period-end cash once disclosed
• Non-operating income/expense components and interest costs

Relative Positioning: Versus domestic small-cap services peers, Mirairo exhibits above-average gross and operating margins with conservative leverage and strong cash conversion, offset by higher net income volatility from extraordinary items and limited disclosure granularity in this filing.

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
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