Startia Holdings,Inc. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥11.51B
• Operating Income: ¥1.41B
• Net Income: ¥1.02B
• EPS: ¥99.91

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

Startia Holdings (33930) delivered steady topline and operating profit growth in FY2026 Q2, with revenue up 6.9% YoY to ¥11.5bn and operating income up 6.6% to ¥1.41bn. Gross profit was ¥4.86bn, implying a healthy gross margin of 42.2%, while operating margin held at 12.2%, suggesting disciplined SG&A despite wage and cost pressures. Ordinary income of ¥1.42bn was only modestly above operating income, indicating minimal contribution from non-operating items and a very light interest burden. Net income declined 7.6% YoY to ¥0.94bn, likely reflecting a less favorable tax/non-operating mix rather than deterioration in core operations. Based on net income of ¥936m and income tax expense of ¥358m, the implied effective tax rate is approximately 27–28%, contrasting with the reported 0.0% metric, which appears to be an undisclosed item rather than an actual zero. DuPont analysis shows ROE at 12.31%, driven by an 8.13% net margin, asset turnover of 0.853x, and financial leverage of 1.77x. Liquidity appears strong, with a current ratio of 219.6% and a quick ratio of 211.0%, supported by working capital of ¥6.28bn. The balance sheet is conservatively positioned: total liabilities are ¥6.55bn against total equity of ¥7.60bn (implying an equity-to-asset ratio of roughly 56% despite the reported 0.0% equity ratio field). Interest coverage is very high at 150.5x, consistent with low interest expense (¥9.4m) and robust operating earnings. Cash flow quality is a watch point: operating cash flow of ¥395m equates to 42% of net income, suggesting a working capital build or timing effects in collections and payables. Financing cash outflows of ¥1.44bn indicate repayments and/or shareholder returns, but the absence of detailed cash and investing disclosures limits free cash flow assessment. EPS printed at ¥99.91, but share count and book value per share were not disclosed in the provided dataset, constraining per-share capital efficiency analysis. Overall, the quarter evidences healthy core profitability and solid financial health, with the primary near-term focus on converting earnings to cash and clarifying capital allocation. Data limitations exist where certain fields were not disclosed (e.g., equity ratio, cash and equivalents, investing cash flow, dividend per share, share counts); conclusions are therefore based on available non-zero metrics and derived calculations.

Profitability Analysis

ROE_decomposition: ROE 12.31% = Net margin 8.13% × Asset turnover 0.853 × Financial leverage 1.77. Net margin benefited from stable gross margin (42.2%) and SG&A discipline; leverage is moderate; asset turnover is adequate for a solutions/services mix. margin_quality: Gross margin 42.2% (¥4,862m/¥11,512m) supports a solid operating margin of 12.2% (¥1,409m/¥11,512m). SG&A expense estimated at ¥3,453m (gross profit minus operating income), implying an SG&A ratio near 30.0%. Ordinary income only ¥15m above operating income indicates limited reliance on non-core gains and minimal financing drag. operating_leverage: Operating income growth (+6.6% YoY) broadly matched revenue growth (+6.9% YoY), suggesting neutral operating leverage in the period. EBITDA margin of 14.0% versus operating margin of 12.2% indicates modest D&A intensity (D&A ¥206m), limiting margin volatility from depreciation cycles.

Growth Assessment

revenue_sustainability: Revenue rose 6.9% YoY to ¥11.5bn, consistent with steady demand. Gross margin stability suggests mix and pricing remained supportive. No segment disclosures provided to parse growth drivers; sustainability will hinge on order intake, recurring revenue retention, and pricing power. profit_quality: Operating income growth of 6.6% roughly kept pace with sales; ordinary income tracked operating trends with negligible non-operating dependence. Net income declined 7.6%, likely reflecting a more normalized tax rate or fewer non-operating tailwinds rather than core margin erosion. outlook: With stable margins and controlled SG&A, near-term earnings trajectory appears anchored by execution rather than financial engineering. Key to sustaining growth will be converting revenue to cash (improving OCF/NI), maintaining gross margin, and avoiding cost creep as wages and vendor prices evolve.

Financial Health

liquidity: Current ratio 219.6% and quick ratio 211.0% demonstrate ample short-term coverage. Working capital totals ¥6,280m, with inventories relatively low at ¥455m, supportive of the strong quick ratio. Cash and equivalents were undisclosed (reported as 0). solvency: Total liabilities of ¥6,554m versus equity of ¥7,602m imply a conservative capital base; calculated equity-to-asset ratio is approximately 56.3% (vs reported 0.0% field which appears undisclosed). Interest coverage is very strong at 150.5x, and interest expense is only ¥9.4m. capital_structure: Debt-to-equity ratio is 0.86x (total liabilities/equity). Net leverage cannot be assessed due to undisclosed cash. Financing cash outflow (−¥1,441m) suggests deleveraging and/or shareholder returns, but details are not disclosed.

Cash Flow Quality

earnings_quality: Operating cash flow of ¥395m is 42% of net income (¥936m), indicating weaker cash conversion in the period—likely from working capital investment (e.g., receivables growth) and/or timing effects. EBITDA of ¥1,615m versus OCF suggests non-cash earnings are not the issue; rather, cash timing is. FCF_analysis: Investing cash flow and capex were not disclosed (reported as 0), preventing a reliable free cash flow calculation. As a proxy, FCF cannot be concluded from the provided data, and the reported FCF of 0 should be treated as undisclosed rather than zero. working_capital: Inventory is modest (¥455m), but movements in receivables and payables are not provided. The OCF/NI shortfall points to a build in net working capital; monitoring DSO/DPO trends is crucial to assess normalization in 2H.

Dividend Sustainability

payout_ratio_assessment: Reported payout ratio of 0.0% appears to reflect lack of disclosure rather than an actual zero payout. With EPS at ¥99.91 and no DPS disclosed, we cannot compute a verified payout ratio. FCF_coverage: Free cash flow is undisclosed; thus, dividend coverage from FCF cannot be assessed. Operating cash generation currently trails net income (OCF/NI 0.42), which would constrain coverage if a dividend were paid. policy_outlook: Capital allocation intent is unclear given missing dividend and investing data and sizable financing outflows (−¥1,441m). Clarity on dividend policy, buybacks, and debt repayment priorities is needed before assessing sustainability.

Risk Assessment

Business Risks:

• Demand cyclicality affecting IT/solutions spending and project timing
• Pricing pressure and competitive intensity impacting gross margins
• Execution risk on scaling services while maintaining SG&A efficiency
• Customer concentration and churn risk (if present) without disclosed breakdown
• Supply chain and vendor cost volatility affecting COGS

Financial Risks:

• Working capital expansion suppressing operating cash flow
• Limited visibility on capex/investing needs due to undisclosed investing cash flows
• Uncertain dividend/capital return commitments given missing DPS disclosure
• Potential FX exposure on procured equipment/services (not disclosed)
• Refinancing/interest rate risk appears low but not fully assessable without debt maturity details

Key Concerns:

• OCF/Net income ratio at 0.42 indicates subpar cash conversion
• Lack of disclosure on cash balance and investing cash flows limits FCF assessment
• Net income decline despite stable operating performance suggests sensitivity to tax/non-operating items

Investment Implications

Key Takeaways:

• Solid core profitability with gross margin at 42.2% and operating margin at 12.2%
• ROE of 12.31% underpinned by healthy margins and moderate leverage
• Net income down 7.6% YoY likely due to tax normalization or non-operating effects
• Strong liquidity: current ratio 219.6%, quick ratio 211.0%, working capital ¥6.28bn
• Interest coverage extremely high at 150.5x; low financing burden
• Cash conversion is the primary watch point (OCF/NI 0.42)
• Capital allocation unclear given −¥1.44bn financing CF and undisclosed dividends/capex

Metrics to Watch:

• OCF/Net income ratio and working capital metrics (DSO/DPO/DIO)
• Gross margin trajectory and SG&A ratio
• Ordinary-to-operating income gap (non-operating gains/losses)
• Effective tax rate normalization vs. prior periods
• Investing cash flow/capex disclosures to gauge FCF
• Net debt and cash balance once disclosed
• Any updates on dividend/buyback policy and share count

Relative Positioning: Based on reported metrics, the company exhibits above-average operating margins and strong liquidity with moderate leverage for a small-to-mid cap solutions/services profile in Japan; however, relative standing versus peers cannot be fully validated without segment mix and cash/capex disclosures.

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
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis