| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥20.8B | ¥20.0B | +4.1% |
| Operating Income / Operating Profit | ¥6.8B | ¥6.4B | +6.2% |
| Ordinary Income | ¥7.1B | ¥6.5B | +9.0% |
| Net Income / Net Profit | ¥4.9B | ¥4.5B | +9.0% |
| ROE | 6.4% | 6.0% | - |
FY2026 Q1 results showed Revenue ¥20.8B (YoY +¥0.8B +4.1%), Operating Income ¥6.8B (YoY +¥0.4B +6.2%), Ordinary Income ¥7.1B (YoY +¥0.6B +9.0%), and Net Income ¥4.9B (YoY +¥0.4B +9.0%), maintaining a trend of higher revenue and profit. Gross margin improved to 62.1% (vs. 57.9% a year ago), up 4.2pt, and Operating Margin increased to 32.9% (vs. 32.3%) up 0.6pt. The core Software Business accounted for 76.0% of revenue and maintained high profitability with an Operating Margin of 44.0%, while the Overseas Business continued to record losses. Progress against the full-year forecast was 24.1% of Revenue, 25.5% of Operating Income, and 26.0% of Ordinary Income, with profitability slightly ahead.
[Revenue] Revenue was ¥20.8B, up +4.1% YoY. By segment, the core Software Business drove growth with ¥15.8B (+5.5%), representing 76.0% of total. The System Development Services Business grew steadily to ¥4.9B (+2.4%), and the Overseas Business showed high growth to ¥0.2B (+16.5%) but remains small in scale. Gross profit was ¥12.9B (¥11.6B a year ago), up +11.5%, and gross margin improved to 62.1% from 57.9% a year ago, a 4.2pt improvement. Price policy optimization and penetration of higher value-added features are presumed to have contributed to the gross margin uplift.
[Profitability] Cost of goods sold decreased to ¥7.9B from ¥8.4B a year ago, lowering the cost ratio to 37.9%. SG&A increased to ¥6.0B (¥5.1B a year ago), up +17.7%, raising the SG&A ratio to 29.1% from 25.6% a year ago, a 3.5pt increase. The increase was mainly due to higher personnel expenses and sales investment, but gross margin improvement absorbed the SG&A rise, resulting in Operating Income of ¥6.8B (+6.2%). Operating Margin improved 0.6pt to 32.9% (vs. 32.3% a year ago). Non-operating items included Interest Income ¥0.2B (¥0.2B a year ago), Foreign Exchange Gains ¥0.1B, and Investment Partnership Income ¥0.0B, totaling Non-operating Income ¥0.3B, while Foreign Exchange Losses ¥0.2B contributed to Non-operating Expense of ¥0.0B, yielding net Non-operating income of ¥0.3B. Ordinary Income was ¥7.1B (+9.0%), and Ordinary Margin improved 1.5pt to 34.3% (vs. 32.8%). After Corporate Taxes of ¥2.3B, Net Income was ¥4.9B (+9.0%), and Net Margin expanded 1.1pt to 23.5% (vs. 22.4%). Overall, the company achieved higher revenue and profit.
The Software Business recorded Revenue ¥15.8B (¥15.0B a year ago, +5.5%) and Operating Income ¥7.0B (¥6.5B a year ago, +6.5%), maintaining very high profitability with an Operating Margin of 44.0% (vs. 43.5% a year ago). The System Development Services Business posted Revenue ¥4.9B (¥4.8B a year ago, +2.4%) and Operating Income ¥0.1B (¥0.1B a year ago, +22.2%), with an Operating Margin of 2.6% (vs. 2.2% a year ago), showing improvement from a low base. The Overseas Business achieved Revenue ¥0.2B (¥0.2B a year ago, +16.5%) but reported an Operating Loss of ¥0.2B (loss of ¥0.2B a year ago, loss widened 24.4%), so losses persist. The Software Business accounts for the majority of consolidated Operating Income, and improving profitability in the Overseas Business remains a future challenge.
[Profitability] Operating Margin of 32.9% improved 0.6pt from 32.3% a year ago; gross margin improvement of 4.2pt absorbed an SG&A ratio increase of 3.5pt. Net Margin is 23.5%, up 1.1pt from 22.4% a year ago, aided by improvements at the operating level and contribution from non-operating income. ROE is 6.4%, decomposed as Net Margin 23.5% × Total Asset Turnover 0.200× × Financial Leverage 1.37×. ROE rose slightly from about 6.0% a year ago, but conservative leverage caps ROE upside.
[Quality of Cash] Non-operating income was ¥0.3B, accounting for 1.4% of Revenue, indicating limited reliance on non-core items and that core operations generate the bulk of earnings. Contract liabilities were ¥15.0B, equivalent to 72.2% of quarterly sales, indicating a deferred/advance revenue stock structure that supports future revenue recognition.
[Investment Efficiency] Total Asset Turnover was 0.200× (annualized 0.80×), not high, but most assets are liquid assets such as Cash and Short-term Securities, reflecting a conservative asset mix.
[Financial Soundness] Equity Ratio is 73.1% (vs. 70.0% a year ago), indicating a strong capital base. Current Ratio 307.8% and Quick Ratio 307.8% indicate very high liquidity. Debt-to-Equity Ratio is 0.37×, and Interest Coverage is approximately 24,000× (Interest Income ¥0.2B ÷ Interest Expense ¥0.0B), implying an effectively debt-free financial structure. Liquidity assets including Cash ¥62.4B and Short-term Securities ¥1.9B are ample, providing strong resilience to unexpected outflows.
Detailed disclosure of the cash flow statement is not available, but balance sheet changes allow inference of funding trends. Cash was ¥62.4B, down ¥1.9B from ¥64.3B a year ago, while contract liabilities remained high at ¥15.0B, with the advance-revenue structure supporting cash generation. Accrued corporate taxes decreased ¥3.1B to ¥2.4B (¥5.5B a year ago), suggesting corporate tax payments were made during the period. Bonus reserves decreased ¥0.6B to ¥1.0B (¥1.6B a year ago), reflecting seasonality of payment timing. Investment securities increased slightly to ¥17.6B from ¥17.2B a year ago, indicating continued deployment of surplus funds. Accumulated Other Comprehensive Income rose ¥0.4B to ¥1.5B (¥1.1B a year ago), with valuation gains on securities boosting Net Assets. Overall, cash generation from operating activities, allocation to investing activities, and corporate tax payments were balanced, and liquidity remained high.
Core earnings were Operating Income ¥6.8B, and Non-operating Income ¥0.3B was limited to 1.4% of Revenue, indicating earnings are primarily from the core business. Breakdown of Non-operating Income: Interest Income ¥0.2B, Foreign Exchange Gains ¥0.1B, Investment Partnership Income ¥0.0B — all recurring elements. Non-operating Expense including Foreign Exchange Losses ¥0.2B was ¥0.0B in total, so net FX impact was a small positive. No extraordinary items were noted, and no temporary profit drivers were identified. Comprehensive Income was ¥5.3B, ¥0.4B higher than Net Income ¥4.9B, with Other Comprehensive Income (Foreign Currency Translation Adjustment ¥0.1B, Valuation Gains on Securities ¥0.3B) contributing positively. The divergence between Ordinary Income and Net Income is small, and tax burden is within a normal range. From an accrual perspective, contract liabilities of ¥15.0B are high and the timing of revenue recognition from advance receipts affects earnings quality, but this is consistent with a normal stock-based business model.
Full-year forecast remains unchanged at Revenue ¥86.2B (+4.7%), Operating Income ¥26.8B (+7.3%), Ordinary Income ¥27.4B (+5.1%), Net Income ¥18.8B, and EPS ¥133.88. Q1 progress rates were Revenue 24.1%, Operating Income 25.5%, Ordinary Income 26.0%, and Net Income 26.0%; relative to a standard quarterly pace of 25%, profitability is somewhat ahead. Gross margin improvement and contribution from Non-operating Income are believed to have supported profit progress. Contract liabilities of ¥15.0B provide an advance revenue base that will underpin future revenue recognition and increase the probability of meeting the full-year outlook. No revisions to guidance are planned at this time, and the initial plan appears reasonably achievable.
Full-year dividend forecast is ¥27, implying a Payout Ratio of approximately 20.2% against forecast EPS ¥133.88, a conservative level. Given Cash ¥62.4B, high Operating Margin of 32.9%, and a cash generation base supported by contract liabilities, dividend funding appears well secured. No share buyback disclosure has been made; Total Return Ratio equals the Payout Ratio. The dividend level is sustainable while leaving capacity for growth investments, and downside risk of a dividend cut is low.
Concentration Risk: The Software Business accounts for 76.0% of Revenue and the majority of Operating Income, so demand fluctuations for specific products or intensified competition could directly affect consolidated performance. Maintenance of high Operating Margin of 44.0% is assumed; pricing pressure or customer attrition could erode margins.
Continued Losses in Overseas Business: The Overseas Business posts Revenue ¥0.2B against an Operating Loss of ¥0.2B, with an Operating Margin of -116.8%, a substantial deficit. The loss widened 24.4% YoY, and prompt profitability improvement is required. Inefficient allocation of resources or need for additional investment could pressure consolidated profitability.
SG&A Increase Risk: SG&A rose to ¥6.0B, up +17.7% YoY, substantially outpacing Revenue growth of +4.1%. SG&A ratio rose 3.5pt to 29.1% (vs. 25.6% a year ago). If personnel-cost inflation or ongoing sales investments cannot be covered by continued gross margin improvement, Operating Margin could deteriorate.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 32.9% | 8.0% (2.2%–15.8%) | +24.8pt |
| Net Margin | 23.5% | 5.8% (1.5%–10.7%) | +17.7pt |
Both Operating Margin and Net Margin substantially exceed industry medians, demonstrating very high profitability within the IT & Communications sector.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 4.1% | 9.3% (0.2%–16.9%) | -5.2pt |
Revenue growth lags the industry median by 5.2pt, placing the company at or below median for growth within the sector.
※ Source: Company aggregation
High profitability and strong financial base: Operating Margin 32.9% and Net Margin 23.5% are outstanding within the sector, with Cash ¥62.4B and Equity Ratio 73.1% indicating extremely solid finances. Contract liabilities ¥15.0B support stability of stock revenues and form a defensive earnings structure. Profit progress against the full-year forecast is somewhat ahead, and continued gross margin improvement could yield upside.
Dependence on Software Business and Overseas Business issues: The Software Business represents 76.0% of Revenue and achieves a high Operating Margin of 44.0%, but concentration risk exists. The Overseas Business recorded an Operating Loss of ¥0.2B with widening loss, so progress on profitability there is key to improving consolidated margins. The 3.5pt rise in SG&A ratio also implies that sustained gross margin improvement will be necessary to maintain margins.
This report was automatically generated by AI analyzing XBRL financial statement data to produce a financial analysis document. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information compiled by the company based on public financial statements. Investment decisions are your responsibility; consult a professional advisor as needed.