| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥52.1B | ¥50.3B | +3.4% |
| Operating Income / Operating Profit | ¥6.1B | ¥7.3B | -17.1% |
| Ordinary Income | ¥6.2B | ¥7.4B | -16.3% |
| Net Income / Net Profit | ¥4.1B | ¥4.9B | -17.6% |
| ROE | 8.5% | 10.3% | - |
FY2026 Q2 results: Revenue ¥52.1B (YoY +¥1.7B +3.4%), Operating Income ¥6.1B (YoY -¥1.2B -17.1%), Ordinary Income ¥6.2B (YoY -¥1.2B -16.3%), Net Income attributable to owners of the parent ¥4.1B (YoY -¥0.9B -17.6%). Despite a modest increase in revenue, a significant rise in SG&A ratio led to lower profits, with operating margin falling 2.9pt to 11.7% (prior year 14.6%). Gross profit was ¥12.8B with a gross margin of 24.6% (prior year 23.8%, +0.8pt); however, SG&A increased to ¥6.7B (prior year ¥4.6B), up ¥2.1B (+45.0%), causing negative operating leverage. EPS was ¥10.73 (prior year ¥12.95, -17.1%), and an effective tax rate of 35.2% pressured net margin.
[Revenue] Revenue was ¥52.1B (prior year ¥50.3B, +3.4%), a modest increase. As the company operates a single segment (Information Services Business), detailed segmental revenue breakdown is not disclosed. Cost of sales was ¥39.3B (prior year ¥38.4B, +2.4%), growing less than revenue, and gross margin improved to 24.6% (prior year 23.8%, +0.8pt). The gross margin improvement suggests higher value-added project mix or improved average pricing.
[Profitability] Operating Income decreased to ¥6.1B (prior year ¥7.3B, -17.1%). Despite gross margin improvement, SG&A rose to ¥6.7B (prior year ¥4.6B, +45.0%), an increase of ¥2.1B, and SG&A ratio rose to 12.9% (prior year 9.2%, +3.7pt). The SG&A increase is presumed driven by upfront investments including headcount increases, recruitment costs, and promotional expenses, with expense growth far outpacing revenue growth (+3.4%), reversing operating leverage. Non-operating income/expenses had minimal impact (non-operating income ¥0.2B; non-operating expenses ¥0.0B). Ordinary Income was ¥6.2B (prior year ¥7.4B, -16.3%). Extraordinary items were limited (extraordinary gains ¥0.0B only). Profit before income taxes was ¥6.3B, with income taxes ¥2.2B (effective tax rate 35.2%), resulting in Net Income attributable to owners of the parent of ¥4.1B (prior year ¥4.9B, -17.6%). Comprehensive income was ¥4.3B (Net Income ¥4.1B plus unrealized gains on securities ¥0.3B); the divergence between net income and comprehensive income is minor. Conclusion: revenue up but profit down.
[Profitability] Operating margin 11.7% (prior year 14.6%, -2.9pt), Net margin 7.8% (prior year 9.8%, -2.0pt), both deteriorated. ROE 8.5% (prior year 10.3%), driven down by lower net margin despite a slight increase in total asset turnover to 0.81x (prior year 0.77x). Gross margin improved to 24.6% (prior year 23.8%, +0.8pt), but the large rise in SG&A ratio to 12.9% (prior year 9.2%, +3.7pt) is the main cause of margin pressure. EBITDA was ¥6.4B (Operating Income ¥6.1B + Depreciation ¥0.3B), with an EBITDA margin declining to 12.3% (prior year 15.3%). [Cash Quality] Operating Cash Flow (OCF) was ¥4.5B versus Net Income ¥4.1B, yielding OCF/Net Income 1.11x, indicating good cash backing of profits. OCF subtotal was ¥7.9B (including depreciation ¥0.3B, goodwill amortization ¥0.2B, provision changes ¥0.2B), from which working capital movements (Accounts receivable +¥0.6B, Accounts payable +¥0.4B inflows) and tax payments ¥3.5B outflow were deducted. OCF/EBITDA 0.70x shows cash conversion at a low end, driven by large tax payments. Days Sales Outstanding (DSO) is prolonged at 154 days (Accounts receivable ¥22.0B ÷ daily sales ¥0.143B), suggesting end-of-period concentrated collections. [Investment Efficiency] Capital expenditure ¥0.0B vs. depreciation ¥0.3B, giving CapEx/Depreciation 0.09x — extremely low. Investment in intangible assets was limited to ¥0.2B, indicating restrained capital spending. Goodwill ¥2.4B (5.0% of equity) and intangible assets ratio 9.3% (intangible assets ¥6.0B ÷ total assets ¥64.5B) suggest limited M&A-related asset risk. [Financial Soundness] Equity Ratio 73.7% (prior year 73.1%, +0.6pt), Current Ratio 324% (Current assets ¥50.6B ÷ Current liabilities ¥15.6B), Quick Ratio 324% — liquidity extremely ample. Cash ¥27.0B, long-term borrowings ¥0.2B (including ¥0.1B short-term repayment component, total borrowings ¥0.3B) — Debt/EBITDA 0.04x, effectively near net cash. Interest Coverage 3,598x (Operating Income ¥6.1B ÷ Interest expense ¥0.0B) — no concerns on interest payment ability.
OCF was ¥4.5B (prior year ¥4.0B, +12.1%). OCF subtotal was ¥7.9B (including depreciation ¥0.3B, goodwill amortization ¥0.2B, provision changes ¥0.2B), from which working capital movements and tax payments were deducted. In working capital, decreases in Accounts receivable ¥0.6B and increases in Accounts payable ¥0.4B contributed inflows; however, corporate tax payments of ¥3.5B were a large outflow, making OCF/EBITDA 0.70x and cash conversion at the lower bound. Investing Cash Flow was -¥0.0B, with CapEx -¥0.0B and intangible asset investment -¥0.2B, both negligible. Financing Cash Flow was -¥4.6B, mainly due to dividend payments -¥4.5B and repayment of long-term borrowings -¥0.0B. Free Cash Flow was ¥4.5B (OCF ¥4.5B + Investing CF -¥0.0B), remaining positive and broadly covering dividend funding of ¥4.5B. Ending cash balance was ¥27.0B (opening ¥27.6B), representing 41.8% of total assets, maintaining ample liquidity. OCF/Net Income 1.11x indicates strong cash backing of accounting profit, but if low investing CF outflows persist due to CapEx restraint, mid-to-long-term concerns over insufficient investment for competitiveness arise.
Operating Income ¥6.1B vs Ordinary Income ¥6.2B — the ¥0.1B difference is minor, indicating limited impact from non-operating items. Non-operating income ¥0.2B comprises interest income ¥0.0B, dividend income ¥0.0B, subsidy income ¥0.1B, etc., mainly one-off subsidy-related income. Non-operating expenses ¥0.0B consist only of interest expense ¥0.0B, indicating very low borrowing dependence. Ordinary Income ¥6.2B vs Profit before income taxes ¥6.3B, with extraordinary items ¥0.0B — almost no one-off effects. Net Income ¥4.1B vs Comprehensive Income ¥4.3B, the ¥0.2B gap is due to unrealized gains on securities ¥0.3B (OCI). The difference between OCF subtotal ¥7.9B and Net Income ¥4.1B (¥3.8B) is explained by non-cash expenses such as depreciation ¥0.3B, goodwill amortization ¥0.2B, decrease in deferred tax assets, provision changes, etc., indicating accruals at appropriate levels. Working capital movements — decrease in Accounts receivable ¥0.6B and increase in Accounts payable ¥0.4B — contributed inflows, suggesting end-of-period concentrated collection. Core earnings base is composed of Operating Income ¥6.1B; dependence on one-off income is low and earnings quality is generally good.
Full Year guidance: Revenue ¥110.0B (YoY +9.6%), Operating Income ¥13.8B (YoY +19.4%), Ordinary Income ¥13.8B (YoY +18.0%), Net Income attributable to owners of the parent ¥9.2B. Q2 results represent progress of Revenue 47.4% (¥52.1B ÷ ¥110.0B), Operating Income 44.1% (¥6.1B ÷ ¥13.8B), Ordinary Income 45.0% (¥6.2B ÷ ¥13.8B), all below a typical 50% level and implying a back-loaded profile. To meet targets, the company needs Revenue ¥57.9B (+11.4% YoY) and Operating Income ¥7.7B in H2 (vs H1 ¥6.1B, +26.2%), requiring SG&A discipline and recovery of operating leverage through utilization and price improvements. Full year EPS guidance ¥24.32 vs H1 EPS ¥10.73 (progress 44.1%), implying H2 EPS of ¥13.59. No revisions to guidance have been made; the company expresses confidence in a H2 recovery. However, if the H1 SG&A growth pace (+45.0%) continues, there is a risk of underperformance against targets.
No dividend for the first half (also nil in the prior year first half); full year dividend forecast is ¥12 (no prior year disclosure). Based on issued shares 40,699 thousand less treasury shares 2,831 thousand, the weighted average shares outstanding during the period are 37,867 thousand, implying total dividend payout for the year of ¥4.5B. Dividend payout ratio against full year Net Income forecast ¥9.2B is approximately 49.1%, a sustainable level. Given cash ¥27.0B at H1-end, H1 FCF ¥4.5B, and Debt/EBITDA 0.04x, there is no concern about securing dividend funding. No share buybacks were conducted (shown as -¥0.0B in Financing CF), so returns are concentrated on dividends. The company has not disclosed a formal dividend policy (target payout ratio or a policy of consecutive increases), but if full year performance progresses as planned, realization of the ¥12 dividend forecast is likely. Conversely, if H2 underperforms, the effective payout ratio could rise due to profit shortfall.
Risk of profitability deterioration from SG&A increase: SG&A rose to ¥6.7B (prior year ¥4.6B, +45.0%), outpacing revenue growth (+3.4%), and SG&A ratio climbed to 12.9% (prior year 9.2%, +3.7pt). The rise is presumed driven by upfront investments such as headcount increases, recruitment costs, and promotional expenses; if H2 revenue growth and utilization improvements do not materialize, these fixed SG&A costs could continue to reverse operating leverage, making the achievement of full year Operating Income forecast ¥13.8B difficult. Restoring SG&A discipline is the catalyst needed for H2 performance.
Prolongation of Accounts receivable and collection risk: Accounts receivable ¥22.0B represent 34.1% of total assets and DSO is prolonged at 154 days. Although Accounts receivable decreased year-on-year (¥22.5B → ¥22.0B), the end-of-period concentrated collection structure is suggested; delays in project acceptance or deterioration in customer payment terms could increase seasonality in OCF and crystallize liquidity risk. Smoothing working capital management and improving collection terms are challenges.
Performance volatility due to back-loaded revenue structure: H1 progress toward full year guidance is Revenue 47.4% and Operating Income 44.1%, below a standard 50%, assuming H2 targets Revenue ¥57.9B and Operating Income ¥7.7B. Even accounting for seasonality in the information services industry (year-end concentration), if H1 SG&A inflation persists, H2 scope for margin improvement is limited. Delays in project execution, lower utilization, or setbacks in price improvement could together raise the likelihood of missing full year guidance.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 11.7% | 14.0% (3.8%–18.5%) | -2.3pt |
| Net Margin | 7.8% | 9.2% (1.1%–14.0%) | -1.4pt |
Both operating and net margins are below industry medians, and the SG&A increase has weakened the company's relative positioning within the industry.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 3.4% | 21.0% (15.5%–26.8%) | -17.6pt |
Revenue growth trails the industry median of 21.0% by a wide margin, remaining conservative relative to the high-growth trend in the information services sector.
※Source: Company compilation
SG&A ratio increase (+3.7pt) compressed operating margin to 11.7%, but gross margin improved by 0.8pt, indicating signs of higher value-added project mix or price improvements. If SG&A restraint and utilization improvements proceed in H2, operating leverage recovery is possible. Progress vs full year guidance (Revenue 47.4% / Operating Income 44.1%) is below a standard 50%, implying a back-loaded profile; thus H2 project execution pace and cost discipline are catalysts for the results.
Financial soundness is very high: Equity Ratio 73.7%, Current Ratio 324%, Cash ¥27.0B (41.8% of total assets), Debt/EBITDA 0.04x — effectively near net cash. Payout ratio 49.1% and H1 FCF ¥4.5B mean no concerns securing dividend funding. Conversely, CapEx/Depreciation 0.09x indicates extremely low investment levels; mid-to-long-term investment for competitiveness (proprietary solution development, talent development, M&A, etc.) will be key to sustaining growth. OCF/Net Income 1.11x shows good cash backing of profit, but OCF/EBITDA 0.70x indicates cash conversion at a low end and suggests scope for smoothing tax payments and improving working capital management.
This report is an earnings analysis document automatically generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on publicly disclosed financial statements. Investment decisions are your own responsibility; consult a professional advisor as necessary.