TIGERS POLYMER CORPORATION FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥24.19B
• Operating Income: ¥1.65B
• Net Income: ¥1.05B
• EPS: ¥66.13

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment 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

Tigers Polymer Co., Ltd. (42310) reported FY2026 Q2 (cumulative first half) consolidated results under JGAAP with resilient profitability despite a modest topline contraction. Revenue was ¥24.19bn, down 1.8% YoY, while operating income rose 29.9% YoY to ¥1.65bn, indicating meaningful operating leverage and cost discipline. Ordinary income was ¥1.85bn, and net income increased 64.2% YoY to ¥1.31bn, lifting the net margin to 5.39%. Gross margin stood at 20.0%, and operating margin improved to approximately 6.83% (¥1.654bn/¥24.192bn), from an estimated ~5.17% in the prior-year first half. Interest expense was minimal at ¥8.83m, supporting an interest coverage ratio of 187.3x, underscoring a very light financial burden. Balance sheet strength is notable: total assets of ¥59.7bn against total liabilities of ¥14.16bn imply a low leverage profile and an implied equity ratio of about 77.5% (despite the reported 0% being a disclosure gap). Liquidity appears robust with a current ratio of 341% and working capital of ¥25.94bn. The DuPont breakdown shows a net margin of 5.39%, asset turnover of 0.405x, and financial leverage of 1.29x, yielding an ROE of 2.82% for the period; this is modest and likely dampened by the company’s strong equity base. The effective tax rate derived from disclosed taxes is around the mid-20% range (estimated ~24–25%), despite the table showing 0% due to a data artifact. Cash flow statements are undisclosed this quarter (values displayed as zero indicate non-disclosure), so OCF/NI and FCF metrics in the table should not be interpreted as actual zero. Dividend per share is also undisclosed in this dataset; EPS was ¥66.13, which implies approximately ~19.7 million average shares outstanding (back-solved from net income and EPS). Inventory of ¥2.41bn appears low versus current assets, suggesting receivables and cash-like items likely dominate, though cash and equivalents were not disclosed. Overall, the company demonstrates improved margin quality, strong solvency, and low financing risk, with the main analytical limitations stemming from absent cash flow and dividend details. Key questions concern sustainability of cost improvements, demand trends in end markets, and the mix of non-operating items contributing to ordinary income. Near-term monitoring should focus on raw material costs, FX impacts, and working capital trends as cash flow data becomes available.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 5.39% (¥1,305m / ¥24,192m)
• asset_turnover: 0.405x
• financial_leverage: 1.29x (Assets/Equity ≈ ¥59.7bn/¥46.277bn)
• calculated_ROE: 2.82% (in line with reported DuPont figure for the period) margin_quality: Gross margin: 20.0% (¥4,845m/¥24,192m), indicating stable product-level profitability., Operating margin: ~6.83% vs. ~5.17% prior-year first half (implied), a ~1.7pp expansion driven by cost control and mix., Ordinary margin: ~7.63% (¥1,848m/¥24,192m), suggesting a positive non-operating contribution (e.g., FX, financial income)., Net margin: 5.39%, up sharply YoY alongside a 64.2% rise in net income despite lower revenue. operating_leverage: Revenue -1.8% YoY with operating income +29.9% YoY implies strong operating leverage from cost reductions or mix optimization., Low interest burden (¥8.83m) ensures operating gains largely translate to pre-tax earnings., Depreciation/EBITDA not disclosed; operating margin improvement indicates better fixed cost absorption even without D&A detail.

Growth Assessment

revenue_sustainability: Topline declined 1.8% YoY to ¥24.19bn; indicates soft demand or pricing pressure in certain segments., Inventory at ¥2.41bn (low vs. current assets) may reflect efficient inventory management or classification differences; limited insight into channel inventory health without more detail., Asset turnover at 0.405x is modest, reflecting a capital-heavy base or first-half seasonality. profit_quality: Operating margin expansion alongside lower revenue points to structural cost improvements or favorable product mix., Ordinary income exceeds operating income, indicating non-operating tailwinds (potential FX/financial gains); sustainability uncertain., Effective tax estimated around mid-20% despite ‘0%’ shown; net profit quality appears reasonable absent unusual items disclosure. outlook: Sustaining current margins will hinge on raw material prices (rubber/plastics), automotive/industrial demand, and FX., If cost efficiencies are structural, full-year profitability could improve even with flat-to-soft revenue., Watch for normalization of non-operating gains in 2H; core OPM trajectory is the key indicator.

Financial Health

liquidity: Current ratio: 341.2%; quick ratio: 318.8% — ample short-term coverage., Working capital: ¥25.94bn (¥36.70bn CA minus ¥10.76bn CL)., Cash and equivalents not disclosed this quarter; headline liquidity looks strong despite this gap. solvency: Total liabilities: ¥14.16bn vs. total assets: ¥59.7bn; liabilities/assets ≈ 23.7%., Implied equity ratio ≈ 77.5% (not the reported 0%), reflecting a very solid capital base., Debt-to-equity: 0.31x (broad liabilities basis), indicating conservative leverage. capital_structure: Minimal interest expense (¥8.83m) and high interest coverage (187x) signal low financial risk., Equity of ¥46.28bn provides significant buffer for investment and volatility., No signs of refinancing pressure; detail on debt maturity profile not provided.

Cash Flow Quality

earnings_quality: OCF, investing CF, and financing CF are undisclosed this period (shown as zero in the dataset)., Given undisclosed OCF, the displayed OCF/NI of 0.00 is not meaningful; cannot directly assess accrual intensity., Net income uplift appears supported by operating margin expansion; durability will be clearer with 2H cash flow data. FCF_analysis: Free cash flow not disclosed; cannot assess capex intensity or FCF conversion., Depreciation/amortization not disclosed; therefore EBITDA and maintenance capex needs cannot be triangulated. working_capital: High working capital (¥25.94bn) suggests strong liquidity, but composition (receivables vs. inventory vs. cash) is unclear due to limited disclosure., Inventory of ¥2.41bn appears lean; changes in receivables/payables turnover should be monitored when detailed notes become available.

Dividend Sustainability

payout_ratio_assessment: Annual DPS and payout ratio are undisclosed in this dataset (zeros should not be treated as actual values)., EPS is ¥66.13 for the first half; full-year EPS trajectory will guide payout capacity. FCF_coverage: FCF not disclosed; coverage metrics (e.g., DPS/FCF) cannot be computed this quarter., Strong balance sheet (equity ratio ~77.5%) provides capacity, but cash distribution policy clarity requires historical context not provided here. policy_outlook: Without stated policy or recent DPS history in this extract, we cannot infer changes., Monitor year-end guidance and 2H cash flow to gauge dividend stability and potential adjustments.

Risk Assessment

Business Risks:

• End-market demand exposure (automotive, industrial equipment) could prolong topline softness.
• Raw material price volatility (synthetic rubber, plastics) may pressure gross margin.
• FX fluctuations can alter ordinary income via translation and transaction effects.
• Customer concentration risk if large OEMs/end customers represent significant revenue share.
• Supply chain and logistics disruptions affecting delivery schedules and input costs.

Financial Risks:

• Cash flow visibility is limited due to undisclosed OCF/FCF in this period.
• Potential working capital swings in 2H (receivables collection, inventory rebuild) could impact cash conversion.
• Non-operating income reliance: if FX/financial gains normalize, ordinary income could moderate.
• Interest rate increases have limited impact currently (very low interest burden), but future capex/debt could raise sensitivity.

Key Concerns:

• Sustainability of margin gains amid slight revenue decline.
• Lack of cash flow disclosure hampers assessment of earnings-to-cash conversion.
• Dependence on non-operating tailwinds for ordinary income uplift.

Investment Implications

Key Takeaways:

• Solid margin expansion with operating income +29.9% YoY despite revenue -1.8% YoY.
• Very strong balance sheet: implied equity ratio ~77.5% and interest coverage ~187x.
• ROE at 2.82% is modest, constrained by a large equity base; improving asset turnover or margin is key.
• Cash flow and DPS not disclosed; await 2H for confirmation of cash generation and shareholder returns.
• Monitor sustainability of non-operating contributions to ordinary income.

Metrics to Watch:

• Core operating margin (OPM) trajectory in 2H.
• Raw material cost indices and pricing pass-through.
• FX rates and non-operating income/loss trends.
• Working capital movements (receivables, payables, inventory turnover) and OCF.
• Capex and D&A disclosures to assess medium-term FCF.
• Full-year EPS guidance and any updates to dividend policy.

Relative Positioning: Within Japanese industrial materials/components peers, Tigers Polymer currently exhibits stronger balance sheet resilience and low financial risk, with profitability improving on cost control. However, its ROE remains on the low side versus peers with higher asset turnover or leaner capital bases; clearer cash flow delivery and sustained OPM gains would enhance its relative standing.

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