AMIYA Corporation FY2025 Q3 Earnings Report

Financial Highlights

• Net Sales: ¥4.21B
• Operating Income: ¥795M
• Net Income: ¥267M
• EPS: ¥64.35

Income Statement

Balance Sheet

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

For FY2025 Q3, 株式会社網屋 (42580) delivered strong top-line and exceptional bottom-line growth, with revenue of ¥4,212 million up 21.9% YoY and operating income of ¥795 million up 117.6% YoY. Gross margin stood at 33.5%, and operating margin improved to roughly 18.9%, indicating significant operating leverage and cost discipline. Net income reached ¥538 million (+101.5% YoY), translating to a net margin of 12.8%, consistent with the DuPont input provided. The DuPont analysis implies ROE of 21.44%, driven by solid margins (12.77%), moderate asset turnover (0.681x), and leverage (assets/equity) of 2.46x. Balance sheet strength appears reasonable: total assets are ¥6,184 million with total equity of ¥2,509 million, implying an equity ratio of about 40.6% despite the reported 0.0% placeholder. Liquidity is adequate with a current ratio of ~1.59x and working capital of ~¥1,735 million, supporting ongoing operations and growth investments. Solvency risk looks moderate given debt-to-equity (liabilities/equity) of 1.31x and strong interest coverage of about 158x (based on operating income vs. interest expense). The effective tax rate, inferred from disclosed taxes and ordinary income, is roughly 13.9%, lower than Japan’s statutory rate, suggesting either tax credits, timing effects, or consolidations that reduce reported tax expense. Earnings quality and cash conversion cannot be assessed due to unreported cash flow figures (OCF/FCF listed as zero should be treated as not disclosed). Likewise, depreciation and amortization are unreported, so EBITDA metrics showing zero are not meaningful. Dividend information is also not disclosed (DPS and payout shown as zero), so current capital return policy cannot be determined from this dataset. Overall, the quarter reflects robust revenue growth, strong operating leverage, and a balanced capital structure, but the absence of cash flow data and cash balance disclosure limits conclusions on cash flow quality and dividend sustainability. The outlook appears supported by margin momentum and prudent leverage, contingent on continued demand and disciplined cost control. Key monitoring items include cash generation, working capital trends, and the durability of elevated operating margins. Data limitations—especially around cash flows, D&A, and dividends—are material and temper confidence in cash-based assessments.

Profitability Analysis

ROE decomposition (DuPont): Net profit margin 12.77% × Asset turnover 0.681 × Financial leverage 2.46 ≈ ROE 21.44%, matching the provided reported ROE. Gross margin is 33.5% (gross profit ¥1,409 million on revenue ¥4,212 million), indicating healthy unit economics for a software/security-centric model. Operating margin is approximately 18.9% (¥795 million/¥4,212 million), reflecting significant operating leverage as operating income grew 117.6% on 21.9% revenue growth. The spread between gross and operating margin (~14.6ppt) suggests effective control of SG&A relative to revenue growth, likely including positive scale effects in sales and R&D. Net margin of 12.8% remains strong even after financing costs (interest expense ¥5.0 million is negligible vs. operating income) and taxes. Interest coverage is robust at about 157.7x, underscoring minimal financing drag on profitability. The effective tax rate inferred at ~13.9% (¥110 million/¥791 million ordinary income) is below the statutory rate, possibly due to tax credits or timing; sustainability should be monitored. EBITDA-related metrics are not reliable because D&A is unreported (0 placeholder), so true EBITDA and EBITDA margin are likely higher than shown. Overall margin quality appears solid, with clear evidence of operating leverage and disciplined opex. Continued margin durability will depend on maintaining pricing power, customer retention, and controlled headcount and partner costs.

Growth Assessment

Revenue grew 21.9% YoY to ¥4,212 million, indicating strong demand for the company’s offerings. Operating income growth of 117.6% YoY far outpaced revenue, evidencing strong operating leverage and cost containment or mix improvements. Net income growth of 101.5% YoY reflects both margin expansion and low financing burden. The sustainability of revenue growth will hinge on recurring revenue mix, renewal rates, upsell activity, and new logo acquisition—data not provided here but critical for outlook. Gross margin at 33.5% is stable-to-healthy for a software/security vendor, suggesting resilient pricing and favorable mix. Profit quality appears strong on an accrual basis; however, the absence of cash flow disclosure prevents assessment of cash conversion and working capital intensity. Asset turnover (0.681x) suggests moderate capital intensity and indicates additional efficiency gains could support ROE if growth continues. Outlook: with strong YTD profitability and ample working capital, the company is positioned to fund organic growth; external financing needs appear limited given low interest expense. Risks to growth include competitive pricing pressure, sales cycle elongation, and dependency on key products or channels. Monitoring ARR/retention, pipeline conversion, and backlog (if applicable) is essential to gauge forward momentum.

Financial Health

Liquidity is adequate with current assets of ¥4,697 million and current liabilities of ¥2,962 million, yielding a current ratio of ~1.59x and working capital of ~¥1,735 million. Quick ratio is shown equal to current ratio because inventories are reported as 0; note that 0 likely indicates not disclosed, so true quick ratio may be slightly lower, though probably similar if inventories are minimal for a software-centric model. Total liabilities are ¥3,283 million against equity of ¥2,509 million, producing liabilities/equity of 1.31x and assets/equity (financial leverage) of 2.46x—moderate leverage levels for a growth company. The economic equity ratio (equity/assets) is approximately 40.6% despite a reported placeholder of 0.0%, indicating a reasonably capitalized balance sheet. Interest expense is low at ¥5.0 million, and interest coverage is very strong (~158x), suggesting minimal refinancing risk. Without cash and debt detail (cash reported as 0 is not disclosed), net cash/Net debt cannot be determined. Overall solvency appears sound, but the lack of cash balance disclosure limits a full liquidity appraisal.

Cash Flow Quality

Cash flow data (operating, investing, financing) are unreported (shown as 0), so OCF/Net income and FCF cannot be evaluated from this dataset. As a result, earnings quality cannot be corroborated by cash conversion metrics, and the stated OCF/NI ratio of 0.00 should be treated as not available. Working capital appears ample on the balance sheet (¥1,735 million), but without period changes in receivables, payables, and deferred revenue, we cannot assess whether growth is consuming or releasing cash. Depreciation and amortization are unreported, preventing reconciliation from operating income to cash flow and impairing any EBITDA-based quality checks. Capex levels are also not disclosed, so maintenance vs. growth investment split is unknown. Key to future assessment will be disclosure of OCF, FCF, changes in trade receivables/payables, and deferred revenue movements (if a subscription model is material).

Dividend Sustainability

Dividend-related data are not disclosed: DPS and payout ratio are shown as 0, which should be treated as unavailable rather than actual zeros. Net income is ¥538 million, but with no OCF or FCF disclosure, we cannot evaluate cash-based coverage. The company’s balance sheet leverage is moderate and interest burden low, implying capacity for reinvestment or potential future returns, but any assessment of dividend sustainability requires visibility into recurring FCF generation and capital allocation policy. Until cash flows and explicit policy guidance are available, payout sustainability cannot be determined from this dataset.

Risk Assessment

Business Risks:

• Competitive intensity in cybersecurity/network management software potentially pressuring pricing and margins
• Dependence on renewal rates and customer retention for recurring revenue stability
• Product obsolescence risk given rapid technology shifts and evolving security threats
• Channel partner performance and concentration risk (if indirect sales are material)
• Sales cycle elongation amid macro uncertainty, affecting bookings and revenue timing
• Talent acquisition and retention in engineering and security domains
• Regulatory and compliance changes impacting demand or required product features

Financial Risks:

• Limited visibility on cash generation due to unreported OCF/FCF and cash balance
• Working capital expansion risk as business scales (receivables and deferred revenue timing)
• Moderate leverage via liabilities/equity of 1.31x, though interest burden is currently low
• Tax rate volatility given observed effective tax rate below statutory levels
• Potential currency exposure on procurement or overseas sales (not disclosed)

Key Concerns:

• Absence of cash flow disclosure prevents validation of earnings quality and FCF
• Unreported D&A obscures true EBITDA and capital intensity
• Dividend policy and capital return intentions are unclear due to lack of DPS information

Investment Implications

Key Takeaways:

• Strong revenue growth (+21.9% YoY) coupled with outsized operating income growth (+117.6% YoY) demonstrates operating leverage
• ROE of 21.44% is supported by healthy margins, moderate asset turnover, and manageable leverage
• Balance sheet capitalization appears solid with an inferred equity ratio of ~40.6% and high interest coverage (~158x)
• Margin structure (33.5% gross, ~18.9% operating) suggests resilient pricing and cost discipline
• Cash flow and dividend visibility are limited due to unreported OCF, FCF, cash balance, and DPS

Metrics to Watch:

• Operating cash flow and OCF/Net income conversion
• Free cash flow after capex and capitalized development costs
• Deferred revenue/ARR growth and net retention rate
• DSO and working capital turns
• Gross margin stability and operating margin trajectory
• Headcount growth vs. revenue growth (opex efficiency)
• Effective tax rate normalization

Relative Positioning: Against TSE Growth/Information & Communication peers, the company exhibits above-peer revenue growth and superior operating leverage, with mid-40% inferred equity ratio and minimal interest burden; lack of cash flow disclosure is a relative analytical gap.

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