BPLATS,Inc. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥336M
• Operating Income: ¥-66M
• Net Income: ¥-87M
• EPS: ¥-35.02

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

Verdict: Weak quarter with contracting top line and a swing to losses, partially cushioned by positive operating cash flow but overshadowed by acute liquidity and leverage stress. Revenue fell to 3.36 (−8.2% YoY), with gross profit of 1.14 and gross margin at 33.9%. SG&A remained heavy at 1.81, representing 53.9% of sales, driving operating loss to −0.66 and ordinary loss to −0.76. Operating margin was −19.6%, while EBITDA was positive at 0.70 (20.8% margin) due to high non-cash D&A of 1.36 linked to sizable intangible assets (8.28 on the balance sheet). Net income printed at −0.86, translating to −35.02 yen basic EPS and ROE of −42.0%. Asset efficiency remains weak with asset turnover at 0.309, reflecting a large fixed (intangible) asset base relative to sales. Financial leverage is high at 5.31x, amplifying the negative NPM into a deep ROE loss. Margin comparison in basis points is not determinable due to lack of comparable YoY margin disclosure; however, the move to operating losses indicates material margin compression. Cash flow quality is mixed: operating cash flow was positive at 1.07 despite the net loss, yielding an OCF/NI of −1.24x (flag by benchmark), but the positivity is primarily driven by non-cash amortization and likely working capital effects. Liquidity is strained: current ratio at 0.52 and working capital at −2.33, with short-term loans of 2.50 dominating the current liability stack (current liabilities 4.85). Solvency risk is elevated as D/E stands at 4.31x and interest coverage is deeply negative (−12.0x), though reported interest expense is modest at 0.05 in the period. ROIC is −16.5%, well below a 5% warning threshold, indicating destruction of capital at current earnings levels. Equity is thin at 2.05 with retained earnings of −0.78, driving a low book value per share of 82.72 yen and vulnerability to further losses. Financing cash inflow of 0.69 suggests reliance on external funding; with OCF positive, near-term liquidity may be managed but refinancing risk remains high given the current ratio. Forward-looking, margin repair (SG&A discipline) and revenue stabilization are mandatory to avoid covenant or refinancing pressures; cash preservation and deleveraging are likely priorities, with the intangible-heavy model implying sustained D&A and ongoing pressure on accounting earnings.

Profitability Analysis

ROE decomposition: ROE (−42.0%) = Net Profit Margin (−25.6%) × Asset Turnover (0.309) × Financial Leverage (5.31x). The dominant negative driver this quarter is Net Profit Margin turning deeply negative (operating margin −19.6%), outweighing leverage benefits. Asset turnover remains low due to a large intangible asset base (8.28), suppressing sales-to-assets efficiency. The business reasons: revenue decline (−8.2% YoY), SG&A rigidity at 53.9% of sales, and high non-cash amortization (1.36) pressured operating income. Sustainability: the compression appears cyclical/operational rather than one-off, as amortization will persist and SG&A flexibility is limited short term; margin recovery would require revenue reacceleration and cost actions. Concerning trends: SG&A growth vs revenue is not disclosed, but the fixed-cost nature of SG&A relative to a shrinking topline suggests deleveraging pressure; interest coverage (−12.0x) underlines insufficient operating profits to service debt.

Growth Assessment

Revenue contracted 8.2% YoY to 3.36, signaling demand or client ramp delays in core offerings. Gross margin at 33.9% is moderate for a software/subscription-oriented model but insufficient given SG&A intensity. EBITDA margin of 20.8% indicates underlying cash earnings before amortization remain positive; however, high D&A (1.36) drives accounting losses. Without segment data, sustainability of revenue is unclear; near-term growth likely hinges on new bookings, churn control, and upsell of subscription services. The negative ordinary income (−0.76) and PBT (−0.74) highlight limited contribution from non-operating items. Outlook: stabilization requires cost realignment and monetization of the intangible asset base; absent topline improvement, profitability recovery is challenging. Watch for pipeline conversion, ARPU trends, and any price increases to defend margins.

Financial Health

Liquidity is weak: current ratio at 0.52 (warning) and quick ratio at 0.52. Short-term loans of 2.50 vs current assets of 2.52 indicate tight coverage, but total current liabilities are 4.85, resulting in a working capital deficit of −2.33. Solvency is stretched: D/E at 4.31x, total liabilities 8.83 on equity 2.05, implying low equity cushion. Interest coverage is negative (−12.0x), pointing to inadequate operating earnings to cover interest, though current period interest expense is 0.05. Maturity mismatch risk is high given the reliance on short-term borrowings and limited liquid assets (cash 1.51, receivables 0.77). Noncurrent liabilities at 3.98 include 0.96 of long-term loans; refinancing of short-term lines appears critical. No off-balance sheet obligations were disclosed in the provided data.

Cash Flow Quality

OCF was positive at 1.07 despite a net loss of −0.86, yielding an OCF/NI of −1.24x, which triggers a quality flag by benchmark but reflects non-cash add-backs (D&A 1.36) and likely working capital effects rather than aggressive accounting. Capex was modest at −0.09; investing CF overall was unreported, limiting full FCF assessment. Indicatively, OCF minus capex would be about 0.98 if capex were the only investing outflow, but this is uncertain without full investing CF detail. Financing CF was +0.69, suggesting continued reliance on debt or other financing to support liquidity. Working capital movements are not detailed; however, positive OCF amid losses suggests accruals and amortization effects rather than cash earnings strength; monitor receivables and deferred revenue changes for potential timing effects.

Dividend Sustainability

No dividend data was reported for the period. With net losses (−0.86), negative ROE (−42.0%), weak liquidity (current ratio 0.52), and high leverage (D/E 4.31x), capacity to initiate or sustain cash dividends appears limited. OCF was positive, but given refinancing needs and working capital deficit, prudent cash retention is likely. Payout ratio and FCF coverage are not calculable with available data.

Risk Assessment

Business Risks:

• Revenue decline (−8.2% YoY) indicating potential demand softness or competitive pressure
• High SG&A intensity (53.9% of sales) limiting operating leverage
• Large intangible asset base (8.28) with high amortization (1.36) depressing GAAP profitability

Financial Risks:

• Low liquidity: current ratio 0.52 and working capital −2.33
• High leverage: D/E 4.31x and reliance on short-term loans (2.50)
• Negative interest coverage (−12.0x), elevating debt service risk
• Thin equity base (equity 2.05; retained earnings −0.78) increasing breach risk under further losses

Key Concerns:

• Maturity mismatch: current liabilities 4.85 vs current assets 2.52
• Dependence on external financing (financing CF +0.69) amid operating losses
• Tax expense (0.12) despite pre-tax loss (−0.74), implying potential non-deductibility or valuation allowance effects

Investment Implications

Key Takeaways:

• Top-line contraction with negative operating income and ROE at −42.0%
• Positive EBITDA (0.70) and OCF (1.07) sustained by non-cash amortization
• Liquidity and leverage are the binding constraints (current ratio 0.52; D/E 4.31x)
• ROIC at −16.5% signals capital destruction at current run-rate
• Short-term debt dependence elevates refinancing risk

Metrics to Watch:

• Bookings growth, churn, and ARPU to gauge revenue recovery
• SG&A run-rate versus revenue (operating leverage)
• Deferred revenue and receivables trends (cash conversion)
• Debt maturity schedule and refinancing actions, short-term loan rollovers
• Gross margin stability and D&A trajectory

Relative Positioning: Relative to domestic small-cap software/platform peers, profitability and liquidity are weaker due to high amortization burden and under-scaled revenue base; cash generation before capex is comparatively better, but balance sheet constraints and refinancing needs place the company at a disadvantage until margins and scale improve.

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
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