These are mechanically computed values based on a residual income model. They are not a forecast of market prices or a recommendation of any investment action, and do not predict or guarantee future share prices. Historical values are computed retrospectively using current guidance-achievement statistics.
| Metric | Current Period | Same Period of Previous Year | YoY |
|---|---|---|---|
| Revenue | ¥2168.4B | ¥1994.6B | +8.7% |
| Operating Income | ¥207.0B | ¥133.8B | +54.7% |
| Profit Before Tax | ¥225.0B | ¥146.5B | +53.6% |
| Net Income | ¥127.0B | ¥111.4B | +14.1% |
| ROE | 3.5% | 3.2% | - |
In addition to revenue growth, operating income increased by double digits, resulting in earnings that demonstrate continued improvement in profitability. Revenue was ¥2,168.4B (+8.7% year on year), operating income was ¥207.0B (+54.7%), profit before tax was ¥225.0B, and net income attributable to owners of the parent was ¥108.4B (+12.9%). High growth in the Overseas segment and improvement in gross margin drove the increase in earnings, while the higher effective tax rate restrained net income growth.
【Revenue】Revenue was ¥2,168.4B, representing an 8.7% year-on-year increase. By segment, Overseas was the largest growth driver at ¥904.4B (41.7% of total, YoY +21.2%), while General Consumer Products maintained stability as the core business at ¥1,067.5B (49.2% of total, YoY +1.6%). Industrial Products was nearly flat at ¥191.3B (YoY -0.3%).
【Profit and Loss】The gross margin improved by +1.5pt year on year to 46.9%, apparently reflecting the contribution of price revisions and an improved product mix. Although the selling, general and administrative expense ratio rose slightly to 39.8% (+0.8pt), the improvement in gross margin more than offset this increase, expanding the operating margin to 9.5% from 6.7% in the previous year. Profit before tax was ¥225.0B (+53.6%), but the high tax burden of ¥98.0B in corporate income taxes and other taxes (effective tax rate of approximately 43.6%) restrained net income growth, with net income attributable to owners of the parent limited to ¥108.4B (YoY +12.9%). Revenue and profit both increased.
The revenue mix was General Consumer Products 49.2%, Overseas 41.7%, and Industrial Products 8.8%, indicating a relatively higher reliance on the Overseas Business. Overseas was the primary driver of overall growth at YoY +21.2%, while General Consumer Products (+1.6%) and Industrial Products (-0.3%) were generally flat. This imbalance in the growth structure indicates that future foreign exchange trends and the competitive environment in overseas markets will have a greater impact on overall company performance.
【Profitability】The operating margin improved significantly to 9.5% from 6.7% in the previous year, while the gross margin was 46.9% (+1.5pt), indicating the effects of cost management and pricing strategies. The net profit margin was 5.0% based on net income attributable to owners of the parent, representing a slight improvement from the previous year; however, the high effective tax rate of approximately 43.6% limited the upside.【Cash Flow Quality】Operating Cash Flow (OCF) was ¥95.4B, a substantial recovery of +416.2% year on year. Cash conversion of net income was generally sound, although the increase in inventories (-¥49.1B) and decrease in trade payables (-¥98.5B) were constraining factors from a working capital perspective.【Investment Efficiency】ROE was 3.5%, and capital efficiency remained low compared with peers when viewed in terms of the combination of total asset turnover and financial leverage.【Financial Soundness】The equity ratio was 62.5% (61.1% in the previous year), indicating a strong capital structure. Short-term borrowings were minimal, while cash and cash equivalents of ¥834.0B provided substantial liquidity, supporting a stable financial foundation.
OCF was ¥95.4B, a substantial recovery of +416.2% year on year. In addition to the increase in profit before tax, the subtotal before changes in working capital of ¥122.2B indicates that the cash-generating capacity of the core business improved. However, the increase in inventories (-¥49.1B) and decrease in trade payables (-¥98.5B) weighed on cash generation from working capital, while corporate income taxes and other taxes paid of ¥38.1B also reduced net OCF. Investing Cash Flow was -¥36.7B, with capital expenditures of ¥45.8B representing the primary use of funds. Financing Cash Flow was -¥112.1B, with dividend payments of ¥41.5B and debt repayments, among other items, serving as sources of cash outflow. As a result, free cash flow (OCF + investing cash flow) was ¥58.6B, a level that generally covers dividends and capital expenditures; however, the structure is susceptible to fluctuations depending on working capital trends.
Most earnings were generated from recurring business activities, and the impact of temporary factors was limited. Other income of ¥79.8B and other expenses of ¥26.1B were recorded, but their respective ratios to revenue were approximately 3.7% and 1.2%, and neither was large enough to materially affect performance. Equity-method investment gains contributed ¥10.1B. Meanwhile, corporate income taxes and other taxes of ¥98.0B against profit before tax of ¥225.0B represented a heavy burden, with the high effective tax rate of approximately 43.6% creating a structure in which recurring profit growth is constrained at the net income level. OCF of ¥95.4B was slightly below net income of ¥127.0B, and the fact that changes in working capital items such as inventories and trade payables delayed the conversion of some earnings into cash should be noted when assessing earnings quality.
Progress against the full-year plan was 50.4% for revenue (¥2,168.4B/¥4,300.0B) and 51.8% for operating income (¥207.0B/¥400.0B), slightly ahead of the standard quarterly progress rate of 50%. Meanwhile, for net income, smoothing of the tax burden in the second half of the fiscal year will be key to achievement within the range for which the progress rate can be confirmed. The full-year forecast calls for revenue growth of +1.9% and operating income growth of +10.0%, and there were no revisions to the earnings or dividend forecasts as of Q2.
The interim dividend was ¥17 per share, and the full-year dividend forecast is ¥34. Based on the company’s full-year forecast of earnings per share of ¥90.38, the payout ratio is approximately 37.6%. Share buybacks were negligible (-¥0.0B), and shareholder returns consist primarily of dividends. The interim dividend was increased from the previous year’s dividend of ¥15 per share, indicating an upward trend in dividends.
Working capital accumulation risk: Inventories of -¥49.1B and trade payables of -¥98.5B were factors depressing cash flow, and fluctuations in inventory and payment cycles could increase OCF volatility.
Risk of continued high tax burden: The effective tax rate was high at approximately 43.6% (corporate income taxes and other taxes of ¥98.0B ÷ profit before tax of ¥225.0B). If the tax burden is not smoothed, net income growth may continue to be restrained relative to revenue and operating income growth.
Impairment risk associated with goodwill growth: Goodwill stood at ¥385.7B (a substantial increase year on year). If the integration of newly consolidated subsidiaries falls behind plan, future impairment risk will need to be monitored.
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 9.5% | 9.7% (5.4%–23.7%) | -0.1pt |
| Net Profit Margin | 5.9% | 5.4% (1.3%–20.1%) | +0.5pt |
| Profitability was broadly in line with the industry median, with the net profit margin slightly above and the operating margin slightly below the median. |
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 8.7% | 10.6% (-3.4%–25.4%) | -1.9pt |
| The revenue growth rate was slightly below the industry median but remained within the industry IQR. |
※Source: Compiled by the Company
The operating margin improved by +2.8pt to 9.5% from 6.7% in the previous year, supported by an improved gross margin and cost management. Monitoring subsequent trends will be useful in determining whether this improvement reflects the establishment of the pricing strategy or temporary factors.
The effective tax rate was high at approximately 43.6%, and net income attributable to owners of the parent increased only +12.9% compared with the +53.6% increase in profit before tax. The extent to which the tax burden is smoothed will be a key point in evaluating future earnings progress.
Goodwill increased substantially from the previous year, reflecting the inclusion of 8 newly consolidated subsidiaries. Together with the high growth of the Overseas segment (+21.2%), the impact of overseas business expansion on the earnings structure may increase going forward.
This is a mechanically calculated reference range based solely on publicly disclosed data using a residual income model (Ohlson-type with an explicit 5-year fade). It is not a forecast of the market share price or a recommendation of any specific investment action.
| Scenario | Theoretical Share Price |
|---|---|
| bear | ¥1,139 |
| base | ¥1,162 |
| bull | ¥1,181 |
| Calculation Assumption | Value |
|---|---|
| Book Value Per Share (BPS) | ¥1,203 |
| Adjusted Forecast EPS | ¥97.2 |
| Cost of Equity r | 9.27% (10-year government bond 2.77% + equity risk premium 6.00% + size premium 0.50%) |
| Residual Income Persistence Coefficient ω / Explicit Forecast Period | 0.62 / 5 years |
| Assumed Payout Ratio | 37.6% |
| Forecast EPS Confidence Adjustment | ×1.075 (based on the industry’s historical guidance achievement rate) |
| Implied PBR / PER |
Sensitivity: ¥1,130–¥1,196 at ±1% for the cost of equity, and ¥1,161–¥1,163 at ±0.1 for ω.
Notes:
(Calculation model: Residual income model / Interest rate reference month: 2026-07 / This value does not predict or guarantee the future share price)
This report is an earnings analysis document automatically generated by AI based on XBRL earnings report data. It does not recommend investment in any specific security. The industry benchmarks are reference information compiled by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own responsibility and, where necessary, after consulting with a professional advisor.
---End of Report---
| 0.97x / 12.0x |