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 | Year-Ago Period | YoY |
|---|---|---|---|
| Revenue | ¥23.36B | ¥22.72B | +2.8% |
| Operating Income | ¥1.52B | ¥1.00B | +51.4% |
| Ordinary Income | ¥1.58B | ¥0.92B | +71.9% |
| Net Income | ¥1.09B | ¥0.59B | +84.9% |
| ROE | 2.5% | 1.3% | - |
The first quarter recorded increases in both revenue and earnings, with the sharp 51.4% year-on-year improvement in operating income being the most notable feature. Revenue was ¥23.36B (+2.8% YoY), operating income was ¥1.52B (+51.4%), ordinary income was ¥1.58B (+71.9%), and net income attributable to owners of the parent was ¥0.999B (+102.8%; consolidated net income for the period, including non-controlling interests, was ¥1.09B, +84.9%). The primary drivers of earnings growth were improved gross margin and cost efficiencies resulting from SG&A expense control, as well as the shift from a foreign exchange loss in the previous year to a foreign exchange gain in the current period.
【Revenue】Revenue was ¥23.36B, representing a 2.8% year-on-year increase. By segment, Functional Products generated ¥11.18B (47.9% of total revenue, +7.8%), Vibration Control generated ¥9.67B (41.4%, -1.4%), Hoses generated ¥1.48B (6.3%, +15.4%), Metal Processing generated ¥0.96B (4.1%, -20.7%), and Life Science generated ¥0.27B (1.2%, +5.0%). Growth in Functional Products and Hoses drove the overall revenue increase, while Metal Processing posted a double-digit decline due to softer demand. In addition, the previous year’s first-quarter figures included a temporary revenue uplift of approximately ¥0.83B in total for Functional Products and Vibration Control due to a change in the fiscal year-end of a consolidated subsidiary. As a result, the underlying growth rate of Vibration Control may have been more resilient than the reported -1.4%.
【Profitability】The gross margin improved to 20.4% from 19.6% in the previous year, an improvement of +0.8pt, while the SG&A ratio declined to 14.0% from 15.2%, a decrease of -1.3pt. These two factors together lifted the operating margin to 6.5% from 4.4% in the previous year (+2.1pt). Ordinary income also benefited from an improvement in non-operating gains and losses, including the shift from a foreign exchange loss in the previous year to a foreign exchange gain of ¥0.05B in the current period, resulting in a 71.9% increase. Net income attributable to owners of the parent was ¥0.999B (+102.8%), and the net margin expanded to 4.3% from 2.2% in the previous year. The key feature was that earnings growth was led particularly by an improved cost structure.
Functional Products generated revenue of ¥11.18B (+7.8%) and operating income of ¥1.41B (+28.1%), with a 12.6% operating margin, driving growth in both revenue and earnings as the core business. Vibration Control posted a slight revenue decline to ¥9.67B (-1.4%), but operating income increased 24.7% to ¥0.87B, and the operating margin improved significantly to 9.0% from approximately 7.1% in the previous year, highlighting the effects of cost efficiencies. Hoses generated revenue of ¥1.48B (+15.4%) and operating income of ¥0.22B (+101.9%), more than doubling, with a 14.7% operating margin that exceeded the company-wide average. Meanwhile, Metal Processing generated revenue of ¥0.96B (-20.7%) and operating income of ¥0.03B (-10.0%), with the operating margin remaining at 2.8%, indicating a widening profitability gap among segments. Life Science, formerly Industrial Equipment, maintained a high profitability level, with a 22.6% operating margin despite its small scale.
【Profitability】The operating margin improved to 6.5% from 4.4% in the previous year (+2.1pt), while the net margin based on net income attributable to owners of the parent improved to 4.3% from 2.2% (+2.1pt). Margins expanded through the combined effects of improved gross margin and SG&A expense control.【Cash Conversion Quality】Days sales outstanding were approximately 82 days, inventory turnover days were approximately 32 days, and days payable outstanding were approximately 26 days, resulting in a cash conversion cycle of approximately 88 days. Working capital levels remained broadly stable.【Capital Efficiency】Total asset turnover was 0.286x on a quarterly basis, and ROE was 2.5%, with the improvement in net margin being the primary driver of the increase in ROE.【Financial Soundness】The equity ratio was 54.1% (53.6% in the previous year), the current ratio was 191.4%, and the quick ratio was 164.9%, indicating a high level of short-term payment capacity. Of interest-bearing debt of ¥15.68B, short-term borrowings amounted to ¥9.29B. Cash and deposits of ¥12.94B provided coverage of 1.4x short-term borrowings, while the interest coverage ratio was approximately 23.7x, indicating a limited interest burden.
As the statement of cash flows has not been disclosed, cash trends are assessed based on changes in the balance sheet. Cash and deposits were ¥12.94B, down ¥1.38B from ¥14.33B at the end of the previous fiscal year, in contrast to the improvement in earnings. This appears to reflect an increase in working capital: trade receivables increased by ¥0.76B from ¥20.298B to ¥21.06B, while accounts payable decreased by ¥0.21B from ¥5.59B to ¥5.37B. In addition, long-term borrowings declined from ¥6.94B to ¥6.39B, and short-term borrowings declined from ¥9.50B to ¥9.29B, with the reduction in interest-bearing debt also contributing to cash outflows. Whether earnings growth translates directly into cash generation will depend on future trends in working capital turnover.
The current period’s earnings growth was driven primarily by recurring factors—improved gross margin and SG&A expense control—and the quality of earnings can therefore be assessed as relatively high. However, non-operating gains and losses included a shift from a foreign exchange loss in the previous year to a foreign exchange gain of ¥0.05B in the current period. This element has a non-recurring nature and is subject to market fluctuations. Comprehensive income was ¥1.04B, while comprehensive income attributable to owners of the parent was ¥0.999B, nearly equal to net income attributable to owners of the parent of ¥0.999B for the same period. As OCI items, including valuation differences on other securities and foreign currency translation adjustments, effectively offset one another, the divergence between net income and comprehensive income was small and is considered to reflect the underlying level of earned income.
The full-year company forecasts are revenue of ¥85.00B (-5.6% from the previous fiscal year), operating income of ¥3.30B (-13.3%), and ordinary income of ¥3.30B (-14.6%), representing plans for declines in both revenue and earnings year on year. Against these forecasts, Q1 progress rates were 27.5% for revenue, 46.0% for operating income, and 47.9% for ordinary income, all exceeding the 25% benchmark based on simple quarterly allocation, with earnings progress particularly ahead of schedule. There were no revisions to the earnings or dividend forecasts. As the full-year plan itself conservatively assumes lower revenue and earnings year on year, the relationship between the strong Q1 progress and the full-year plan will need to be assessed by monitoring progress in subsequent quarters.
The full-year dividend forecast is ¥100.00 per share, and the payout ratio calculated using the company’s forecast EPS of ¥161.72 is approximately 61.8%. Although a simple comparison with the previous year’s actual interim dividend of ¥42.5 is not possible, the full-year shareholder return level has been set in conjunction with earnings growth. There were no revisions to the dividend forecast. Given the financial base comprising an equity ratio of 54.1% and cash and deposits of ¥12.94B, financial constraints on maintaining dividends for the time being appear limited.
Profitability gap among segments: Metal Processing generated revenue of ¥0.96B (-20.7%) and had an operating margin of only 2.8%, widening the gap with Functional Products (12.6%) and Hoses (14.7%). This is a dilutive factor relative to the company-wide operating margin of 6.5%.
Reliance on short-term interest-bearing debt: Of interest-bearing debt of ¥15.68B, short-term borrowings account for ¥9.29B, more than half of the total. Although cash and deposits of ¥12.94B provide 1.4x coverage, refinancing conditions require monitoring.
Volatility in non-operating gains and losses: The foreign exchange gain of ¥0.05B in the current period represents a shift from a foreign exchange loss in the previous year. Accordingly, part of the increase in ordinary income and net income has a non-recurring nature and depends on market conditions.
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 6.5% | 8.7% (4.2%–14.2%) | -2.2pt |
| Net Margin | 4.7% | 7.0% (3.2%–10.6%) | -2.4pt |
| The company’s profitability is below the industry median. Its improvement from the previous year should be considered separately from its relative position within the industry. |
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 2.8% | 6.2% (-1.1%–14.6%) | -3.5pt |
| Revenue growth was below the industry median, indicating a relatively modest pace of revenue expansion. |
※Source: Compiled by the Company
The operating margin improved from 4.4% in the previous year to 6.5%, an improvement of 2.1pt, driven by a change in the cost structure arising from improved gross margin (+0.8pt) and a lower SG&A ratio (-1.3pt). The earnings-led progress rate of 46.0% for the full year also indicates a structural recovery in profitability.
By segment, Functional Products, Vibration Control, and Hoses expanded with accompanying improvements in profitability, while Metal Processing continued to struggle with a 2.8% operating margin. The profitability gap within the segment portfolio remains a defining feature of the business mix.
Comprehensive income attributable to owners of the parent (¥0.999B) was nearly equal to net income attributable to owners of the parent (¥0.999B). No significant divergence arose from OCI items, indicating that the impact of temporary valuation gains or losses on current-period earnings was limited.
This is a mechanically calculated reference range based solely on publicly disclosed data using a residual income model (Ohlson-type model with an explicit five-year fade). It is not a forecast of the market share price or a recommendation to undertake any specific investment action.
| Scenario | Theoretical Share Price |
|---|---|
| bear | ¥2,727 |
| base | ¥2,771 |
| bull | ¥2,812 |
| Calculation Assumption | Value |
|---|---|
| Book Value per Share (BPS) | ¥3,106 |
| Adjusted Forecast EPS | ¥178.3 |
| Cost of Equity r | 9.77% (10-year government bond 2.77% + equity risk premium 6.00% + size premium 1.00%) |
| Residual Income Persistence Factor ω / Explicit Forecast Period | 0.62 / 5 years |
| Assumed Payout Ratio | 61.8% |
| Forecast EPS Confidence Adjustment | ×1.103 (based on the industry’s historical guidance achievement rate) |
| Implied PBR / PER |
Sensitivity: ¥2,697–¥2,848 at ±1% for the cost of equity, and ¥2,760–¥2,778 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 release 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, after consulting professionals as necessary.
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| 0.89x / 15.5x |