| Metric | This Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥8794.6B | ¥8404.0B | +4.6% |
| Operating Income | ¥288.2B | ¥164.9B | +74.7% |
| Profit Before Tax | ¥3.8B | ¥-85.2B | +772.8% |
| Net Income | ¥55.1B | ¥-134.7B | -27.4% |
| ROE | 3.0% | -9.5% | - |
For the fiscal year ended March 2026, Revenue was ¥8,794.6B (YoY +¥390.6B, +4.6%), Operating Income was ¥288.2B (YoY +¥123.3B, +74.7%), Ordinary Income was ¥19.6B (YoY +¥24.1B), and Net Income attributable to owners of the parent was ¥44.2B (YoY +¥181.5B). Revenue growth was secured through price revision effects and recovering demand, and gross margin improved materially to 22.3% (up +2.3pt from 20.0% a year earlier), driving a significant recovery in Operating Income (+74.7% YoY). However, financial expenses of ¥329.7B exceeded EBIT of ¥288.2B, leaving Profit Before Tax at ¥3.8B. A tax benefit of -¥51.3B (tax income recorded) resulted in Net Income of ¥55.1B and Net Income attributable to owners of the parent of ¥44.2B, achieving a return to profitability. Comprehensive income was ¥310.0B, turning sharply positive from -¥312.1B the prior year, driven by foreign currency translation gains of +¥123.4B and remeasurements of defined benefit plans +¥40.6B.
[Revenue] Revenue was ¥8,794.6B (YoY +4.6%), achieving top-line growth. The YoY increase of ¥390.6B was driven by the penetration of price revisions in key markets and a recovery in architectural and automotive glass demand. Although segment disclosure is not provided, the improvement in gross margin to 22.3% (up +2.3pt from 20.0%) suggests price-led revenue growth and an improved product mix. Cost of sales was limited to ¥6,835.4B (from ¥6,722.3B prior year, +1.7%), growing below revenue and expanding gross profit.
[Profitability] Operating Income was ¥288.2B (YoY +74.7%), a substantial increase, and the Operating Margin recovered to 3.3% (up +1.3pt from 2.0%). Selling expenses were ¥760.5B (from ¥673.9B, +12.8%), and administrative expenses were ¥867.6B (from ¥802.1B, +8.2%); SG&A rose but was absorbed by gross profit expansion (Gross Profit ¥1,959.2B, from ¥1,681.7B, +16.5%). Operating Income after individually disclosed items was ¥233.0B, with net positive impact of approximately ¥55B from individually disclosed item income ¥34.1B and expenses ¥89.3B. Financial income was ¥47.0B versus financial expenses of ¥329.7B (net -¥282.7B), posing a heavy interest burden; even with equity-method investment income of ¥57.1B, Profit Before Tax was limited to ¥3.8B. A tax benefit of -¥51.3B yielded Net Income of ¥55.1B, and after non-controlling interests of ¥10.9B, Net Income attributable to owners of the parent was ¥44.2B. In conclusion, while top- and operating-level performance improved, the bottom line remains structurally dependent on interest burden and tax effects.
[Profitability] Operating Margin was 3.3% (up +1.3pt from 2.0%), and Gross Margin was 22.3% (up +2.3pt from 20.0%), indicating improving profitability driven by price revisions and cost control. ROE was 3.4% (turning positive from -11.9% prior year), but Net Profit Margin remains low at 0.6%, with financial expenses of ¥329.7B exceeding EBIT of ¥288.2B representing a structural drag. Equity-method investment income of ¥57.1B is 15x Profit Before Tax of ¥3.8B, indicating high reliance on equity-method results for consolidated earnings.
[Cash Quality] Operating Cash Flow (OCF) was ¥336.2B, 6.1x Net Income of ¥55.1B; OCF / Net Income attributable to owners of the parent was 7.6x, demonstrating strong cash backing of earnings. OCF subtotal (pre-working capital changes) was ¥637.4B, with working capital increase of -¥301.2B (inventory +¥210.1B, trade receivables +¥45.5B, etc.) pressuring OCF. Free Cash Flow (FCF) was ¥10.6B (OCF ¥336.2B - Investing CF ¥325.6B), remaining only slightly positive, and CapEx of ¥418.5B is not fully covered by OCF.
[Investment Efficiency] Total Asset Turnover was 0.79x (Revenue ¥8,794.6B ÷ Total Assets ¥11,174.9B), broadly flat. Inventory increased to ¥1,855.1B, and inventory days were approximately 99 days (Inventory ÷ Cost of Sales × 365), high and indicating room to improve working capital efficiency. CapEx was ¥418.5B, 4.8% of Revenue, exceeding depreciation and indicating continued capacity expansion.
[Financial Soundness] Equity Ratio was 13.5% (up +3.0pt from 10.5%), still low; D/E ratio was approximately 5.0x (Interest-bearing debt ¥5,471.8B ÷ Net Assets ¥1,855.2B), reflecting high leverage. Current liabilities increased to ¥5,602.8B (from ¥4,094.4B, +36.9%), including short-term borrowings of ¥3,078.0B (from ¥1,770.1B, +73.9%), indicating shortening of debt maturities. Current Ratio was approximately 0.61x (Current Assets ¥3,418.5B ÷ Current Liabilities ¥5,602.8B), below the 1.0 caution threshold. Interest paid of ¥285.3B is close to EBIT of ¥288.2B, leaving Interest Coverage at about 1.0x and financially fragile. Goodwill of ¥873.5B is 47.1% of Net Assets, implying sensitivity to impairment. Deferred tax assets were ¥466.9B (from ¥373.9B, +24.9%), subject to realization risk depending on future taxable income.
OCF was ¥336.2B (from ¥524.2B prior year, -35.9%), calculated as OCF subtotal ¥637.4B less working capital increase of -¥301.2B. Inventory increase +¥210.1B and trade receivables increase +¥45.5B were primary drivers; inventories rose to ¥1,855.1B and inventory days remained elevated at roughly 99 days. Interest paid ¥285.3B and corporate tax payments ¥47.0B were fixed cash outflows. Investing CF was -¥325.6B, led by CapEx of -¥418.5B, partially offset by proceeds from sale of tangible fixed assets ¥15.6B, sale of FVTOCI financial assets ¥49.3B, and dividends received from equity-method affiliates ¥64.0B. Financing CF was -¥146.6B, with borrowings executed ¥2,751.5B and repayments -¥2,866.3B, net repayment -¥114.7B, and dividend payments -¥19.5B (to owners of parent -¥19.5B, to non-controlling interests -¥12.4B). FCF was slightly positive at ¥10.6B, indicating that CapEx and interest burden are not fully covered by OCF and continue to be supplemented by asset sales and dividend receipts. Cash and cash equivalents declined to ¥551.0B (from ¥629.8B at the beginning of the period, including foreign exchange translation +¥26.9B and hyperinflation adjustment +¥30.4B), leaving liquidity thin.
Of Operating Income ¥288.2B, the Operating Income after individually disclosed items was ¥233.0B after excluding net effects of about ¥55B (Individually disclosed item income ¥34.1B, expenses ¥89.3B), indicating temporary items have boosted headline Operating Income. Financial income ¥47.0B includes interest and dividend income ¥31.1B and is recurring, but financial expenses ¥329.7B, mainly interest paid ¥285.3B, are high and the net financial position of -¥282.7B is a persistent earnings headwind. Equity-method investment income of ¥57.1B is 15x Profit Before Tax of ¥3.8B, showing consolidated earnings are highly dependent on equity-method income. A tax benefit of -¥51.3B lifted Net Income, but a tax benefit of ¥49.4B was also recorded in the prior year; the realizability of deferred tax assets of ¥466.9B will affect future tax burden. Comprehensive income ¥310.0B comprises Net Income ¥55.1B plus Other Comprehensive Income of +¥254.9B (foreign currency translation +¥123.4B, remeasurement of defined benefit plans +¥40.6B, FVTOCI financial asset valuation gains +¥51.8B, etc.), reflecting substantial improvement from currency and pension valuation changes. OCF ¥336.2B is 6.1x Net Income ¥55.1B, supporting strong cash backing of earnings and suggesting no excessive accrual buildup.
Full-year forecast: Revenue ¥8,800.0B (vs. this period +0.1%), Operating Income ¥360.0B (vs. this period +24.9%), Net Income ¥40.0B (vs. this period -27.4%), Net Income attributable to owners of the parent ¥30.0B (vs. this period -32.1%). This period results were Revenue ¥8,794.6B (99.9% of forecast), Operating Income ¥288.2B (80.1% of forecast, shortfall), Net Income ¥55.1B (137.8% of forecast, exceedance), and Net Income attributable to owners of the parent ¥44.2B (147.3% of forecast, exceedance). The shortfall in Operating Income vs. forecast was due to individually disclosed item expenses and SG&A increases that constrained core profitability. Conversely, Net Income exceeded forecasts significantly due to the recorded tax benefit. The forecasted dividend remains ¥0, and resumption of dividends was deferred. Progress vs. full-year forecast is 99.9% for Revenue and 80.1% for Operating Income; Operating Income lags and requires a second-half catch-up.
No dividend was paid at either interim or year-end; annual dividend is ¥0, maintaining no payout. Dividend payments to owners of the parent of ¥19.5B are presumed to be preferred dividends on Class A preferred shares, with no ordinary share dividend paid. Payout Ratio is 0% (ordinary share basis), reflecting a conservative stance. Share buybacks were effectively not executed (Treasury stock acquisition ¥0.0B), and Total Return Ratio is 0%. Under FCF ¥10.6B and interest-bearing debt ¥5,471.8B with D/E ratio 5.0x, deleveraging and reduction of debt service costs are priority tasks, and dividend resumption will depend on stable FCF generation and balance sheet improvement. All Class A preferred shares (25,308 shares) were converted to common shares during FY2026, and the Class A dividend burden is expected to be removed from FY2027 onward.
Interest burden and short-term debt concentration risk: Financial expenses of ¥329.7B exceed EBIT of ¥288.2B, leaving Interest Coverage at approximately 1.0x, an extremely low level. Short-term borrowings surged to ¥3,078.0B (YoY +73.9%), while long-term borrowings decreased to ¥2,393.7B (YoY -30.8%), indicating maturity concentration through tenor replacement. Current Ratio is approximately 0.61x, below the 1.0 caution level. Interest rate increases or deterioration of refinancing conditions could sharply impact liquidity and finance costs.
Inventory build-up and working capital efficiency risk: Inventories increased to ¥1,855.1B (from ¥1,645.0B, +12.8%), and inventory days are about 99 days, indicating inventory accumulation. Working capital increase of -¥301.2B against OCF subtotal ¥637.4B weighed on cash flow, with inventory increase +¥210.1B the main factor. Demand softness or adverse product mix could trigger write-downs or discounting risk and reduce cash generation.
Dependence on equity-method investment income and uncertainty of tax effects: Equity-method investment income of ¥57.1B is 15x Profit Before Tax of ¥3.8B, meaning consolidated results are significantly influenced by affiliates’ performance. Net Income was boosted by a tax benefit of -¥51.3B, but the realizability of deferred tax assets of ¥466.9B (from ¥373.9B, +24.9%) depends on future taxable income and poses impairment risk or reversal of tax benefits.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Return on Equity | 3.4% | 6.3% (3.2%–9.9%) | -2.9pt |
| Operating Margin | 3.3% | 7.8% (4.6%–12.3%) | -4.5pt |
| Net Profit Margin | 0.6% | 5.2% (2.3%–8.2%) | -4.6pt |
Profitability metrics lag industry medians, with Operating Margin and Net Profit Margin more than 4pt below industry averages, indicating a low-return structure.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 4.6% | 3.7% (-0.4%–9.3%) | +0.9pt |
Revenue growth exceeds the industry median, reflecting demand recovery and price revision-driven revenue gains.
※Source: Company aggregation
Progress on price revisions and cost control improved Gross Margin to 22.3% (YoY +2.3pt) and Operating Margin to 3.3% (YoY +1.3pt), showing an improving profitability trend. Operating Income increased YoY by +74.7%, indicating the P/L is entering a trough-recovery phase. Sustainable profit improvement hinges on normalizing inventory turnover (reducing inventory days from 99) and containing SG&A relative to sales.
The structure where financial expenses of ¥329.7B exceed EBIT of ¥288.2B is the largest earnings bottleneck: Interest Coverage is about 1.0x, D/E ratio 5.0x, and Equity Ratio 13.5%, indicating persistent financial fragility. The sharp rise in short-term borrowings (+73.9%) increases refinancing concentration risk and current ratio ~0.61x is below the 1.0 caution threshold. Priority KPIs are deleveraging, lengthening and fixing debt profile, and working capital compression to improve FCF generation. The conversion completion of all Class A preferred shares is a positive for capital policy as it removes preferred dividend burden.
This report was automatically generated by AI analyzing XBRL financial statement data. It does not constitute investment advice for any specific security. Industry benchmarks are compiled by the Company based on public financial statements and are for reference only. Investment decisions are your own responsibility; consult a professional advisor as needed.