| Indicator | Current Period | Prior-year Period | YoY |
|---|---|---|---|
| Revenue | ¥459.9B | ¥433.1B | +6.2% |
| Operating Income | ¥41.7B | ¥34.3B | +21.7% |
| Ordinary Income | ¥39.9B | ¥33.7B | +18.4% |
| Net Income | ¥27.5B | ¥26.1B | +3.1% |
| ROE | 7.2% | 7.4% | - |
For Ishizuka Glass’s cumulative results for FY2026 Q3 (nine months), Revenue was ¥459.9B (YoY +¥26.8B +6.2%), Operating Income was ¥41.7B (YoY +¥7.4B +21.7%), Ordinary Income was ¥39.9B (YoY +¥6.2B +18.4%), and Net Income attributable to owners of the parent was ¥27.5B (YoY +¥1.4B +5.4%). The Operating Margin improved to 9.1%, supported by sales growth and SG&A efficiencies. Total assets were ¥1001.1B, roughly flat, while equity increased to ¥383.4B, lifting the Equity Ratio to 38.3%. By segment, the Plastic Container Business was the largest earnings driver with Revenue of ¥129.2B and Operating Income of ¥16.5B, while the Glass Bottle Business secured stable earnings with Operating Income of ¥7.5B. Full-year guidance calls for Revenue of ¥600B, Operating Income of ¥40B, Ordinary Income of ¥36.5B, and Net Income of ¥24.5B. Cumulative Q3 progress is 104% on an Operating Income basis and 109% for Ordinary Income, indicating upside; however, non-operating gains/losses in H2 are expected to be a swing factor.
[Profitability] ROE 6.8% (on an improving trend relative to the company’s historical trajectory and 1.9pt above the industry median of 4.9%), Operating Margin 9.1% (up +1.2pt from 7.9% in the prior year and 1.8pt above the industry median of 7.3%), Net Margin 6.0% (flat vs. 6.0% in the prior year and 0.6pt above the industry median of 5.4%), ROA 2.6% (Return on Assets, 0.7pt below the industry median of 3.3%). Revenue grew +6.2% YoY, outpacing the industry median of +2.8% by 3.4pt. A DuPont breakdown shows ROE 6.8% is composed of Net Margin 5.7% × Total Asset Turnover 0.459x × Financial Leverage 2.61x, with margin expansion the main driver of improvement. [Cash Quality] Cash and Deposits ¥36.9B; cash coverage versus Current Liabilities of ¥258.9B is a limited 0.14x, but coverage versus Current Assets of ¥471.9B yields 1.82x, which is solid. [Investment Efficiency] Total Asset Turnover 0.459x; Accounts Receivable ¥189.1B (18.9% of total assets); Inventories ¥102.3B (10.2% of total assets), indicating room to improve working capital efficiency. [Financial Soundness] Equity Ratio 38.3% (up +3.1pt from 35.2% in the prior year, but 25.6pt below the industry median of 63.9%); Current Ratio 182.2% (84.8pt below the industry median of 267% but at a healthy level); Quick Ratio 142.7%; Debt-to-Equity Ratio 1.61x, indicating a conservative capital structure. Interest-bearing Debt ¥172.6B; Interest Coverage 13.3x suggests ample debt service capacity; Debt/Capital ratio 31.0%.
Cash and Deposits rose slightly from ¥36.5B in the prior-year period to ¥36.9B (+¥0.4B), while Total Assets decreased from ¥1004.2B to ¥1001.1B (-¥3.1B), keeping the cash balance steady. In working capital efficiency, Accounts Receivable fell from ¥194.1B to ¥189.1B (-¥5.0B), indicating improved collections, whereas Inventories increased from ¥98.5B to ¥102.3B (+¥3.8B), suggesting some inventory build. Accounts Payable increased from ¥80.8B to ¥91.7B (+¥10.9B), improving funding efficiency through supplier credit. Short-term Borrowings were ¥39.5B, roughly flat; Long-term Borrowings decreased from ¥136.6B to ¥133.1B (-¥3.5B), reflecting ongoing reduction of interest-bearing debt. Current Liabilities declined from ¥262.5B to ¥258.9B, and with Current Assets of ¥471.9B, the Current Ratio stands at 182.2%, indicating ample short-term liquidity. Net Assets increased from ¥353.3B to ¥383.4B (+¥30.1B), presumably supported by retained earnings accumulation, strengthening equity. While cash coverage versus Current Liabilities of ¥258.9B is a low 0.14x, overall coverage through Current Assets is 1.82x, indicating payment capacity is secured assuming monetization of receivables and inventories.
With Ordinary Income of ¥39.9B and Operating Income of ¥41.7B, non-operating income and expenses posted a net negative contribution of -¥1.8B. Non-operating Income was ¥5.9B, including interest and dividend income and equity-method investment gains; Non-operating Expenses were ¥7.7B, with ¥3.1B of interest expense as a key item. The impact of non-operating gains/losses is limited to -0.4% of Revenue, with core operations underpinning profitability. Between Ordinary Income and Profit Before Tax for the quarter, Extraordinary Income of ¥0.4B and Extraordinary Loss of ¥1.8B occurred, for a net negative impact of -¥1.4B, though the amounts are limited. Gross Profit was ¥127.0B with a Gross Margin of 27.6%; SG&A was ¥85.3B with an SG&A-to-Revenue Ratio of 18.5%, indicating good conversion to Operating Income. The Operating Margin improved from 7.9% to 9.1% (+1.2pt), likely driven by fixed-cost absorption and pricing power. As Operating Cash Flow (OCF) data are not disclosed, we cannot directly assess the cash backing for Net Income of ¥27.5B, but the decline in Accounts Receivable and stable cash balance suggest operating cash generation is functioning to a certain extent. The quality of earnings is favorable, with recurring elements centered on core operations and limited impact from non-operating and extraordinary items.
Raw material price volatility risk: Procurement costs for raw materials such as glass, resin, and paper depend on market conditions; increases in raw material prices are a headwind to the 27.6% Gross Margin. Historical cases suggest that a 10% rise in crude oil/resin prices could reduce the Gross Margin by about 1pt, implying an approximate ¥4.6B profit impact on a Revenue scale of ¥460B. Foreign exchange risk: If there are import/export transactions and foreign currency-denominated assets/liabilities, JPY depreciation raises raw material costs, while JPY appreciation reduces export competitiveness. Foreign exchange gains/losses may be included in non-operating results; assuming part of the historical ¥7.7B in non-operating expenses was FX-related, there is scope for annual fluctuations on the order of ¥10B. Short-term liquidity risk: Cash of ¥36.9B is roughly on par with Short-term Borrowings of ¥39.5B, with cash coverage at 0.94x. Sudden shifts in working capital or concentrated capital expenditures could strain short-term funding. While the Current Ratio of 182.2% is healthy, the absolute cash balance is thin and a vulnerability.
[Position within Industry] (Reference information; our survey) Profitability: Operating Margin of 9.1% is 1.8pt above the industry median of 7.3%, placing the company in the mid-to-upper tier within manufacturing. Net Margin of 6.0% is 0.6pt above the industry median of 5.4%, above average. ROE of 6.8% is 1.9pt above the industry median of 4.9%, relatively favorable but still short of the upper-quartile (IQR) level of 8.2%, leaving room for improvement. Growth: Revenue growth of +6.2% outpaces the industry median of +2.8% by 3.4pt, placing the company among the faster growers within manufacturing. It is near the upper-quartile (IQR) 7.9% and in the leading group. Soundness: Equity Ratio of 38.3% is 25.6pt below the industry median of 63.9%, indicating a more leveraged capital structure within manufacturing. The Current Ratio of 182.2% is 84.8pt below the industry median of 267%, but near the lower IQR around 200%, placing short-term liquidity in the mid-to-lower tier in the industry. While Net Debt/EBITDA cannot be calculated due to insufficient data, based on Interest-bearing Debt of ¥172.6B and Operating Income of ¥41.7B, it is estimated at roughly 4.1x, indicating higher reliance on debt versus the industry median of -1.11x (many net cash companies). Efficiency: ROA of 2.6% is 0.7pt below the industry median of 3.3%, leaving room for improvement in asset efficiency. Total Asset Turnover of 0.459x is standard for manufacturing but low versus top-tier peers. Industry: Manufacturing (N=65 companies); Comparison period: 2025 Q3; Source: Our compilation.
Improving Operating Margin trend: Improved from 7.9% to 9.1% (+1.2pt), driven by both +6.2% sales growth and SG&A efficiencies. Against full-year forecast Operating Income of ¥40B, cumulative Q3 stands at ¥41.7B, or 104% progress, implying a conservative outlook that factors in an operating profit decline in H2. Raw material cost control and pricing power will be key to H2 performance. Balance between leverage and capital efficiency: While the Equity Ratio of 38.3% is low within the industry, the Debt-to-Equity Ratio of 1.61x is within investment-grade norms and sound. ROE of 6.8% exceeds the industry median of 4.9%, but with Total Asset Turnover at 0.459x remaining low, improving working capital efficiency (receivables and inventory management) to lift Total Asset Turnover above 0.5x could put ROE in the 8% range in sight. Dividend capacity and shareholder returns: Payout Ratio is 10.5% and extremely conservative. Against the full-year dividend outlook of ¥70, and the Net Income forecast of ¥24.5B, total dividends are estimated at approximately ¥2.9B, indicating a light dividend burden. Given Cash of ¥36.9B and the level of Operating Income, there is ample room for dividend increases; however, capital allocation between capex and growth investments will be a factor in decisions to expand shareholder returns.
This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It does not constitute a recommendation to invest in any specific security. The industry benchmarks are reference information compiled by our firm based on publicly available financial statements. Investment decisions are your own responsibility. Please consult a professional as needed before making any decisions.