Nihon Yamamura Glass Co.,Ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥36.66B
• Operating Income: ¥2.57B
• Net Income: ¥2.12B
• EPS: ¥258.43

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment 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

Nihon Yamamura Glass (52100) reported FY2026 Q2 consolidated results under JGAAP showing resilient profitability despite modest top-line pressure. Revenue declined 2.9% YoY to ¥36.7bn, but operating income increased 6.9% YoY to ¥2.57bn, indicating margin improvement and cost control. Gross profit reached ¥7.81bn with a gross margin of 21.3%, reflecting stable pricing and/or input cost normalization relative to last year. Operating margin rose to approximately 7.0%, supported by SG&A discipline and operating leverage. Ordinary income of ¥3.06bn outpaced operating income, suggesting positive non-operating contributions (e.g., financial income or equity-method gains) or lower non-operating costs. Net income rose 25.8% YoY to ¥2.64bn, benefitting from both operating improvements and a normalizing tax burden. The DuPont decomposition indicates a 7.20% net margin, 0.389x asset turnover, and 1.72x financial leverage, yielding an ROE of 4.82%—modest but improving, driven primarily by margin expansion rather than leverage. Cash generation was healthy but not exceptional: operating cash flow (OCF) of ¥2.01bn equated to 0.76x net income, suggesting accruals and working-capital investment reduced cash conversion this half. Liquidity remains strong with a current ratio of 208% and a quick ratio of 172%, underpinned by ¥20.97bn of working capital. The balance sheet is conservatively positioned: total liabilities of ¥40.48bn vs. equity of ¥54.75bn imply a liabilities-to-equity ratio of 0.74x, and interest coverage is a comfortable 25x on operating income. Depreciation and amortization totaled ¥1.84bn, supporting an EBITDA of ¥4.41bn and an EBITDA margin of 12.0%, indicating reasonable underlying cash profitability for a materials manufacturer. Effective tax appears closer to ~22% based on income tax expense (¥0.75bn) relative to an inferred pre-tax income, despite the provided “0.0%” metric being unreported; this aligns with a normalized tax environment. The equity ratio value is shown as 0.0% but is unreported; based on assets and equity, the equity ratio would be approximately 58%—evidence of a solid capital base. Dividend data (DPS and payout) are not disclosed in this set; no inference on distribution policy can be made from the zeros shown. While revenue softness warrants monitoring, the company’s improved profitability, strong liquidity, and conservative leverage provide a buffer against cyclical volatility in glass/container end-markets. Overall, the quarter reflects operational resilience and prudent financial management, albeit with some data gaps in cash and equity-disclosure line items that limit full clarity on free cash flow and capital allocation.

Profitability Analysis

roe_decomposition: ROE 4.82% = Net Margin 7.20% × Asset Turnover 0.389 × Financial Leverage 1.72. ROE improvement drivers are primarily margin-led; leverage remains moderate and asset turnover is subdued for a manufacturing business, signaling room for better asset utilization. margin_quality: Gross margin 21.3% and operating margin ~7.0% indicate disciplined cost control and potentially supportive pricing. Ordinary income exceeds operating income, implying constructive non-operating balance (e.g., FX, investment income) that enhances bottom line but may be less repeatable. Net margin at 7.2% is solid for the sector. operating_leverage: Operating income grew +6.9% despite -2.9% revenue, evidencing positive operating leverage. D&A of ¥1.84bn versus EBITDA ¥4.41bn indicates moderate capital intensity; incremental margins appear healthy given cost base stability.

Growth Assessment

revenue_sustainability: Revenue declined 2.9% YoY to ¥36.7bn, likely reflecting demand softness in certain container/glass end-markets or product mix headwinds. The decline is modest, suggesting core customer demand remains broadly intact. profit_quality: Operating profit grew faster than sales, supported by cost optimization and potentially easing energy/raw material inputs. Interest expense is low (¥103m), and tax expense appears normalized. Non-operating gains helped ordinary income, which may not fully persist. outlook: Assuming stable demand, normalized energy costs, and ongoing cost control, second-half margins can remain resilient. Key swing factors are energy/fuel prices, product mix, and downstream beverage/food/pharma demand. Asset turnover remains a constraint to ROE; improved utilization and throughput would be beneficial.

Financial Health

liquidity: Current ratio 207.9%, quick ratio 171.9%, working capital ¥20.97bn—ample near-term liquidity. Inventories are ¥7.00bn, manageable relative to current assets. solvency: Total liabilities ¥40.48bn vs. equity ¥54.75bn (liabilities/equity 0.74x) indicate conservative leverage. Interest coverage 25.0x on operating income provides a strong buffer against rate increases or cyclical downturns. capital_structure: Financial leverage 1.72x (assets/equity) reflects a solid equity base. The displayed equity ratio of 0.0% is unreported; based on the balance sheet, equity ratio approximates 58% (¥54.75bn/¥94.14bn).

Cash Flow Quality

earnings_quality: OCF of ¥2.01bn equals 0.76x net income (¥2.64bn), pointing to moderate accruals and/or working capital use. EBITDA of ¥4.41bn vs. OCF indicates some cash drag from working capital or timing effects in the half. fcf_analysis: Investing cash flow shows as 0 (unreported), so free cash flow cannot be reliably calculated. Given OCF of ¥2.01bn and typical maintenance capex needs in glass manufacturing, underlying FCF is likely positive but data is insufficient to quantify. working_capital: Current assets ¥40.41bn and inventories ¥7.00bn suggest manageable inventory levels; the OCF/NI ratio below 1.0 implies incremental working-capital investment or collection timing effects this period.

Dividend Sustainability

payout_ratio_assessment: DPS and payout ratio are shown as 0.00 but are unreported; no conclusion can be drawn on current dividend policy or payout discipline from this dataset. fcf_coverage: FCF coverage is shown as 0.00x but is unreported; with OCF positive and capex undisclosed, we cannot assess dividend coverage. policy_outlook: With conservative leverage and steady profitability, the balance sheet could support distributions; however, absent disclosed DPS/FCF, we refrain from inferring policy changes.

Risk Assessment

Business Risks:

• Demand cyclicality in beverage, food, and industrial glass end-markets
• Energy and raw material price volatility impacting glass melting costs
• Product mix and pricing pressure from competition and private labels
• Customer concentration risks with large beverage/food clients
• Environmental regulations and decarbonization capex requirements
• FX impacts on imports of raw materials and export competitiveness

Financial Risks:

• Working-capital swings affecting cash conversion (OCF/NI at 0.76x)
• Potential variability in non-operating income that lifted ordinary income
• Capex intensity typical of glass manufacturing could weigh on FCF if elevated
• Interest rate risk is limited currently but could rise from low base

Key Concerns:

• Sustainability of margin gains amid a slight revenue decline
• Limited visibility on investing cash flows and capex due to undisclosed items
• Unreported dividend metrics preclude assessment of capital return framework

Investment Implications

Key Takeaways:

• Margins expanded despite a 2.9% YoY revenue decline, lifting operating and net income
• ROE of 4.82% is margin-driven; asset turnover remains a headwind
• Strong liquidity (current ratio ~208%) and conservative leverage (liabilities/equity 0.74x)
• OCF at 0.76x net income signals some working-capital drag
• Interest coverage robust at 25x, reducing solvency concerns
• Data gaps on investing cash flows and dividends limit FCF and payout analysis

Metrics to Watch:

• Volume/pricing trends and energy surcharge dynamics in 2H
• Working capital turns (inventory days, receivable days) and OCF/NI >1.0
• Capex disclosures and maintenance vs. growth split
• EBITDA margin trajectory relative to energy and raw material costs
• Asset turnover improvement and utilization rates
• Ordinary income composition (recurring vs. non-recurring items)

Relative Positioning: Within Japanese glass/container peers, the company exhibits solid balance-sheet strength and improving margins, though overall ROE is still modest due to restrained asset turnover; cash conversion is adequate but would benefit from tighter working-capital management and clearer capex visibility.

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
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis