jig.jp co.,ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥7.36B
• Operating Income: ¥1.07B
• Net Income: ¥510M
• EPS: ¥15.09

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend 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

株式会社jig.jp (52440) reported FY2026 Q2 consolidated results under JGAAP showing solid top-line expansion with revenue of ¥7,359 million (+10.3% YoY) and high gross profitability (gross margin 86.3%), consistent with a software/service-heavy mix. Despite revenue growth, operating income declined slightly to ¥1,075 million (-1.7% YoY), indicating some margin compression, likely from higher SG&A or stepped-up growth investments. Ordinary income of ¥987 million trailed operating income, implying net non-operating losses (e.g., investment-related items or other non-operating costs) despite minimal interest expense. Net income increased 23.8% YoY to ¥630 million, suggesting improved below-the-line items versus the prior year or lower minority impacts. DuPont analysis indicates an ROE of 13.34%, driven by an 8.56% net margin, asset turnover of 1.014x, and moderate financial leverage of 1.54x, which is a healthy, quality-driven ROE profile for a high-margin, asset-light model. Liquidity appears strong with a current ratio of 238% and working capital of approximately ¥3,282 million. The capital structure is conservative with total liabilities/equity at 0.56x; using reported assets and equity implies an effective equity ratio of about 65%, though the disclosed equity ratio is shown as 0.0% (likely undisclosed). Cash generation quality is reasonable with operating cash flow of ¥581 million versus net income of ¥630 million (OCF/NI 0.92x), suggesting modest working capital investment. The interest coverage is extraordinarily high (≈950x), reflecting very low financing costs and strong operating earnings capacity. EBITDA of ¥1,084 million (14.7% margin) reinforces the profitability profile, although the small D&A (¥8.9 million) indicates limited capital intensity or unreported elements. Financing cash outflow of ¥294 million suggests debt repayment and/or shareholder returns, but dividend details are not disclosed; headline DPS and payout ratios showing zero should be treated as undisclosed rather than true zeros. Several data points are not reported (e.g., cash and equivalents, investing cash flows, inventories, equity ratio, shares outstanding), constraining deeper per-share and cash deployment analyses. The effective tax rate shown as 0.0% is inconsistent with disclosed tax expense; based on net income and tax expense, the implied tax rate is roughly 33%, and this should be monitored for normalization. Overall, jig.jp demonstrates strong gross profitability and adequate ROE with prudent leverage and good liquidity. Key watchpoints are the slight operating margin compression, non-operating losses, and working capital dynamics that kept OCF slightly below net income. Given the high gross margins and moderate leverage, the outlook hinges on sustaining double-digit revenue growth while stabilizing operating margins. Data limitations, particularly around cash balances, investing activities, and dividends, warrant cautious interpretation of cash flow coverage and capital allocation.

Profitability Analysis

ROE of 13.34% decomposes into net margin of 8.56%, asset turnover of 1.014x, and financial leverage of 1.54x, indicating returns are driven primarily by healthy margins rather than leverage. Gross margin stands at 86.3%, consistent with a software/services model and favorable unit economics. Operating income of ¥1,075 million on revenue of ¥7,359 million implies an operating margin of roughly 14.6%, slightly lower YoY given operating income fell -1.7% despite +10.3% revenue growth. Non-operating items were a drag (ordinary income ¥987 million vs operating income ¥1,075 million), offsetting some operating strength. EBITDA margin is 14.7%, only marginally above operating margin due to low D&A (¥8.9 million), implying minimal depreciation headwinds or potentially limited capitalized asset base. The small D&A may also indicate that R&D is expensed rather than capitalized or that certain intangibles are not disclosed here. Interest expense is negligible (¥1.1 million), yielding an interest coverage of roughly 950x and underscoring low financial risk from borrowing costs. Operating leverage appears evident: revenue grew double digits while operating income declined slightly, implying cost growth (likely SG&A) outpaced revenue; monitoring cost discipline will be important to defend margins. The net margin improved YoY in light of net income growth (+23.8%) vs a small decline in operating income, suggesting favorable below-the-line items or tax normalization versus the prior period.

Growth Assessment

Revenue growth of +10.3% YoY to ¥7,359 million suggests sustained demand and/or successful expansion in core services. The high gross margin profile supports scalable economics, but the drop in operating income implies rising operating costs, possibly due to sales & marketing or product investment to support growth. Net income increased 23.8% YoY to ¥630 million, likely aided by lower non-operating charges or tax effects relative to last year. Ordinary income at ¥987 million, below operating income, indicates some headwinds from non-operating items this period; stability in this line will be important for consistent earnings growth. Profit quality is decent: OCF/NI of 0.92x suggests earnings are largely cash-backed, with modest working capital absorption. Sustainability of revenue growth will depend on customer retention, ARPU expansion, and continued product differentiation, typical drivers in software/service models. Near-term outlook hinges on balancing growth investments with margin discipline; stabilizing SG&A intensity could re-expand operating margins. Given the asset-light nature signaled by low D&A, incremental growth should carry attractive incremental margins once cost growth normalizes. Data gaps (e.g., lack of billings, backlog, or segment detail) limit deeper assessment of pipeline durability.

Financial Health

Liquidity is strong with a current ratio of 238% and working capital of approximately ¥3,282 million, providing a buffer against near-term obligations. Quick ratio equals the current ratio due to inventories showing as 0, but inventories are likely not applicable or undisclosed; regardless, the liquid position appears robust. Solvency is conservative: total liabilities/equity of 0.56x indicates modest leverage. Using reported assets and equity implies an equity ratio near 65% (equity of ¥4,723 million vs assets of ¥7,257 million), despite the disclosed figure showing 0.0% (undisclosed). Interest expense is extremely low (¥1.1 million), and interest coverage near 950x confirms minimal financing risk. Ordinary income being below operating income points to non-operating pressures that should be monitored, but not from interest burden. The capital structure provides ample capacity to fund growth or absorb shocks. Absence of disclosed cash & equivalents constrains precise liquidity assessment, though the strong current assets vs current liabilities suggests adequate cash or receivables.

Cash Flow Quality

Operating cash flow of ¥581 million versus net income of ¥630 million yields an OCF/NI ratio of 0.92x, indicating reasonable earnings quality with limited working capital drag. The small delta suggests some increase in receivables or other current assets consistent with growth, but not severe. Depreciation & amortization is low (¥8.9 million), consistent with an asset-light model; hence, accrual risk from large non-cash charges appears limited. Free cash flow cannot be reliably computed because investing cash flow is shown as 0 (undisclosed); thus, the reported FCF figure of 0 should not be interpreted as actual zero. Financing cash outflow of ¥294 million indicates debt repayment and/or shareholder returns; without dividend disclosure, attribution is uncertain. Working capital management looks generally sound given strong current ratios; however, without details on receivables, payables, and deferred revenue, the durability of cash conversion remains a watchpoint. Overall, cash generation appears aligned with earnings, with modest working capital investment typical of growth phases.

Dividend Sustainability

Dividend per share and payout ratio are shown as 0.00, which should be treated as undisclosed rather than true zeros. Without confirmed DPS or total dividends paid, we cannot calculate a payout ratio or FCF coverage with confidence. Financing cash outflows suggest some capital returns or debt service, but attribution is unclear. Given net income of ¥630 million and positive operating cash flow of ¥581 million, the company could theoretically fund modest dividends if desired; however, absence of investing cash flow disclosure prevents robust FCF analysis. Policy outlook cannot be inferred from the provided data; investors should seek guidance on capital allocation priorities and any dividend policy statements from management.

Risk Assessment

Business Risks:

• Operating margin compression due to rising SG&A as growth investments scale
• Dependence on subscription/service revenues with potential customer churn risk
• Competitive intensity in software/services impacting pricing and ARPU
• Execution risk in product development and feature velocity
• Potential reliance on key customers or channels (concentration risk)
• Cybersecurity and data privacy risks inherent to digital services
• Regulatory changes affecting digital content/communication services

Financial Risks:

• Non-operating losses dragging ordinary income below operating income
• Working capital expansion in growth periods reducing cash conversion
• Limited visibility on cash position and investing cash flows due to undisclosed items
• Potential capitalization policy risks (e.g., development costs) affecting earnings quality
• Tax rate variability; implied effective tax rate around 33% vs displayed 0% metric

Key Concerns:

• Slight decline in operating income despite double-digit revenue growth
• Negative non-operating impact narrowing the gap between operating and ordinary income
• Data gaps in cash, investing activities, and dividend disclosures limiting capital allocation analysis

Investment Implications

Key Takeaways:

• Double-digit revenue growth with very high gross margins underscores strong unit economics
• ROE of 13.34% achieved with modest leverage, indicating quality-driven returns
• Operating margin pressure emerged as costs outpaced revenue growth
• Ordinary income below operating income suggests non-operating headwinds
• Cash generation broadly aligns with earnings (OCF/NI 0.92x), implying decent earnings quality
• Balance sheet is conservatively leveraged with strong liquidity

Metrics to Watch:

• Operating margin and SG&A intensity (as a % of revenue)
• Non-operating income/expense trends (gap between operating and ordinary income)
• OCF to net income ratio and working capital movements (DSO/DPO, deferred revenue)
• Revenue growth drivers: churn, ARPU, and new bookings/billings if disclosed
• Effective tax rate normalization
• Cash & equivalents and investing cash flows to assess FCF and capital allocation
• Equity ratio and leverage to ensure continued balance sheet strength

Relative Positioning: Compared to typical TSE-listed software/service peers, jig.jp exhibits above-average gross margins, a solid mid-teens ROE with modest leverage, and strong liquidity; near-term positioning is tempered by slight operating margin compression and non-operating drags, with performance contingent on sustaining growth while stabilizing costs.

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