Fusic Co.,Ltd. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥532M
• Operating Income: ¥58M
• Net Income: ¥39M
• EPS: ¥31.43

Income Statement

Balance Sheet

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

Fusic reported solid FY2026 Q1 results with revenue of ¥532.0m, up 20.6% YoY, and operating income of ¥58.0m, up 76.4% YoY, demonstrating strong operating leverage. Gross profit was ¥156.1m, implying a gross margin of 29.3%, and operating margin expanded to approximately 10.9%, indicating effective cost control and/or improved pricing and mix. Ordinary income equaled operating income at ¥58.0m, suggesting minimal non-operating gains or losses in the quarter. Net income was ¥39.0m (+73.9% YoY), translating to a quarterly net margin of 7.33% and EPS of ¥31.43. Balance sheet strength is notable: total assets were ¥1,515.0m against total liabilities of ¥433.2m and total equity of ¥1,155.0m, implying an equity ratio of roughly 76.3% (despite the disclosed equity ratio field being 0.0%, which appears to be unreported). Liquidity is robust with current assets of ¥1,332.8m versus current liabilities of ¥404.3m, driving a current ratio of 329.6% and working capital of ¥928.5m. Interest expense was immaterial at ¥45k, and interest coverage is exceptionally high at ~1,289x, underscoring low financial risk from debt. The tax charge of ¥10.22m implies an effective tax rate around 17.6% on ordinary income of ¥58.0m (the listed 0.0% is not reflective of the reported amounts). DuPont metrics for the quarter show a net margin of 7.33%, asset turnover of 0.351x, and financial leverage of 1.31x, yielding a quarterly ROE of 3.38%; annualized, this would approximate the mid-teens, though seasonality may affect full-year outcomes. Cash flow details were not disclosed (zeros indicate unreported), limiting direct assessment of OCF and FCF quality for the quarter. No dividend was reported (DPS 0), consistent with growth reinvestment for an asset-light software/services business. The improvement in operating income outpacing revenue growth suggests utilization gains, scale benefits, or disciplined SG&A. The company’s low leverage, ample liquidity, and rising profitability provide a solid foundation to support growth initiatives. However, the absence of cash flow data and share data (shares outstanding reported as zero) constrains precision in several per-share and coverage metrics; we therefore triangulate shares outstanding from EPS and net income. Overall, Fusic’s Q1 evidences healthy top-line momentum and expanding margins with a conservative balance sheet, but further disclosures on cash flows, backlog, and cost structure will be essential to gauge sustainability.

Profitability Analysis

ROE_decomposition: Quarterly DuPont: Net margin 7.33% × Asset turnover 0.351 × Financial leverage 1.31 ≈ ROE 3.38% for the quarter (reported). Annualized ROE would be approximately ~13–14% assuming similar performance across quarters, subject to seasonality and mix. margin_quality: Gross margin of 29.3% and operating margin of ~10.9% indicate solid value-add after cost of sales and improved operating efficiency. Ordinary margin equals operating margin, indicating limited non-operating noise. The effective tax rate calculated from disclosed figures is ~17.6% (¥10.22m tax on ¥58.0m ordinary income). operating_leverage: Revenue growth of +20.6% YoY versus operating income growth of +76.4% YoY signals strong operating leverage, likely from scale effects in labor utilization, pricing, and SG&A discipline. Interest expense is negligible (¥45k), so profit expansion is primarily operational.

Growth Assessment

revenue_sustainability: Top-line growth of +20.6% YoY suggests healthy demand. As a services/solutions-oriented model, sustainability will depend on backlog, recurring contracts, and net hiring/productivity; these data were not disclosed. profit_quality: Profit growth outpaced revenue, supported by stable-to-improving gross margin and tight overhead control. Ordinary income aligns with operating income, indicating high-quality earnings without reliance on non-operating items. outlook: If utilization, mix, and pricing hold, operating leverage should continue to support earnings growth. A normalized tax rate of mid-teens to low-20s appears reasonable based on the quarter. Lack of cash flow disclosure and potential seasonality warrant caution in extrapolating Q1 run-rates.

Financial Health

liquidity: Current assets ¥1,332.8m vs. current liabilities ¥404.3m implies a current ratio of 3.30x and working capital of ¥928.5m, indicating strong short-term solvency. Quick ratio is reported equal to current ratio; inventories are unreported (listed as 0). solvency: Total liabilities ¥433.2m vs. equity ¥1,155.0m yields a debt-to-equity proxy of ~0.38x. Interest coverage is ~1,289x, reflecting minimal financial risk. The computed equity ratio is ~76.3% (disclosed 0.0% appears unreported). capital_structure: Low leverage and substantial equity base provide flexibility for investment and potential volatility in working capital typical of project-based businesses. No evidence of significant interest-bearing debt pressure in the quarter.

Cash Flow Quality

earnings_quality: With ordinary income equaling operating income and negligible interest expense, earnings quality appears operationally driven. However, absent OCF disclosure, we cannot validate cash conversion or working capital drag for the quarter. FCF_analysis: Operating CF and investing CF were not disclosed (zeros indicate unreported), so FCF cannot be computed. Given the asset-light nature implied by low depreciation disclosure (unreported), capital intensity is likely modest, but confirmation is needed. working_capital: Working capital stands at ¥928.5m, supported by large current assets relative to current liabilities. Without AR/AP detail, we cannot assess collection cycles or potential build-up.

Dividend Sustainability

payout_ratio_assessment: No dividend declared (DPS 0, payout ratio 0%). With net income of ¥39.0m in Q1 and strong balance sheet, capacity exists, but stated policy is not disclosed. FCF_coverage: FCF not disclosed; therefore coverage cannot be assessed. Given the low leverage and high liquidity, future distributions would likely be supported if cash generation is consistent, but visibility is limited. policy_outlook: Given growth momentum and an asset-light model, retaining earnings to fund expansion appears plausible near term. Any initiation would likely target a conservative payout aligned with cash visibility.

Risk Assessment

Business Risks:

• Project timing and seasonality affecting quarterly revenue and margins
• Dependence on utilization and staffing; hiring/attrition impacting delivery capacity and gross margin
• Customer concentration risk typical of smaller IT/services firms (not disclosed)
• Pricing pressure and competitive intensity in cloud/IT services
• Execution risk on fixed-price projects and scope creep
• Macroeconomic slowdown leading to IT budget deferrals

Financial Risks:

• Limited visibility on cash conversion due to unreported OCF/FCF
• Potential working capital swings impacting cash despite accounting profits
• Tax rate variability (effective rate ~17.6% this quarter may not be steady)
• Exposure to credit risk in receivables (AR details not disclosed)

Key Concerns:

• Lack of cash flow disclosure hampers assessment of earnings-to-cash conversion
• Key per-share metrics constrained by unreported share count and BVPS
• Single-quarter data may not reflect full-year profitability due to seasonality

Investment Implications

Key Takeaways:

• Strong Q1 operating leverage: +20.6% revenue vs +76.4% operating income YoY
• Healthy margins: gross margin 29.3%, operating margin ~10.9%, net margin 7.33%
• Robust balance sheet: equity ratio estimated ~76.3%, current ratio ~3.30x, interest coverage ~1,289x
• Earnings quality appears operational; non-operating items minimal
• Cash flow metrics unreported; further disclosure needed to confirm cash conversion
• No dividend currently; reinvestment likely given growth profile

Metrics to Watch:

• Backlog and book-to-bill to gauge sustainability of revenue growth
• Utilization rate, headcount growth, and wage inflation vs pricing
• Gross margin and SG&A ratio to track operating leverage persistence
• AR days and OCF/Net income to assess cash conversion
• Tax rate normalization and any non-operating income/expense volatility
• Equity ratio and any changes in interest-bearing debt

Relative Positioning: Within Japanese small-cap IT/services peers, Fusic exhibits above-average liquidity and low leverage with improving operating efficiency; confirmation of consistent cash generation and visibility on recurring revenue would strengthen its relative quality profile.

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