FUJIMI INCORPORATED FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥33.50B
• Operating Income: ¥6.47B
• Net Income: ¥4.37B
• EPS: ¥62.98

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

FUJIMI INCORPORATED (5384) delivered a solid FY2026 Q2 performance with clear signs of margin resilience and positive operating leverage. Revenue grew 8.9% YoY to ¥33.5bn, outpacing typical semiconductor consumables end-market trends and indicating healthy demand across key product lines. Operating income rose 13.4% YoY to ¥6.47bn, implying margin expansion on scale benefits and cost control. Net income increased 6.9% YoY to ¥4.67bn, with a net margin of 13.9%, reflecting robust underlying profitability. The DuPont breakdown points to modest ROE of 5.82%, driven primarily by healthy margins but tempered by low asset turnover (0.320) and conservative leverage (financial leverage 1.30x). Gross margin is reported at 39.6%, and EBITDA margin at 22.1%, both consistent with a high-value-added materials franchise. Operating cash flow of ¥6.80bn exceeds net income (OCF/NI = 1.46x), supporting good earnings quality and cash conversion. The balance sheet remains very strong: equity of ¥80.3bn against total assets of ¥104.7bn implies an equity ratio of roughly 76.7% (the reported 0.0% is undisclosed, not zero), and current ratio stands at 450%, underlining ample liquidity. Leverage is light, with a debt-to-equity ratio of 0.17x and de minimis interest expense, yielding an interest coverage of ~6,469x. Financing cash outflows of ¥2.82bn suggest shareholder returns and/or debt paydown, though dividends are not disclosed in the dataset (annual DPS shown as 0.00 indicates not reported). Free cash flow cannot be assessed because investing cash flows are undisclosed in the XBRL extract. While the provided gross profit amount does not reconcile to revenue less cost of sales, we rely on the reported gross margin metric for analysis. The tax charge of ¥1.25bn implies an effective tax rate around 20%, consistent with historical levels for Japanese corporates. Overall, performance signals improving operating leverage, strong balance sheet flexibility, and high cash conversion despite partial disclosure gaps. Near-term outlook hinges on semiconductor capex cycles and mix, but current results suggest resilient demand and effective cost management. Key watchpoints include sustaining revenue momentum, protecting margins amid input cost variability, and any capital allocation updates. Given data limitations (notably equity ratio, cash balance, investing CF, DPS), conclusions focus on the disclosed non-zero metrics and calculated indicators.

Profitability Analysis

ROE of 5.82% decomposes into net profit margin 13.94% × asset turnover 0.320 × financial leverage 1.30. The margin component is the dominant driver, supported by a 22.1% EBITDA margin and ~19.3% operating margin (¥6.469bn/¥33.496bn). Asset turnover is modest, reflecting a capital-intensive and inventory-dependent model typical of precision consumables and an interim (half-year) denominator effect. Financial leverage is conservative, limiting ROE uplift but enhancing resilience. Gross margin is reported at 39.6%, indicating disciplined pricing and product mix; the increase in operating income versus revenue (+13.4% vs +8.9% YoY) evidences positive operating leverage. Non-operating items were slightly negative (ordinary income ¥6.26bn < operating income ¥6.47bn, ~¥0.21bn drag), likely FX or other non-recurring items; interest burden is negligible (¥1m). Tax expense of ¥1.25bn implies an effective tax rate around 20% on pre-tax income, consistent with stable tax planning. Overall margin quality appears strong with good cost pass-through and product mix, though the reported gross profit figure does not reconcile with revenue/cost lines; we therefore anchor on the provided gross margin metric.

Growth Assessment

Revenue grew 8.9% YoY to ¥33.5bn, with operating income up 13.4% YoY, indicating healthy top-line momentum and mix-enhanced profitability. The spread between revenue and operating income growth suggests efficiency gains and scale benefits. Net income growth of 6.9% YoY trails operating income growth due to a minor non-operating drag and normalizing tax. Sustainability will depend on semiconductor end-market demand (foundry/logic, memory cycles) and consumables usage intensity; current results imply resilient wafer-polish and related consumables demand. Margin sustainability appears supported by a high-value product mix and disciplined costs, evidenced by a 22.1% EBITDA margin and strong OCF conversion (1.46x NI). With conservative leverage, growth is likely funded internally, enabling continued R&D and capacity tuning. Outlook risks include macro softness, inventory adjustments at customers, and FX volatility affecting non-operating income. Absent disclosed order backlog, we infer near-term stability from YoY growth and operating leverage, but monitor for seasonality in H2.

Financial Health

Liquidity is robust: current assets ¥56.1bn vs current liabilities ¥12.47bn yields a 450% current ratio and 402% quick ratio, backed by low inventories (¥5.99bn) relative to current assets. Working capital stands at ¥43.66bn, indicating ample cushion for operations. Solvency is strong: total equity ¥80.27bn vs total liabilities ¥14.01bn implies low gearing (debt-to-equity 0.17x) and an equity ratio of approximately 76.7% (equity/total assets), despite the equity ratio field showing as undisclosed. Interest expense is negligible (¥1m) with interest coverage ~6,469x, underscoring minimal financial risk. The capital structure is conservatively positioned, affording flexibility for investment and shareholder returns.

Cash Flow Quality

Operating cash flow of ¥6.80bn exceeds net income of ¥4.67bn (OCF/NI 1.46x), indicating good earnings quality and limited accrual build. EBITDA of ¥7.41bn aligns with OCF strength, suggesting working capital management is effective in the period. Free cash flow cannot be determined because investing cash flow is undisclosed (reported as 0 indicates not provided), so FCF and FCF coverage metrics are not assessable from this dataset. Financing cash outflow of ¥2.82bn implies shareholder returns and/or debt repayment; absent DPS disclosure, the split between dividends and buybacks is unclear. Working capital appears supportive (high quick ratio, low relative inventories), which should continue to underpin cash generation if demand remains stable.

Dividend Sustainability

Dividend data are not disclosed in this extract (annual DPS and payout ratio reported as 0.00 indicate undisclosed). With OCF/NI at 1.46x and a very strong balance sheet, underlying capacity to fund dividends appears ample in principle. However, FCF is not derivable due to missing investing cash flow, preventing a robust payout and FCF coverage assessment. Financing cash outflows of ¥2.82bn suggest some form of shareholder return and/or debt servicing. Policy outlook cannot be inferred from the provided data; any guidance from management and historical payout trends would be key to assessing sustainability.

Risk Assessment

Business Risks:

• Semiconductor cycle exposure leading to demand volatility and customer inventory adjustments
• Product mix shifts affecting gross margin and operating leverage
• Customer concentration risk typical in semiconductor consumables
• Technological displacement risk from new polishing/slurry processes or competitors
• Supply chain and raw material cost volatility impacting margins
• FX fluctuations influencing competitiveness and non-operating income

Financial Risks:

• Potential working capital swings in a cyclical environment
• Capex intensity not observable in this period due to undisclosed investing CF
• Translation and transaction FX impacts on ordinary income
• Limited ROE enhancement due to conservative leverage

Key Concerns:

• Incomplete disclosure of investing cash flows and cash balance, limiting FCF visibility
• Gross profit line not reconciling with revenue and cost of sales; reliance on reported margin metric
• Dividend data not disclosed, constraining payout sustainability analysis

Investment Implications

Key Takeaways:

• Top-line growth of 8.9% YoY with stronger operating income growth (+13.4%) signals positive operating leverage
• Healthy profitability: 39.6% gross margin, 22.1% EBITDA margin, ~19.3% operating margin
• Strong cash conversion with OCF/NI at 1.46x supports earnings quality
• Conservative balance sheet: ~76.7% equity ratio, 0.17x D/E, and exceptional interest coverage
• ROE at 5.82% constrained by low asset turnover and low leverage despite solid margins
• Non-operating items slightly negative; effective tax rate ~20%
• Financing cash outflow of ¥2.82bn indicates capital returns and/or debt service, but DPS undisclosed

Metrics to Watch:

• Revenue growth trajectory and order trends into H2
• Gross and operating margin progression (pricing, mix, input costs)
• Working capital turns (AR, inventory days) and OCF/NI sustainability
• Capex and investing cash flows to assess FCF and capacity expansions
• FX impacts on ordinary income and margin sensitivity
• Capital allocation updates (dividends, buybacks) and payout policy signals

Relative Positioning: Within Japanese semiconductor materials/consumables peers, FUJIMI exhibits above-average margin resilience and cash conversion, coupled with a stronger-than-average balance sheet and low leverage; ROE trails peers that employ higher leverage or exhibit faster asset turns.

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