| Metrics | Current Period | Same Period Last Year | YoY |
|---|---|---|---|
| Revenue | ¥39.5B | ¥28.2B | +40.3% |
| Operating Income | ¥9.1B | ¥2.4B | +284.6% |
| Ordinary Income | ¥8.4B | ¥1.9B | +348.7% |
| Net Income | ¥5.8B | ¥1.2B | +361.6% |
| ROE | 14.6% | 3.7% | - |
In FY2026 Q1, Revenue was ¥39.5B (YoY +¥11.3B, +40.3%), Operating Income was ¥9.1B (YoY +¥6.7B, +284.6%), Ordinary Income was ¥8.4B (YoY +¥6.5B, +348.7%), and Net Income was ¥5.8B (YoY +¥4.6B, +361.6%). The Operating Margin reached a high level of 23.1%, improving by 14.6 points from 8.5% in the same period last year. The full-year forecast calls for Revenue of ¥105.0B (YoY +7.2%) and Operating Income of ¥14.7B (YoY +40.9%), with Q1 progress at 37.6% for Revenue and 62.0% for Operating Income, tracking well. EPS rose to ¥100.36 (up ¥78.61 from ¥21.75 in the same period last year).
[Profitability] ROE 14.6% (annualized), Operating Margin 23.1% (+14.6pt from 8.5% in the same period last year), Net Margin 14.6% (+10.2pt from 4.4%), and ROIC 4.0%, reflecting a capital-intensive business structure. [Cash Quality] Cash and Deposits ¥13.69B (YoY +¥4.22B, +44.5%), with cash coverage of short-term liabilities at 7.61x. Working Capital remains positive at ¥2.99B. [Investment Efficiency] Total Asset Turnover 0.179x; EPS ¥100.36 (+361.6% from ¥21.75 in the same period last year). [Financial Soundness] Equity Ratio 17.8%, Current Ratio 108.3%, Quick Ratio 108.3%, Debt-to-Equity Ratio 4.61x. Interest-bearing Debt ¥130.31B (including Long-term Borrowings of ¥128.51B), with Interest Coverage of 15.7x, indicating limited interest burden. Retained Earnings ¥24.96B (YoY +¥5.00B, +30.0%), signaling accumulation of internal reserves.
Cash and Deposits increased by ¥4.22B YoY to ¥13.69B, confirming that the trend of higher revenue and profits is contributing to cash generation. In working capital efficiency, Advances Received of ¥5.12B and deposits payable, etc., are functioning as short-term funding sources. Real estate for sale stands at ¥13.26B, and the timing of monetizing inventory affects liquidity. Although there is a short-term repayment burden with Current Portion of Long-term Borrowings of ¥15.98B, cash coverage of short-term liabilities is a sufficient 7.61x relative to Cash and Deposits. Non-current liabilities are ¥145.86B, accounting for 80.2% of total liabilities; monitoring the maturity profile and refinancing plans for Long-term Borrowings of ¥128.51B is important. The increase in Retained Earnings (+¥5.00B) indicates accumulation of internal funds and is a positive factor for improving equity.
Ordinary Income was ¥8.4B versus Operating Income of ¥9.1B, with net non-operating expenses of approximately ¥0.7B. Interest Expenses of ¥0.75B were recorded as non-operating expenses, but Interest Coverage remains sufficient at 15.7x. The Operating Margin of 23.1% is achieved with a Cost of Sales ratio of 71.8% and an SG&A ratio of 5.1%. The significant improvement from the prior-year Operating Margin of 8.5% is attributable to controlled growth in SG&A (+12.2%) relative to the increase in Revenue (+40.3%). While Operating Cash Flow is not disclosed on a quarterly basis, preventing verification of the cash backing of profits, the YoY increase in Cash and Deposits (+44.5%) suggests cash generation from operating activities.
[Position within the Industry] (Reference information / Our research) In this fiscal year, industry-wide benchmark data are limited to in-house data; therefore, evaluation focuses on comparisons with the company’s own historical trends. In profitability, the Operating Margin of 23.1% is at the company’s historical peak (highest in available data) and can be assessed as high in an industry such as real estate that exhibits large variability in margins. In growth, the 40.3% Revenue growth rate significantly exceeds the company’s historical growth and reflects strong progress in selling real estate projects. In soundness, the Equity Ratio of 17.8% falls within the standard range for real estate development, but the Debt-to-Equity Ratio of 4.61x is categorized as high leverage within the industry. For the full-year forecast, Revenue growth of +7.2% and Operating Income growth of +40.9% continue to anticipate high growth, predicated on a robust project pipeline. (Source: Our compilation; comparison target: company’s past five fiscal periods)
First, a notable improvement in the Operating Margin to 23.1% (+14.6pt YoY) was driven by controlled growth in SG&A (+12.2%) relative to the increase in Revenue (+40.3%). Second, the Q1 progress rate toward the full-year Operating Income forecast is high at 62.0%; since the assumption is that the H2 margin will be lower than H1, attention is needed to margin fluctuations by project and potential skew in revenue recognition timing. Third, within a high-leverage structure with a Debt-to-Equity Ratio of 4.61x, Retained Earnings increased by +30.0% YoY, and equity improvement via internal reserves is progressing, which can be evaluated as a sign of improving financial soundness. Going forward, key monitoring points include verification of the cash backing of profits through OCF disclosure, the inventory turnover of real estate for sale, and plans for debt repayment and refinancing.
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 benchmark is reference information compiled by our company based on publicly available earnings data. Investment decisions are your own responsibility; consult a professional as needed before making any decisions.