| Metric | Current Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥3219.4B | ¥3300.4B | -2.5% |
| Operating Income / Operating Profit | ¥136.0B | ¥122.0B | +11.5% |
| Ordinary Income | ¥147.6B | ¥136.6B | +8.1% |
| Net Income / Net Profit | ¥1.3B | ¥-23.1B | +105.6% |
| ROE | 0.1% | -1.5% | - |
For the fiscal year ended March 2026, Revenue was ¥3,219.4B (YoY -¥81.0B, -2.5%), Operating Income was ¥136.0B (YoY +¥14.0B, +11.5%), Ordinary Income was ¥147.6B (YoY +¥11.0B, +8.1%), and Net Income attributable to owners of the parent was ¥1.3B (YoY +¥24.4B, +105.6%). Despite lower Revenue, Operating Income increased, with gross margin improving to 12.7% (up +0.8pt from 11.9% a year earlier) and Operating Margin improving to 4.2% (up +0.5pt from 3.7%), indicating improved profitability. Special losses of ¥202.3B (impairment losses ¥115.6B, business restructuring losses ¥75.3B) were recorded, but Net Income swung to profit year-on-year. By segment, the Americas remained the core earnings source with Revenue ¥1,362.1B (+3.6%) and Operating Income ¥97.3B (margin 7.1%); Japan posted Revenue ¥1,061.3B (-7.3%) but Operating Income improved substantially to ¥30.9B (YoY from ¥7.1B, +337.1%); Europe logged Revenue ¥445.1B (-1.8%) and Operating Loss ¥-3.5B, remaining in deficit; Asia posted Revenue ¥524.1B (+4.8%) and Operating Income ¥12.2B (+135.6%), with progress toward profitability.
[Revenue] Revenue was ¥3,219.4B (YoY -2.5%). By region, the Americas maintained growth with Revenue ¥1,362.1B (+3.6%), and Asia was solid at ¥524.1B (+4.8%), while Japan declined to ¥1,061.3B (-7.3%) due to reduced shipments to major customers, and Europe was slightly down at ¥445.1B (-1.8%). By product, body press parts were ¥2,862.1B, precision parts ¥294.8B, resin parts ¥45.5B, and others ¥17.1B. By major customers, sales to Nissan North America were ¥533.7B, Nissan Mexico ¥529.2B, and Nissan Motor Co., Ltd. ¥429.3B, indicating high dependency on the Nissan Group. Revenue mix by region: Japan 28.1%, USA 22.4%, Mexico 19.8%, China 12.2%, Others 17.5%. Sales by customer location were notably impacted by Japan-bound sales declining from ¥1,043.7B to ¥903.3B (-13.4%).
[Profitability] Cost of sales was ¥2,811.1B (87.3% of Revenue), yielding a gross margin of 12.7% (up +0.8pt YoY). Improvements in cost ratio were driven by a higher-margin mix in the Americas and production efficiency gains. SG&A was ¥272.3B (8.5% of Revenue, up +0.3pt from 8.2% prior year), but Operating Income rose to ¥136.0B (YoY +11.5%), with an Operating Margin of 4.2% (up +0.5pt). Non-operating income totaled ¥39.2B, including interest income ¥26.3B and equity-method investment income ¥0.6B; non-operating expenses were ¥27.7B, including interest expense ¥16.2B and foreign exchange losses ¥3.7B, resulting in Ordinary Income of ¥147.6B (YoY +8.1%). In extraordinary items, special losses totaled ¥202.3B (business restructuring losses ¥75.3B, impairment losses ¥115.6B), while special gains totaled ¥7.3B (including step acquisition gains ¥6.5B), yielding Profit Before Tax of ¥-47.5B. After income taxes of ¥39.3B and non-controlling interests of ¥-3.3B, Net Income attributable to owners of the parent was ¥1.3B, turning to a positive result; however, this is materially affected by special losses and diverges from core operating performance. In conclusion, despite Revenue decline, improvements in gross margin and contributions from non-operating income supported increased operating profit, but special losses left the final profit level subdued.
The Americas segment posted Revenue ¥1,362.1B (YoY +3.6%) and Operating Income ¥97.3B (YoY -32.3%), margin 7.1%. While Revenue increased, Operating Income declined substantially, suggesting higher startup costs and one-off expenses. The Japan segment recorded Revenue ¥1,061.3B (-7.3%) and Operating Income ¥30.9B (+337.1%), margin 2.9%; profitability improved significantly despite Revenue decline, driven by cost reductions and efficiency. The Europe segment posted Revenue ¥445.1B (-1.8%) and Operating Loss ¥-3.5B (from Operating Income ¥2.3B in the prior year), margin -0.8%; structural profitability deficiencies persist, underpinning impairment recognition. The Asia segment achieved Revenue ¥524.1B (+4.8%) and Operating Income ¥12.2B (+135.6%), margin 2.3%, progressing toward sustained profitability as regional reorganization benefits materialize. Of the companywide Operating Income ¥136.0B, the Americas accounted for approximately 72%, Japan 23%, Asia 9%, while Europe had a negative contribution, highlighting a revenue structure concentrated in the Americas.
[Profitability] Operating Margin 4.2% (up +0.5pt from 3.7%), Net Margin 0.0% (from -6.4% a year earlier, +6.4pt), Gross Margin 12.7% (up +0.8pt), SG&A Ratio 8.5% (up +0.3pt). ROE was 0.1% (substantially improved from -14.7% prior year), but low Net Income reflects ongoing profitability challenges. EBITDA was ¥308.2B (Operating Income plus depreciation), with an EBITDA margin of 9.6%, indicating maintained cash-generating ability. [Cash Quality] Operating Cash Flow (OCF) was ¥231.3B (YoY -19.2%), Free Cash Flow was ¥135.2B, and FCF margin was 4.2%. The OCF/EBITDA ratio was 0.75x, with working capital increases slowing cash conversion. Days Sales Outstanding (DSO) were 79 days (worsened from 60 days), Days Inventory Outstanding (DIO) 35 days (improved from 48 days), Days Payable Outstanding (DPO) 44 days. Working capital ratio worsened relative to Revenue. [Investment Efficiency] Total asset turnover was 1.10x (prior year 1.11x), tangible fixed asset turnover 3.43x (prior year 3.02x). Capital expenditures were ¥90.5B versus depreciation ¥172.2B, giving a capex-to-depreciation ratio of 0.53x, indicating renewal-level investment. [Financial Soundness] Equity Ratio was 51.9% (up +0.3pt from 51.6%), Current Ratio 155.1% (improved from 141.6%), interest-bearing debt ¥504.3B, Debt/EBITDA 1.64x, Interest Coverage 8.41x (EBITDA / interest paid). Short-term borrowing dependence is high (short-term borrowings ¥345.5B, long-term borrowings ¥158.7B), making refinancing management important. Cash and deposits stood at ¥559.3B, indicating ample liquidity.
OCF was ¥231.3B (down -19.2% from ¥286.2B). From OCF subtotal of ¥232.1B, changes in working capital included an increase in trade receivables of -¥114.1B, a decrease in inventories of +¥66.2B, and an increase in trade payables of +¥16.4B, resulting in a net negative contribution from working capital. After corporate tax payments of -¥12.4B, OCF of ¥231.3B includes non-cash charges such as depreciation ¥172.2B and impairment losses ¥115.6B, indicating solid underlying cash generation. Investing Cash Flow was -¥96.1B, mainly capital expenditures -¥90.5B and acquisition of subsidiary shares -¥5.8B. Free Cash Flow was ¥135.2B (OCF ¥231.3B + Investing CF -¥96.1B), maintaining ample surplus. Financing Cash Flow was -¥135.9B, driven by net repayment of short-term borrowings -¥71.9B, long-term borrowings repayment -¥75.7B, dividend payments -¥26.7B, and dividends to non-controlling interests -¥28.7B. Cash and cash equivalents increased by ¥43.4B from ¥484.5B at the beginning of the period to ¥527.9B at period end. The OCF/EBITDA ratio of 0.75x is below the benchmark 1.0x due to increases in receivables, indicating a need to improve collections. Free Cash Flow dividend coverage was 5.01x (FCF ¥135.2B / dividends ¥26.7B), showing strong capacity to sustain dividends.
Operating Income of ¥136.0B versus Ordinary Income of ¥147.6B indicates a +¥11.6B contribution from non-operating items. Of non-operating income ¥39.2B, interest income was ¥26.3B (0.8% of Revenue), dividend income received ¥1.3B, equity-method income ¥0.6B, and other ¥5.8B, with interest income as the primary contributor. Non-operating expenses ¥27.7B comprised interest expense ¥16.2B, foreign exchange losses ¥3.7B, and other ¥3.6B. The divergence from Ordinary Income ¥147.6B to Profit Before Tax ¥-47.5B is attributable to special losses ¥202.3B (impairment losses ¥115.6B, business restructuring losses ¥75.3B, etc.), and is viewed as a one-off factor. Comprehensive income was ¥32.5B; in addition to Net Income ¥1.3B, other comprehensive income included foreign currency translation adjustments +¥102.3B and retirement benefit adjustments +¥13.3B, etc. The difference between Net Income and Comprehensive Income (+¥31.2B) reflects non-cash items. On an accrual basis, OCF ¥231.3B versus Net Income ¥1.3B shows significant divergence, driven by non-cash charges such as depreciation ¥172.2B and impairment losses ¥115.6B and by working capital movements (trade receivables increase -¥114.1B), supporting conservative recognition of earnings. Goodwill amortization was minor at ¥1.7B, limiting EBITDA distortion. Recurring earnings on an operating plus non-operating basis are maintained at a healthy level, and excluding special losses, core operating profitability is at a reasonable level.
Full-year guidance is Revenue ¥2,850.0B (YoY -11.5%), Operating Income ¥115.0B (YoY -15.5%), Ordinary Income ¥115.0B (YoY -22.1%), Net Income attributable to owners of the parent ¥45.0B, EPS forecast ¥101.15, and dividend forecast ¥35.0. Progress ratios against current-year results are approximately Revenue 113%, Operating Income 118%, Ordinary Income 128%, indicating performance already ahead of the full-year plan, although the company has set conservative guidance. The assumptions likely incorporate uncertainties around European restructuring, production adjustments by major customer the Nissan Group, and model cycle variability. Forecast Operating Margin is 4.0% (current-year actual 4.2%), reflecting expected weaker fixed cost absorption due to lower Revenue. Annual dividend is projected at ¥35.0 (down from ¥60.0 in the current year), aligned with profit levels.
The annual dividend for the period was ¥60.0 (Q2-end ¥30.0, year-end ¥30.0), unchanged from the prior year. Given Net Income attributable to owners of the parent of ¥1.3B, the payout ratio calculates anomalously at 4,615%, but this is a temporary distortion caused by compression of Net Income due to special losses. On a Free Cash Flow basis, FCF ¥135.2B covers dividends ¥26.7B by 5.01x, indicating ample capacity to maintain dividends. Total dividend outlay ¥26.7B represents 3.4% of retained earnings ¥781.4B, a level that does not impair financial soundness. Next fiscal year’s forecast dividend of ¥35.0 and projected Net Income ¥45.0B imply a payout ratio of approximately 35% (dividend outlay ¥15.6B ÷ Net Income ¥45.0B), returning to normalization. No share buybacks were executed in the period (treasury stock decreased from -¥10.3B at the beginning of the period to -¥5.7B at period end, due to disposal of treasury shares). Total shareholder return comprised dividends only ¥26.7B, giving a Total Return Ratio on an FCF basis of 19.7%.
Customer Concentration Risk: Three major customers (Nissan North America ¥533.7B, Nissan Mexico ¥529.2B, Nissan Motor Co., Ltd. ¥429.3B) account for 46% of Revenue, indicating high dependence on the Nissan Group. Production adjustments or model changes by these customers directly impact sales; Japan segment experienced -7.3% decline this period. Slow progress in diversification would amplify revenue volatility due to customer concentration.
Structural Deficit in Europe Segment: Europe posted Operating Loss ¥-3.5B (margin -0.8%), with impairment and restructuring losses as principal factors. The regional allocation of tangible fixed assets includes the UK at ¥154.4B, implying heavy fixed-cost burden. Delays in structural reforms would weigh on consolidated ROE and raise the risk of further impairments.
Working Capital Management Risk: Trade receivables increased from ¥543.3B to ¥700.6B (+29.0%), with DSO deteriorating to 79 days (from 60 days), indicating potential changes in collection terms or customer credit quality. This pressures the OCF/EBITDA ratio (0.75x). If DSO normalization is delayed, recurring pressure on OCF and impairment of the cash position could materialize.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 4.2% | 7.8% (4.6%–12.3%) | -3.5pt |
| Net Margin | 0.0% | 5.2% (2.3%–8.2%) | -5.2pt |
Operating Margin of 4.2% is -3.5pt below the manufacturing median of 7.8%, and Net Margin 0.0% is materially behind the median of 5.2%. Even excluding special losses, core operating profitability ranks in the lower tier of the industry.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | -2.5% | 3.7% (-0.4%–9.3%) | -6.2pt |
Revenue growth of -2.5% lags the industry median +3.7% by -6.2pt, indicating relative underperformance while the industry overall trends upward.
※Source: Company aggregation
Operating Income increase and gross margin improvement despite Revenue decline: Revenue declined -2.5% while Operating Income rose +11.5%, gross margin improved to 12.7% (YoY +0.8pt), and Operating Margin improved to 4.2% (YoY +0.5pt). A higher-margin mix in the Americas and cost improvements contributed, reflecting progress in structural cost competitiveness. Core operating profitability excluding special losses remains solid, demonstrating the effect of structural reforms.
Size of special losses and swing to profitability: Special losses totaled ¥202.3B (impairment losses ¥115.6B, business restructuring losses ¥75.3B), yet Net Income attributable to owners of the parent turned positive at ¥1.3B. This marks a substantial improvement from last year’s ¥-210.5B loss, suggesting the worst phase of impairments may be behind. Goodwill impairments in Europe and Asia (total ¥22.8B) were conservative accounting responses to changes in the business environment, lowering the risk of recurrence going forward.
Working capital and regional mix challenges: Trade receivables increased +29.0% and DSO rose to 79 days (from 60), highlighting collection management issues. The OCF/EBITDA ratio of 0.75x indicates room for improvement; normalizing DSO is key to expanding OCF and improving ROE. Europe’s Operating Loss ¥-3.5B (margin -0.8%) continues to offset profits from the Americas, Japan, and Asia; success in improving European profitability is pivotal for consolidated margin expansion. With Free Cash Flow ¥135.2B and dividend coverage 5.01x, financial capacity exists to both maintain dividends and invest in structural reforms. The next fiscal year’s conservative guidance (Revenue ¥2,850B, Operating Income ¥115B) could be outperformed if DSO normalization and European profit recovery are realized earlier, providing upside for ROE recovery and relative industry valuation.
This report is an earnings analysis document automatically generated by AI based on XBRL financial statement data. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information aggregated by our firm based on public financial statements. Investment decisions are your own responsibility; consult a professional advisor as needed.