FUJI CORPORATION FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥79.54B
• Operating Income: ¥9.59B
• Net Income: ¥5.22B
• EPS: ¥102.06

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

FUJI (6134) posted strong FY2026 Q2 consolidated results under JGAAP, with revenue of ¥79.5bn (+26.3% YoY) and operating income of ¥9.59bn (+47.6% YoY), indicating notable operating leverage. Net income rose 72.2% YoY to ¥8.99bn, and net margin reached 11.3%, reflecting both improved mix and cost discipline. Gross margin was 29.0%, while operating margin was approximately 12.1%, and EBITDA margin was 17.4%, showcasing healthy profitability for a capital equipment supplier. DuPont metrics point to a calculated ROE of 4.04%, driven by an 11.30% net margin, asset turnover of 0.313, and low financial leverage of 1.14. Liquidity and solvency are robust: current assets of ¥155.4bn versus current liabilities of ¥22.3bn produce a current ratio of 6.98x and quick ratio of 6.41x, and implied equity ratio is about 87.6% (¥222.4bn equity over ¥253.8bn assets). Interest expense is negligible (¥12m) and interest coverage is extremely high at 799x, underscoring a conservative balance sheet. Operating cash flow of ¥17.8bn was almost 2x net income, indicating high earnings quality and favorable working capital dynamics in the half. Revenue growth outpaced cost growth, and the step-up in operating profit suggests improved utilization and scale benefits in the core SMT/automation businesses. Ordinary income of ¥10.23bn exceeded operating income, implying positive net non-operating items (e.g., financial income or FX tailwinds). Using net income and taxes disclosed, the implied effective tax rate is roughly 21–22% for the period. Several reported zeros (e.g., equity ratio, cash and equivalents, investing cash flows, dividend data, share counts) indicate unreported items rather than actual zero values; analysis therefore focuses on disclosed non-zero datapoints. Working capital is ample (¥133.2bn), providing flexibility for procurement and production in a choppy supply chain environment. While free cash flow cannot be precisely assessed due to unreported investing cash flows (and capex), the strong OCF and fortress balance sheet imply capacity to fund growth and potential shareholder returns. Overall, FUJI’s interim performance demonstrates cyclical recovery with disciplined cost control, high liquidity, and minimal leverage, though reported ROE remains modest given the large equity base. Outlook hinges on demand sustainability in electronics capex, FX trends, and order visibility into H2 and FY2027.

Profitability Analysis

ROE_decomposition: Calculated ROE: 4.04% = Net Profit Margin (11.30%) × Asset Turnover (0.313) × Financial Leverage (1.14). The modest ROE is primarily constrained by low leverage and relatively low asset turnover versus high-margin peers, despite good margins. margin_quality: - Gross margin: 29.0% on revenue of ¥79.5bn and COGS of ¥39.9bn, indicating solid pricing and product mix.

• Operating margin: ~12.1% (¥9.59bn / ¥79.54bn), improving faster than revenue (+47.6% OI vs. +26.3% revenue), evidencing operating discipline.
• Net margin: 11.30%, supported by low interest burden and favorable non-operating items.
• EBITDA margin: 17.4%, with D&A of ¥4.27bn indicating a capital-intensive base but manageable non-cash charges. operating_leverage: Revenue grew 26.3% YoY while operating income rose 47.6% YoY, signifying positive operating leverage from higher volumes, better utilization, and fixed-cost absorption. The incremental operating margin expansion suggests efficiencies and potentially higher-margin shipment mix.

Growth Assessment

revenue_sustainability: The 26.3% YoY revenue growth implies a cyclical upturn in demand for SMT/automation equipment and services. Sustainability depends on backlog, order intake momentum, and regional demand (not disclosed), as well as customer capex cycles in electronics and automotive electronics. profit_quality: Net income growth (+72.2% YoY) outpaced revenue due to leverage on fixed costs and leaner expense ratios. With interest expense minimal and ordinary income above operating income, profit quality appears solid, benefitting from operations and benign financial items. outlook: Key determinants for H2 include order visibility, installation lead-times, and macro/FX conditions. If utilization remains elevated and pricing/mix holds, margins can remain resilient. However, the low asset turnover suggests that further revenue scale is needed to lift ROE meaningfully absent a change in capital structure.

Financial Health

liquidity: Current ratio 698% and quick ratio 640% (current assets ¥155.4bn; inventories ¥12.9bn; current liabilities ¥22.3bn) indicate very strong short-term liquidity and procurement capacity. solvency: Debt-to-equity ratio 0.12x and interest coverage 799x show conservative leverage and negligible financial risk from borrowing costs. capital_structure: Total assets ¥253.8bn, total equity ¥222.4bn, implying an equity ratio around 87.6%. The firm is equity-heavy, limiting ROE despite strong margins but providing resilience through cycles.

Cash Flow Quality

earnings_quality: Operating CF of ¥17.79bn is ~1.98x net income (¥8.99bn), indicating robust cash conversion, likely aided by favorable working capital (collections and/or payables timing). FCF_analysis: Investing cash flow is unreported (shown as 0), so precise free cash flow cannot be derived. On an indicative basis, OCF comfortably covers typical maintenance capex for capital equipment makers, but definitive FCF requires capex disclosure. working_capital: Working capital stands at ¥133.17bn, with inventories at ¥12.88bn. The high quick ratio suggests limited reliance on inventory liquidation for liquidity. Monitoring receivables DSO and order advance payments is important to validate OCF sustainability.

Dividend Sustainability

payout_ratio_assessment: Annual DPS and payout ratio are shown as 0.0%, which should be interpreted as undisclosed for this dataset. Based on EPS of ¥102.06 and strong OCF, capacity for distributions exists, but policy and timing are not provided. FCF_coverage: FCF coverage cannot be assessed without investing CF/capex data. OCF is strong, but sustained dividends require confirmation of recurring FCF after capex. policy_outlook: With an equity-rich balance sheet and minimal leverage, the company has flexibility for dividends or buybacks, subject to cash allocation priorities (growth capex, R&D, M&A) and management policy.

Risk Assessment

Business Risks:

• Cyclical demand for SMT mounters and factory automation equipment tied to electronics and auto electronics capex
• Order volatility and backlog timing, impacting quarterly revenue recognition and utilization
• Competitive pricing pressure from global peers and Chinese entrants
• Supply chain constraints for precision components and semiconductors
• FX fluctuations (JPY vs. USD/EUR/CNY) affecting both demand and margins
• Technology transition risks (e.g., mini/micro LED, advanced packaging) requiring sustained R&D

Financial Risks:

• Low asset turnover dampening ROE despite high equity base
• Potential working capital swings as orders ramp or normalize
• Capex requirements for capacity and product development potentially absorbing OCF in upcycles
• Customer credit risk during downcycles

Key Concerns:

• Sustainability of margin gains if revenue momentum slows
• Visibility on capex and investing cash flows (unreported), which are key to FCF
• ROE remaining modest given conservative capital structure

Investment Implications

Key Takeaways:

• Strong top-line growth (+26.3% YoY) and operating leverage (+47.6% OI YoY)
• Healthy margins: GM 29.0%, OPM ~12.1%, EBITDA margin 17.4%
• High earnings quality: OCF/NI ≈ 1.98x
• Very robust liquidity (CR 6.98x; QR 6.41x) and minimal leverage (D/E 0.12x)
• Calculated ROE 4.04% constrained by low leverage and asset turnover
• Ordinary income above operating income, indicating supportive non-operating items
• Implied effective tax rate around low-20s percent based on NI and tax expense

Metrics to Watch:

• Order intake, book-to-bill, and backlog conversion into H2
• Gross margin trajectory and mix (new platforms vs. services/spares)
• Working capital metrics (DSO/DPO/DOH) and OCF sustainability
• Capex and investing cash flows to assess FCF and capital allocation
• Asset turnover improvement and ROE progression
• FX sensitivity (JPY movements) and hedging gains/losses

Relative Positioning: Balance sheet strength and cash generation position the company defensively versus capital equipment peers, while operating leverage in the latest half indicates competitive execution; however, low asset turnover and conservative leverage keep ROE below more aggressive peers.

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
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