Tameny Inc. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥2.77B
• Operating Income: ¥-119M
• Net Income: ¥-136M
• EPS: ¥-4.97

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

Verdict: FY2026 Q2 was weak operationally with an operating loss and negative bottom line, despite modest top-line growth and positive operating cash flow. Revenue rose 2.7% YoY to 27.69, but gross profit of 18.98 could not cover SG&A of 19.97, resulting in operating income of -1.19 and ordinary income of -1.45. Gross margin printed a high 68.5%, while operating margin was -4.3% (operating loss of -1.19 on revenue of 27.69). Margin trend versus last year cannot be quantified due to lack of disclosed YoY operating profit, but the SG&A envelope exceeded gross profit by 0.99 this quarter, indicating insufficient operating leverage. Net income was -1.36 (EPS -4.97 JPY), and ROIC was -13.4%, well below a 5% warning threshold. The reported ROE of 104.6% is mechanically distorted by negative equity (owners’ equity -1.30) and is not economically meaningful. On earnings quality, operating cash flow was +1.50, outpacing net loss (-1.36), with D&A of 1.09 supporting cash generation; the OCF/NI ratio of -1.10 flags a quality alert by rule, but here it reflects loss magnitude and non-cash charges rather than aggressive accruals. Liquidity is tight: current ratio is 97.8% and quick ratio 97.8%, just below 1.0, with working capital of -0.52. Debt is sizable (short-term loans 7.05; long-term loans 16.88), and interest coverage is deeply negative (-5.29x), highlighting debt service stress. Cash and deposits of 13.76 provide some near-term buffer, but refinancing and covenant risks remain elevated given negative equity and weak EBIT. Equity is negative (owners’ equity -1.30), and book value per share is -4.05 JPY, underscoring balance sheet fragility and potential constraints on strategic flexibility. No dividends were disclosed; capital allocation is likely focused on liquidity preservation and restructuring. Free cash flow is not reported; using disclosed OCF and capex implies positive FCF of about 1.17, but sustainability is uncertain with operating losses. Forward-looking, the company needs SG&A discipline, monetization improvements in matchmaking/wedding services, and continued cash discipline to restore operating margin and move ROIC toward breakeven. Without a return to operating profitability and deleveraging, solvency and refinancing risks will remain the dominant investor focus. Overall, the quarter shows incremental revenue growth but continued structural cost and leverage issues that will require sustained turnaround execution.

Profitability Analysis

DuPont decomposition (caveat: negative equity makes ROE not economically meaningful): ROE = Net Profit Margin × Asset Turnover × Financial Leverage = (-4.9%) × 0.691 × (-30.82x) ≈ 104.6%. The positive ROE results purely from negative equity; it should not be used for performance assessment. Component movements: we lack prior-period component disclosure, but the binding constraint is net margin (operating loss and interest burden) rather than turnover. Business drivers: gross margin is high (68.5%), indicating pricing/mix strength or a service-heavy model, but SG&A of 19.97 exceeded gross profit (18.98), producing operating margin of -4.3%; interest expense of 0.23 further depresses ordinary income (-1.45). Sustainability: absent visible cost takeout or revenue scale, the operating loss appears structural in the near term; D&A (1.09) helps cash but does not fix margin. Concerning trends: SG&A growth cannot be compared to revenue growth due to unreported YoY SG&A, but the absolute gap (SG&A > GP by 0.99) is a red flag; interest coverage is -5.29x, suggesting rising finance cost pressure if rates or spreads increase.

Growth Assessment

Top line grew 2.7% YoY to 27.69, but operating performance deteriorated to a loss (-1.19) given SG&A above gross profit. With gross margin strong at 68.5%, the issue is scale and cost absorption rather than pricing. Revenue sustainability will depend on user acquisition/retention in matchmaking and recovery in wedding-related demand; however, tighter marketing ROI and efficiency measures are needed to convert growth into profit. Profit quality: ordinary loss (-1.45) and net loss (-1.36) reflect interest and operating drag; non-operating items were small (income 0.02; expense 0.23). Outlook: near-term focus should be on SG&A rationalization, improving utilization of intangible assets (goodwill 2.03; intangibles 4.82), and reducing financing costs through debt paydown. Without operating break-even, growth alone will not repair ROIC (currently -13.4%).

Financial Health

Liquidity: current ratio 97.8% and quick ratio 97.8% are below 1.0 (warning), with working capital of -0.52. Cash and deposits are 13.76 against short-term loans of 7.05 and total current liabilities of 23.44, limiting cushion. Solvency: total liabilities 42.84 exceed total assets 40.07, with owners’ equity at -1.30 (negative equity); D/E is not meaningful and appears highly negative due to negative equity. Interest-bearing debt comprises short-term loans 7.05 and long-term loans 16.88 (total 23.93), implying leverage is substantial relative to assets and cash generation. Interest coverage is -5.29x (warning), indicating debt service risk. Maturity mismatch: short-term obligations (notably ST loans 7.05) are high relative to current assets and near break-even working capital; rollover risk is material. Off-balance sheet: none disclosed in the provided data. Note: minor discrepancies between assets-liabilities and reported equity may reflect rounding or unreported components under JGAAP classifications.

Cash Flow Quality

OCF was +1.50 versus net income of -1.36, yielding an OCF/NI ratio of -1.10 (flagged by rule); qualitatively, cash generation benefited from non-cash D&A (1.09) and likely working capital release, offsetting the accounting loss. EBITDA was -0.10, indicating that positive OCF depended on working capital movements and non-cash items rather than underlying operating profitability. Capex was modest at -0.33; implied FCF (OCF - capex) is approximately +1.17, but FCF is unreported and may include other investing cash flows not disclosed here. Sustainability: with operating margin negative and interest burdens persistent, positive OCF may not be repeatable without continued working capital releases or cost reductions. No indications of aggressive working capital tactics can be confirmed from the limited disclosures, but vigilance is warranted given liquidity tightness.

Dividend Sustainability

No dividends were disclosed for the period, and payout ratios are not calculable. Given negative equity (-1.30), operating losses (-1.19), and tight liquidity (current ratio 0.98), capacity to resume or maintain cash dividends appears constrained. Even with implied positive FCF this quarter (~1.17), priority likely remains debt service and liquidity preservation. Policy outlook: absent a clear return to operating profitability and balance sheet repair, a conservative or suspended dividend policy is expected.

Risk Assessment

Business Risks:

• Demand volatility in matchmaking and wedding-related services affecting revenue scale.
• High SG&A base relative to gross profit leading to persistent operating losses.
• Intangible asset concentration (goodwill 2.03; intangibles 4.82) exposing the company to impairment risk.
• Competitive intensity and customer acquisition cost inflation compressing unit economics.

Financial Risks:

• Negative equity (-1.30) and potential covenant/refinancing risk with total loans of 23.93.
• Liquidity tightness (current ratio 0.98; working capital -0.52) increasing short-term rollover risk.
• Interest coverage -5.29x indicating elevated debt service stress.
• Sensitivity to interest rate increases that could raise financing costs and pressure ordinary income.

Key Concerns:

• Sustained operating losses with SG&A exceeding gross profit by 0.99.
• ROIC of -13.4% well below acceptable thresholds (<5% warning).
• Reliance on working capital movements to support OCF while EBITDA is negative.
• Potential constraints on strategic options due to negative book value per share (-4.05 JPY).

Investment Implications

Key Takeaways:

• Modest revenue growth (+2.7% YoY) but continued operating loss (-1.19).
• High gross margin (68.5%) offset by SG&A envelope exceeding gross profit.
• OCF positive (1.50) despite net loss, aided by D&A and likely working capital release.
• Balance sheet fragile: negative equity (-1.30) and interest coverage -5.29x.
• Liquidity below comfort levels (current ratio 0.98) with meaningful short-term loans (7.05).
• ROIC -13.4% highlights value-destructive returns pending turnaround.

Metrics to Watch:

• Operating margin trajectory and SG&A-to-revenue ratio each quarter.
• Working capital trends (receivables and payables) and sustainability of positive OCF.
• Debt mix and maturities; progress on reducing short-term loans and interest expense.
• Impairment risks to goodwill/intangibles and their impact on equity.
• Cash balance versus near-term obligations to gauge refinancing risk.

Relative Positioning: Versus domestic consumer service peers, the company remains sub-scale with negative equity, weaker interest coverage, and inferior ROIC; a credible cost restructuring and deleveraging plan is required to close the gap even if gross margins are competitive.

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