| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue | ¥209.4B | ¥201.0B | +4.2% |
| Operating Income | ¥25.9B | ¥26.3B | -1.4% |
| Ordinary Income | ¥25.4B | ¥26.7B | -5.0% |
| Net Income | ¥12.4B | ¥20.4B | -39.0% |
| ROE | 5.4% | 9.0% | - |
For the fiscal year ended March 2026, Revenue was ¥209.4B (YoY +¥8.4B +4.2%), Operating Income was ¥25.9B (YoY -¥0.4B -1.4%), Ordinary Income was ¥25.4B (YoY -¥1.3B -5.0%), and Net Income was ¥12.4B (YoY -¥8.0B -39.0%). Growth in the Construction Machinery Filters business secured revenue gains, but the Air Filter business turned to a loss and a foreign exchange loss of ¥0.6B weighed on profits, resulting in higher revenue but lower profits. Gross margin remained largely stable at 43.9% (prior year 44.4%), while SG&A ratio edged up to 31.5% (prior year 31.4%), causing Operating Margin to decline 0.7pt to 12.4% (prior year 13.1%). Net Income declined sharply by 39.0% YoY, primarily due to higher corporate tax burden and an increased effective tax rate.
【Revenue】Revenue was ¥209.4B (YoY +4.2%), driven by the Construction Machinery Filters business at ¥186.5B (+6.7%). This segment benefited from steady domestic and overseas demand for construction machinery and expanded sales of core product lines. Conversely, the Air Filter business declined significantly to ¥22.9B (-12.5%) due to deteriorating market conditions and competitive pressure. Segment mix was 89.1% Construction Machinery Filters and 10.9% Air Filters, indicating roughly 90% dependence on construction machinery and a structure in which the growth of that segment determines group top-line performance.
【Profitability】Gross profit was ¥91.9B (gross margin 43.9%), an increase of ¥2.6B YoY, with gross margin slightly down 0.5pt from 44.4% last year and broadly stable. SG&A was ¥66.0B (SG&A ratio 31.5%), up ¥2.9B YoY, driven by higher variable costs with revenue growth and increased fixed costs. As a result, Operating Income was ¥25.9B (Operating Margin 12.4%), down ¥0.4B YoY, and Operating Margin fell 0.7pt from 13.1% a year earlier. By segment, Construction Machinery Filters delivered Operating Income of ¥27.1B (margin 14.5%), up 6.2% YoY with healthy profitability, while the Air Filter business swung to an operating loss of ¥1.2B (margin -5.3%), a substantial deterioration of -259.8% YoY that compressed company margins. Non-operating items included a foreign exchange loss of ¥0.6B and interest expense of ¥0.3B, worsening non-operating income by ¥0.6B and leading to Ordinary Income of ¥25.4B (-5.0%), a larger decline than at the operating level. Profit before tax was ¥25.2B; after recording corporate taxes of ¥8.0B (effective tax rate 31.7%), Net Income was ¥12.4B (-39.0%). Compared to prior-year Net Income of ¥20.4B, increased tax burden is the main cause of the Net Income contraction. In conclusion, while Revenue and Operating Income growth in the Construction Machinery Filters business supported the group top-line, losses in the Air Filter business and FX impact resulted in a fiscal outcome of higher revenue but lower profits.
The Construction Machinery Filters business achieved Revenue of ¥186.5B (YoY +6.7%) and Operating Income of ¥27.1B (YoY +6.2%, margin 14.5%), recording both revenue and profit growth. Stable domestic and overseas demand for construction machinery, expanded sales of core products, and improved product mix contributed, maintaining a high margin of 14.5%. Conversely, the Air Filter business posted Revenue of ¥22.9B (-12.5%) and an operating loss of ¥1.2B (from operating profit of ¥0.8B in the prior year), a significant deterioration. Shrinking sales amid worsening market conditions and intensified competition, combined with heavy fixed-cost burden, rapidly eroded profitability. This segment’s operating margin was -5.3%, an 8.2pt decline from 2.9% last year, and was the main driver of the 0.7pt decline in consolidated Operating Margin.
【Profitability】Operating Margin was 12.4%, down 0.7pt from 13.1% last year, and Net Margin deteriorated sharply to 5.9% (prior year 10.1%). ROE was 5.4%, down 2.2pt from 7.6% last year; DuPont decomposition attributes the decline mainly to compressed Net Margin. 【Cash Quality】Operating Cash Flow (OCF) was ¥24.5B, 1.98x Net Income ¥12.4B, indicating strong cash generation. EBITDA, adding back depreciation of ¥7.9B, was ¥33.8B, and OCF/EBITDA was 0.72x, with an increase in working capital constraining cash conversion. Days Sales Outstanding was 82 days and Days Inventory Outstanding was 66 days, indicating room to improve working capital efficiency. 【Investment Efficiency】Capital expenditure was ¥6.5B, below depreciation of ¥7.9B, with CapEx/Depreciation at 0.82x, a level consistent with maintenance-oriented spending. Total asset turnover was 0.75x (prior year 0.75x), showing limited improvement in asset efficiency. 【Financial Soundness】Equity Ratio was 81.3% (prior year 84.9%), remaining high and reflecting very healthy finances. Current ratio was 340.7%, and cash and deposits amounted to ¥67.2B, indicating ample liquidity; cash coverage against short-term borrowings of ¥16.0B was 4.2x. All interest-bearing debt consists of short-term borrowings, with Debt/EBITDA at 0.47x and Interest Coverage at 86.4x, reflecting high financial resilience.
OCF was ¥24.5B (YoY -11.4%), sourced from Profit before tax ¥25.2B and Depreciation ¥7.9B, with working capital movements turning the subtotal ¥30.3B into a cash outflow of -¥5.8B. The breakdown was Inventory increase -¥2.5B, Accounts Receivable decrease +¥2.4B, and Accounts Payable decrease -¥2.2B, where inventory buildup and reduced payables weakened working capital efficiency. After corporate tax payments of -¥5.6B, OCF was ¥24.5B, 1.98x Net Income ¥12.4B, showing solid cash generation, but OCF/EBITDA at 0.72x falls below the benchmark 0.9x, highlighting the need to correct working capital. Investing Cash Flow was -¥7.7B, mainly CapEx -¥6.5B and intangible asset investment -¥1.1B, leaving Free Cash Flow at ¥16.8B positive. Financing Cash Flow was -¥11.5B: while short-term borrowings increased by ¥16.0B providing funding, there were repayments of long-term borrowings -¥3.2B, lease liabilities repayment -¥1.0B, dividend payments -¥10.5B, and share buybacks -¥12.7B, resulting in total net outflow of ¥11.5B. Cash and deposits rose to ¥67.2B (YoY +¥6.8B), keeping liquidity ample. Improving working capital efficiency and moderating share buybacks will be key to CF generation going forward.
Operating Income of ¥25.9B is derived from recurring costs of cost of goods sold and SG&A, indicating high quality of recurring earnings. In non-operating items, a foreign exchange loss of ¥0.6B and interest expense of ¥0.3B depressed Ordinary Income, but both are non-operating, temporary, and variable factors. Extraordinary items were small: extraordinary gains ¥0.1B (e.g., gain on sale of fixed assets) and extraordinary losses ¥0.2B (e.g., loss on disposal of fixed assets), with limited impact on recurring profit. Comprehensive Income of ¥20.4B equals Net Income ¥17.2B plus foreign currency translation adjustments ¥3.2B, and the divergence from Net Income reflects valuation changes from FX fluctuations. OCF of ¥24.5B significantly exceeds Net Income ¥12.4B, and the accrual ratio is approximately -¥12B/¥25.2B = -48%, indicating cash-backed quality earnings. However, working capital increases have depressed OCF/EBITDA to 0.72x and the expansion of inventory and receivables is reducing cash realization efficiency, which warrants attention.
Full Year guidance projects Revenue ¥225.6B (YoY +7.7%), Operating Income ¥28.2B (+9.0%), Ordinary Income ¥27.8B (+9.5%), and EPS forecast ¥28.71, indicating a plan for revenue and profit growth. First-half results were Revenue ¥209.4B and Operating Income ¥25.9B, representing progress rates of 92.8% for Revenue and 91.8% for Operating Income against the full-year forecast, suggesting steady performance. The second half assumes incremental Revenue ¥16.2B (the difference based on applying a 7.7% growth rate) and additional Operating Income ¥2.3B, with sustained demand in the Construction Machinery Filters business and profit recovery in the Air Filter business being key to achieving targets. Net Income forecast ¥20.1B (¥1.7B below prior year) assumes ¥7.7B in the second half vs. ¥12.4B in the first half, reflecting cautious assumptions regarding tax burden and non-operating items. Dividend forecast is ¥10 (including interim ¥8 for a full-year ¥18), with a Payout Ratio of 34.8%, a more restrained level than the first-half Payout Ratio of 49.3%.
Dividends are interim ¥8 and year-end forecast ¥10 for full-year ¥18; for the first half, total dividends were ¥10.5B against Net Income ¥12.4B (Payout Ratio 49.3%), somewhat high but sustainable given OCF ¥24.5B and FCF ¥16.8B. In addition, share buybacks of ¥12.7B were executed to improve capital efficiency corresponding to the number of shares acquired. Total shareholder return of Dividends ¥10.5B + Share Buybacks ¥12.7B = ¥23.2B substantially exceeded Net Income ¥12.4B, yielding a Total Return Ratio of 187%, a high level. While total returns were funded by OCF and FCF, continuing this level of distribution beyond the current fiscal year could slow internal reserve accumulation and affect growth investment capacity. The full-year dividend forecast of ¥10 indicates a dividend cut from the interim reported ¥18 and suggests a shift toward capital allocation that balances profit levels and investment capacity.
Deterioration in the Air Filter business profitability: The Air Filter business recorded Revenue ¥22.9B (-12.5%) and an operating loss ¥1.2B (margin -5.3%), swinging to a loss as market conditions deteriorated and competition intensified, rapidly worsening profitability. It reduced consolidated Operating Margin by 0.7pt; if structural reforms and cost reductions do not progress, this business could remain a drag on consolidated profits going forward.
Worsening working capital efficiency: Inventory stood at ¥21.3B (YoY +¥2.6B) and Accounts Receivable at ¥47.0B, with DIO 66 days and DSO 82 days, indicating increased inventory and receivables. Working capital increases reduced the OCF subtotal ¥30.3B to actual OCF ¥24.5B, and OCF/EBITDA is low at 0.72x. Failure to improve inventory management and receivables collection may lead to declining cash generation and the need for additional working capital.
Foreign exchange risk: A foreign exchange loss of ¥0.6B was recorded as a non-operating expense, pressuring Ordinary Income. Foreign currency translation adjustments contributed +¥3.2B to Comprehensive Income, but a reversal in FX rates could have opposite effects. Given a material share of overseas sales in the Construction Machinery Filters business, a stronger yen could compress revenue and profit while expanding non-operating losses.
収益性・リターン
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 12.4% | 7.8% (4.6%–12.3%) | +4.6pt |
| Net Margin | 5.9% | 5.2% (2.3%–8.2%) | +0.7pt |
Operating Margin exceeds the industry median of 7.8% by 4.6pt, reflecting a high-profitability profile among manufacturers. Net Margin also exceeds the median of 5.2%.
成長性・資本効率
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 4.2% | 3.7% (-0.4%–9.3%) | +0.5pt |
Revenue growth slightly outpaced the industry median of 3.7%, maintaining an average growth pace.
※Source: Company aggregation
Stable earning power of the Construction Machinery Filters business: With Revenue ¥186.5B (+6.7%) and Operating Income ¥27.1B (margin 14.5%), this segment’s revenue base is robust and supported by steady domestic and overseas demand for construction machinery. Consolidated Operating Margin of 12.4%, well above the industry median, is underpinned by this segment’s high profitability, increasing the likelihood of achieving next year’s Operating Income forecast of ¥28.2B. Trends in construction demand and deepening relationships with key customers will be key to medium-term earnings stability.
Structural improvement of the Air Filter business and reallocation of capital: The Air Filter business swung to an operating loss of ¥1.2B (margin -5.3%), demonstrating that sales contraction and fixed-cost burden have become prominent. If turnaround measures are delayed, this will continue to affect consolidated profits and raise the hurdle for achieving next year’s forecasts. At the same time, total shareholder returns of ¥23.2B (share buybacks ¥12.7B and dividends ¥10.5B) exceeded Net Income ¥12.4B, so careful balancing with growth investment is required. The dividend cut to a full-year forecast ¥10 suggests recalibration of profit levels and investment capacity, and the sustainability of capital allocation policies will be tested.
Room to improve working capital efficiency and recover cash generation: Working capital increases led to a cash outflow of -¥5.8B, keeping OCF/EBITDA at a low 0.72x. There is substantial room to improve inventory turns and receivables collection; if corrected, OCF could exceed ¥30B. If construction-in-progress ¥9.4B begins contributing to operations while working capital efficiency improves, FCF expansion and restoration of investment capacity could be expected from next fiscal year onward.
This report is an AI-generated financial analysis document based on XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on public financial statements. Investment decisions are your own responsibility; please consult a professional advisor as necessary before making investment decisions.