| Metric | Current Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue | ¥74.1B | ¥62.4B | +18.8% |
| Operating Income | ¥18.6B | ¥13.9B | +33.7% |
| Ordinary Income | ¥19.6B | ¥13.7B | +43.4% |
| Net Income | ¥13.8B | ¥9.7B | +42.1% |
| ROE | 9.4% | 7.1% | - |
For 2026 FY Q3 (9-month cumulative), Revenue was ¥74.1B (YoY +¥11.7B +18.8%), Operating Income was ¥18.6B (YoY +¥4.7B +33.7%), Ordinary Income was ¥19.6B (YoY +¥5.9B +43.4%), and Net Income was ¥13.8B (YoY +¥4.1B +42.1%), achieving both revenue and profit growth. Operating margin improved to 25.1% (prior year 22.3%), up 2.8pt, and driven by foreign exchange gains at the ordinary level and realization of operating leverage, the net margin expanded to 18.6% (prior year 15.5%), up 3.1pt. Revenue growth of +18.8% is a robust level for a manufacturer, supported by order progress and improved utilization of production capacity.
[Revenue] Revenue of ¥74.1B represents YoY growth of +18.8%, driven by expanded demand and production progress for manufacturing equipment for semiconductors and electronic components. Contract liabilities (advance receipts) were ¥16.5B, up from ¥4.4B the prior year (+¥12.1B, +277.5%), indicating a business structure where orders lead and production/inspection follow. Cost of sales was ¥37.6B, gross profit ¥36.5B, with gross margin improving 0.2pt to 49.3% (prior year 49.1%). SG&A was ¥17.9B (prior year ¥16.7B), up only +7.0%, meaning growth in SG&A lagged revenue growth (+18.8%) and positive operating leverage emerged.
[Profit & Loss] Operating Income was ¥18.6B (+33.7%), with operating margin at 25.1% (prior year 22.3%), maintaining high profitability. Ordinary Income of ¥19.6B (+43.4%) outpaced Operating Income due to recording foreign exchange gains of ¥0.7B (prior year foreign exchange losses of ¥0.4B), though exchange contribution is limited to roughly 3.7% of Ordinary Income. Non-operating income totaled ¥1.2B and non-operating expenses ¥0.2B; dividend income received ¥0.0B and interest expense paid ¥0.1B remained small. Income before taxes was ¥19.7B, income taxes ¥5.9B (effective tax rate 30.0%), resulting in Net Income of ¥13.8B (+42.1%). In conclusion, a structure of revenue and profit growth driven by high gross margins and controlled SG&A continues.
[Profitability] Operating margin 25.1% (prior year 22.3%), Net margin 18.6% (prior year 15.5%) remain at high levels, and ROE of 9.4% improved from a prior-year estimate of 7.1%. ROE improvement was mainly due to expansion of Net margin (+3.1pt) and a slight rise in total asset turnover (0.351 → 0.362); financial leverage remained conservative at 1.40x. [Cash Quality] DSO 87 days, DIO 309 days, CCC 255 days indicate material working capital drag, with Work-in-Progress (WIP) at ¥24.9B (78.2% of total inventory of ¥31.8B) showing high WIP ratio and sluggish inventory turns. Accounts receivable decreased to ¥17.7B (YoY -37.8%), and together with the build-up of contract liabilities, this reflects a business model with order-fronting and lagged production/inspection. [Investment Efficiency] Total asset turnover improved slightly to 0.362x (prior 0.351), but asset composition skewed toward inventory and WIP leaves room for efficiency gains. Intangible assets ratio is 0.2% and goodwill burden is minimal. [Financial Soundness] Equity Ratio 71.5% (prior 76.3%), current ratio 309.6%, quick ratio 309.6% indicate a solid financial base. Cash and deposits are ¥95.0B versus interest-bearing debt of ¥10.2B (short-term borrowings ¥10.0B, long-term borrowings ¥0.2B), yielding cash/short-term liabilities ratio of 9.50x and Debt/Capital ratio of 6.5%, both conservative. Short-term liabilities ratio is 97.7%, implying formal concentration of maturities, but ample cash mitigates mismatch. Interest coverage is approximately 221x, so interest burden is negligible.
Operating Cash Flow (OCF) data are not disclosed, but cash movements are inferred from balance sheet trends. Cash and deposits rose from ¥69.8B to ¥95.0B (+¥25.2B, +36.1%), with Net Income ¥13.8B generated and contract liabilities (advance receipts) build-up of +¥12.1B likely primary cash sources. Accounts receivable fell from ¥28.5B to ¥17.7B (-¥10.8B, -37.8%), reflecting accelerated collections or timing shifts due to advance receipts. Inventory rose from ¥24.2B to ¥31.8B (+¥7.7B, +31.8%), notably WIP increased from ¥20.0B to ¥24.9B (+¥4.9B), weighing on working capital. Accounts payable increased from ¥8.3B to ¥14.5B (+¥6.2B, +75.1%), showing production expansion and front-loading of component procurement. Investment securities increased from ¥2.6B to ¥5.5B (+¥2.9B, +110.3%), contributing via expanded surplus asset management and valuation gains. As a manufacturing indicator, contract liabilities build-up of ¥16.5B will contribute to future revenue recognition, but high WIP levels indicate a structure that requires time for cash conversion; the timing lag between profit recognition and cash realization is reflected in a prolonged CCC of 255 days.
Core recurring earnings are Operating Income of ¥18.6B, with net non-operating items of +¥1.0B (non-operating income ¥1.2B, non-operating expenses ¥0.2B), which is limited. The main item of non-operating income was foreign exchange gains ¥0.7B, about 1.0% of Revenue and approximately a 3.7% contribution to Ordinary Income — a temporary component but small in scale. Dividend income received ¥0.0B and interest income received ¥0.0B, indicating low recurrence of non-operating income. Interest expense ¥0.1B is minimal relative to interest-bearing debt ¥10.2B, so financial costs are limited. Non-operating income as a percentage of Revenue is 1.6%, below 5%, and Operating Income secures earnings quality. The divergence between Ordinary Income and Net Income is small; effective tax rate 30.0% is within a normal range; no extraordinary items disclosed and no distortions from one-off factors observed. Inventory build-up and AR reduction create accrual timing differences between profit recognition and cash flows, so cash-based profitability may lag profit-based measures.
Full Year guidance is maintained at Revenue ¥107.8B (YoY +15.4%), Operating Income ¥26.3B (YoY +12.3%), Ordinary Income ¥27.2B (YoY +14.7%), Net Income ¥19.2B (YoY +13.1%). Progress rates for the 3Q cumulative results are: Revenue 68.7%, Operating Income 70.8%, Ordinary Income 72.1%, Net Income 71.7% — about 4–6pt below the standard full-year pace of 75% (9 months / 12 months), but acceptable given the equipment industry’s concentration of inspections and delivery timing. The build-up of contract liabilities ¥16.5B and high WIP ¥24.9B are consistent with the assumption that shipments and inspections will concentrate in Q4, so feasibility of achieving the full-year plan is maintained. Dividend forecast was revised upward to ¥75 per share, and with a year-end lump-sum dividend, the total annual payout is about ¥6.0B, implying a forecast payout ratio of 31.4%, a sustainable level.
Dividend forecast was increased to full-year ¥75 (year-end lump-sum) as disclosed today (2026-06-12). Assuming shares outstanding of 8,042,881 (after deducting 10,541 treasury shares, 8,032,340 shares), the total annual dividend is approximately ¥6.0B. The payout ratio versus full-year Net Income forecast of ¥19.2B is approximately 31.4%, conservative, and sustainability is high given cash deposits of ¥95.0B and equity of ¥146.5B. No share buyback was disclosed; shareholder returns are limited to dividends. Prior-year dividend data are not disclosed, but the wording of the upward revision suggests a shift toward a dividend policy above prior levels.
Working capital efficiency deterioration risk: DIO 309 days and CCC 255 days show pronounced inventory and WIP retention, with WIP ratio remaining high at 78.2%. Timing mismatches in production and inspection or demand fluctuations could widen the gap between profit recognition and cash collection, increasing volatility in OCF.
Short-term liability concentration risk: Short-term liability ratio 97.7% indicates maturity concentration in the short term. Short-term borrowings ¥10.0B and accounts payable ¥14.5B total ¥24.5B due within one year. While cash deposits ¥95.0B sufficiently cover this, rapid working capital expansion or large capital expenditures could exert short-term liquidity pressure.
Foreign exchange risk: Foreign exchange gains of ¥0.7B boosted Ordinary Income, but FX movements present two-way risk. While overseas sales and procurement composition are unclear, if FX sensitivity is high, yen appreciation could deteriorate margins or weaken competitiveness in bids.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 25.1% | 8.9% (5.4%–12.7%) | +16.3pt |
| Net Margin | 18.6% | 6.5% (3.3%–9.4%) | +12.1pt |
Profitability significantly exceeds manufacturing medians, indicating competitive advantage in high value-added equipment.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 18.8% | 2.8% (-1.5%–8.8%) | +16.0pt |
Growth rate is in the top tier for manufacturing, reflecting demand environment and strong order capability.
※ Source: Company compilation
Sustainability of high profitability: Operating margin 25.1% and Net margin 18.6% continue to far exceed manufacturing medians, and positive operating leverage has emerged. With restrained SG&A growth and stable gross margins, there is room for profitability improvement as scale expands. Progress toward the full-year plan is generally steady, and the dividend increase signals management confidence in performance outlook.
Room to improve working capital management: Inventory days 309 and CCC 255 indicate heavy working capital compared with peers, and particularly high WIP ratio of 78.2% is a challenge. The pace of digesting contract liabilities ¥16.5B and progress in completing and shipping WIP will be key to Q4 operating cash flow and achieving the full-year plan. Improving inventory efficiency is a structural theme directly linked to ROE and cash generation.
This report was auto-generated by AI analyzing XBRL financial disclosure data. It is not 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 responsibility; consult a professional advisor as necessary.