| Metric | Current Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥8934.6B | ¥8488.9B | +5.3% |
| Operating Income | ¥778.7B | ¥677.0B | +15.0% |
| Profit Before Tax | ¥819.7B | ¥725.4B | +13.0% |
| Net Income | ¥676.4B | ¥547.9B | +23.5% |
| ROE | 8.8% | 7.9% | - |
For the fiscal year ended March 2026, Revenue was ¥8934.6B (YoY +¥445.7B, +5.3%), Operating Income was ¥778.7B (YoY +¥101.7B, +15.0%), Ordinary Income was ¥265.9B (YoY -¥588.2B, -68.9%), and Net Income attributable to owners of the parent was ¥676.2B (YoY +¥128.5B, +23.5%). Although the operating line showed profit growth, Ordinary Income decreased significantly because under IFRS the figure corresponding to Ordinary Income, Profit Before Tax, increased to ¥819.7B (prior ¥725.4B, +13.0%), while one-off profit from non-continuing operations of ¥50.4B (prior ¥13.8B) was added to Net Income. Substantively, the company achieved revenue and profit growth: Operating margin improved to 8.7% (up +0.7pt from 8.0% a year earlier), Gross Profit margin was 42.5% (down -0.4pt from 42.9%), and SG&A ratio improved to 33.2% (down -0.8pt from 34.0%), with expense efficiency driving margin expansion.
[Revenue] Revenue increased to ¥8934.6B (YoY +5.3%). By segment, Printing & Solutions accounted for ¥5705.8B (+4.7%), representing 63.9% of total—driven by Communications & Printing Devices ¥498.3B and Labeling ¥72.2B. Machinery expanded sharply to ¥829.7B (+23.3%), supported by recovery in demand for industrial equipment. Industrial Printing rose slightly to ¥1392.9B (+1.5%), with Domino business ¥125.3B growing but Industrial Printers contracting by ¥13.96B. Personal & Home was ¥609.7B (+6.7%), and Nissay ¥214.4B (+7.1%) both increased. By region, the U.S. expanded to ¥2306.7B (prior ¥2268.4B), China to ¥907.9B (prior ¥823.7B), while Japan was flat at ¥889.5B (prior ¥891.6B).
[Profitability] Operating Income rose to ¥778.7B (+15.0%). Cost of sales ratio deteriorated slightly to 57.5% (prior 57.1%, +0.4pt) but SG&A ratio improved to 33.2% (prior 34.0%, -0.8pt), delivering operating leverage. By segment, Printing & Solutions remained core with Operating Income ¥664.5B (+9.0%, margin 11.6%), and Machinery recovered to ¥67.0B (+530.0%, margin 8.1%). Conversely, Industrial Printing declined to ¥29.1B (-44.3%, margin 2.1%), and Other expenses increased to ¥155.8B (prior ¥99.7B), pressuring non-operating items. Profit Before Tax was ¥819.7B (+13.0%). Net financial income (financial income ¥50.5B less financial expenses ¥15.5B) contributed ¥34.9B (prior ¥43.7B). After deducting income taxes of ¥193.7B, profit from continuing operations was ¥626.0B (prior ¥534.2B, +17.2%), and adding ¥50.4B from non-continuing operations resulted in Net Income of ¥676.4B (+23.5%). The profit from non-continuing operations includes temporary factors, so core earning power should be assessed on a continuing-operations basis; nevertheless, the company achieved revenue and profit growth.
Printing & Solutions delivered Revenue ¥5705.8B (+4.7%) and Operating Income ¥664.5B (+9.0%), with a high margin of 11.6%, accounting for the bulk of corporate profits. Volume and mix improvements in Communications & Printing Devices contributed, and the segment absorbed an increase in Other expenses of ¥83.5B (prior ¥21.2B). Industrial Printing posted Revenue ¥1392.9B (+1.5%) but Operating Income fell to ¥29.1B (-44.3%), with margin deteriorating to 2.1% (prior 3.8%). Despite Domino business growth, increased Other expenses of ¥45.8B (prior ¥20.3B) weighed on profitability. Machinery saw Revenue ¥829.7B (+23.3%) and Operating Income ¥67.0B (+530.0%), with margin improving to 8.1% (prior 1.7%) as demand for industrial equipment expanded. Nissay posted Revenue ¥214.4B (+7.1%) and Operating Income ¥9.6B (+101.9%), turning profitable with margin improving to 4.5% (prior -0.1%). Personal & Home reported Revenue ¥609.7B (+6.7%) and Operating Income ¥66.0B (-9.8%), with margin at 10.8% (prior 11.6%), a modest decline.
[Profitability] Operating margin was 8.7% (improved +0.7pt from 8.0%), and ROE was 9.3% (improved +1.2pt from 8.1%), indicating enhanced profitability. Gross profit margin was 42.5% (down -0.4pt from 42.9%), while SG&A ratio improved to 33.2% (down -0.8pt from 34.0%), lifting margins via expense efficiency. EBITDA was approximately ¥1260B (Operating Income ¥778.7B + Depreciation & Amortization ¥480.9B), and EBITDA margin was about 14.1%, remaining stable. [Cash Quality] Operating Cash Flow (OCF) was ¥1110.0B, 1.64x Net Income of ¥676.4B, indicating strong cash generation; the accrual ratio was -4.3%, signaling sound quality. Inventory change +¥128.7B and receivables change +¥30.0B supported OCF. Free Cash Flow was ¥680.1B (OCF ¥1110.0B - Investing CF ¥429.9B), covering dividends ¥254.7B and capital expenditures ¥324.7B, and the company executed share repurchases of ¥184.6B. [Investment Efficiency] Total asset turnover was 0.88x (Revenue ¥8934.6B / Total Assets ¥10188.1B), relatively low; Days Inventory Outstanding ~166 days (Inventory ¥2339.9B / Cost of Sales ¥5134.8B × 365), Days Sales Outstanding ~101 days (Receivables ¥1422.8B / Revenue ¥8934.6B × 365), Days Payables Outstanding ~63 days (Payables ¥887.4B / Cost of Sales ¥5134.8B × 365), yielding Cash Conversion Cycle ~161 days—leaving room to improve working capital efficiency. [Financial Soundness] Equity Ratio was 74.9% (prior 74.1%), interest-bearing debt totaled ¥9.9B (current ¥5.9B + non-current ¥4.0B), effectively net-debt free, with cash and deposits ¥1976.7B and net cash position ¥1966.8B—extremely strong. Current ratio was ~322% (Current Assets ¥6474.3B / Current Liabilities ¥2011.8B), and Fixed Asset Ratio ~48% (Fixed Assets ¥3713.8B / Net Assets ¥7673.6B), indicating ample liquidity.
OCF was ¥1110.0B (YoY +23.3%), demonstrating robust cash generation. Profit Before Tax ¥819.7B plus Depreciation & Amortization ¥514.3B and impairment losses ¥20.5B, along with decreases in inventory ¥128.7B and receivables ¥30.0B, contributed positively. Offsetting factors included a decrease in payables ¥56.1B and tax payments ¥264.2B, but the subtotal resulted in ¥1333.9B in operating inflows. Investing CF was -¥429.9B, mainly reflecting capex ¥324.7B, intangible asset acquisition ¥115.6B, and acquisitions of subsidiaries ¥55.3B, partially offset by investment property disposals ¥25.2B and redemption of debt-like financial instruments ¥80.6B. Free Cash Flow was ¥680.1B. Financing CF was -¥546.3B, including dividend payments ¥254.7B, share repurchases ¥184.6B, and lease payments ¥91.4B. Adding foreign exchange translation effects +¥124.3B, cash and cash equivalents rose to ¥1976.7B (from ¥1727.8B, +¥248.9B). OCF/Net Income ratio was 1.64x, FCF margin was 7.6% (FCF ¥680.1B / Revenue ¥8934.6B), and after funding dividends, investments, and buybacks the company still increased cash, maintaining financial flexibility.
Operating Income ¥778.7B stems from recurring business activities, i.e., Gross Profit ¥3799.8B less SG&A ¥2963.5B. Other income ¥98.2B includes incidental gains, but an increase in Other expenses to ¥155.8B (prior ¥99.7B) resulted in a net -¥57.6B impact from non-operating items. Financial income ¥50.5B comprises interest and dividends received; financial expenses ¥15.5B comprises interest paid; net financial income ¥34.9B (prior ¥43.7B) is stable. Profit from non-continuing operations ¥50.4B (prior ¥13.8B) includes one-off items; therefore, evaluation of recurring earning power should use profit from continuing operations ¥626.0B (prior ¥534.2B). Comprehensive income was ¥1156.7B (Net Income ¥676.4B + Other Comprehensive Income ¥480.3B), with the majority of OCI being foreign currency translation adjustments ¥446.9B—an accounting valuation gain without cash backing. OCF ¥1110.0B is 1.64x Net Income ¥676.4B, and the accrual ratio -4.3% (OCF - Net Income / Total Assets) indicates high quality of earnings. Inventory reduction and receivables collection supported cash conversion, underpinning substantive earning power.
For the fiscal year ending March 2027, management forecasts Revenue ¥9100.0B (YoY +1.8%), Operating Income ¥850.0B (YoY +9.2%), and Net Income ¥720.0B (YoY +6.5%), planning for revenue and profit growth. Full-year dividend guidance assumes interim ¥50.0 and year-end ¥50.0 for an annual ¥100.0 (same level as prior year), and forecast EPS is ¥289.21. Given first-half results Revenue ¥8934.6B, Operating Income ¥778.7B, and Net Income ¥676.4B, the company assumes second-half incremental increases of Revenue +¥165.4B, Operating Income +¥71.3B, and Net Income +¥43.6B. Progress ratios are high at Revenue 98.2%, Operating Income 91.6%, and Net Income 93.9%, suggesting strong likelihood of achieving full-year targets. Key drivers will be stickiness in core Printing & Solutions, continued demand in Machinery, and margin improvement in Industrial Printing.
The company plans interim ¥50.0 and year-end ¥50.0 for an annual dividend of ¥100.0. Payout Ratio is 46.7% (Dividend payments ¥254.7B / Net Income ¥676.4B × on an issued shares basis; full-year forecast basis ~34.5%), a stable level. Share repurchases of ¥184.6B were executed, bringing Total Return Ratio to approximately 65% (Dividends ¥254.7B + Share Repurchases ¥184.6B / Net Income ¥676.4B). Against Free Cash Flow ¥680.1B, dividends and buybacks totaled ¥439.3B, giving FCF coverage ~1.55x and leaving headroom. Treasury stock at year-end was ¥217.3B (up ¥183.4B from prior ¥33.9B), contributing to improved capital efficiency. With cash & deposits ¥1976.7B and effectively no net debt (net cash ¥1966.8B), there is ample capacity to continue dividends and buybacks.
Segment concentration risk: Printing & Solutions accounts for 63.9% of Revenue and the majority of Operating Income, so demand fluctuations or pricing competition in this segment directly impact corporate performance. If the core Communications & Printing Devices market matures or contracts, maintaining top-line growth and margins may be challenging.
Deterioration in Industrial Printing profitability: Operating Income ¥29.1B (-44.3%), margin 2.1%—a low level driven by increased Other expenses of ¥45.8B. Delay in margin recovery could pressure overall operating margins and perpetuate adverse mix within the portfolio. Delays in segment restructuring or business model reforms are a concern.
Working capital efficiency and cash volatility risk: Inventory ¥2339.9B (DIO ~166 days) and CCC ~161 days indicate low working capital efficiency; during demand fluctuations there is risk of inventory write-downs, discounting, and increased logistics costs. Foreign currency translation gains of +¥446.9B boosted comprehensive income, but a reversal to yen appreciation could produce valuation losses and affect cash generation. Working capital expansion during a downturn could compress OCF.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| ROE | 9.3% | 6.3% (3.2%–9.9%) | +3.0pt |
| Operating Margin | 8.7% | 7.8% (4.6%–12.3%) | +1.0pt |
| Net Margin | 7.6% | 5.2% (2.3%–8.2%) | +2.4pt |
ROE, Operating Margin, and Net Margin all exceed industry medians, positioning the company among higher-profitability manufacturers.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 5.3% | 3.7% (-0.4%–9.3%) | +1.6pt |
Revenue growth outperformed the industry median by +1.6pt, indicating resilient growth among manufacturers.
※ Source: Company compilation
Profitability of the core business and quality of OCF: Printing & Solutions maintains a high margin of 11.6% and OCF of ¥1110.0B (1.64x Net Income), demonstrating strong cash generation. Expense efficiency improved Operating margin to 8.7% (+0.7pt), with lower SG&A driving profit growth. Working capital improvements (reductions in inventory and receivables) boosted cash; if inventory DIO 166 days and CCC 161 days normalize further, there is upside to cash generation.
Profitability gaps across segments and remediation needs: While Machinery recovered (Operating Income +530.0%, margin 8.1%), Industrial Printing deteriorated (Operating Income -44.3%, margin 2.1%). Overall profit growth depends on continued improvement in Machinery and margin restoration in Industrial Printing; delay in the latter limits upside to corporate margins. Achieving the FY2027 target (Operating Income +9.2%) hinges on progress in that segment’s structural reforms.
Financial flexibility and scope for shareholder returns: With Equity Ratio 74.9%, net-debt free status, and net cash ¥1966.8B, the balance sheet is very strong. Payout Ratio 46.7% and Total Return Ratio ~65% with FCF coverage 1.55x indicate capacity for shareholder returns. The company enhanced capital efficiency with ¥184.6B in buybacks and has the financial foundation to consider dividend increases or additional return measures (special dividends, increased buybacks). While foreign currency translation gains (+¥446.9B) lifted comprehensive income, the cash buffer is sufficient to hedge against adverse currency moves.
This report was automatically generated by AI analyzing XBRL financial statement filings. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the firm from public financial statements. Investment decisions are your responsibility; please consult a professional advisor as needed.