| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| 売上高 | ¥3261.9B | ¥3011.0B | +8.3% |
| 営業利益 | ¥271.2B | ¥215.1B | +26.1% |
| 経常利益 | ¥278.9B | ¥211.9B | +31.6% |
| 純利益 | ¥141.1B | ¥76.5B | +84.4% |
| ROE | 7.9% | 5.4% | - |
For the fiscal year ended March 2026, Meidensha Corporation reported Revenue of ¥3,261.9B (YoY +¥250.9B +8.3%), Operating Income of ¥271.2B (YoY +¥56.1B +26.1%), Ordinary Income of ¥278.9B (YoY +¥67.0B +31.6%), and Net Income attributable to owners of the parent of ¥141.1B (YoY +¥64.6B +84.4%), achieving significant top-line and bottom-line growth. Operating margin improved to 8.3% (prior year 7.1%), a 1.2pt improvement, led particularly by the Power Infrastructure Business (Operating Income +57.5%) and the Field Engineering Business (Operating Income +27.6%). Net Income was boosted by special gains including ¥53.9B gain on sale of fixed assets, expanding to approximately 1.8x the prior year.
[Revenue] Revenue increased to ¥3,261.9B (YoY +8.3%). By segment, the Power Infrastructure Business recorded ¥1,008.4B (+16.7%) as the largest growth driver, supported by increased large renewable energy-related projects and resilient electricity demand. The Field Engineering Business expanded steadily to ¥570.1B (+15.0%) driven by renewals of maintenance contracts with existing customers and accumulation of new maintenance projects. The Social Systems Business maintained revenue growth at ¥1,045.5B (+8.5%), while the Industrial Electronics & Mobility Business declined to ¥693.1B (-3.8%) due to semiconductor market adjustments and temporary weakness in automotive demand. By region, domestic sales were ¥2,353.4B (+10.0%) as the core, Asia decreased slightly to ¥612.6B (-1.1%), and Other regions expanded to ¥296.0B (+17.1%).
[Profitability] Operating Income rose significantly to ¥271.2B (YoY +26.1%). Cost of sales ratio improved to 71.6% (prior 72.9%), a 1.3pt improvement, and the gross margin rose to 28.4% (prior 27.1%) due to price revisions taking effect and a favorable mix of higher-margin projects. SG&A increased to ¥654.2B (prior ¥600.8B, +8.9%), but SG&A ratio was contained at 20.1% (prior 20.0%), reflecting absorption of fixed costs by revenue growth. By segment, Power Infrastructure delivered ¥125.8B (margin 12.5%, a large improvement from prior ¥7.9B), and Field Engineering delivered ¥126.7B (margin 22.2%, prior ¥99.3B), driving company-wide profit. Conversely, Industrial Electronics & Mobility fell to ¥0.2B (margin 0.0%, prior ¥11.3B), pressured by an impairment loss of ¥33.0B. Non-operating items net contributed ¥7.6B (Non-operating income ¥32.4B, Non-operating expenses ¥24.8B), with dividend income ¥14.0B being a contributor. Extraordinary items comprised special gains of ¥64.5B (gain on sale of fixed assets ¥53.9B, gain on sale of available-for-sale securities ¥9.7B) exceeding special losses of ¥35.2B including impairment loss ¥33.0B, lifting Profit Before Tax to ¥308.2B. Income taxes were ¥68.1B (effective tax rate 22.1%) kept low, resulting in Net Income attributable to owners of the parent of ¥141.1B (YoY +84.4%). In conclusion, revenue and profit growth were achieved, with high growth in Power Infrastructure and service businesses improving the overall earnings structure, while restructuring costs in the Mobility business and one-off special gains substantially boosted Net Income.
The Power Infrastructure Business achieved revenue of ¥1,008.4B (YoY +16.7%) and Operating Income of ¥125.8B (YoY +57.5%), a significant profit improvement with margin improving to 12.5% (prior 7.9%), aided by increased large-scale orders for substation equipment and grid stabilization devices related to renewable energy, price revisions taking hold, and project selection. The Social Systems Business reported revenue of ¥1,045.5B (+8.5%) and Operating Income of ¥40.9B (+34.9%), maintaining top- and bottom-line growth with margin improving to 3.9% (prior 3.0%), supported by equipment renewal demand from railway operators and public-sector social infrastructure investment. The Industrial Electronics & Mobility Business saw revenue of ¥693.1B (-3.8%) and Operating Income of ¥0.2B (-98.1%), a sharp profit decline with margin deteriorating to 0.0% (prior 1.1%), affected by reduced demand for components for semiconductor manufacturing equipment and stagnation in orders for automotive test equipment, plus a ¥33.0B impairment loss. The Field Engineering Business continued high growth with revenue of ¥570.1B (+15.0%) and Operating Income of ¥126.7B (+27.6%), maintaining a high margin of 22.2% (prior 20.0%), supported by expansion of contract maintenance for existing installations and demand for replacement services for aging equipment. The Real Estate Business was almost flat with revenue ¥32.3B (-0.1%) and Operating Income ¥14.1B (-2.1%), maintaining high profitability with a 43.7% margin (prior 44.6%) and serving as a stable cash generator.
[Profitability] Operating margin of 8.3% improved 1.2pt from 7.1% a year earlier, supported by gross margin improvement to 28.4% (prior 27.1%) and fixed cost absorption. Net Income margin attributable to owners of the parent improved substantially to 4.3% (prior 2.5%), though this includes an uplift from special gains of ¥29.3B (net special items). ROE was 13.2% (DuPont decomposition: Net Profit Margin 7.2% × Total Asset Turnover 0.873x × Financial Leverage 2.09x), improving 4.0pt from 9.2% due to higher profitability and maintained asset efficiency. ROA (based on Ordinary Income) increased to 7.8% (prior 6.3%). [Cash Quality] Operating Cash Flow (OCF) was ¥175.0B (YoY -50.6%), and the OCF/Net Income ratio was 1.24x relative to Net Income of ¥141.1B, but compared to profit before deduction of non-controlling interests of ¥236.3B the ratio was 0.74x, below the 0.8x threshold. Deterioration in working capital was the main cause: accounts receivable increased by ¥141.2B (DSO 136 days, prior 127 days) and accounts payable decreased by ¥39.0B. Inventories were roughly flat (DIO 109 days), but work-in-progress of ¥456.9B accounted for 65.6% of inventories, suggesting project schedule delays. CCC (cash conversion cycle) extended to 193 days (prior 177 days), a 16-day deterioration, indicating weaker cash conversion efficiency. [Investment Efficiency] Total asset turnover was steady at 0.873x (prior 0.882x). Long receivable and inventory days (DSO 136 days, DIO 109 days) indicate timing normalization of project acceptance remains an issue. [Financial Soundness] Equity Ratio was 47.8% (prior 41.6%), up 6.2pt, driven by retained earnings accumulation and an increase in unrealized gains on available-for-sale securities of ¥94.0B boosting net assets. Current ratio was 190.1% (prior 183.8%), quick ratio 182.0% (prior 177.4%), showing ample liquidity; cash and deposits of ¥318.3B cover short-term interest-bearing debt (short-term borrowings ¥163.4B + commercial paper ¥50.0B) by 1.49x, providing sufficient buffer. Total interest-bearing debt stood at ¥396.4B (short-term ¥213.4B + long-term ¥183.0B), Debt/EBITDA was 1.03x (EBITDA = Operating Income ¥271.2B + Depreciation ¥111.7B = ¥382.9B), and EBITDA interest coverage was 41x (EBITDA ¥382.9B ÷ interest expense ¥9.3B), indicating strong financial safety. Short-term debt ratio is somewhat high at 41.5%, but cash/short-term interest-bearing debt ratio of 1.49x limits liquidity risk. Retirement benefit liabilities of ¥408.1B represent a structural burden but are absorbable within equity of ¥1,785.3B.
Operating Cash Flow was ¥175.0B (YoY -50.6%), declining significantly. Converting Profit Before Tax ¥308.2B to OCF, non-cash expenses such as depreciation ¥111.7B and impairment loss ¥33.0B were added back, while deterioration in working capital was a major offset. Accounts receivable increased by ¥141.2B with DSO extending to 136 days (prior 127 days), impacted by delayed acceptance of project work and extended credit terms. Accounts payable decreased by ¥39.0B, shortening payment terms and causing cash outflows. Inventory change was almost zero, but high WIP of ¥456.9B (65.6% of inventories) indicates process bottlenecks and was a primary driver of CCC extension to 193 days (prior 177 days). Corporate taxes paid of ¥77.0B also contributed to cash outflows. Investing Cash Flow was -¥171.3B (prior -¥90.7B), with increased expenditures centered on acquisition of tangible and intangible fixed assets ¥152.4B, and a net increase in time deposits of ¥65.6B further pressuring cash, partially offset by proceeds from sale of fixed assets of ¥60.9B. Financing Cash Flow was -¥77.8B (prior -¥145.4B), narrower year-on-year, with net short-term borrowings increase of ¥29.0B and long-term borrowings of ¥45.5B offsetting long-term borrowings repayments of ¥72.5B, bond redemptions ¥60.0B, and dividend payments ¥61.2B. Free Cash Flow (OCF + Investing CF) was ¥3.6B, nearly balanced, falling well short of dividend payments of ¥61.2B, effectively funded by cash and deposits on the balance sheet (opening ¥307.9B → closing ¥318.3B) and low leverage capacity. Cash and cash equivalents at period-end were ¥236.4B (opening ¥290.9B, net decrease ¥54.5B), maintaining liquidity, but sustained improvement in OCF is essential to balance dividends and investments going forward.
Quality of earnings is mixed. Recurring earnings are anchored by Operating Income ¥271.2B, generated from Gross Profit ¥925.5B less SG&A ¥654.2B reflecting core operating earning power. In non-operating income, dividend income ¥14.0B accounted for a major portion of Non-operating income ¥32.4B, contributing stable income from investment securities. Non-operating expenses were limited at ¥24.8B (interest expense ¥9.3B, other ¥10.0B), so Ordinary Income ¥278.9B was largely driven by core operations. In extraordinary items, special gains ¥64.5B (gain on sale of fixed assets ¥53.9B, gain on sale of available-for-sale securities ¥9.7B) exceeded special losses ¥35.2B including impairment loss ¥33.0B, producing net special items of ¥29.3B that boosted Profit Before Tax. This one-off contribution accounts for about 9.5% of Profit Before Tax ¥308.2B, posing a risk of reversal next year. Comprehensive income ¥427.8B expanded to roughly 3.0x Net Income ¥141.1B, driven by unrealized gains on available-for-sale securities ¥94.0B, actuarial adjustments related to retirement benefits ¥59.4B, and foreign currency translation adjustments ¥34.4B boosting net assets. On an accruals analysis, OCF ¥175.0B versus Net Income attributable to owners of the parent ¥141.1B yields an OCF/Net Income ratio of 1.24x superficially favorable, but compared to pre-noncontrolling interest profit ¥236.3B the ratio is 0.74x, below the 0.8x threshold, indicating working capital deterioration (accounts receivable +¥141.2B, accounts payable -¥39.0B) is hindering cash conversion of profits. The reduction from OCF subtotal ¥249.4B to OCF ¥175.0B (¥74.4B) was mainly due to working capital changes, so sustainability of earnings depends on improvements in working capital management.
The company plans for FY2027 (year ending March 2027) Revenue of ¥3,550.0B (YoY +8.8%), Operating Income ¥290.0B (YoY +6.9%), and Ordinary Income ¥290.0B (YoY +4.0%). Operating Income growth lagging Revenue growth (+6.9% vs +8.8%) suggests a conservative plan factoring in cost inflation and upfront investments (R&D, personnel). Continued large projects in the Power Infrastructure Business and expansion of maintenance contracts in the Field Engineering Business are expected growth drivers, while Industrial Electronics & Mobility is treated cautiously pending post-impairment restructuring progress and semiconductor market recovery. Contract liabilities of ¥232.9B support future revenue recognition and indicate substantial backlog. At present, progress rates are high: Revenue ¥3,261.9B is 91.9% of the full-year plan ¥3,550.0B, and Operating Income ¥271.2B is 93.5% of the full-year plan ¥290.0B, making incremental performance in H2 key to plan achievement. However, since this fiscal year included special gains netting ¥29.3B, next year’s Net Income plan of ¥220.0B (based on EPS forecast ¥484.96) assumes fundamental growth excluding one-off items.
Dividends are ¥157 per year (Year-end ¥110 + Interim ¥47), with a Payout Ratio of 30.2% (Net Income attributable to owners of the parent ¥141.1B ÷ shares outstanding 45,528 thousand × total dividends ¥61.2B), at a sustainable level. Compared to total dividends ¥61.2B, Free Cash Flow of ¥3.6B gives an FCF coverage of 0.06x, extremely low, indicating dividend funding is effectively dependent on the balance sheet cash buffer (cash and deposits ¥318.3B) and low leverage (Debt/EBITDA 1.03x). Dividend policy is oriented toward stable dividends, presumed to target a payout ratio in the 30% range. No share buybacks were disclosed; shareholder returns were implemented solely via dividends. Past dividend trend shows the same ¥157 per share (Year-end ¥110 + Interim ¥47) maintained year-on-year, confirming a stance of stable dividends. Sustainability going forward depends on OCF improvement (normalization of working capital, shortening CCC), and building a structure where FCF consistently exceeds dividend levels is a key challenge.
Deterioration in working capital efficiency and weakened cash conversion: DSO 136 days (prior 127 days) and CCC 193 days (prior 177 days) have extended, and OCF/Net Income ratio 0.74x (pre-noncontrolling interest basis) shows cash conversion of profits is stalling. High WIP of ¥456.9B (65.6% of inventories) suggests project schedule delays and variability in acceptance timing; if working capital management does not improve, balancing dividends and investment will be at risk.
Weak profitability and restructuring costs in Industrial Electronics & Mobility: Operating Income in this segment was ¥0.2B (margin 0.0%), a sharp decline from prior ¥11.3B, and an impairment loss of ¥33.0B pressured earnings. If demand recovery for components for semiconductor manufacturing equipment and automotive test equipment is delayed, portfolio diversification of earnings may decline and dependence on Power Infrastructure and service businesses may increase.
Dependence on special gains and risk of one-off reversals: Of Net Income attributable to owners of the parent ¥141.1B this year, net special items ¥29.3B (including gain on sale of fixed assets ¥53.9B) account for about 9.5% of Profit Before Tax. A reversal of one-off gains is expected next year, and reliance on non-recurring income could raise questions about sustainability from investors if overemphasized.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| 営業利益率 | 8.3% | 7.8% (4.6%–12.3%) | +0.6pt |
| 純利益率 | 4.3% | 5.2% (2.3%–8.2%) | -0.9pt |
Operating margin is 0.6pt above the industry median and ranks high, but Net Income margin is 0.9pt below the median, remaining in the mid-range. The impact of special items means operating-level superiority is not fully reflected in final profit.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| 売上高成長率（前年比） | 8.3% | 3.7% (-0.4%–9.3%) | +4.6pt |
Revenue growth is 4.6pt above the industry median, positioning the company in the upper quartile. Expansion of Power Infrastructure demand and growth in high-margin service businesses indicate competitive advantage within the industry.
※Source: Company aggregation
High growth in Power Infrastructure and service businesses drove company earnings, with significant improvements in Operating margin to 8.3% (prior 7.1%) and ROE to 13.2% (prior 9.2%). Power Infrastructure margin at 12.5% (prior 7.9%) and Field Engineering margin at 22.2% (prior 20.0%) remain high, supported by structural demand from renewable energy investment and aging social infrastructure replacement. Contract liabilities of ¥232.9B underpin future revenue and the backlog depth suggests medium-term growth probability.
Conversely, deterioration in working capital efficiency (CCC 193 days, prior 177 days) and weakened cash conversion shown by OCF/Net Income ratio 0.74x (pre-noncontrolling interest) are the primary concerns. High WIP of ¥456.9B (65.6% of inventories) suggests project delays, and extended DSO of 136 days reflects variability in acceptance timing. Free Cash Flow of ¥3.6B is far below total dividends ¥61.2B, so dividend funding effectively depends on balance sheet buffer. To sustainably combine dividends and growth investment, urgent improvement in working capital management (shorten DSO, compress WIP, optimize payables) to reduce CCC to below 120 days is required.
The Industrial Electronics & Mobility Business showing Operating Income ¥0.2B (prior ¥11.3B) and an impairment loss of ¥33.0B indicates the business portfolio is undergoing reorganization. With semiconductor market recovery and automotive demand uncertain, turning this segment back to profit is a medium-term challenge. Meanwhile, special gains of ¥29.3B (gain on sale of fixed assets, etc.) boosted Net Income this year, representing a potential reversal risk in subsequent years. The plan for next year (Revenue ¥3,550B, Operating Income ¥290B) projects continued revenue and profit growth, but realization relies on fundamental profit growth and improved working capital efficiency.
This report is an earnings analysis document automatically generated by AI analyzing XBRL earnings release data. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information aggregated by the company based on public financial statements. Investment decisions are your responsibility; consult a professional advisor as needed before making investment decisions.