| Metric | Current Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1009.0B | ¥971.0B | +3.9% |
| Operating Income / Operating Profit | ¥65.3B | ¥57.0B | +14.5% |
| Ordinary Income | ¥65.7B | ¥53.9B | +21.9% |
| Net Income / Net Profit | ¥20.7B | ¥41.4B | -50.0% |
| ROE | 3.0% | 6.5% | - |
For the fiscal year ended March 2026, Revenue was ¥1,009B (YoY +¥38B +3.9%), Operating Income was ¥65.3B (YoY +¥8.3B +14.5%), Ordinary Income was ¥65.7B (YoY +¥11.8B +21.9%), and Net Income attributable to owners of the parent was ¥20.7B (YoY -¥20.7B -50.0%). At the operating level, higher sales and profits in the Domestic Measurement & Control Business contributed, improving the operating margin to 6.5% (prior year 5.9%), a 0.6pt improvement. Ordinary Income grew more than operating income due to a reduction in non-operating expenses (¥5.7B, prior year ¥9.7B). Conversely, Net Income was affected by changes in extraordinary gains and losses. In the prior year, extraordinary gains were ¥13.7B and extraordinary losses ¥3.6B for a net +¥10.1B; in the current period extraordinary gains were ¥68.4B (including fixed asset disposal gains ¥61.5B, gains on sales of investment securities ¥6.9B) and extraordinary losses ¥26.2B (including business restructuring expenses ¥20.6B) for a net +¥42.2B, expanding one-off gains. However, profit attributable to non-controlling interests increased to ¥9.4B (prior year ¥8.1B), and after deducting corporate taxes and other of ¥40.8B from pre-tax income of ¥107.9B, Net Income was ¥48.4B, of which ¥20.7B was attributable to owners of the parent. The large decline in Net Income attributable to owners of the parent reflects the high prior-year level (¥41.4B) and the increase in profit attributable to non-controlling interests.
[Revenue] Revenue ¥1,009B (YoY +3.9%) was driven by growth in the Domestic Measurement & Control Business, which expanded to ¥597.3B (YoY +6.5%). By segment, Domestic Measurement & Control accounted for 59.2% of sales, aided by recovery in demand for smart meters and distribution/panel equipment. Overseas Measurement & Control was slightly down to ¥415.7B (YoY -0.4%), maintaining a 41.2% share. The Real Estate Business contracted to ¥4.3B (YoY -22.5%) but had minimal overall impact (share 0.4%). Gross profit was ¥242.2B, with a gross margin of 24.0% (prior year 24.1%) broadly unchanged; cost of sales was ¥766.8B, maintaining a cost ratio of 76.0%.
[Profitability] Operating Income ¥65.3B (YoY +14.5%) benefited from an increase in absolute gross profit (prior year ¥234.4B → current ¥242.2B) and subdued SG&A (¥176.9B, prior year ¥177.4B), improving the operating margin by 0.6pt to 6.5%. Domestic Measurement & Control margin improved to 7.8% (prior year 7.1%), and Overseas Measurement & Control improved to 4.2% (prior year 3.5%), enhancing segment profitability. Ordinary Income ¥65.7B (YoY +21.9%) was supported by non-operating income of ¥6.1B (including dividend income ¥3.0B) exceeding non-operating expenses of ¥5.7B (including interest expense ¥3.2B and foreign exchange losses ¥1.4B), amplifying operating profit growth. Pre-tax income ¥107.9B reflects the addition of net extraordinary items of +¥42.2B (extraordinary gains ¥68.4B, led by fixed asset disposal gains ¥61.5B; extraordinary losses ¥26.2B, including business restructuring expenses ¥20.6B). After corporate taxes and other of ¥40.8B (effective tax rate 37.8%), Net Income was ¥48.4B, and after subtracting profit attributable to non-controlling interests ¥9.4B, Net Income attributable to owners of the parent was ¥20.7B. The halving from prior-year Net Income attributable to owners of the parent (¥41.4B) was mainly due to changes in the composition of extraordinary gains (prior year fixed asset disposal gains ¥9.4B), increased profit attributable to non-controlling interests, and a rebound effect from prior-year pre-tax income of ¥63.9B. In conclusion, the company achieved higher sales and operating profits, but Net Income declined due to one-off items and changes in non-controlling interests.
The Domestic Measurement & Control Business reported Revenue ¥597.3B (YoY +6.5%) and Operating Income ¥46.8B (YoY +17.9%), with a margin of 7.8% (prior year 7.1%), a 0.7pt improvement. Recovery in demand for smart meters and energy solutions drove sales growth and scale effects improved margins. The Overseas Measurement & Control Business recorded Revenue ¥415.7B (YoY -0.4%) and Operating Income ¥17.4B (YoY +18.0%), with a margin of 4.2% (prior year 3.5%), up 0.7pt. Despite flat sales, cost control and margin improvements bolstered profitability. The Real Estate Business had Revenue ¥4.3B (YoY -22.5%) and Operating Income ¥1.0B (YoY -61.9%), with a margin of 23.7% (prior year 48.1%) sharply down, but the small business scale limits its impact on consolidated results. Overall, Domestic Measurement & Control accounted for 71.7% of operating income and remains the core earnings base.
[Profitability] The operating margin of 6.5% improved 0.6pt from 5.9% in the prior year, aided by a decline in SG&A ratio to 17.5% (prior year 18.3%). ROE 3.0% (Net Income attributable to owners of the parent ¥20.7B ÷ average shareholders’ equity during the period ¥688.9B) reflects volatility in Net Income due to one-off items. ROA (based on Ordinary Income) 6.6% is explained by total asset turnover of 1.01x and an Ordinary Income margin of 6.5%. [Cash Quality] Operating Cash Flow (OCF) ¥88.6B is 1.36x Operating Income ¥65.3B, supported by depreciation ¥30.2B and working capital improvement (inventory reduction ¥45.0B). The OCF/Net Income ratio is a high 4.28x. Free Cash Flow ¥136.9B (OCF ¥88.6B + Investing CF ¥48.3B) exceeded capital expenditure ¥47.6B due to fixed asset sale proceeds ¥89.1B. [Investment Efficiency] Total asset turnover 1.01x (prior year 0.97x) is calculated from Revenue ¥1,009B against total assets ¥998.2B, indicating slight asset efficiency improvement. CapEx / Depreciation ratio 1.58x reflects a balance between renewal and capacity-enhancing investments. [Financial Soundness] Equity Ratio 69.0% (prior year 63.0%), Debt/Equity ratio 0.7% (interest-bearing debt ¥4.65B ÷ equity ¥688.3B) indicate an effectively debt-free balance sheet. Current ratio 249% (current assets ¥587.9B ÷ current liabilities ¥236.1B) and Quick ratio 209% (quick assets ¥494.1B ÷ current liabilities ¥236.1B) show excellent short-term liquidity.
Operating Cash Flow was ¥88.6B (YoY +28.6%), derived from operating income subtotal ¥112.7B less changes in working capital and corporate tax payments of ¥24.5B. The largest contributor was inventory reduction of ¥45.0B, compressing inventories to ¥94.1B (prior year ¥128.9B), reflecting easing supply constraints and improved delivery progress. Conversely, trade receivables increased by ¥17.3B, indicating some lengthening of collection days, and trade payables decreased by ¥12.4B as payments progressed. Depreciation ¥30.2B and an increase in product warranty provisions ¥9.7B also supported cash generation. Investing Cash Flow was +¥48.3B, as PPE sale proceeds ¥89.1B significantly exceeded capital expenditures ¥47.6B and intangible asset investments ¥6.6B. Fixed asset sales were the source of extraordinary gains and represent non-recurring cash inflows. Financing Cash Flow was -¥88.1B, driven by repayment of short-term borrowings ¥32.4B, repayment of long-term borrowings ¥29.8B, dividend payments ¥13.0B, and share buybacks ¥10.3B. Interest-bearing debt was reduced from ¥69.3B to ¥4.65B, strengthening the financial position. Free Cash Flow ¥136.9B (OCF ¥88.6B plus Investing CF ¥48.3B including fixed asset sale proceeds) funded shareholder returns and debt reduction. Cash and deposits increased by ¥43.7B to ¥159.2B (prior year ¥115.5B), substantially improving year-end liquidity.
Operating Income ¥65.3B represents results from recurring business activities, increasing 14.5% YoY due to higher sales and cost control in the Domestic Measurement & Control Business. Net non-operating items were a small positive of ¥0.4B (non-operating income ¥6.1B - non-operating expenses ¥5.7B), with dividend income ¥3.0B contributing as a recurring income source. Extraordinary items were a large net positive of ¥42.2B (extraordinary gains ¥68.4B - extraordinary losses ¥26.2B), with fixed asset disposal gains ¥61.5B and gains on sales of investment securities ¥6.9B temporarily boosting profits. Business restructuring expenses ¥20.6B are also one-off costs. Of pre-tax income ¥107.9B, Ordinary Income ¥65.7B (60.9%) represents recurring components, while net extraordinary items ¥42.2B (39.1%) represent non-recurring components. After corporate taxes and other of ¥40.8B (effective tax rate 37.8%), Net Income ¥48.4B includes ¥9.4B attributable to non-controlling interests. On an OCF basis, operating income subtotal ¥112.7B corresponds to OCF ¥88.6B (ratio 78.7%), signaling a healthy cash conversion rate, with inventory compression ¥45.0B significantly improving working capital. Comprehensive Income was ¥78.5B, comprising Net Income ¥48.4B plus valuation differences on available-for-sale securities ¥7.9B, translation adjustments ¥0.3B, and retirement benefit adjustments ¥3.1B — total mark-to-market effects ¥11.3B. Of comprehensive income, ¥69.1B is attributable to owners of the parent and ¥9.4B to non-controlling interests. In terms of earnings quality, operating improvements appear sustainable, but Net Income levels are highly influenced by one-off gains and changes in profit attributable to non-controlling interests.
For the fiscal year ending March 2027, the full-year forecast is Revenue ¥1,010B (YoY +0.1%), Operating Income ¥81B (YoY +24.1%), Ordinary Income ¥81B (YoY +23.3%), Net Income attributable to owners of the parent ¥48B (YoY +131.9%), EPS 107.99円, and Dividend ¥29 (including a special interim dividend of ¥10). Progress at the fiscal year-end against the forecast stands at Revenue 99.9% (¥1,009B ÷ ¥1,010B), Operating Income 80.6% (¥65.3B ÷ ¥81B), and Ordinary Income 81.1% (¥65.7B ÷ ¥81B). Achieving the full-year Operating Income forecast requires an additional ¥15.7B of uplift, implying earnings growth concentrated in the second half. The Net Income forecast ¥48B is 2.3x the current period result ¥20.7B, likely reflecting the assumption of the reversal of current-period one-off gains. Revenue is expected to be largely flat, while further improvement to an operating margin of 8.0% (¥81B ÷ ¥1,010B) is anticipated, contingent on continued cost efficiency and margin improvements. The dividend forecast ¥29 is down from the prior-year actual ¥49 (including special dividend ¥10); on a normal dividend basis, the plan reduces the dividend from ¥39 in the prior year to ¥29. The dividend payout ratio based on EPS forecast 107.99円 is 26.9%, down from the prior-year payout ratio 29.1% (total dividends ¥21.9B ÷ Net Income attributable to owners of the parent ¥20.7B, noting the formal increase due to low Net Income in the current period). The full-year forecast incorporates continued operating improvement while reflecting the fall-off of one-off items and a conservative Net Income view.
Dividends for the period consisted of an interim dividend ¥17 and a year-end dividend ¥32 (including special dividend ¥10) for a total of ¥49, with total dividends of approximately ¥21.9B (based on outstanding shares 46,917 thousand - treasury stock 2,468 thousand = dividend-eligible shares 44,449 thousand). The dividend payout ratio against Net Income attributable to owners of the parent ¥20.7B is 105.8%, formally exceeding 100% due to the low Net Income level caused by one-off effects. Considering retained earnings ¥331.3B, cash and deposits ¥159.2B, and Free Cash Flow ¥136.9B, the capacity to pay dividends is sufficient. Share buybacks totaling ¥10.3B were executed, bringing total shareholder returns to ¥32.2B. The total return ratio relative to Free Cash Flow is 23.5%, indicating high cash-return sustainability. The dividend forecast for FY2027 ¥29 (including a special interim dividend ¥10) plans a reduction from the prior-year ordinary dividend ¥39 (current period ¥49 - special dividend ¥10) to ¥29 on a normal dividend basis; with EPS forecast 107.99円, the payout ratio is 26.9%, an appropriate level. The dividend policy is performance-linked, and management signals willingness to implement special dividends flexibly to strengthen shareholder returns.
Dependence on the Domestic Measurement & Control Business (sales composition 59.2%): Revenue is sensitive to public investment and smart meter replacement cycles, so capital expenditure trends of utilities and policy changes directly affect orders. While YoY growth of +6.5% was maintained, a cyclical peak-out in replacement demand or intensified price competition could slow growth.
Working capital efficiency risk (CCC 123 days, DSO ~70 days): With trade receivables ¥193.1B, inventories ¥94.1B, and trade payables ¥69.8B, working capital accounts for 28.7% of total assets. Although inventory compression progressed this period, inventories and receivables could rebuild with rising orders, causing volatility in OCF generation. The increase in trade receivables ¥17.3B suggests some lengthening in collection.
Dependence on non-recurring items and earnings volatility: Extraordinary gains this period (¥68.4B — fixed asset disposal gains ¥61.5B, gains on sales of investment securities ¥6.9B) boosted Net Income but are non-recurring. From next fiscal year onward, securing Net Income from core operations will be required, necessitating further improvement in operating margins. Variability in product warranty provisions (¥13.96B) and the potential recurrence of business restructuring expenses are additional sources of earnings volatility.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 6.5% | 7.8% (4.6%–12.3%) | -1.3pt |
| Net Margin | 2.1% | 5.2% (2.3%–8.2%) | -3.1pt |
The operating margin is 1.3pt below the industry median, placing the company in the middle-to-lower range within manufacturing. Net margin 2.1% is 3.1pt below the median 5.2%, but this period’s large one-off effects suggest assessing recurring earning power via operating margin.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 3.9% | 3.7% (-0.4%–9.3%) | +0.2pt |
Revenue growth 3.9% is roughly in line with the industry median 3.7%, maintaining a manufacturing-sector average growth pace.
※Source: Company compilation
The trend of improving operating profitability continues; the improvement to an operating margin of 6.5% (prior year 5.9%) was driven by higher sales in the Domestic Measurement & Control Business and cost control, and further improvement to an operating margin of 8.0% is expected next year. The decline in SG&A ratio to 17.5% (prior year 18.3%) reflects scale effects and efficiency gains and is expected to be sustainable.
The financial position is extremely sound, with interest-bearing debt reduced to ¥4.65B (prior year ¥69.3B), Debt/Equity ratio 0.7%, cash and deposits ¥159.2B, and current ratio 249%, establishing an effectively debt-free and highly liquid financial base. Free Cash Flow generation ¥136.9B provides room for shareholder returns, and a payout ratio of 26.9% (on next-year forecasts) indicates potential for future dividend increases.
Net Income attributable to owners of the parent ¥20.7B decreased 50.0% YoY due to extraordinary gains/losses (extraordinary gains ¥68.4B - extraordinary losses ¥26.2B) and profit attributable to non-controlling interests ¥9.4B, but the FY2027 forecast ¥48B assumes a recovery in core operations after the reversal of one-off gains. Inventory compression ¥45.0B supported OCF generation, but in an order expansion scenario inventories and receivables may rebuild, creating CF volatility; structural improvement of CCC 123 days and DSO 70 days remains a mid-term challenge.
This report is an AI-generated financial analysis document based on XBRL earnings release data. It is not a recommendation to invest in any particular security. Industry benchmarks are compiled by the company from public financial statements and are provided for reference only. Investment decisions are your responsibility; consult professionals as necessary.