About Quarterly Earnings Report Disclosures
| Item | Current | Prior | YoY % |
|---|---|---|---|
| Net Sales | ¥393.45B | ¥374.64B | +5.0% |
| Operating Income | ¥17.72B | ¥19.23B | -7.8% |
| Profit Before Tax | ¥17.04B | ¥-336M | +5169.9% |
| Net Income | ¥9.05B | ¥-3.32B | +372.7% |
| Dividend Per Share | ¥52.00 | ¥52.00 | +0.0% |
| Item | Current End | Prior End | Change |
|---|---|---|---|
| Total Assets | ¥1.40T | ¥1.36T | +¥37.87B |
| Total Equity | ¥940.29B | ¥934.43B | +¥5.86B |
| Shareholders' Equity | ¥777.81B | ¥771.88B | +¥5.92B |
| Equity Ratio | 55.6% | 56.7% | -1.1% |
| Item | Value |
|---|---|
| Net Profit Margin | 2.3% |
| Item | Value |
|---|---|
| Shares Outstanding (incl. Treasury) | 206.24M shares |
| Treasury Stock | 9.61M shares |
| Average Shares Outstanding | 196.83M shares |
| Book Value Per Share | ¥4,782.03 |
| Item | Amount |
|---|---|
| Q2 Dividend | ¥52.00 |
| Year-End Dividend | ¥52.00 |
| Item | Forecast |
|---|---|
| Net Sales Forecast | ¥845.00B |
| Operating Income Forecast | ¥60.00B |
| Net Income Forecast | ¥29.00B |
| Dividend Per Share Forecast | ¥52.00 |
This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.
Verdict: Soft quarter with modest profitability and subdued capital efficiency; operating margin is positive but ROE/ROIC are notably weak. Revenue reached 3,934.48 (100M JPY), and operating income was 177.19, translating to an operating margin of approximately 4.5%. Profit before tax was 170.35, implying a small net non-operating expense of about 6.84. Net income came in at 90.47, a net profit margin of roughly 2.3%. Total assets were 13,996.61 and total equity 9,402.92, implying financial leverage of 1.49x and an equity ratio of 55.6%, which is conservative. DuPont analysis yields ROE of 1.0% (Net margin 2.3% × Asset turnover 0.281 × Leverage 1.49x), confirming very low capital return this period. ROIC is reported at 1.3%, well below the 5% warning threshold and far below typical 7–8% management targets for industrial firms. Tax and minority burden were heavy: net-incomization from PBT implies roughly 79.88 in taxes/minorities/other deductions, about 47% of PBT. Non-operating result was slightly negative this quarter, suggesting limited support from financial/associate items. Margin trend analysis is constrained as YoY and gross/SG&A details were not disclosed; hence, basis-point expansion/compression vs prior periods cannot be quantified. On an absolute basis, the operating margin of ~4.5% and net margin of ~2.3% are subdued for this business mix. Cash flow quality cannot be judged because operating cash flow data were not provided, creating uncertainty on earnings convertibility. Dividend optics are stretched: the calculated payout ratio is 237.1%, which appears unsustainably high against current-period earnings unless supported by cash on hand or normalization in H2. Balance sheet leverage looks conservative given the 55.6% equity ratio, but the absence of interest-bearing debt and liquidity details prevents a firm view on near-term funding risk. Forward-looking, restoring margin intensity and asset turns (inventory normalization, better utilization, pricing discipline) will be key to lift ROE/ROIC. Overall, the quarter underscores a need for operating recovery and cash flow visibility to support the dividend framework and improve capital efficiency.
ROE decomposition: 1) Net Profit Margin ≈ 2.3%, 2) Asset Turnover ≈ 0.281x (Revenue/Assets = 3,934.48/13,996.61), 3) Financial Leverage ≈ 1.49x (Assets/Equity = 13,996.61/9,402.92). ROE ≈ 2.3% × 0.281 × 1.49 ≈ 1.0% (matches reported). The weakest and most influential component is the net profit margin; at ~2.3% it depresses ROE despite conservative leverage. Asset turnover is also soft, signaling underutilized assets or elevated inventories/customers’ receivables relative to sales, further dragging ROE. Business drivers likely include muted demand and pricing power in core automation/healthcare segments, and a negative non-operating contribution (≈ -6.84), plus a high tax/minority burden (~47% of PBT). These appear cyclical/operational rather than one-off: absent explicit special items, the compression looks tied to operating conditions and mix. Sustainability: margin recovery is plausible with volume normalization and mix improvement, but it is not yet evidenced in the disclosed data. Watch for warning signs such as SG&A growth outpacing revenue; SG&A breakdown was not reported, so cost discipline cannot be validated this quarter.
Top-line printed at 3,934.48 (100M JPY), but YoY growth was not disclosed, preventing rate-of-change assessment. Operating income of 177.19 indicates limited operating leverage at current scale (op. margin ~4.5%). Non-operating result was a small drag, and the effective tax/minority load was high, restricting earnings growth conversion. Without segment data (e.g., Industrial Automation vs Healthcare vs Social Systems), we cannot judge mix shifts or the sustainability of sales levels. Near-term growth outlook hinges on capex cycles in factory automation, inventory normalization at customers (notably in China and Europe), and FX tailwinds from JPY depreciation—none quantified here. Given low ROIC (1.3%), incremental growth must be accompanied by better margin/turns to be value-accretive. Absence of R&D and capex disclosure limits visibility on product vitality and future pipeline. Overall revenue sustainability is uncertain; confirmation requires order trends, book-to-bill, backlog, and regional demand data that were not provided.
Liquidity cannot be assessed due to missing current assets/liabilities; therefore no current or quick ratio can be calculated. Solvency looks conservative from an equity ratio of 55.6% (equity 9,402.92 vs assets 13,996.61), implying moderate overall leverage. We cannot compute D/E or interest coverage due to unreported debt and interest figures; no automatic warning triggered (D/E > 2.0 not evidenced). Maturity mismatch risk cannot be evaluated without a split of short-term debt and current assets; this is a key blind spot. Off-balance sheet obligations were not disclosed in the data provided. Overall, balance sheet capacity appears sound on equity ratio optics, but lack of liquidity and debt detail prevents a definitive risk view.
Operating cash flow and free cash flow were not disclosed, so OCF/Net Income and FCF coverage cannot be evaluated. This is a material limitation for earnings quality assessment. Working capital dynamics (receivables, inventories, payables) are not available; as a result, we cannot detect potential working capital-driven earnings support or reversal risks. Given the modest net margin (2.3%) and low ROIC (1.3%), confirmation of cash conversion will be particularly important in subsequent quarters.
The calculated payout ratio is 237.1%, indicating dividends exceed current-period earnings, which is not sustainable without drawdown of cash, asset sales, or a strong rebound in H2. FCF coverage is unassessable due to missing OCF and capex, further clouding sustainability. Policy-wise, Omron historically targets stable/ progressive dividends, but maintaining such with current earnings would require improved profitability and cash generation. Until OCF data confirm coverage, dividend capacity should be considered constrained relative to this quarter’s earnings base.
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Relative Positioning: Against Japanese automation peers, current-period profitability and capital returns appear weaker (low ROE/ROIC, modest operating margin). Balance sheet capitalization is solid, but absent cash flow data reduces confidence versus peers with clearer FCF generation.
This analysis was auto-generated by AI. Please note the following: