MCJ Co.,Ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥104.17B
• Operating Income: ¥10.75B
• Net Income: ¥7.27B
• EPS: ¥77.06

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment Information

Full Year Forecast

Disclaimer

This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.

AI Financial Analysis

Executive Summary

MCJ Co., Ltd. (TSE: 6670) delivered solid FY2026 Q2 (first half) results with revenue of ¥104.2bn, up 8.3% YoY, demonstrating steady topline momentum. Gross profit reached ¥24.75bn, translating to a gross margin of approximately 23.8%, indicating stable product profitability in what is typically a competitive IT hardware/peripherals market. Operating income increased 10.1% YoY to ¥10.75bn, outpacing sales growth and driving a modest operating margin expansion to about 10.3%. Ordinary income was ¥10.78bn, only slightly above operating income, implying limited non-operating swings and a fairly clean earnings structure. Net income came in at ¥7.45bn, up 2.6% YoY, reflecting a normalizing tax burden and minimal below-the-line volatility. DuPont analysis points to a net margin of 7.15%, asset turnover of 0.806x, and financial leverage of 1.42x, producing an ROE of 8.19% that is consistent with the reported figure. ROA is approximately 5.8%, supported by disciplined cost control and efficient asset utilization. Liquidity is robust with a current ratio of about 313% and quick ratio near 252%, underpinned by strong current assets of ¥119.2bn and working capital of ¥81.1bn. The balance sheet appears conservatively financed: equity of ¥90.9bn versus total assets of ¥129.2bn implies an equity ratio near 70% (although the reported equity ratio field is unreported), and the interest coverage is a very comfortable 58.7x. Operating cash flow of ¥7.11bn is close to net income (OCF/NI ~0.96), indicating reasonable earnings quality and limited accrual distortion in the period. EBITDA of ¥11.36bn and modest D&A (¥0.61bn) suggest a light fixed-asset intensity, although true capex cannot be confirmed due to unreported investing cash flows. Inventory stands at ¥23.27bn; given the sector’s product cycle and price risks, inventory discipline will remain important for margin stability. Dividend-related fields are unreported, so payout and FCF coverage cannot be assessed from this dataset. Share count and per-share book value are also unreported; however, equity size allows inference of strong capitalization. Overall, MCJ shows healthy profitability, strong liquidity, and solid cash conversion in 1H, with modest margin expansion and stable non-operating items. Data limitations exist around investing cash flows, cash balance, debt composition, dividends, and share information, which constrains full FCF and per-share analyses.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 7.15%
• asset_turnover: 0.806x
• financial_leverage: 1.42x
• calculated_ROE: 8.19%
• commentary: ROE is primarily driven by healthy net margins and moderate asset turnover; leverage is conservative, suggesting return generation is not reliant on debt. margin_quality:
• gross_margin: 23.8%
• operating_margin: 10.3%
• ordinary_margin: 10.4%
• net_margin: 7.15%
• drivers: ['Operating income growth (+10.1% YoY) exceeded revenue growth (+8.3% YoY), indicating slight operating leverage and/or mix improvements.', 'Non-operating items were limited (ordinary income ~¥31m above operating), implying a clean earnings base.', 'Tax expense of ¥2.92bn implies an effective tax rate around 27–28%, consistent with domestic norms.'] operating_leverage:
• revenue_growth_YoY: 8.3%
• operating_income_growth_YoY: 10.1%
• assessment: Positive operating leverage evident, with opex growing slower than sales; continued scale benefits likely if revenue momentum persists.

Growth Assessment

revenue_sustainability: Topline growth of 8.3% YoY suggests resilient demand and/or successful product launches/channels. Sustainability will depend on PC and peripherals cycles, ASP/pricing, and corporate/consumer demand trends. profit_quality: Limited reliance on non-operating gains, strong interest coverage, and OCF/NI ~0.96 indicate quality earnings. Modest D&A implies low depreciation drag; however, capex intensity is unclear. outlook: With expanding operating margin and robust liquidity, the company is positioned to pursue growth while absorbing input cost fluctuations. Watch for inventory turnover, ASP trends, and any shifts in component costs or FX that could affect gross margin.

Financial Health

liquidity:

• current_ratio: 312.9%
• quick_ratio: 251.8%
• working_capital: ¥81.07bn
• commentary: Very strong short-term solvency, ample buffer to manage seasonal swings and inventory cycles. solvency:
• equity: ¥90.93bn
• total_assets: ¥129.19bn
• implied_equity_ratio: ≈70.4% (computed from provided BS; reported equity ratio field is unreported)
• interest_coverage: 58.7x
• debt_to_equity: 0.49x (as provided; composition of interest-bearing debt not disclosed)
• commentary: Conservative capitalization with high equity buffer; even if some borrowings exist, coverage metrics are strong. capital_structure: Leverage is modest; stability is supported by high equity and strong operating earnings. Absence of detailed debt and cash breakdown limits net debt analysis.

Cash Flow Quality

earnings_quality: OCF of ¥7.11bn vs NI of ¥7.45bn (0.96x) suggests earnings are largely cash-backed, with limited accrual build in the period. FCF_analysis: Investing cash flow is unreported; therefore, true free cash flow cannot be determined. The calculated FCF of 0 in the dataset should be treated as a placeholder, not an economic value. working_capital: Inventories of ¥23.27bn are material; stable gross margins imply no apparent discounting pressure. Monitoring receivables and inventory turns will be key to sustaining OCF.

Dividend Sustainability

payout_ratio_assessment: Dividend per share and payout ratio are unreported in this dataset; thus, payout sustainability cannot be quantified. FCF_coverage: Not assessable due to unreported investing cash flows and dividend amounts. policy_outlook: Given strong liquidity and cash-generative operations, the balance sheet could support distributions; however, without disclosed DPS and capex/FCF, no conclusion can be drawn on policy trajectory.

Risk Assessment

Business Risks:

• End-market cyclicality in PCs/peripherals impacting volumes and pricing.
• Inventory obsolescence risk due to rapid product cycles and component transitions.
• FX volatility affecting component costs and margins (if import dependent).
• Supply chain disruptions impacting availability and lead times.
• Competitive pricing pressure from domestic and global peers.

Financial Risks:

• Unreported cash balance and debt composition obscure net leverage and refinancing profile.
• Potential working capital swings (inventory and receivables) could pressure OCF seasonally.
• Tax rate variability; effective tax approximates 27–28%, but changes in tax items could affect net margins.

Key Concerns:

• Lack of visibility on investing cash flows and capex intensity limits FCF assessment.
• Dividend data not disclosed, constraining shareholder return analysis.
• Equity ratio reported as 0% in the dataset is clearly unreported; reliance on computed ratio may differ from management’s definition.

Investment Implications

Key Takeaways:

• Healthy 1H topline growth (+8.3% YoY) with margin expansion driving operating income growth (+10.1% YoY).
• ROE of 8.2% supported by solid margins and moderate leverage; ROA ~5.8%.
• Strong liquidity (current ratio ~3.1x) and high implied equity ratio (~70%) underpin resilience.
• High interest coverage (58.7x) indicates low financial strain.
• Earnings quality is good with OCF/NI ~0.96, though full FCF unknown due to missing investing CF.

Metrics to Watch:

• Inventory turns and aged inventory levels versus sales growth.
• Gross margin trajectory amid component cost and FX changes.
• Operating expense ratio and scalability as revenue grows.
• Investing cash flows and capex to clarify true FCF.
• Any updates on dividend policy and share count for per-share analytics.

Relative Positioning: MCJ appears operationally efficient with conservative balance sheet strength relative to typical hardware/peripheral peers; the main analytical gap versus best-in-class disclosures is limited visibility on capex/FCF and shareholder return policy.

Disclaimer

This analysis was auto-generated by AI. Please note the following:

• No Guarantee of Accuracy: The accuracy and completeness of this analysis are not guaranteed. For accurate financial data, please refer to the original disclosure documents published on TDnet or other official sources
• Not Investment Advice: This analysis is for general informational purposes only and does not constitute investment advice under applicable securities laws. It is not a recommendation to buy or sell any specific securities
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis