SUZUKI CO.,LTD. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥9.18B
• Operating Income: ¥1.32B
• Net Income: ¥910M
• EPS: ¥60.41

Income Statement

Balance Sheet

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

Suzuki Co., Ltd. (67850) delivered solid topline and bottom-line growth in FY2026 Q1 under JGAAP on a consolidated basis. Revenue rose 14.6% YoY to ¥9.175bn, while operating income increased 10.5% YoY to ¥1.322bn, indicating positive demand but slightly softer operating leverage versus the prior year. Net income reached ¥867m (+11.5% YoY), translating to a reported net margin of 9.45%. Gross profit is reported at ¥1.817bn, implying a gross margin of 19.8%, and the operating margin stands at 14.4%, reflecting a lean SG&A burden and/or some non-operating support to margins. Ordinary income of ¥1.377bn exceeded operating income, suggesting net non-operating gains (e.g., interest/dividend income or FX) more than offset interest expense. Interest expense remained modest at ¥10.3m, and interest coverage was strong at 128.5x, underscoring limited financial risk from debt servicing. On the balance sheet, total assets were ¥41.801bn and total equity ¥28.844bn, implying a computed equity ratio around 69% (equity/assets), despite a placeholder equity ratio of 0.0% in the dataset. Liquidity appears robust with a current ratio of 198.6% and a quick ratio of 194.5%, supported by low inventories (¥398m) relative to current assets. DuPont analysis shows a net margin of 9.45%, asset turnover of 0.219x, and financial leverage of 1.45x, yielding an ROE of 3.01% for the quarter; annualizing mechanically would imply a double-digit run-rate, but this is not a forecast. The implied effective tax rate from disclosed figures is approximately 20–21% (¥223.5m tax on about ¥1.09bn pre-tax), though the calculated metric table lists 0.0% as a placeholder. Cash flow statements (OCF, investing, financing) and cash balance are not disclosed this quarter, limiting assessment of earnings-to-cash conversion and free cash flow. Dividend information is also not disclosed (DPS and payout shown as 0.00), consistent with early-stage fiscal-year reporting. Overall, profitability is healthy, leverage is conservative, and liquidity is ample, but operating leverage looks mixed given operating income growth lagged revenue growth. The absence of cash flow disclosures introduces uncertainty around cash conversion, working capital dynamics, and capex intensity. Inventory levels look lean, supporting the strong quick ratio and potentially healthy turns, but inventory quality cannot be assessed without CFS and detailed notes. Key watchpoints include margin trajectory as the year progresses, non-operating income sustainability, and restoration of cash flow disclosures.

Profitability Analysis

ROE_decomposition: Net margin 9.45% × asset turnover 0.219 × financial leverage 1.45 = ROE 3.01% (quarterly). This reflects solid profitability, moderate asset intensity, and low leverage. margin_quality: Gross margin is 19.8% (gross profit ¥1.817bn on revenue ¥9.175bn). Operating margin is ~14.4% (operating income ¥1.322bn), indicating a relatively lean SG&A structure (roughly 5–6% of revenue after accounting for other income/expense). Net margin of 9.45% is supported by modest interest expense and a likely normalized tax rate (~20–21% inferred). operating_leverage: YoY revenue +14.6% vs operating income +10.5% suggests slight negative operating leverage in the quarter, likely due to higher cost inflation, product mix, or upfront expenses. Ordinary income outpaced operating income due to net non-operating gains, which may not be structural.

Growth Assessment

revenue_sustainability: Double-digit revenue growth (+14.6% YoY) indicates solid demand momentum early in the fiscal year. The low inventory base and high quick ratio are consistent with healthy sell-through, though order backlog and segment mix are undisclosed. profit_quality: Operating margin remains high-teens to mid-teens from gross to operating levels, but the slower growth in operating income versus revenue suggests some pressure from costs or mix. Non-operating income supported ordinary profit, introducing some variability risk if such income normalizes. outlook: If current revenue momentum holds and cost pressures stabilize, operating leverage could improve in subsequent quarters. However, the absence of cash flow and segment disclosures limits visibility on sustainability. Watch for pricing power, input cost trends, and any normalization in non-operating gains.

Financial Health

liquidity: Current ratio 198.6% and quick ratio 194.5% indicate strong short-term solvency. Working capital is ¥9.663bn (current assets ¥19.464bn less current liabilities ¥9.801bn). solvency: Computed equity ratio is ~69% (¥28.844bn equity / ¥41.801bn assets), implying a conservative capital base. Interest coverage is 128.5x, signaling minimal debt-service risk. capital_structure: Debt-to-equity ratio is 0.41x, consistent with low leverage. Ordinary income exceeding operating income suggests net financial and other income; maintaining this would support coverage, but reliance on it could introduce volatility.

Cash Flow Quality

earnings_quality: Operating cash flow is undisclosed (reported as 0). As a result, the OCF/Net Income ratio of 0.00 is not interpretable this quarter. Earnings quality cannot be validated against cash conversion without CFS details. FCF_analysis: Free cash flow is not disclosed. Capex and depreciation are also undisclosed (D&A reported as 0 indicates not reported). This constrains assessment of maintenance vs growth capex and true FCF coverage. working_capital: Inventories are modest at ¥398m, supporting the strong quick ratio and suggesting efficient inventory management. However, receivables, payables, and collection/turnover metrics are not disclosed, limiting insight into WC-driven cash needs.

Dividend Sustainability

payout_ratio_assessment: DPS and payout ratio are listed as 0.00, indicating no disclosure or decision at Q1 rather than an actual zero payout. Without EPS policy context or FY guidance, payout sustainability cannot be assessed. FCF_coverage: Free cash flow is undisclosed; therefore, FCF coverage of dividends cannot be evaluated this quarter. policy_outlook: Given strong balance sheet metrics (low leverage, high liquidity), the company appears to have capacity for shareholder returns, but policy cadence is unknown. Monitor full-year guidance and board resolutions for dividend policy signals.

Risk Assessment

Business Risks:

• Potential cost inflation or adverse product mix pressuring gross and operating margins
• Dependence on non-operating income to support ordinary profit in certain quarters
• Demand cyclicality in end markets (details not disclosed)
• Supply chain and procurement risks affecting lead times and input costs
• Limited visibility due to absence of segment and order backlog disclosures

Financial Risks:

• Uncertain cash conversion given missing operating cash flow data
• Potential normalization of non-operating gains reducing ordinary income
• FX exposure (if overseas sales or financial assets exist) potentially impacting ordinary income
• Refinancing or interest rate risk appears low but not fully assessable without debt maturity detail

Key Concerns:

• Operating leverage softness despite double-digit revenue growth
• Lack of cash flow and capex disclosure impeding FCF assessment
• Data gaps in equity ratio and DPS figures (placeholders), limiting precision in shareholder return analysis

Investment Implications

Key Takeaways:

• Strong Q1 revenue growth (+14.6% YoY) with solid profitability (operating margin ~14.4%, net margin 9.45%).
• Balance sheet conservative with a computed equity ratio near 69% and interest coverage of 128.5x.
• Operating leverage modestly negative YoY; monitor cost discipline and mix.
• Non-operating income supported ordinary profit; sustainability is uncertain.
• Cash flow statements and DPS not disclosed, constraining assessment of earnings quality and capital returns.

Metrics to Watch:

• Operating margin and gross margin trajectory over subsequent quarters
• Ordinary income composition (recurring vs non-recurring, financial vs other)
• Restoration of operating cash flow disclosure and OCF/NI conversion ratio
• Capex and depreciation trends to gauge maintenance vs growth investment
• Working capital movements (receivables and payables turnover) and inventory turns

Relative Positioning: Within Japanese mid-cap industrial/technology peers, Suzuki appears to combine healthy profitability with a conservative balance sheet and strong liquidity, but exhibits mixed operating leverage and limited disclosure this quarter on cash flows and dividends.

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
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