Anshin Guarantor Service Co.,Ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Operating Income: ¥77M
• Net Income: ¥115M
• EPS: ¥6.66

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend 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

Anshin Hosho Co., Ltd. (7183) reported FY2026 Q2 standalone results under JGAAP with limited line-item disclosure, requiring focus on the non-zero items. Operating income was ¥77 million, down 15.3% YoY, indicating weaker core profitability in the first half. Ordinary income reached ¥157 million, materially exceeding operating income and implying net non-operating gains of roughly ¥80 million. Net income rose 17.5% YoY to ¥115 million, suggesting bottom-line resilience driven by non-operating items despite softer operations. Depreciation and amortization totaled ¥30.1 million, yielding EBITDA of approximately ¥107.1 million. Interest expense was ¥14.0 million, and EBIT-based interest coverage is about 5.5x, which is adequate but leaves limited buffer if operating profit weakens further. Using income tax expense of ¥55.2 million and net income, the implied effective tax rate is approximately 32–33%, consistent with a normalized Japanese statutory tax environment. Total assets were ¥13.64 billion and total liabilities ¥10.50 billion, with total equity of ¥2.43 billion. While the reported equity ratio is shown as 0.0% due to disclosure gaps, a simple calculation indicates an equity ratio of about 17.8% (equity/assets), reflecting a leveraged balance sheet typical for a guarantee/credit-related model. Liquidity is modest: current assets of ¥11.44 billion versus current liabilities of ¥10.50 billion produce a current ratio near 1.09x and working capital of roughly ¥0.94 billion. Operating cash flow was negative at ¥92.1 million, which contrasts with positive net income and implies working capital consumption or timing effects common in guarantee businesses (e.g., claims payments, receivable build, or other short-term asset movements). Investing and financing cash flows are undisclosed or minimal, limiting free cash flow analysis; the reported FCF of 0 should be treated as not disclosed. Dividend data shows zero (DPS and payout), likely indicating no interim dividend or non-disclosure rather than a definitive policy shift. ROE and related DuPont metrics tied to revenue are not computable due to revenue non-disclosure, but leverage (assets/equity) is about 5.6x, magnifying equity returns when profits are stable. Overall, the period shows weaker operating profit offset by non-operating tailwinds, adequate interest coverage, tight but positive liquidity, and negative OCF that warrants monitoring. Data limitations (notably revenue, cash balance, and share data) constrain the depth of margin and per-share analyses. Outlook hinges on normalizing non-operating items, stabilizing operating income, and improving cash conversion in the second half.

Profitability Analysis

ROE_decomposition: Classical DuPont decomposition is constrained by undisclosed revenue and average equity. Using available balance sheet and income data, financial leverage (assets/equity) is ~5.63x (¥13,641m / ¥2,425m). A rough half-year ROE proxy is ~4.7% (¥115m / ¥2,425m), implying a simple annualized ROE near ~9–10%, though this is approximate and uses period-end equity rather than average equity and excludes any seasonality. Net profit margin and asset turnover cannot be computed due to unreported revenue. margin_quality: Operating income declined 15.3% YoY to ¥77m, indicating compression in core margins or increased operating costs. Ordinary income of ¥157m implies net non-operating gains of ~¥80m, which lifted net income to ¥115m (+17.5% YoY). The effective tax rate is roughly 32–33% (¥55.2m tax on ~¥170.2m pre-tax), consistent with normal taxation. EBITDA is ¥107.1m (OI + D&A), but EBITDA margin cannot be assessed without revenue; therefore, margin quality assessment focuses on the mix shift toward non-operating income. operating_leverage: With revenue undisclosed, operating leverage cannot be quantified directly. However, the decline in operating income despite positive net income suggests limited operating leverage benefits in the half, and that bottom-line performance depended on non-operating items rather than scale efficiencies.

Growth Assessment

revenue_sustainability: Revenue is undisclosed for the period; thus, top-line growth trends cannot be evaluated. The dependence on non-operating gains in H1 raises questions about the sustainability of net income growth absent clearer revenue momentum. profit_quality: Operating income fell YoY while net income rose, indicating income quality skewed toward non-operating contributions. Interest coverage of ~5.5x is acceptable, but resilience would be stronger with improving operating profit. Negative OCF versus positive earnings suggests weaker cash conversion in the half, potentially due to working capital movements common in guarantee operations (e.g., timing of claims and recoveries). outlook: For H2, stabilization of operating profit and normalization of non-operating items will be key. Improvement in cash generation through tighter working capital management would support quality of earnings. Given leverage of ~5.6x assets/equity, incremental changes in profitability can materially affect ROE, but also increase sensitivity to downside if operating trends weaken.

Financial Health

liquidity: Current assets ¥11,436.6m vs current liabilities ¥10,496.0m yields a current ratio ~1.09x and working capital of ~¥940.6m, indicating tight but positive liquidity. Cash and equivalents are undisclosed; thus, quick liquidity and cash runway cannot be precisely assessed. All liabilities are shown as current, which may reflect classification specific to the business model or disclosure constraints. solvency: Total liabilities are ¥10,496.0m vs equity ¥2,425.0m. The computed equity ratio is ~17.8% (vs reported 0.0% due to non-disclosure), implying a leveraged profile consistent with guarantee/credit-related businesses. Interest expense of ¥14.0m against EBIT of ¥77m yields ~5.5x coverage, adequate but not robust if operating income declines. capital_structure: Debt-to-equity (using total liabilities/equity) is ~4.33x. Financial leverage (assets/equity) is ~5.63x. The structure emphasizes liabilities, which is typical, but elevates sensitivity to funding costs and to any deterioration in asset quality or claim experience.

Cash Flow Quality

earnings_quality: Net income of ¥115m contrasts with operating cash outflow of ¥92.1m, giving OCF/NI of approximately -0.80. This gap points to working capital absorption and/or timing effects; without detailed notes, it is hard to distinguish recurring claim-related cash outflows from temporary movements. FCF_analysis: Investing cash flow is undisclosed (reported as 0), so true free cash flow cannot be determined. If we temporarily assume minimal capex in line with past patterns typical of service/guarantee models, underlying FCF would still likely be negative in H1 given negative OCF, but this remains an assumption rather than a reported fact. working_capital: The balance sheet shows current assets modestly exceeding current liabilities; however, the negative OCF suggests increases in receivables or guarantee-related assets and/or payments on current liabilities. Detailed components (receivables, payables, provisions) are not provided, limiting granularity.

Dividend Sustainability

payout_ratio_assessment: DPS and payout ratio are reported as 0.0, which likely reflects non-disclosure for the interim period rather than a clear policy statement. Without confirmed DPS and with partial-period earnings, a robust payout analysis is not possible. FCF_coverage: With OCF negative and investing cash flows undisclosed, FCF coverage of dividends cannot be assessed. On a conservative view, interim cash generation would not support distributions without drawing on cash balances, which are also undisclosed. policy_outlook: Given leverage and negative H1 OCF, a prudent stance would be to prioritize liquidity until operating cash flow normalizes. Confirmation of full-year DPS guidance, if any, and visibility into H2 cash conversion will be decisive for assessing sustainability.

Risk Assessment

Business Risks:

• Dependence on Japan’s rental and credit markets; macro softness can elevate claim incidence and reduce new guarantee volumes
• Potential volatility in non-operating items that currently support earnings
• Regulatory changes in the guarantee/credit space affecting capital, disclosures, or business practices
• Operational risk from collections, fraud, or IT/cybersecurity breaches
• Concentration risk by counterparties, channels, or property segments if present

Financial Risks:

• Negative operating cash flow despite positive net income, indicating weak cash conversion
• Leverage with an equity ratio of ~17.8% and liabilities/equity of ~4.33x, amplifying earnings volatility
• Interest rate and funding cost risk with moderate interest coverage (~5.5x)
• Liquidity tightness with a current ratio around 1.09x and undisclosed cash balance
• Potential asset quality/claims risk impacting provisions and cash flows

Key Concerns:

• Reliance on non-operating income to offset weaker operating profit in H1
• Sustained negative OCF would strain liquidity if not reversed in H2
• Limited disclosure (revenue, cash, investing flows) impedes assessment of margin structure and FCF

Investment Implications

Key Takeaways:

• Operating income declined 15.3% YoY to ¥77m, while net income rose 17.5% to ¥115m due to non-operating gains
• Interest coverage is ~5.5x; adequate but sensitive to operating fluctuations
• Computed equity ratio is ~17.8%, indicating a leveraged profile
• Operating cash flow was -¥92.1m, signaling weak cash conversion in H1
• Liquidity is tight but positive with a current ratio of ~1.09x and working capital ~¥0.94bn
• Disclosure gaps (revenue, cash, capex/IF, shares) constrain deeper ratio analysis

Metrics to Watch:

• Ordinary income composition (recurring vs non-recurring non-operating items)
• Operating income trend and cost discipline in H2
• Operating cash flow and working capital movements (receivables, claims paid/recovered)
• Equity ratio and liabilities/equity (capital adequacy) trajectory
• Interest coverage and funding costs
• Any DPS guidance and payout policy disclosures

Relative Positioning: Within Japan’s rental guarantee/credit services peers, the company exhibits modest operating profitability, reliance on non-operating contributions in the half, relatively high leverage (equity ratio ~18%), and weaker cash conversion versus an ideal profile; clearer revenue disclosure and normalized cash generation would be needed to benchmark margins and ROE more precisely.

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