HYOJITO Co.,Ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥4.04B
• Operating Income: ¥436M
• Net Income: ¥316M
• EPS: ¥67.07

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

For FY2026 Q2 (cumulative, standalone JGAAP), 表示灯株式会社 reported revenue of ¥4,037.9m, flat YoY, while operating income rose 5.8% to ¥436.0m, indicating margin discipline despite top-line stagnation. Ordinary income of ¥480.0m exceeded operating income, implying positive non-operating contributions. Net income increased 11.3% to ¥316.0m, with an implied net margin of 7.83%. EBITDA was ¥696.4m, yielding a 17.2% EBITDA margin, and the reported gross margin was high at 68.6%, consistent with a service-heavy model. The DuPont decomposition shows net margin of 7.83%, asset turnover of 0.281x, and financial leverage of 1.79x, resulting in a calculated ROE of 3.93% for the period; annualizing would lift the indicative full-year ROE, but the point-in-time calculation is conservative. Operating cash flow was robust at ¥569.5m, delivering an OCF/Net income ratio of 1.80, which supports earnings quality. The balance sheet appears conservative with total assets of ¥14.38bn and equity of ¥8.05bn, implying an equity ratio around 56% (equity/total assets), despite the equity ratio metric being undisclosed in the feed. Liquidity is adequate: current ratio 118.2% and quick ratio 116.3%, with working capital of ¥1.15bn. Leverage is moderate with total liabilities/equity at 0.82x, and the bulk of liabilities are current (¥6.36bn), highlighting some short-term obligations concentration. Interest expense is undisclosed, and the reported interest coverage metric is not informative; however, profitability suggests ample coverage. Tax expense of ¥146.7m implies an effective tax rate near 31–32% on our reconstruction, notwithstanding the 0.0% placeholder in the feed. Investing cash flows and cash balances are not disclosed, limiting visibility on capex intensity and liquidity buffers. Dividend data (DPS, payout, FCF coverage) are also undisclosed, so dividend policy and sustainability cannot be inferred from this release. Overall, the company delivered resilient margins and cash generation against flat sales, underpinned by a solid capital structure, but visibility on capex, cash, and shareholder returns is limited due to unreported line items.

Profitability Analysis

ROE_decomposition: DuPont shows Net margin 7.83% × Asset turnover 0.281x × Financial leverage 1.79x = ROE 3.93% for the half-year period. On an annualized revenue base, asset turnover would be closer to ~0.56x, implying a higher full-year ROE if margins and leverage are maintained. Ordinary income outpacing operating income indicates non-operating gains lifting returns. margin_quality: Gross margin reported at 68.6% suggests a service-led mix with relatively low direct costs. Operating margin is 10.8% (¥436.0m/¥4,037.9m), and net margin is 7.83%. EBITDA margin of 17.2% implies modest D&A burden (D&A ¥260.4m equals ~6.4% of sales). The YoY improvement in operating income despite flat revenue points to cost control and potentially favorable mix. operating_leverage: With revenue flat and OP up 5.8%, incremental operating margin was positive. That dynamic indicates operating leverage from SG&A efficiency; sustaining this will depend on maintaining utilization and mix as revenues evolve in H2.

Growth Assessment

revenue_sustainability: Revenue was flat YoY at ¥4,037.9m through Q2, suggesting subdued demand or timing effects. Given the company’s likely exposure to advertising/signage services, revenues may be sensitive to contract timing and macro conditions. profit_quality: Profit growth outpaced sales (+11.3% NI vs. +0.0% sales), aided by non-operating items and cost discipline. The implied effective tax rate (~31–32%) is consistent with normalized levels, supporting the quality of bottom-line growth. outlook: If H2 seasonality/materializations are typical, maintaining the current margin profile could produce decent full-year earnings leverage even on modest sales growth. Key swing factors include renewal/rollover of client contracts, mix of higher-margin services, and cost inflation management.

Financial Health

liquidity: Current assets ¥7,511.1m vs. current liabilities ¥6,356.6m yield a current ratio of 118.2% and quick ratio of 116.3%, supported by low inventories (¥120.3m). Working capital stands at ¥1,154.5m, indicating adequate near-term coverage. solvency: Equity is ¥8,047.0m vs. total liabilities ¥6,597.3m (debt-to-equity 0.82x). Implied equity ratio is ~56.0% (equity/total assets), reflecting a conservative capital base, though the equity ratio metric itself is undisclosed in the feed. capital_structure: Liabilities are predominantly short-term (current liabilities ¥6,356.6m, ~96% of total liabilities), which concentrates refinancing/payment needs within 12 months; however, strong equity and OCF mitigate this risk. Interest expense is undisclosed, but profitability suggests comfortable coverage.

Cash Flow Quality

earnings_quality: OCF of ¥569.5m vs. NI of ¥316.0m (OCF/NI 1.80x) indicates strong cash conversion and low accrual stretch in the period. FCF_analysis: Investing CF is undisclosed, so capex and therefore true FCF cannot be determined. EBITDA of ¥696.4m and strong OCF imply capacity to fund maintenance capex if requirements are modest; confirmation awaits disclosure of investing cash flows. working_capital: Given the high OCF, working capital likely released cash or was well-managed in the half. Inventories are small; receivables and payables dynamics (not disclosed) are the key drivers to monitor.

Dividend Sustainability

payout_ratio_assessment: Dividend per share and payout ratio are not disclosed in this dataset. The reported 0.00 values should be treated as placeholders rather than actual zero. FCF_coverage: With investing cash flows unreported, FCF coverage of dividends cannot be assessed. On earnings alone, the company appears capable of distributions, but policy and capex needs are unknown. policy_outlook: Absent disclosure, infer no change. Future statements on DPS, payout policy, and capital allocation priorities (growth capex vs. returns) will be critical to assess sustainability.

Risk Assessment

Business Risks:

• Exposure to macro-sensitive advertising and signage demand with potential contract timing volatility
• Concentration risk if reliant on specific transportation hubs, venues, or municipal contracts
• Renewal risk on key client or location agreements
• Cost inflation in materials and subcontracting potentially pressuring margins
• Execution risk in new service rollouts or digital transformation of signage

Financial Risks:

• High proportion of current liabilities increases near-term cash obligations
• Limited visibility on cash and investing cash flows constrains assessment of liquidity buffers and capex needs
• Potential working capital swings tied to receivable collections and project milestones
• Non-operating income contribution volatility impacting ordinary income

Key Concerns:

• Flat revenue trajectory through Q2 despite profit improvement
• Undisclosed cash balance and capex obscure FCF and dividend capacity
• Short-term liability concentration requires continued strong OCF

Investment Implications

Key Takeaways:

• Margins expanded with operating income up 5.8% on flat sales, indicating cost discipline
• OCF/Net income of 1.80x supports high-quality earnings
• Balance sheet is conservative with an implied ~56% equity ratio and 0.82x liabilities-to-equity
• Ordinary income exceeds operating income, suggesting reliance on non-operating gains
• Visibility gaps on cash, capex, and dividends limit clarity on shareholder return capacity

Metrics to Watch:

• H2 revenue growth and booking/contract renewal trends
• SG&A ratio and operating margin sustainability
• OCF to NI ratio and working capital days (AR/AP/Inventory)
• Investing cash flows (capex) to gauge true FCF
• Equity ratio and current ratio to monitor liquidity/solvency
• Composition of non-operating income and any financial income/expense

Relative Positioning: Relative to domestic small-cap advertising/signage peers, the company exhibits stronger balance sheet conservatism, solid cash conversion, and mid-teens EBITDA margins, but lower reported asset turnover in the half-year and limited disclosure on capex/dividends temper visibility.

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