HAMAYUU CO.,LTD. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥1.54B
• Operating Income: ¥31M
• Net Income: ¥20M
• EPS: ¥9.37

Income Statement

Balance Sheet

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

Hamayuu Co., Ltd. (76820) posted FY2026 Q1 single-entity results showing modest top-line growth and stronger bottom-line leverage, albeit off a low base. Revenue rose 4.2% year over year to 15.45 (100M JPY), while operating income increased 22.0% to 0.31, indicating positive operating leverage. Gross profit was 11.02 with a high gross margin of 71.3%, consistent with a dine-in restaurant model where food cost is a smaller share than labor and occupancy within SG&A. SG&A totaled 10.76, leaving an operating margin of roughly 2.0%, which is still thin but improving. Ordinary income reached 0.32 (+19.0% YoY), aided by small net non-operating income (0.13 income versus 0.12 expenses). Net income nearly doubled to 0.20 (+98.2% YoY), lifting net margin to about 1.3%, but the effective tax rate was elevated at 62.0%, compressing bottom-line translation from ordinary income to net profit. DuPont analysis yields ROE of 1.2% (net margin 1.3% × asset turnover 0.329 × financial leverage 2.94x), reflecting still modest profitability and low asset velocity. The balance sheet is liquid, with a current ratio of 170.3% and quick ratio of 162.0%, supported by cash and deposits of 13.42 against current liabilities of 10.60. Solvency appears manageable: total liabilities are 31.17 and equity is 15.94, implying a debt-to-equity of 1.96x, while long-term loans stand at 13.19. Interest coverage is sound at 10.13x, indicating adequate buffer against financing costs. Working capital of 7.45 provides an operating cushion amid cost volatility. Dividend metrics are largely unreported; a calculated payout ratio of 162.3% suggests potential strain if interpreted on a quarterly EPS basis, but the absence of DPS/FCF details limits conclusions. Cash flow statements (operating, investing, financing) are not disclosed for the quarter, constraining assessment of earnings quality and free cash flow. With single-entity reporting under JGAAP and limited segment detail, the analysis focuses on headline margins, leverage, and liquidity. Overall, Q1 shows improving profitability leverage on modest sales growth, strong liquidity, and manageable financial risk; however, sustained earnings improvement will require continued cost discipline and normalization of the effective tax burden. Data gaps (cash flows, SG&A breakdown, capex, DPS) temper confidence and require monitoring in subsequent quarters.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 1.3% (Net income 0.20 / Revenue 15.45)
• asset_turnover: 0.329 (Revenue 15.45 / Total assets 46.93)
• financial_leverage: 2.94x (Assets 46.93 / Equity 15.94)
• calculated_ROE: 1.2% (DuPont)
• commentary: ROE remains low primarily due to thin net margin and modest asset turnover; leverage is moderate at ~3x assets-to-equity. margin_quality:
• gross_margin: 71.3% (11.02 / 15.45)
• operating_margin: 2.0% (0.31 / 15.45)
• ordinary_income_margin: 2.1% (0.32 / 15.45)
• net_margin: 1.3% (0.20 / 15.45)
• observations: High gross margin is consistent with restaurant model cost structure; SG&A intensity remains high, capping operating margin. Elevated effective tax rate (62.0%) weighs on net margin. operating_leverage: Positive: revenue +4.2% YoY versus operating income +22.0% YoY indicates cost base is scaling; further SG&A efficiency could widen margins. Interest coverage at 10.13x suggests financing costs are not a material drag at current earnings levels.

Growth Assessment

revenue_sustainability: Top-line growth of 4.2% YoY appears steady but modest; likely driven by pricing, mix, and incremental traffic/store additions (store-level drivers not disclosed). No segment or same-store detail provided, limiting visibility on structural vs. one-off drivers. profit_quality: Ordinary income growth (+19.0% YoY) outpaced sales, reflecting operating leverage. However, the high effective tax rate compressed net income conversion. Non-operating items are small and balanced; core improvement appears to be operational. outlook: If gross margin resilience persists and SG&A is contained, operating margin could improve from ~2%. Key swing factors include labor and utility costs, occupancy, and price elasticity. Normalization of the effective tax rate would provide additional net profit uplift. Lack of CF and capex disclosure makes medium-term growth capex needs and returns uncertain.

Financial Health

liquidity:

• current_ratio: 170.3% (18.04 / 10.60)
• quick_ratio: 162.0% (per provided metric; driven by cash 13.42 and minimal receivables 0.05)
• cash_position: Cash and deposits 13.42 vs current liabilities 10.60 (cash ratio ~126%), indicating solid short-term coverage. solvency_capital_structure:
• total_assets: 46.93
• total_liabilities: 31.17
• equity: 15.94
• debt_to_equity: 1.96x (liabilities/equity)
• long_term_loans: 13.19
• interest_coverage: 10.13x (operating income 0.31 / interest expense 0.03)
• commentary: Leverage is moderate for a small-cap restaurant operator. Maturity profile not disclosed; long-term loans dominate, reducing near-term refinancing risk but requiring steady cash generation.

Cash Flow Quality

earnings_quality: Assessment constrained by lack of operating cash flow disclosure. High gross margin and improved operating income suggest underlying operations are contributing, but without OCF we cannot verify cash conversion. free_cash_flow: Not assessable; investing cash flow and capex unreported. FCF coverage of dividends cannot be determined. working_capital: Working capital of 7.45 (CA 18.04 - CL 10.60). Low receivables (0.05) and modest inventories (0.88) are consistent with restaurant cash model; cash balances are the primary current asset.

Dividend Sustainability

payout_ratio_assessment: A calculated payout ratio of 162.3% is noted, but DPS and total dividends are unreported. If the ratio is based on annualized dividends vs quarterly EPS, it may overstate payout stress; clarity on DPS timing and basis is required. FCF_coverage: Not calculable due to unreported OCF and capex. policy_outlook: Dividend policy cannot be inferred from this quarter. Given thin margins and leverage, sustained dividends would ideally align with proven cash generation; visibility is limited without CF data.

Risk Assessment

Business Risks:

• Cost inflation in labor, utilities, and food inputs compressing margins
• Demand sensitivity to consumer sentiment and discretionary spending
• Geographic concentration and limited scale (implied by small balance sheet)
• Execution risk in store operations, staffing, and pricing
• Competition in casual dining and Chinese cuisine formats

Financial Risks:

• Thin operating margin (~2%) leaves limited buffer against shocks
• High effective tax rate (62.0%) depresses net income and ROE
• Leverage at 1.96x liabilities/equity; long-term loans 13.19 require ongoing servicing
• Limited disclosure on cash flows and capex impedes assessment of liquidity durability
• Potential dividend burden if payout ratio is indeed above 100%

Key Concerns:

• Sustainability of operating leverage if sales growth slows
• Normalization path of the effective tax rate
• Visibility on OCF/FCF and capex needs
• Ability to protect gross margin amid cost volatility

Investment Implications

Key Takeaways:

• Modest sales growth (+4.2% YoY) translated into outsized operating income growth (+22.0%), signaling positive operating leverage.
• Margins remain thin despite a high gross margin; SG&A intensity is the primary constraint on operating profitability.
• Liquidity is strong with cash covering current liabilities; solvency is acceptable with interest coverage over 10x.
• ROE is low at 1.2% due to modest asset turnover and thin net margin, compounded by a high effective tax rate.
• Data gaps (cash flows, DPS, capex, SG&A breakdown) limit conviction on earnings quality and dividend capacity.

Metrics to Watch:

• Same-store sales and traffic/price mix (not disclosed this quarter)
• Operating margin progression and SG&A ratio
• Effective tax rate normalization
• Operating cash flow and capex to confirm FCF generation
• Interest coverage and debt trajectory (especially long-term loans)
• DPS disclosures and payout alignment with cash generation

Relative Positioning: Within Japan’s small-cap restaurant peers, Hamayuu exhibits solid liquidity and manageable leverage but operates with thin operating margins and low ROE; improved cost efficiency and clearer cash flow disclosure would be needed to close the gap with higher-quality operators.

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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