| Metric | Current Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥5607.3B | ¥5390.5B | +4.0% |
| Operating Income / Operating Profit | ¥737.0B | ¥717.2B | +2.8% |
| Ordinary Income | ¥827.5B | ¥720.2B | +14.9% |
| Net Income / Net Profit | ¥509.6B | ¥409.8B | +24.4% |
| ROE | 9.0% | 8.2% | - |
For the fiscal year ended March 2026, Shimadzu Corporation delivered revenue of 5,607.3B yen (YoY +216.8B +4.0%), operating income of 737.0B yen (YoY +19.8B +2.8%), ordinary income of 827.5B yen (YoY +107.3B +14.9%), and net income attributable to owners of the parent of 509.6B yen (YoY +99.8B +24.4%), marking revenue and profit growth. At the operating level, solid performance in Measurement Instruments and double-digit growth in Aerospace Equipment drove results, and the operating margin remained high at 13.1% (prior year 13.3%). However, SG&A growth (+8.4%) outpaced revenue growth, limiting operating leverage. The significant rise in ordinary income was primarily due to foreign exchange gains of 77.2B, and net income benefited from a stable effective tax rate of 25.7%. Gross profit margin improved to 44.6% from 43.5% a year earlier (+1.1pt), supported by improved product mix and maintained pricing.
[Revenue] Revenue was 5,607.3B yen (+4.0%), led by core Measurement Instruments at 3,649.6B yen (+4.9%) showing steady growth, and Aerospace Equipment at 433.8B yen (+12.1%) delivering double-digit growth. Medical Devices increased slightly to 738.2B yen (+1.7%), while Industrial Equipment declined slightly to 715.9B yen (-1.1%). By region: Japan 2,425.8B yen (prior 2,345.7B), Americas 818.7B yen (prior 785.6B), Europe 548.0B yen (prior 495.6B), China 917.4B yen (prior 913.5B), Other Asia 714.7B yen (prior 649.8B). Growth in Europe and Asia was notable, aided by favorable FX. Gross profit was 2,500.9B yen (gross margin 44.6%), up 156.5B from 2,344.4B yen (43.5%) a year earlier, improving gross margin by 1.1pt.
[Profitability] Operating income was 737.0B yen (+2.8%). SG&A increased to 1,763.9B yen (+8.4%, SG&A ratio 31.5%), rising faster than sales and compressing the operating margin to 13.1% from 13.3% (down 0.2pt). Major drivers were allocations for ERP-related costs and R&D. Segment profit adjustment amounted to ▲37.4B yen (prior ▲17.8B), widening the adjustment. Non-operating income was 112.5B yen, driven mainly by foreign exchange gains of 77.2B yen (prior year had foreign exchange losses of 15.1B recorded in non-operating expenses), leading to a swing from ▲29.0B yen to +90.5B yen in non-operating results. As a result, ordinary income rose to 827.5B yen (+14.9%), outpacing operating-level growth. Extraordinary items netted ▲12.9B yen (extraordinary gains 2.7B, extraordinary losses 15.7B), including impairment losses of 3.8B and valuation losses on investment securities of 8.1B, but the impact on net income was limited at about 2%. Income before income taxes of 814.6B yen less income taxes of 209.6B yen resulted in net income of 509.6B yen (+24.4%).
Measurement Instruments: revenue 3,649.6B yen (+4.9%), operating income 525.8B yen (+1.0%, margin 14.4%), accounting for 65.1% of revenue and providing stable contribution. Medical Devices: revenue 738.2B yen (+1.7%), operating income 48.7B yen (+14.3%, margin 6.6%) — higher growth in profit but relatively low margin. Industrial Equipment: revenue 715.9B yen (-1.1%), operating income 106.0B yen (+1.2%, margin 14.8%) — revenue down but profit up, maintaining high profitability. Aerospace Equipment: revenue 433.8B yen (+12.1%), operating income 82.2B yen (+35.5%, margin 18.9%) — highest margin and growth among segments, driven by order recovery and utilization improvements. Other segments (real estate related, etc.): revenue 94.9B yen (-3.9%), operating income 11.8B yen (+87.3%, margin 12.4%) — one-off factors caused large profit increase. The company-wide margin of 13.1% was supported by Aerospace Equipment’s high profitability offsetting Medical Devices’ low margin.
[Profitability] Operating margin was 13.1%, down 0.2pt from 13.3% but remained high; net profit margin improved 1.5pt to 9.1% (prior 7.6%). ROE was 9.0%, below prior 10.9%, largely because equity increased significantly (4,980.7B → 5,651.7B, +13.5%) and net income growth (+24.4%) did not fully catch up. DuPont decomposition shows net profit margin 9.1%, total asset turnover 0.76x, and financial leverage 1.31x. Gross margin improved to 44.6% from 43.5% (+1.1pt) due to product mix and price maintenance. [Cash Quality] Operating Cash Flow / Net Income was 1.07x (546.8B / 509.6B), above the 1.0x benchmark, indicating good cash realization. From operating CF subtotal of 714.2B, working capital changes of ▲167.4B (inventory increase 46.3B, accounts receivable increase 19.3B, accounts payable decrease 95.7B, contract liabilities decrease 75.7B) caused cash outflow, and corporate tax payments of 184.2B were made. Accrual ratio was (509.6B - 546.8B) / 7,379.8B = ▲0.5%, negative, indicating cash generation exceeded profit and good earnings quality. [Investment Efficiency] Total asset turnover was 0.76x (prior 0.80x), slightly lower due to extended working capital. DSO 102 days, DIO 179 days, CCC 232 days, indicating lengthening and the need to improve inventory and receivables efficiency. Capital expenditures were 149.4B vs. depreciation 203.8B, indicating restrained investment. [Financial Soundness] Equity ratio improved to 76.6% (prior 74.1%). Interest-bearing debt was minimal at short-term borrowings 13.7B and long-term borrowings 0.04B (total 13.7B), Debt/EBITDA 0.01x, and interest coverage 255x (operating CF 546.8B / interest paid 2.9B), indicating very strong debt service capacity. Cash and deposits were 1,673.2B (up 239.0B from 1,434.1B), current ratio 331%, quick ratio 274% — very ample liquidity. Debt/Capital ratio was 0.2%, indicating an effectively debt-free balance sheet.
Operating CF was 546.8B (prior 520.0B, +5.1%). It was calculated from an operating CF subtotal of 714.2B less working capital changes of ▲167.4B (inventory increase 46.3B, accounts receivable increase 19.3B, accounts payable decrease 95.7B, contract liabilities decrease 75.7B). Corporate tax payments of 184.2B were a major cash outflow, while interest and dividend receipts of 19.8B contributed to inflows. Investing CF was ▲159.1B (prior ▲231.7B), primarily due to acquisition of tangible fixed assets 149.4B, with sales proceeds 5.1B and additional acquisition of subsidiary shares ▲65.5B affecting the net amount. Financing CF was ▲255.0B (prior ▲484.1B), with dividend payments 193.5B and lease liability repayments 48.2B as main items; treasury stock acquisition was limited at 0.05B. Free Cash Flow (Operating CF + Investing CF) was 387.7B, a substantial improvement from 288.3B the prior year, providing roughly 2.0x coverage of dividend payments of 193.5B. Cash and cash equivalents increased by 236.2B from beginning balance 1,371.9B to ending 1,608.4B, supported by foreign exchange translation gains of 103.5B, further strengthening liquidity. Although Operating CF / Net Income is favorable at 1.07x, improving working capital efficiency (CCC 232 days) is key to additional cash generation.
The difference of 90.5B between operating income 737.0B and ordinary income 827.5B is the net of non-operating income 112.5B (of which foreign exchange gains 77.2B, interest income 16.3B) and non-operating expenses 22.0B (of which interest expense 2.9B, foreign exchange losses 15.1B). The large contribution from foreign exchange gains 77.2B was a major factor; the prior year had foreign exchange losses of 15.1B recorded in non-operating expenses, producing an improvement of about over 90B YoY. This FX contribution is largely a transitory effect from yen depreciation, and next fiscal year’s guidance assumes a decline in ordinary income to 750.0B yen (▲9.4%), reflecting this drop-off. Extraordinary items were net ▲12.9B (extraordinary gains 2.7B, extraordinary losses 15.7B), including impairment losses 3.8B and valuation losses on investment securities 8.1B, but the impact on net income of 509.6B was only about 2.5%, and the recurring profit structure remains stable. Non-operating income equals about 2.0% of revenue, a moderate level, and fluctuations in non-operating results are driven by FX. The accrual ratio was ▲0.5%, indicating cash exceeded profit and good earnings quality. Comprehensive income was 866.5B, well above net income of 509.6B, contributed by foreign currency translation adjustments 153.5B, valuation difference on available-for-sale securities 30.0B, and adjustments relating to retirement benefits 78.0B; however, these are remeasurement-sensitive and include non-recurring elements.
Full Year guidance: Revenue 5,750.0B yen (+2.5%), Operating Income 760.0B yen (+3.1%), Ordinary Income 750.0B yen (▲9.4%), Net Income attributable to owners of the parent 550.0B yen, EPS forecast ¥190.35. Revenue and operating income are expected to increase, but ordinary income is forecast to decline ▲9.4% year-on-year, reflecting a conservative assumption accounting for the loss of this year’s FX contribution. Operating income assumes +3.1% growth, premised on maintained pricing, improved product mix, and SG&A restraint. Net income of 550.0B assumes normalization of tax burden; interim dividend is announced at ¥27, and payout ratio is expected to be around 33–34% for the full year. As of period-end, progress to the full-year plan stands at Revenue 97.5%, Operating Income 97.0%, Ordinary Income 110.3% — indicating operating performance excluding FX contribution is roughly on track and the likelihood of achieving next year’s targets is high.
Annual dividend is ¥69 (interim ¥27, year-end ¥42), and payout ratio relative to net income 509.6B yen is 33.0% (total dividends 192.1B / 509.6B). A ¥4 commemorative dividend for the 150th anniversary is included in the year-end dividend; on a normal basis the dividend would be ¥65. Share repurchases were minimal at 0.05B, so dividends are the primary shareholder return. DOE (dividend / equity) is about 3.4%, balancing equity growth and returns. With FCF of 387.7B and dividends of 193.5B, coverage is about 2.0x and combined with cash of 1,673.2B, dividend sustainability is high. Next fiscal year guidance shows EPS ¥190.35 and interim dividend ¥27; full-year dividend is expected in the ¥54–60 range, maintaining payout ratio around 30–35%. Additional share buyback capacity is retained, giving flexibility in capital policy.
Foreign Exchange Risk: Ordinary income increased +14.9% this year largely due to foreign exchange gains of 77.2B, but next year’s guidance assumes ordinary income ▲9.4% reflecting loss of that FX contribution. Foreign currency translation adjustments of 153.5B also boosted comprehensive income, but a shift to yen appreciation would pressure non-operating results and comprehensive income. Approximately 58% of revenue is export or overseas, with regional mix Americas 15%, Europe 10%, China 16%, Other Asia 13%, so earnings are sensitive to FX in converting local-currency results to yen.
Deterioration in Working Capital Efficiency: CCC is long at 232 days (DSO 102 days, DIO 179 days). Inventory is 864.5B (+58.0B), accounts receivable 1,563.3B (+72.0B), contract liabilities 412.5B (▲75.7B). The decline in contract liabilities indicates recognition of deferred revenue, which may pull forward timing of revenue recognition, but accumulated inventory and receivables are pressuring cash generation. Working capital changes reduced operating CF by ▲167.4B, impairing cash conversion efficiency. Improving inventory turns and credit management are urgent priorities.
Business Concentration Risk: Measurement Instruments account for 65.1% of revenue and 68.6% of segment profit, making the company exposed to demand cycles in semiconductor manufacturing equipment and analytical instruments. Industrial Equipment saw a slight revenue decline of ▲1.1%, and although Aerospace Equipment grew 12.1%, its revenue share is only 7.7%, so swings in Measurement Instruments demand materially affect consolidated performance. Medical Devices has a low margin of 6.6% and limited contribution as a growth driver, so segment concentration affects earnings stability.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 13.1% | 7.8% (4.6%–12.3%) | +5.4pt |
| Net Profit Margin | 9.1% | 5.2% (2.3%–8.2%) | +3.9pt |
Profitability substantially exceeds the manufacturing median, positioning the company as a high-margin leader within the industry.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 4.0% | 3.7% (-0.4%–9.3%) | +0.3pt |
Revenue growth is in line with the industry median, reflecting steady growth.
※Source: Company aggregation
Next fiscal year ordinary income guidance (▲9.4%) incorporates loss of FX contribution and is conservative; on an operating basis management forecasts +3.1% operating income growth, so excluding FX downside the company’s core operating momentum is expected to continue. If SG&A growth is contained and product mix improves, maintaining operating margin is feasible, and growth in core operating profit post-FX normalization will be key to valuation.
Significant room to improve working capital efficiency (CCC 232 days). If inventory and receivables compression proceeds, OCF / Net Income ratio could exceed 1.2x and ROE could recover above 10%. The decline in contract liabilities indicates derecognition of deferred revenue and potential front-loading of revenue recognition; hence order trends and inventory optimization will be catalysts for shareholder value enhancement.
Aerospace Equipment’s high-margin growth (margin 18.9%, profit +35.5%) underpins company margins; sustained defense demand and recovery in aircraft deliveries would further lift margins via improved segment mix. Together with stable contribution from Measurement Instruments, portfolio quality is improving. Financial soundness is very high (Debt/EBITDA 0.01x, cash 1,673B), providing ample room for M&A or additional shareholder returns and expanding strategic options for mid-term value creation.
This report was automatically generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information compiled by the Company based on public financial statements. Investment decisions are your responsibility; please consult a professional advisor as appropriate.