| Metric | This Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥979.8B | ¥911.0B | +7.6% |
| Operating Income / Operating Profit | ¥70.9B | ¥56.6B | +25.4% |
| Ordinary Income | ¥63.5B | ¥51.9B | +22.3% |
| Net Income / Net Profit | ¥-1.1B | ¥22.6B | +493.6% |
| ROE | -0.3% | 6.9% | - |
For the fiscal year ended May 2026, Revenue was ¥979.8B (YoY +¥68.8B +7.6%), Operating Income was ¥70.9B (YoY +¥14.4B +25.4%), and Ordinary Income was ¥63.5B (YoY +¥11.6B +22.3%), showing top-line growth and operating-stage profit expansion. However, recognition of Special Losses of ¥37.7B turned Net Income to ¥-1.1B (prior year ¥22.6B). Operating margin improved by 1.0pt to 7.2% (prior year 6.2%), aided by recovery in utilization rates centered in North America and pricing adjustments. Gross profit margin was 17.3% (prior year 16.5%) and SG&A ratio improved to 10.1% (prior year 10.3%), demonstrating operating leverage. Special Losses totaled ¥37.7B, including ¥1.3B of loss on retirement of fixed assets, and combined with a high effective tax rate of 68.8% materially depressed Net Income.
Revenue was driven by the North America segment at ¥222.9B (+16.4% YoY), which achieved a significant increase in Operating Income to ¥17.3B (+85.7%). Asia reported Revenue of ¥318.9B (+6.0%) and Operating Income of ¥11.2B (+11.9%), while Japan recorded Revenue of ¥368.9B (+3.9%) and Operating Income of ¥45.2B (+17.4%), showing steady performance in core markets. Europe had Revenue of ¥124.2B (+2.6%) with Operating Income of ¥4.7B (-3.3%), a slight decrease. By product, molded products were ¥817.9B and molds ¥161.9B, supported by recovering demand from automotive and ICT equipment. Regional Revenue composition was Japan ¥315.2B, Asia ¥317.4B, North America ¥222.9B, and Europe ¥124.3B.
On the income statement, Cost of Sales was ¥809.9B yielding Gross Profit of ¥169.9B and a gross margin of 17.3% (up +0.8pt from 16.5%), reflecting easing cost pressure. After SG&A of ¥98.9B (10.1% of sales), Operating Income was ¥70.9B (7.2% of sales), a substantial improvement from prior Operating Income of ¥56.6B (6.2%). Non-operating income was ¥2.4B (including interest income ¥0.6B) versus non-operating expenses of ¥9.8B (including interest expense ¥5.3B, foreign exchange loss ¥0.3B), resulting in Ordinary Income of ¥63.5B. Special income was ¥0.3B (including gain on sale of investment securities ¥0.1B) against Special losses of ¥37.7B (including loss on retirement of fixed assets ¥1.3B), compressing Profit before Tax to ¥26.1B. After income taxes of ¥17.9B (effective tax rate 68.8%), Net income attributable to owners of the parent was ¥7.6B and Non-controlling interests ¥0.6B, resulting in consolidated Net Loss of ¥-1.1B, i.e., a year of revenue increase but loss at the bottom line.
The Japan segment recorded Revenue ¥368.9B (+3.9% YoY), Operating Income ¥45.2B (+17.4%), and Operating Margin 12.3%, remaining the largest and most profitable contributor. North America achieved Revenue ¥222.9B (+16.4%), Operating Income ¥17.3B (+85.7%), and Operating Margin 7.8%, with improved utilization driving large profit expansion and advancing monetization of North American operations. Asia reported Revenue ¥318.9B (+6.0%), Operating Income ¥11.2B (+11.9%), and Operating Margin 3.5%—revenue and profit growth but low margin. Europe had Revenue ¥124.2B (+2.6%), Operating Income ¥4.7B (-3.3%), and Operating Margin 3.8%, with recovery of profit levels remaining a challenge. Sum of segment profits was ¥78.5B, less corporate adjustments of ¥7.6B, yielding consolidated Operating Income of ¥70.9B.
Profitability: Operating margin of 7.2% improved 1.0pt from 6.2% prior year, supported by gross margin 17.3% (prior year 16.5%) and SG&A ratio 10.1% (prior year 10.3%). ROE was -0.3% due to the net loss, but operating and ordinary-stage earnings power show recovery. ROA (ordinary income basis) improved to 7.7% from 6.9%, indicating better efficiency of operating assets. Cash quality: Operating Cash Flow (OCF) was ¥84.1B (YoY -1.8%), representing 11.1x relative to Net Income ¥-1.1B, including non-cash expenses such as Depreciation ¥43.2B. OCF/EBITDA ratio was 0.74x, reflecting heavier working capital. Investment efficiency: Total asset turnover was 1.11x, Days Sales Outstanding 68 days, Inventory Days 11 days. Capital expenditures totaled ¥62.5B, 1.45x of Depreciation ¥43.2B, indicating ongoing production capacity expansion. Financial soundness: Equity Ratio 40.1% (prior year 43.1%), Net D/E ratio 0.09x, with interest-bearing debt ¥182.0B and cash ¥149.6B producing net interest-bearing debt ¥32.4B at a low level. Debt/EBITDA was 1.60x and interest coverage 13.5x (Operating Income / Interest Expense), indicating good financial resilience. Current Ratio 149.4% and Quick Ratio 141.5% show sufficient short-term liquidity.
Operating CF was ¥84.1B (YoY -1.8%). From operating CF subtotal ¥101.2B, increases in trade receivables -¥11.1B, inventory increases -¥2.4B, and decrease in trade payables -¥6.4B produced working capital outflow of ¥17.1B. After corporate tax payments of ¥12.5B, OCF remained solid, but OCF/EBITDA ratio 0.74x indicates room to improve working capital efficiency. Investing CF was -¥64.8B, centered on capital expenditures of ¥62.5B, expanding production capacity at roughly 1.45x depreciation. Financing CF was a small inflow of ¥2.4B, where increases in long-term borrowings funded repayment of short-term loans and dividends ¥8.5B (of which dividends to owners of the parent ¥7.3B). Free Cash Flow was positive at ¥19.3B (Operating CF ¥84.1B - Investing CF ¥64.8B), and cash balance rose to ¥149.6B at year-end (up ¥29.3B from ¥120.3B). Movements in working capital were driven by Days Sales Outstanding 68 days, inventory buildup (Inventories ¥24.7B, prior year ¥17.7B), and decline in trade payables; improving the cash conversion cycle remains a future challenge.
Ordinary Income ¥63.5B reflects recurring earnings power at the operating stage. However, Special Losses ¥37.7B materially reduced Net Income; breakdown includes ¥1.3B loss on retirement of fixed assets. Non-operating income ¥2.4B (0.2% of sales) is minor, while non-operating expenses ¥9.8B are led by interest expense ¥5.3B (1.0% of sales). Composition of non-operating items shows no anomalies, and the earnings structure depends on core operations. Operating CF ¥84.1B is 11.1x Net Income ¥-1.1B, indicating high-quality cash generation including non-cash charges like Depreciation ¥43.2B. The gap between Ordinary Income and Net Income is due to Special Losses and an abnormally high effective tax rate of 68.8%, suggesting these are largely one-off factors. Comprehensive income was ¥34.8B, with foreign currency translation adjustments ¥20.3B and retirement benefit adjustments ¥6.4B adding to Net Income, so total value creation remained positive.
Full Year plan calls for Revenue ¥1,050B (YoY +7.2%), Operating Income ¥79B (YoY +11.4%), Ordinary Income ¥71B (YoY +11.8%), and Net Income ¥45B. Current-period results compare to plan with Revenue ¥979.8B (progress 93.3%), Operating Income ¥70.9B (progress 89.8%), Ordinary Income ¥63.5B (progress 89.5%), and Net Income ¥-1.1B (negative progress). Achievement rates for operating and ordinary stages are around 90% and trending with the plan. The large shortfall in Net Income is due to Special Losses ¥37.7B in the period; assuming this one-off factor drops out under full-year assumptions, achieving Net Income ¥45B is plausible. EPS forecast ¥147.61 vs. current-period EPS ¥24.87; assuming exclusion of special losses and tax normalization, the plan range is reasonable. Dividend forecast is ¥16 per annum (current-period payout ¥28), reflecting normalization of payout ratio to a 20–40% range. Continued momentum in North America and improvement in working capital efficiency are key to achieving full-year targets.
Annual dividend was ¥28 (interim ¥14, year-end ¥14), with total dividend payout ¥7.31B. Dividend payout ratio relative to Net income attributable to owners of the parent ¥7.58B is approximately 96%, a high level, but Free Cash Flow coverage of dividends is 2.25x on Free Cash Flow ¥19.3B, indicating adequate capacity to pay this year’s dividend. Next fiscal year dividend forecast is ¥16; assuming Net Income ¥45B plan, the payout ratio would normalize to about 30%. There were no share buybacks; shareholder returns are dividend-only. Total returns are dividend-centric, balancing investment priority and financial stability while aiming for a sustainable dividend policy once profits recover.
Risk of persistently low gross margins: Although gross margin improved to 17.3% from 16.5%, it remains below 20%, making profitability vulnerable to raw material and energy cost increases and pricing competition. Work-in-progress ratio 42.3% (WIP ¥3.57B / Inventories ¥8.41B) is high, and production bottlenecks or process inefficiencies could delay gross margin recovery.
Risk of deteriorating working capital efficiency: Days Sales Outstanding 68 days, inventory increases (+39.3% YoY), and decreases in trade payables led to ¥17.1B working capital outflow. OCF/EBITDA ratio 0.74x is below industry benchmark 0.9x; demand variability or supply chain disruptions could worsen inventory and collection efficiency and squeeze cash generation.
Risk from special losses and tax rate volatility: This period included Special Losses ¥37.7B and an abnormally high effective tax rate of 68.8%, greatly compressing Net Income. Future fixed-asset-related special losses or temporary tax-effect timing differences could keep Net Income volatile. To maintain credibility of financial guidance, improving transparency on non-recurring items and stabilizing tax rates is required.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 7.2% | 7.8% (4.6%–12.3%) | -0.5pt |
| Net Profit Margin | -0.1% | 5.2% (2.3%–8.2%) | -5.3pt |
Operating margin at 7.2% is 0.5pt below the industry median 7.8%, indicating slightly weaker operating-stage profitability within the industry. Net profit margin is -0.1% due to special losses, substantially below the industry median 5.2%, with one-off factors heavily depressing the company’s industry standing.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 7.6% | 3.7% (-0.4%–9.3%) | +3.9pt |
Revenue growth of 7.6% exceeds the industry median 3.7% by 3.9pt, placing the company among the higher-growth peers. Growth is driven by increases centered in North America.
※Source: Company compilation
Operating-stage earnings power shows steady improvement with Operating Margin 7.2% (prior year 6.2%) and North America operating income +85.7% reflecting recovery in utilization and cost improvements. The fiscal results are discontinuous due to Special Losses ¥37.7B and effective tax rate 68.8% that distorted Net Income; next fiscal year should see a strong rebound in Net Income as these one-off items fall away and tax rates normalize. The Net Income guidance ¥45B is within a reasonable range, and structural recovery in operating capability is confirmed.
Cash generation was solid with Operating CF ¥84.1B and Free CF ¥19.3B, funding capital expenditures ¥62.5B and dividends ¥7.3B while increasing cash balances. With interest-bearing debt ¥182.0B and cash ¥149.6B, and Debt/EBITDA 1.60x, financial resilience is good. However, there is significant room to improve working capital efficiency (DSO 68 days, WIP ratio 42.3%), and improving OCF/EBITDA from 0.74x is key to enhancing cash conversion next fiscal year. Monitor progress on inventory optimization and collection improvements.
This report was automatically generated by AI analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company from publicly available financial statements. Investment decisions should be made at your own responsibility and, if necessary, after consulting a professional adviser.