| Metric | Current Period | Same Period Last Year | YoY |
|---|---|---|---|
| Revenue | ¥77.4B | ¥76.8B | +0.9% |
| Operating Income | ¥-0.9B | ¥-0.3B | - |
| Ordinary Income | ¥-0.9B | ¥-0.3B | - |
| Net Income | ¥-0.6B | ¥-0.0B | -1.7% |
| ROE | -1.1% | -0.1% | - |
In FY2026 Q3, Revenue was ¥77.4B (YoY +¥0.6B +0.9%), a slight increase, but Operating Income was ¥-0.9B (a deterioration of ¥-0.6B from ¥-0.3B in the same period last year), Ordinary Income was ¥-0.9B (a deterioration of ¥-0.6B from ¥-0.3B in the same period last year), and Net Income was ¥-0.6B (a deterioration of ¥-0.6B from ¥-0.0B in the same period last year), expanding the deficit. SG&A of ¥10.9B exceeded Gross Profit of ¥9.99B, the main cause of the operating loss, and interest burden of ¥0.34B also pressured earnings. Earnings per share was -¥2.19, with both profitability and capital efficiency in negative territory.
[Profitability] ROE -1.1% (DuPont decomposition values: Net Profit Margin -0.8% × Total Asset Turnover 0.55x × Financial Leverage 2.42x), Operating Margin -1.2%, Net Profit Margin -0.8%, ROIC -0.8%. The SG&A ratio is 14.1% versus a Gross Margin of 12.9%, resulting in a reversal of profitability. [Cash Quality] Cash and cash equivalents ¥16.7B and Short-term borrowings ¥16.9B, with a cash-to-short-term-debt coverage of 0.99x, indicating limited headroom. Operating Cash Flow (OCF) is undisclosed, but given the operating loss, cash generation is presumed weak. [Investment Efficiency] Total Asset Turnover 0.55x indicates low asset efficiency. Investment securities ¥7.1B (YoY +25.1%) and intangible assets ¥0.3B (YoY +45.9%) expanded, but recovery status is unconfirmed. [Financial Soundness] Equity Ratio 41.4%, Current Ratio 132.8%, Debt-to-Equity Ratio 1.42x, Debt/Capital 40.0%. The short-term debt ratio is 43.5%, indicating a high proportion of short-term debt and refinancing risk. Interest coverage -2.68x, placing interest burden in a non-computable range premised on operating losses.
Although detailed disclosure of Operating Cash Flow is not available, based on Net Income of ¥-0.6B and Operating Income of ¥-0.9B, cash generation from operating activities is presumed limited. Cash and cash equivalents stand at ¥16.7B, remaining flat YoY, while the balance sheet shows Short-term borrowings of ¥16.9B and Long-term borrowings of ¥21.9B, with total interest-bearing debt of ¥38.9B; cash-to-short-term-debt coverage is 0.99x, suggesting thin liquidity. On the investment side, investment securities increased by +¥1.4B YoY, and intangible assets increased by +¥0.1B, indicating a certain scale of cash outflows from investing activities. Including repayment terms for short- and long-term borrowings, financing cash flow is expected to be negatively affected by refinancing and interest payments. Against interest-bearing debt of ¥38.9B, interest burden of ¥0.34B occurred, and interest payments in an operating loss phase structurally strain cash management. The planned dividend of ¥2.0 per share is a cash outflow and requires attention to sustainability under operating losses.
With Ordinary Income at ¥-0.9B and Operating Income at ¥-0.9B, Non-operating income of ¥0.43B and Non-operating expenses of ¥0.39B largely offset each other, resulting in minimal additional gains/losses at the ordinary level. The main component of non-operating income is gains on sale of investment securities of ¥0.27B, which includes a one-off profit factor. Extraordinary gains/losses are minor, with loss on sale of investment securities of ¥0.01B; the difference between Profit Before Tax of ¥-0.89B and Net Income of ¥-0.62B is mainly due to income tax expense of ¥0.27B. With a Gross Margin of 12.9% versus an SG&A ratio of 14.1%, SG&A exceeded gross profit by 1.2 percentage points, resulting in a structurally loss-making operation. Gains on sale of investment securities in non-operating income are one-off items and do not indicate recurring earning power. As Operating Cash Flow is undisclosed, it is difficult to evaluate cash backing of earnings; however, considering operating losses and interest burden, the quality of earnings is low with concerns about sustainability.
[Industry Position] (Reference information, our research) Profitability: Operating Margin of -1.2% is 8.5 percentage points below the industry median of 7.3% (2025 Q3, N=65 companies), indicating an inferior position within the industry. Net Profit Margin of -0.8% is also far below the industry median of 5.4%, highlighting a heavy SG&A burden and insufficient profitability. ROE -1.1% is negative versus the industry median of 4.9%, indicating extremely low capital efficiency. Soundness: Equity Ratio of 41.4% is 22.5 percentage points below the industry median of 63.9%, indicating a high debt ratio. Current Ratio of 132.8% is significantly below the industry median of 267.0% (2.67x), placing short-term liquidity at a lower level within the industry. Debt/Capital of 40.0% is relatively high in the industry, confirming heavy financial leverage. Efficiency: Revenue growth rate of +0.9% is 1.9 percentage points below the industry median of +2.8%, indicating low growth. Return on total assets (ROA-equivalent on a net income basis) of -0.4% is negative versus the industry median of 3.3%, indicating inferior asset efficiency. Overall, the company falls below the industry median across profitability, soundness, and efficiency, indicating a challenging position within the industry. (Industry: Manufacturing, comparison period: 2025 Q3, Source: our aggregation, N=65 companies)
This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information aggregated by us based on public earnings data. Investment decisions are your own responsibility; please consult a professional as needed.