These are mechanically computed values based on a residual income model. They are not a forecast of market prices or a recommendation of any investment action, and do not predict or guarantee future share prices. Historical values are computed retrospectively using current guidance-achievement statistics.
| Metric | Current Period | Previous Year Period | YoY |
|---|---|---|---|
| Revenue | ¥372.95B | ¥366.14B | +1.9% |
| Operating Income | ¥27.88B | ¥22.98B | +21.3% |
| Ordinary Income | ¥35.27B | ¥28.23B | +25.0% |
| Net Income | ¥25.98B | ¥45.81B | -43.3% |
| ROE | 2.0% | 3.6% | - |
The Company reported higher revenue and operating income, confirming improved profitability in its core businesses; however, net income declined significantly due to the absence of extraordinary gains recorded in the previous year. Revenue was ¥372.95B (+1.9% YoY), Operating Income was ¥27.88B (+21.3%), and Ordinary Income was ¥35.27B (+25.0%), while Net Income was ¥25.98B (-43.3%) and Net Income Attributable to Owners of the Parent was ¥23.58B (-48.0%). The primary reason for the decline in net income was the reversal of the previous year's ¥37.29B gain on the sale of investment securities. Earnings power at the operating level continued to improve steadily due to an enhanced gross margin and control of selling, general and administrative expenses.
【Revenue】Revenue was ¥372.95B, representing a 1.9% YoY increase. By segment, Electronics led company-wide growth with revenue of ¥71.33B (+12.4%), while LifeAndHealthcare posted a modest increase in revenue to ¥127.73B (+0.5%). Meanwhile, SmartCommunication recorded a decline in revenue to ¥173.97B (-1.4%), indicating the impact of slowing demand.
【Profit and Loss】Operating Income was ¥27.88B (+21.3%), and the Operating Income margin improved to 7.5% from the previous year. The gross margin improved to 25.8%, while the SG&A ratio was 18.3%, indicating the contribution of cost management. By segment, Electronics secured high profitability with segment profit of ¥17.90B (+28.2%, profit margin 25.1%), while LifeAndHealthcare also expanded to ¥11.58B (+21.8%). In contrast, SmartCommunication declined to ¥5.18B (-13.9%, profit margin 3.0%). Ordinary Income increased to ¥35.27B (+25.0%), but Net Income contracted to ¥25.98B (-43.3%) due to the reversal of extraordinary gains. Overall, the results can be assessed as higher revenue and higher profit, although Net Income was affected by temporary factors.
Electronics recorded revenue of ¥71.33B (+12.4% YoY), Operating Income of ¥17.90B (+28.2%), and a profit margin of 25.1%, demonstrating the highest profitability among the three segments and leading the increase in company-wide Operating Income. LifeAndHealthcare posted revenue of ¥127.73B (+0.5%), Operating Income of ¥11.58B (+21.8%), and an improved profit margin of 9.1%; although revenue growth was limited, margin improvement progressed. SmartCommunication recorded revenue of ¥173.97B (-1.4%), Operating Income of ¥5.18B (-13.9%), and a profit margin of 3.0%, making it the only segment among the three to report both lower revenue and lower profit. SmartCommunication accounted for the largest share of revenue at approximately 46.7%, but Electronics made the largest contribution to segment profit, indicating a widening profitability gap among segments.
【Profitability】The Operating Income margin was 7.5%, improving from 6.3% in the previous year, while the gross margin also increased to 25.8%. In contrast, the Net Income margin remained at 6.3% (6.3% based on Net Income Attributable to Owners of the Parent), representing a significant decline from 12.5% in the previous year; this is an apparent decline caused by the reversal of extraordinary gains recorded in the previous year. 【Investment Efficiency】ROE was low at 2.0% (Company-disclosed figure), and improvements at the operating level have not yet been fully reflected in capital efficiency. 【Financial Soundness】The Equity Ratio remained high at 62.9%, with Total Assets of ¥2,080.18B and Net Assets of ¥1,307.88B, indicating a strong capital base. Interest-bearing debt consisted of ¥2.30B in long-term borrowings and ¥200.00B in bonds, while Cash and Deposits stood at ¥268.45B, placing the Company in a near-net-cash position. 【Cash Flow Quality】Accounts receivable and notes receivable amounted to ¥322.14B, while Inventories were ¥92.01B. Working capital represents a substantial portion of current assets and requires monitoring from a fund-efficiency perspective.
Although detailed disclosures for the Statement of Cash Flows are unavailable, funding trends can be inferred from changes in the balance sheet. Cash and Deposits declined to ¥268.45B from ¥298.14B in the previous year. The increase in treasury stock to ¥23.32B and the reduction in short-term borrowings (¥24.46B, -25.8% YoY) can be observed as uses of funds. Property, plant and equipment increased slightly from the previous year to ¥422.78B, indicating ongoing capital investment. Investment securities increased to ¥421.83B, suggesting active investment activity in terms of asset holdings. Overall, the Company appears to be allocating funds generated from its businesses to share repurchases, debt reduction, and additional investment securities purchases.
Recurring earnings power is centered on Operating Income of ¥27.88B, while temporary items—Extraordinary Income of ¥4.45B (including a ¥4.45B gain on the sale of fixed assets) and Extraordinary Losses of ¥1.05B—had a limited impact on Net Income. The previous year included a large one-time gain of ¥37.29B on the sale of investment securities, which boosted Net Income; accordingly, the decline in Net Income this period was caused by this reversal. Non-operating income was ¥9.06B, or approximately 2.4% of Revenue, and was not significant. Its composition was relatively stable, including ¥5.22B in equity-method investment income. The gap between Ordinary Income of ¥35.27B and Net Income of ¥25.98B was attributable to income taxes and other taxes of ¥12.69B (equivalent to an effective tax rate of 32.8%), with no unusual factors observed from a tax-burden perspective. Comprehensive Income was ¥57.83B, substantially exceeding Net Income of ¥25.98B, primarily due to a ¥33.88B increase in valuation differences on securities. This indicates that, on a standalone Net Income basis, the increase in asset value resulting from improved market conditions for investment securities has not been fully reflected.
Progress against the full-year earnings forecast was 24.4% for Revenue, 25.8% for Operating Income, and 28.4% for Ordinary Income, indicating that quarterly progress was generally in line with, or slightly ahead of, plan. The full-year outlook is Revenue of ¥153.00B (+1.2%), Operating Income of ¥10.80B (+6.9%), and Ordinary Income of ¥12.40B (+4.0%). As of the current quarter, there were no revisions to the earnings forecast or dividend forecast. Ordinary Income progress slightly exceeded that of Operating Income, likely due to stable contributions from equity-method investment income and non-operating income.
The full-year dividend forecast is ¥41.00 per share, representing an expected increase from the previous year's dividend of ¥18.00 (reference value before the combined interim and year-end dividends). The Payout Ratio against forecast EPS of ¥224.45 is approximately 18.3%, remaining at a conservative level. Given the financial base of Cash and Deposits of ¥268.45B and an Equity Ratio of 62.9%, there appear to be no significant constraints on securing funds for dividends. Treasury stock increased to ¥23.32B, indicating a shareholder-return policy that extends beyond dividends.
Segment profitability gap: SmartCommunication's Operating Income was ¥5.18B (-13.9% YoY), with a profit margin of 3.0%, lower than those of the other segments and a factor weighing on the company-wide profit margin.
Market sensitivity of investment securities: Investment securities amounted to ¥421.83B, representing approximately 20.3% of Total Assets. As indicated by fluctuations in valuation differences on securities of ¥33.88B within Comprehensive Income, the asset composition is susceptible to stock-market conditions and interest-rate trends.
Net Income volatility: Depending on the presence or absence of temporary gains and losses, such as the ¥37.29B gain on the sale of investment securities recorded in the previous year, Net Income is structurally prone to diverging from Ordinary Income (¥35.27B versus ¥25.98B).
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Income Margin | 7.5% | 8.7% (4.2%–14.2%) | -1.2pt |
| Net Income Margin | 7.0% | 7.0% (3.2%–10.6%) | -0.1pt |
The Company's Operating Income margin is slightly below the industry median, while its Net Income margin is approximately in line with the industry median.
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 1.9% | 6.2% (-1.1%–14.6%) | -4.3pt |
The Revenue growth rate is 4.3pt below the industry median, indicating a relatively moderate pace of revenue growth within the industry.
※Source: Compiled by the Company
Core business profitability improved, with the Operating Income margin rising to 7.5% from 6.3% in the previous year, led by the expansion of high profitability in the Electronics segment, which had a profit margin of 25.1%. The significant decline in Net Income was caused by the reversal of extraordinary gains recorded in the previous year, which should be distinguished when assessing underlying operating performance.
The profitability gap among segments has widened, with SmartCommunication's profit margin of 3.0% and 13.9% YoY decline in profit weighing on the company-wide profit margin. The segment's profitability improvement trend will be a key focus in assessing the future earnings structure.
Full-year progress was generally in line with plan, at 24.4% for Revenue, 25.8% for Operating Income, and 28.4% for Ordinary Income, with no revisions to either the earnings forecast or dividend forecast. The Equity Ratio of 62.9% and near-net-cash financial structure merit ongoing monitoring from the perspective of shareholder returns and investment capacity.
This is a mechanically calculated reference range based solely on publicly disclosed data using a residual income model (Ohlson-type model with an explicit 5-year fade period). It is not a forecast of the market share price or a recommendation of any specific investment action.
| Scenario | Theoretical Share Price |
|---|---|
| bear (bearish) | ¥2,844 |
| base (base case) | ¥2,909 |
| bull (bullish) | ¥2,976 |
| Calculation Assumption | Value |
|---|---|
| Book Value Per Share (BPS) | ¥3,050 |
| Adjusted Forecast EPS | ¥233.8 |
| Cost of Equity r | 9.27% (10-year Japanese government bond 2.77% + equity risk premium 6.00% + size premium 0.50%) |
| Residual Income Persistence Factor ω / Explicit Forecast Period | 0.62 / 5 years |
| Assumed Payout Ratio | 18.3% |
| Forecast EPS Confidence Adjustment | ×1.042 (based on the Company's historical track record of achieving its guidance) |
| Implied PBR / PER |
Sensitivity: ¥2,827–¥2,996 at ±1% for the cost of equity, and ¥2,904–¥2,913 at ±0.1 for ω.
Notes:
(Model used: Residual Income Model / Interest Rate Reference Month: 2026-07 / This value does not predict or guarantee the future share price)
This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It does not recommend investment in any specific security. The industry benchmarks are reference information compiled by the Company based on publicly disclosed earnings data. Investment decisions should be made at your own responsibility, and you should consult a professional advisor as necessary.
---End of Report---
| 0.95x / 12.4x |