MUTOH HOLDINGS CO.,LTD. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥8.76B
• Operating Income: ¥487M
• Net Income: ¥1.09B
• EPS: ¥45.88

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

For FY2026 Q2, MUTOH Holdings posted revenue of ¥8.76bn, down 1.7% YoY, indicating modest top-line softness amid likely sluggish demand for wide-format printing equipment and related consumables. Gross profit was ¥3.833bn, implying a gross margin of 43.8%, which appears resilient at the gross level despite the slight revenue decline. Operating income fell to ¥487m, down 30.1% YoY, signaling notable operating deleverage as fixed costs and/or SG&A growth outpaced revenue. Ordinary income of ¥426m was below operating income, suggesting a net non-operating loss (e.g., forex or other non-operating items), albeit small relative to operating profits. Net income declined sharply to ¥210m (-79.9% YoY), a much steeper contraction than operating income, indicating the impact of non-operating/extraordinary items and/or a heavier tax burden. Based on net income (¥210m) and income tax expense (¥185m), the implied pre-tax income is approximately ¥395m and the effective tax rate is roughly 46.8%, materially higher than normal levels for many Japanese manufacturers. The DuPont decomposition shows a net margin of 2.40%, asset turnover of 0.294x, and financial leverage of 1.21x, yielding an ROE of about 0.85% for the period—subdued profitability primarily constrained by low margins and modest asset utilization rather than leverage. Liquidity is very strong: current assets of ¥18.6bn versus current liabilities of ¥4.0bn produce a current ratio of 4.66x and a quick ratio of 3.98x, underpinned by significant working capital (¥14.6bn). Solvency is robust as well: total liabilities are only ¥5.35bn against equity of ¥24.64bn, implying a debt-to-equity ratio of roughly 0.22x; the computed equity ratio is approximately 82.8%. Interest expense is minimal at ¥3m with interest coverage of ~162x, highlighting negligible financial risk from borrowings. Inventory stands at ¥2.70bn; relative to H1 cost of sales (¥5.08bn), inventory days are around 96 days, generally reasonable for capital equipment and consumables. Ordinary income below operating income points to some external headwinds (possibly FX or valuation losses), while the very steep drop in net income versus operating income suggests extraordinary charges and/or tax effects. Cash flow statement items were not disclosed in the provided XBRL snapshot (zeros indicate unreported data), limiting free cash flow analysis, and dividend per share was also unreported. Overall, the company exhibits strong balance sheet strength and liquidity, but pressured profitability and elevated tax/extraordinary impacts weigh on ROE and EPS. Near-term priorities likely include sustaining gross margin, tightening SG&A, and managing inventories, while FX and global demand trends for wide-format printers remain key external variables.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 2.40% (¥210m / ¥8,760m)
• asset_turnover: 0.294x (as provided; based on period revenue vs assets)
• financial_leverage: 1.21x (Assets ¥29,749m / Equity ¥24,641m)
• calculated_ROE: 0.85% (matches provided DuPont ROE) margin_quality:
• gross_margin: 43.8% (¥3,833m / ¥8,760m), solid relative to revenue softness
• operating_margin: 5.6% (¥487m / ¥8,760m), down YoY given -30.1% operating income vs -1.7% revenue
• ordinary_margin: 4.9% (¥426m / ¥8,760m), reflecting small non-operating losses
• net_margin: 2.4% (¥210m / ¥8,760m), compressed by non-operating/extraordinary factors and high tax operating_leverage: Revenue declined 1.7% YoY while operating income fell 30.1% YoY, indicating significant operating deleverage—likely from fixed cost absorption and/or higher SG&A. Interest burden is negligible (¥3m), so the profit drop is predominantly operational and below-operating line.

Growth Assessment

revenue_sustainability: Top line contracted modestly (-1.7% YoY), consistent with a cautious demand environment for wide-format printers and consumables. No segment/geographic detail provided limits attribution. profit_quality: Gross margin remained robust, but operating income declined sharply, implying cost pressure or mix headwinds. Ordinary income below operating points to FX/other headwinds. Net income fell much more than operating income, suggesting extraordinary items and/or elevated taxation. outlook: With subdued net margin (2.4%) and low asset turnover (0.294x), near-term profit recovery hinges on SG&A discipline, stable pricing, and demand normalization. FX volatility (JPY) and global capex cycles in signage/industrial printing remain key external drivers. Data gaps on H1 cash flows and order trends temper visibility.

Financial Health

liquidity:

• current_assets: ¥18,607m
• current_liabilities: ¥3,994m
• current_ratio: 4.66x
• quick_ratio: 3.98x
• working_capital: ¥14,613m
• commentary: Ample short-term liquidity provides cushion against earnings volatility and supply chain lead-time variability. solvency:
• total_assets: ¥29,749m
• total_liabilities: ¥5,351m
• total_equity: ¥24,641m
• debt_to_equity: 0.22x
• computed_equity_ratio: 82.8% (Equity/Assets), while the reported equity ratio was unreported in XBRL
• interest_coverage: ≈162x (Operating income ¥487m / Interest expense ¥3m)
• commentary: Low leverage and strong equity base minimize refinancing and covenant risks. capital_structure: Predominantly equity-funded with limited debt; room exists to utilize balance sheet if needed for strategic investments without stressing solvency metrics.

Cash Flow Quality

earnings_quality: OCF was not disclosed in the provided data; hence OCF/Net Income ratio shown as 0.00 reflects unreported, not zero cash flow. Earnings quality cannot be validated via cash conversion this period. free_cash_flow: Not assessable due to unreported OCF and investing CF. Capex and depreciation were also unreported, limiting visibility on maintenance vs growth spend. working_capital: Inventories ¥2,699m vs H1 cost of sales ¥5,079m implies ~96 inventory days; appears reasonable for the product mix. Strong working capital position supports operations, but close monitoring of inventory turns is prudent given softer revenue.

Dividend Sustainability

payout_ratio_assessment: Annual DPS and payout ratio were unreported in the dataset (displayed as 0.00). With net income for H1 at ¥210m and a strong balance sheet, capacity depends on full-year earnings and policy, but cannot be quantified here. FCF_coverage: FCF coverage cannot be evaluated due to unreported cash flows; the 0.00x shown reflects missing data. policy_outlook: Absent disclosed dividend guidance, sustainability hinges on full-year profitability normalization and maintenance of cash-rich balance sheet. Conservative leverage supports flexibility, but no conclusion can be drawn without DPS/FCF data.

Risk Assessment

Business Risks:

• Demand volatility in wide-format printing hardware and consumables across signage and industrial applications
• Pricing pressure and competition from domestic and overseas manufacturers
• FX fluctuations (especially USD/JPY and EUR/JPY) affecting both revenue and COGS
• Supply chain and component cost variability (printheads, chips, inks, logistics)
• Product mix shifts toward lower-margin models or regions
• Channel inventory management and potential order timing effects
• Technology substitution risk (e.g., competing print technologies or digital alternatives)

Financial Risks:

• Earnings sensitivity to SG&A and fixed cost absorption leading to operating deleverage
• Potential extraordinary losses and tax rate volatility impacting bottom line
• Working capital swings (inventory and receivables) affecting cash conversion
• FX translation and transaction impacts on ordinary income

Key Concerns:

• Sharp YoY decline in net income (-79.9%) despite modest revenue dip
• Elevated implied effective tax rate (~46.8%) and possible extraordinary impacts
• Operating deleverage evidenced by -30.1% YoY operating income vs -1.7% revenue

Investment Implications

Key Takeaways:

• Top line slightly down (-1.7% YoY) while operating income dropped 30.1%, indicating cost pressure and operating leverage
• Net income contracted sharply (-79.9% YoY), likely due to extraordinary/tax effects beyond core operations
• Balance sheet is very strong: current ratio 4.66x, equity ratio ~82.8%, debt-to-equity 0.22x
• Interest burden is negligible (coverage ~162x), limiting financial risk
• Gross margin remains healthy at 43.8%, but SG&A/mix pressures compressed operating margin to 5.6%

Metrics to Watch:

• Order intake and backlog for printers and consumables
• Gross margin trajectory and FX-adjusted pricing
• SG&A as a percentage of sales and cost control initiatives
• Inventory turnover and receivables collection (cash conversion cycle)
• Extraordinary items and effective tax rate normalization
• Operating cash flow and capex once disclosed
• Ordinary income vs operating income (FX/non-operating effects)

Relative Positioning: Compared with domestic peers in wide/industrial inkjet (e.g., peer set including Mimaki Engineering and Roland DG), MUTOH exhibits a conservative balance sheet and low financial risk but currently lower ROE and compressed net margins; recovery depends on demand stabilization, mix/pricing discipline, and SG&A control.

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
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis