| Metric | Current Period | Same Period Last Year | YoY |
|---|---|---|---|
| Revenue | ¥209.5B | ¥295.8B | -29.2% |
| Operating Income | ¥59.5B | ¥48.5B | +22.7% |
| Ordinary Income | ¥59.7B | ¥48.9B | +21.9% |
| Net Income | ¥39.0B | ¥32.5B | +18.5% |
| ROE | 8.7% | 7.7% | - |
FY2026 Q3 results were Revenue of ¥209.5B (YoY -¥86.3B -29.2%), Operating Income of ¥59.5B (YoY +¥11.0B +22.7%), Ordinary Income of ¥59.7B (YoY +¥10.8B +21.9%), and Net Income attributable to owners of the parent of ¥39.0B (YoY +¥6.5B +20.1%). While Revenue declined significantly from the prior year, the Operating Margin improved substantially to 28.4% (up +12.0pt from 16.4% in the prior year), marking progress toward a higher-margin structure. By segment, the Hotel Business posted Revenue of ¥95.4B and Operating Income of ¥40.4B; the Sports Club Business posted Revenue of ¥93.9B and Operating Income of ¥11.7B; and the Leasing Business posted Revenue of ¥20.6B and Operating Income of ¥7.4B, with the Hotel Business driving overall profitability. The full-year outlook calls for Revenue of ¥272.0B (FY YoY -23.6%), Operating Income of ¥70.0B (FY YoY +18.9%), and Net Income of ¥30.0B (FY YoY +17.9%), continuing to assume a decreasing revenue, increasing profit trend.
[Profitability] ROE of 6.1% improved from the prior year but slightly trails the industry median of 6.5%. The Operating Margin of 28.4% far exceeds the industry median of 7.1%, at the highest level in the past five periods. The Net Margin of 18.6% also significantly exceeds the industry median of 5.3%, reflecting a highly profitable structure. Gross Margin is 34.6%. [Cash Quality] Cash and Deposits are ¥218.4B, providing 30.3x coverage of Short-Term Borrowings of ¥7.2B. [Investment Efficiency] Total Asset Turnover of 0.29x is well below the industry median of 0.81x, reflecting a capital-intensive business profile. [Financial Soundness] Equity Ratio is 52.0% (industry median 57.1%), Current Ratio is 188.0% (slightly below the industry median of 2.30x = 230%), Interest-bearing Debt is ¥91.8B, and Net Debt is -¥126.6B, indicating a virtually debt-free position. Financial Leverage of 1.62x is below the industry median of 1.72x, a conservative level. Interest Coverage is 58.7x, indicating ample interest-paying capacity.
Cash and Deposits increased by ¥9.2B YoY to ¥218.4B, and profit growth at the operating level is estimated to have contributed to cash accumulation. In working capital efficiency, Working Capital stands at ¥108.8B, with Accounts Receivable of ¥24.2B (up +¥2.8B from ¥21.4B in the prior year) and Inventories at a small ¥0.05B, indicating effective management of Accounts Payable and Accrued Expenses. Fixed Assets total ¥491.5B, accounting for 67.9% of Total Assets, maintaining a capital-intensive structure grounded in real estate and equipment. Against Short-Term Borrowings of ¥7.2B and Long-Term Borrowings of ¥84.6B, cash coverage is 2.4x, securing liquidity. Treasury Shares expanded from -¥0.08B in the prior year to -¥9.8B, suggesting share repurchases during the period. Despite declining sales, improved margins are estimated to have strengthened cash generation; however, in the absence of detailed Operating Cash Flow data, quantitative verification of the cash backing of profits is limited.
With Ordinary Income at ¥59.7B versus Operating Income at ¥59.5B, net non-operating gains were approximately ¥0.2B, indicating earnings are generated largely on an operating basis. Non-operating income is presumed to consist mainly of financial income such as interest and dividends received, and after deducting non-operating expenses of ¥1.6B (including interest expense of ¥1.0B), the net amount is small. Extraordinary Gains of ¥1.2B (including Gain on Sales of Fixed Assets of ¥0.4B) and Extraordinary Losses of ¥0.2B were recorded, and of the Profit before income taxes of ¥60.7B, about ¥1.0B is attributable to one-off factors; however, earnings are primarily driven by ordinary activities. The improvement in Operating Margin amid a significant Revenue decline appears to reflect a shift to higher-margin businesses and fixed-cost containment, with SG&A Expenses at ¥13.0B held down from the prior year. The Tax Burden Coefficient of 0.448 and the Effective Tax Rate of 35.8% indicate a high tax burden suppressing Net Income, affecting the quality of after-tax earnings. While earnings power at the ordinary level is solid, the persistence of sales declines and room for improvement in the tax burden are key monitoring points.
[Position within Industry] (Reference information, our research) Profitability: The Operating Margin of 28.4% significantly exceeds the industry median of 7.1% (IQR 2.9%–10.5%), placing the company in a high-profitability model within the industry. The Net Margin of 18.6% also significantly exceeds the industry median of 5.3%. Meanwhile, ROE of 6.1% slightly trails the industry median of 6.5%, indicating that high margins have not fully translated into shareholder capital efficiency. Soundness: The Equity Ratio of 52.0% is slightly below the industry median of 57.1%, but with Net Debt of -¥126.6B the company is effectively debt-free, and Financial Leverage of 1.62x is below the industry median of 1.72x, a conservative level. The Current Ratio of 188.0% is slightly below the industry median of 230% (2.30x), but cash coverage is ample. Efficiency: Total Asset Turnover of 0.29x is far below the industry median of 0.81x, reflecting a fixed asset–intensive business profile. Revenue growth rate of -29.2% is well below the industry median of +9.1%, indicating a revenue contraction phase within the industry. Industry: Healthcare (N=56 companies), Comparison: 2025 Q3, Source: Our aggregation
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 our firm based on publicly available financial statements. Investment decisions are your own responsibility; consult a professional as necessary before making any decisions.