| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1160.8B | ¥1031.7B | +12.5% |
| Operating Income / Operating Profit | ¥253.6B | ¥212.8B | +19.2% |
| Ordinary Income | ¥233.0B | ¥204.5B | +13.9% |
| Net Income / Net Profit | ¥123.3B | ¥108.2B | +13.9% |
| ROE | 10.2% | 10.2% | - |
For FY2026 ending March 2026, Revenue was ¥1,160.8B (YoY +¥129.1B +12.5%), Operating Income was ¥253.6B (YoY +¥40.8B +19.2%), Ordinary Income was ¥233.0B (YoY +¥28.5B +13.9%), and Net Income attributable to owners of the parent was ¥123.3B (YoY +¥15.1B +13.9%), with all four metrics achieving double-digit growth. The core Real Estate Regeneration Business (Real Estate Revitalization Business) accounted for 65.8% of revenue, and the Real Estate Services Business grew strongly at +30.6% YoY, improving company-wide margins. Operating margin rose to 21.8% (from 20.6% in the prior year, +1.2pt), and gross margin expanded to 32.8% (from 31.2% in the prior year, +1.6pt). Conversely, Operating Cash Flow (OCF) swung to a large negative of -¥187.4B (from -¥77.4B previously, -342.3%) primarily due to inventory build-up of properties for sale and similar assets (-¥404.4B), delaying the conversion of profit into cash.
[Revenue] Revenue expanded steadily to ¥1,160.8B (YoY +12.5%). By segment, the Real Estate Regeneration Business recorded ¥764.3B (+7.1%), representing 65.8% of the total; the Real Estate Services Business posted ¥163.1B (+30.6%), rising to a 14.1% composition. The Hotel & Tourism Business was ¥189.5B (+0.6%), roughly flat, while Other segments (overseas development, construction, etc.) surged to ¥58.7B (+194.8%). Gross profit was ¥381.1B (¥322.2B prior year) and gross margin improved to 32.8% (from 31.2%, +1.6pt), driven by a favorable mix of high-margin projects in Real Estate Regeneration and growth in fee-based services.
[Profitability] Operating Income was ¥253.6B (YoY +19.2%), with an operating margin improving to 21.8% (from 20.6%, +1.2pt). Selling, General and Administrative Expenses (SG&A) were ¥127.6B (¥109.4B prior year), with an SG&A ratio of 11.0% (from 10.6%, +0.4pt), a slight increase, but margin improvement from gross profit outweighed this, improving operating-stage profitability. Goodwill amortization doubled to ¥4.6B (from ¥2.5B) but had limited overall impact. Ordinary Income was ¥233.0B (YoY +13.9%), with non-operating expenses of ¥23.6B (including interest expense of ¥15.2B) increasing YoY, causing ordinary-stage growth to lag operating income. Interest expense rose +67.4% from ¥9.1B to ¥15.2B, reflecting higher debt-related costs. Extraordinary income/loss was a net +¥4.3B (extraordinary income ¥5.8B, extraordinary losses ¥1.4B), modest in size, resulting in profit before tax of ¥42.3B (¥31.8B prior year). Corporate taxes and other were ¥69.3B (¥64.0B prior year), keeping the effective tax rate relatively high, but Net Income attributable to owners of the parent settled at ¥123.3B (YoY +13.9%). In conclusion, revenue and profit increased and profitability maintained an improving trend.
Segment profit (on an ordinary income basis) was led by the Real Estate Regeneration Business at ¥221.5B (¥201.0B prior year, +10.2%), with a high segment profit margin of 29.0% maintained. The Real Estate Services Business posted ¥87.0B (¥61.1B prior year, +42.4%), a large profit increase, raising its margin to 53.4%, supported by expansion of fee businesses such as property management, brokerage, and maintenance. The Hotel & Tourism Business declined slightly to ¥38.2B (¥40.7B prior year, -6.3%), with a segment margin of 20.1%, relatively low and sensitive to demand fluctuations. Other segments recorded ¥11.8B (¥4.4B prior year, +170.5%), but after allocation of corporate overheads of -¥125.5B (¥-102.8B prior year), consolidated Ordinary Income arrived at ¥233.0B. Concentration in Real Estate Regeneration (65.8% revenue composition) provides a base for earnings stability but also increases sensitivity to market fluctuations.
[Profitability] Operating margin improved to 21.8% (from 20.6%), and Net margin remained around 10.6% (from 10.5%). ROE was 10.2%, driven by a decomposition of Net margin 10.6%, Asset Turnover 0.44x, and Financial Leverage 2.20x, indicating profitability improvements. The expansion of gross margin to 32.8% (from 31.2%, +1.6pt) is attributable to higher profitability in the Real Estate Services Business and better project mix in Real Estate Regeneration. [Cash Quality] Operating CF / Net Income was -1.52x, a substantial negative, indicating weak cash backing of reported profits. The accrual ratio was -12.9%, suggesting profit growth is being supported by inventory build-up (properties for sale, etc.). OCF/EBITDA was -0.65x, showing weak cash generation even on an EBITDA basis. [Investment Efficiency] Asset Turnover declined to 0.44x (from 0.47x) as inventory increases and asset growth weighed on efficiency. A ROIC-equivalent metric (EBIT ÷ (Equity + estimated interest-bearing debt)) is estimated at around 10%, exceeding estimated capital costs. [Financial Soundness] Equity Ratio stood at 45.5% (from 48.5%), a slight decline but still moderate. Debt-to-equity multiple was 1.20x, within acceptable range, and EBITDA Interest Coverage was robust at 16.9x (EBITDA ¥253.6B + Depreciation & Amortization ¥34.6B = ¥288.2B ÷ Interest Paid ¥17.3B), indicating strong interest-paying capacity.
Operating Cash Flow (OCF) turned sharply negative to -¥187.4B (¥-77.4B prior year). Pre-working-capital OCF subtotal was -¥90.2B, with an inventory increase of -¥404.4B as the largest contributor, reflecting build-up of properties for sale and projects under development that absorbed cash. Increases in trade payables of ¥9.7B and trade receivables change of -¥0.7B were minor. Corporate tax payments of -¥83.9B, interest payments of -¥14.6B, and lease payments of -¥18.8B also pressured OCF. Investing Cash Flow was -¥102.3B (¥-88.1B prior year), with capital expenditures of -¥40.9B, intangible asset acquisitions of -¥17.8B, and acquisitions of subsidiary shares of -¥28.0B as main outflows, reflecting continued growth investment. Free Cash Flow was -¥289.6B (¥-165.5B prior year), a large negative, and dividend payments of -¥3.2B and share buybacks of -¥13.0B could not be covered by internal cash flows and were financed through financing activities. Financing Cash Flow was +¥228.4B (¥+94.8B prior year), with long-term borrowings procured of ¥633.5B, net decrease in short-term borrowings of -¥46.6B, and long-term borrowings repayments of -¥346.2B, resulting in net fundraising. Cash and cash equivalents totaled ¥81.0B, an increase of ¥37.6B YoY, but excluding FX effects of ¥0.9B the substantive increase was due to external financing. The inventory build-up is expected to fund future sales; if disposals progress smoothly, OCF should improve, but risks of sales delays remain.
The bulk of Ordinary Income of ¥233.0B derives from Operating Income of ¥253.6B, indicating earnings are primarily driven by core operations. Extraordinary items were modest at net +¥4.3B (extraordinary gains ¥5.8B such as gains on sale of fixed assets ¥1.1B, minus extraordinary losses ¥1.4B including disposal losses on fixed assets ¥0.4B and impairment losses on investment securities ¥1.0B), so one-off impacts are limited. Non-operating income was ¥3.0B and non-operating expenses were ¥23.6B, with interest expense ¥15.2B the main cost item, showing recurring costs associated with debt financing. Total comprehensive income was ¥164.8B (owners of the parent ¥162.7B); relative to Net Income ¥123.3B, other comprehensive income items such as foreign currency translation adjustments ¥2.5B and valuation differences on available-for-sale securities ¥0.0B added ¥2.6B, resulting in only a small divergence from Net Income. OCF/Net Income of -1.52x, accrual ratio -12.9%, and OCF/EBITDA -0.65x indicate weak cash backing for reported profits, primarily due to working capital absorption from inventory increases, warranting cautious assessment of earnings quality. Interest burden is ¥15.2B, equivalent to 6.0% of Operating Income ¥253.6B; in a rising interest rate environment, profit compression risk could become more material.
The FY2027 March 2027 guidance projects Revenue ¥1,300.0B (YoY +12.0%), Operating Income ¥281.5B (YoY +11.0%), Ordinary Income ¥260.0B (YoY +11.6%), and Net Income attributable to owners of the parent ¥174.0B (YoY +41.2%), indicating plans for higher revenue and profit. The inventory build-up at period-end (increase in inventory -¥404.4B) is expected to fund next-period sales; progress in disposals within Real Estate Regeneration will be key to achieving guidance. EPS forecast is ¥304.27 (from ¥327.76 this period, -7.2%), based on an average shares outstanding of 57,185 thousand shares during the period (up from 48,773 thousand shares this period), reflecting assumptions that incorporate share buybacks and changes in shares outstanding. Dividend forecast is ¥40 per year, implying a projected payout ratio of 13.1%, a conservative level. Overcoming the negative OCF and successfully converting inventory into cash receipts will be critical to achieving the plan.
Annual dividend is ¥76 (interim ¥38, year-end ¥38), with a payout ratio of 23.2% (based on EPS ¥327.76), indicating sufficient capacity for shareholder return relative to earnings. Total dividend payments were ¥3.2B (cash flow statement basis), and total shareholder returns including share buybacks of ¥13.0B amounted to ¥16.2B, yielding a Total Return Ratio of 13.1%, a conservative level. Free Cash Flow was -¥289.6B, a large negative, so dividends and buybacks were effectively funded by external financing (Financing CF +¥228.4B). Cash and cash equivalents of ¥81.0B provide a degree of liquidity, but sustaining return policies requires a recovery to positive OCF and normalization of inventory turnover. The payout ratio of 23.2% leaves room for growth investment, and the FY2027 dividend forecast of ¥40 (forecast payout ratio 13.1%) follows the same conservative policy.
Risk of sales delays associated with inventory build-up: The inventory increase of -¥404.4B heavily pressured OCF, yielding OCF/Net Income of -1.52x and weak cash conversion. If sales of properties for sale do not proceed as planned, liquidity tightening and impairment risk could materialize. Prolonged inventory turnover days have already manifested as a decline in Asset Turnover to 0.44x (from 0.47x), posing downside risk to next-period revenue and profit plans.
Increased interest payment burden and margin compression in a rising interest rate environment: Interest expense of ¥15.2B rose +67.4% YoY from ¥9.1B, reaching about 6.0% of Operating Income. With a debt-to-equity multiple of 1.20x and rising dependence on interest-bearing debt, rate increases will directly compress profits. If acquisition prices for real estate rise alongside borrowing costs, maintaining a gross margin of 32.8% will become challenging, increasing downside risk to profitability. Although interest coverage is currently strong at 16.9x, rapid deterioration is possible depending on rate movements.
High sensitivity to market fluctuations due to concentration in the core business: With the Real Estate Regeneration Business accounting for 65.8% of revenue and segment profit of ¥221.5B, office and commercial real estate market fluctuations and delays in sales timing directly affect performance. The Hotel & Tourism Business, with a margin of 20.1%, has relatively low profitability and is exposed to demand volatility; the Real Estate Services Business has more stable fee-based revenues but is limited in scale. Limited portfolio diversification means earnings volatility can increase significantly in adverse economic cycles or deteriorating supply-demand conditions.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 21.8% | 10.7% (6.8%–17.9%) | +11.2pt |
| Net Margin | 10.6% | 5.8% (2.5%–11.9%) | +4.8pt |
The company ranks high in profitability within the real estate sector, with operating and net margins substantially above sector medians.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 12.5% | 12.8% (4.2%–29.2%) | -0.3pt |
Revenue growth is broadly in line with the industry median, indicating a standard growth pace.
※Source: Company compilation
Balancing high profitability with sustainable growth: Operating margin of 21.8% and Net margin of 10.6% rank high within the real estate sector, driven by high-margin projects in Real Estate Regeneration and the high growth of Real Estate Services (+30.6% YoY). FY2027 guidance targets Revenue +12% and Operating Income +11%, relying on inventory built during the period to fund next-period sales. Monitoring maintenance of gross margin 32.8% (31.2% prior year) and ROE 10.2% is important.
Cash conversion and normalization of inventory turnover are the top priorities: OCF was -¥187.4B, OCF/Net Income -1.52x, and OCF/EBITDA -0.65x, indicating weak cash backing of reported profits driven by inventory build-up of -¥404.4B. Progress in selling inventory and recovery to positive OCF will determine the sustainability of dividends and investment capacity. Given Free Cash Flow of -¥289.6B and reliance on external financing (Financing CF +¥228.4B), progress on disposal plans is the key monitoring metric for investment decisions.
Interest rate sensitivity and debt cost management are critical: Interest expense of ¥15.2B expanded by +67.4% YoY, equating to about 6.0% of Operating Income. While leverage and interest coverage are currently acceptable (debt-to-equity 1.20x, interest coverage 16.9x), a rising interest rate environment could squeeze margins and asset valuations. Management of spreads between project IRRs in Real Estate Regeneration and financing costs, and the presence or absence of interest rate hedges, will be crucial for medium-term profitability preservation.
This report is an earnings analysis document automatically generated by AI analyzing XBRL financial statement data. It is not a recommendation to invest in any specific security. Industry benchmarks are reference information compiled by the Company based on public financial statements. Investment decisions are your responsibility; consult a professional advisor as appropriate before making any investment.