FUJI KYUKO CO.,LTD. FY2026 Q2 Earnings Report

Financial Highlights

• Operating Income: ¥4.44B
• Net Income: ¥2.73B
• EPS: ¥53.58

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment 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

Fuji Kyuko Co., Ltd. (Consolidated, JGAAP) reported solid earnings momentum in FY2026 Q2, with operating income of ¥4.44bn (+7.4% YoY) and net income of ¥2.85bn (+6.6% YoY), despite revenue not being disclosed in the XBRL for this period. Ordinary income of ¥4.39bn was close to operating income, indicating limited non-operating drag and manageable financing costs. Depreciation and amortization totaled ¥2.79bn, lifting EBITDA to ¥7.23bn, which underscores the asset-intensive nature of the transport and leisure portfolio. Operating cash flow of ¥5.54bn outpaced net income (OCF/NI 1.95x), pointing to robust cash earnings quality in the half. Liquidity appears comfortable with a current ratio of 1.46x and quick ratio of 1.42x, supported by current assets of ¥33.08bn versus current liabilities of ¥22.73bn. The balance sheet shows total assets of ¥100.07bn and total equity of ¥39.01bn; this implies an effective equity ratio of about 39%, even though the reported equity ratio field shows 0% (undisclosed). Total liabilities of ¥64.32bn translate to a liabilities-to-equity measure of roughly 1.65x, indicative of moderate leverage for an infrastructure- and leisure-heavy operator. Interest expense of ¥0.23bn is well covered, with interest coverage at 19.6x based on operating income, reflecting strong debt service capacity. The effective tax burden appears normal: with tax expense of ¥1.30bn and implied pre-tax income of roughly ¥4.14bn, the effective tax rate is about 31%, suggesting no unusual tax effects this quarter. Investing cash flow was not disclosed, limiting visibility into capex timing, but negative financing cash flow (−¥3.92bn) hints at debt repayment and/or distribution-related outflows. Working capital is positive at ¥10.35bn, which should help absorb seasonal swings in transportation and leisure demand. While the absence of revenue data precludes margin and turnover analysis, the uplift in operating and net income suggests sustained post-pandemic recovery in tourism-related segments and steady ridership/leisure demand. Given Fujikyu’s mix of rail/bus, amusement, hotel, and other tourism assets, seasonality and inbound trends remain important contextual drivers not observable in the disclosed line items. Dividend-related figures were not disclosed; thus, payout policy assessment relies on historical tendencies rather than current-period data. Overall, earnings quality appears sound, leverage is manageable, liquidity is adequate, and cash generation is supportive of ongoing operations, though visibility on capital allocation is constrained by missing investing cash flow details.

Profitability Analysis

ROE decomposition is limited by undisclosed revenue. Using balance sheet and net income, semiannual ROE approximates 7.3% (¥2.845bn / ¥39.014bn), which annualizes to the mid-teens if performance is sustained, aided by financial leverage of ~2.56x (assets/equity). Net margin and asset turnover cannot be computed without revenue; therefore, the classic DuPont split between margin and turnover is not available. Operating income growth of +7.4% YoY indicates healthy operating leverage, likely from better fixed-cost absorption across rail/leisure assets. EBITDA of ¥7.23bn versus operating income of ¥4.44bn highlights significant non-cash D&A, typical for transport infrastructure and theme-park/hotel assets; margin quality cannot be quantified, but the OCF/NI ratio (1.95x) supports earnings quality. Ordinary income at ¥4.39bn close to operating income suggests non-operating items (including interest) are not materially dilutive. Interest coverage at 19.6x underscores ample buffer against rate increases. The implied effective tax rate (~31%) appears normal, suggesting reported net income is not flattered by tax credits or unusual items. Overall, profitability is improving in absolute terms, with signs of operating leverage, but margin structure and efficiency ratios remain unassessed due to undisclosed revenue.

Growth Assessment

Operating income rose 7.4% YoY and net income rose 6.6% YoY, signaling continued recovery in core businesses. Revenue was not disclosed, so we cannot confirm whether growth is price-driven, volume-driven, or mix-driven. Given Fujikyu’s exposure to transportation and leisure, sustained inbound tourism and domestic travel normalization likely underpin growth, but this is an inference rather than a disclosed metric. The alignment of ordinary income with operating income suggests growth is organically driven rather than financial or one-off items. EBITDA growth versus prior year is implied by the higher operating income, but exact EBITDA YoY cannot be measured without prior-period D&A detail. Profit quality appears solid, supported by high OCF/NI, indicating earnings are backed by cash generation. Short-term outlook hinges on seasonal demand patterns, visitor numbers at leisure facilities, and ridership trends; absent revenue disclosure, we cannot quantify run-rate growth or traffic/visitor KPIs. Pricing actions (e.g., fare adjustments or amusement park ticket pricing), occupancy/ADR in lodging, and event-driven demand likely remain key levers for 2H. External tailwinds include weak yen supporting inbound tourism; headwinds may include wage inflation and higher maintenance/energy costs impacting fixed-cost bases. Overall, growth is positive year-on-year in profit terms, but revenue sustainability cannot be validated from disclosed data.

Financial Health

Liquidity is comfortable with current assets of ¥33.08bn versus current liabilities of ¥22.73bn (current ratio 1.46x; quick ratio 1.42x), aided by relatively small inventories (¥0.71bn). Total assets are ¥100.07bn against total equity of ¥39.01bn, implying an equity ratio around 39% (the reported 0% is an undisclosed placeholder). Total liabilities of ¥64.32bn imply a liabilities-to-equity measure of ~1.65x; interest-bearing debt details are not disclosed, so true net leverage cannot be determined. Interest expense of ¥0.23bn is modest relative to operating income, reflected in strong interest coverage of 19.6x. Working capital is positive at ¥10.35bn, supporting operational resilience through seasonal swings. Cash and equivalents were not disclosed, limiting precision on liquidity buffers; however, operating cash inflows of ¥5.54bn in the half are supportive. Financing cash outflow of ¥3.92bn suggests deleveraging and/or shareholder returns, but specifics cannot be confirmed without investing/dividend detail. Overall solvency looks sound for an asset-heavy operator, though visibility into debt composition, maturity ladder, and covenants is limited by the dataset.

Cash Flow Quality

Earnings quality appears robust: OCF of ¥5.54bn versus net income of ¥2.85bn yields an OCF/NI ratio of 1.95x, indicating strong cash conversion after working capital and taxes. EBITDA of ¥7.23bn sets a high cash earnings capacity; OCF represents roughly 77% of EBITDA, reasonable given working capital needs and tax payments in a half-year. Investing cash flow is undisclosed (reported as 0), so Free Cash Flow cannot be reliably computed; the provided FCF value of 0 should be treated as "not disclosed". Absent capex detail, we cannot assess maintenance vs. growth capex mix; however, given the capital intensity of rail and leisure assets, capex is likely material and lumpy. Working capital stands at ¥10.35bn and liquidity ratios are healthy, suggesting manageable cash needs for operations. The negative financing CF of ¥3.92bn implies debt repayment and/or distributions, consistent with cash generative operations, but confirmation is not possible without dividend and debt schedule details. Overall, cash flow quality is favorable, but FCF sustainability cannot be judged until investing cash flows are disclosed.

Dividend Sustainability

Dividend information (DPS, payout ratio, and FCF coverage) was not disclosed and shows as zero placeholders. Therefore, current payout levels and coverage cannot be assessed for this period. From a capacity standpoint, earnings and OCF growth support the potential for distributions, but the absence of investing CF (capex) data prevents evaluation of true FCF available to shareholders. Financing cash outflow of ¥3.92bn could include dividends and/or debt repayment; without DPS or share count data, attribution is not possible. Historically, payout policies for rail/leisure operators balance stable dividends with capex needs; however, this period’s data does not permit policy confirmation. Until capex and DPS are disclosed, we cannot compute payout ratio, FCF coverage, or evaluate sustainability.

Risk Assessment

Business Risks:

• Demand volatility tied to seasonality, weather, and macro tourism trends affecting ridership and leisure facilities
• Inbound tourism sensitivity to FX, visa policies, and geopolitical developments
• Energy and utility cost inflation impacting transport and amusement operations
• Labor cost pressures and staffing tightness in hospitality and operations
• Safety, accident, and service disruption risks inherent in transportation and amusement rides
• Competitive dynamics in leisure/entertainment and regional transport
• Event risk for major assets (ride downtime, maintenance overruns, or unexpected closures)

Financial Risks:

• Capex intensity and potential for lumpy investment cycles affecting free cash flow
• Interest rate risk on floating-rate debt, albeit currently mitigated by strong interest coverage
• Refinancing and maturity concentration risk (debt profile not disclosed)
• Limited visibility on liquidity buffers due to undisclosed cash balance
• Potential FX exposure via inbound tourism revenues versus mostly JPY-denominated costs (operational mismatch rather than financial FX debt)

Key Concerns:

• Revenue and margin details are undisclosed, preventing validation of pricing and mix dynamics
• Investing cash flows are not disclosed, obscuring capex and FCF sustainability
• Dividend metrics (DPS/payout) are not disclosed, limiting clarity on shareholder return policy

Investment Implications

Key Takeaways:

• Profit growth continued with operating income +7.4% YoY and net income +6.6% YoY
• Cash earnings quality is strong (OCF/NI 1.95x) with solid interest coverage (19.6x)
• Liquidity is comfortable (current ratio 1.46x; quick 1.42x) and implied equity ratio ~39%
• Leverage is moderate (total liabilities/equity ~1.65x) for an asset-heavy operator
• Visibility on revenue, capex, and dividends is limited due to undisclosed items

Metrics to Watch:

• Revenue by segment (transportation, leisure, hotel) and traffic/visitor KPIs
• Capex and investing cash flows to gauge FCF and maintenance vs. growth spend
• DPS and payout ratio to assess capital allocation and dividend sustainability
• Operating income by segment and non-operating items (interest, subsidies)
• Ridership volumes, park attendance, ADR/RevPAR, and inbound tourism indicators
• Energy and labor cost trends impacting operating leverage

Relative Positioning: Within Japanese transportation and leisure operators, Fujikyu exhibits improving profitability and strong cash conversion with moderate leverage and adequate liquidity; however, relative assessment of margins and efficiency is constrained versus peers due to undisclosed revenue and capex in this period.

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