| Metric | This Period | Prior Year Same Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥3555.6B | ¥3449.9B | +3.1% |
| Operating Income / Operating Profit | ¥227.8B | ¥213.8B | +6.5% |
| Ordinary Income | ¥225.8B | ¥212.9B | +6.1% |
| Net Income / Net Profit | ¥74.1B | ¥93.7B | -20.9% |
| ROE | 4.5% | 6.2% | - |
For the fiscal year ended March 2026 (Full Year), Konoike Transport Co., Ltd. reported Revenue of ¥3555.6B (YoY +¥105.7B +3.1%), Operating Income of ¥227.8B (YoY +¥14.0B +6.5%), Ordinary Income of ¥225.8B (YoY +¥12.9B +6.1%), and Net Income attributable to owners of the parent of ¥142.7B (YoY +¥2.2B +1.5%), finishing with both revenue and profit growth. The Integrated Solutions Business drove growth and profitability for the second consecutive year, improving the operating margin to 6.4% (prior year 6.2%, +0.2pt). However, Net Income expansion was limited, primarily due to higher corporate tax burden and a negative net amount of special gains/losses (▲¥4.3B). Gross margin improved to 12.2% from 11.7% a year earlier (+0.5pt), aided by upscaling in core businesses, while SG&A ratio rose to 5.8% from 5.5% (+0.3pt), with wage increases and higher headquarters costs partially offsetting operating leverage. Operating Cash Flow (OCF) remained robust at ¥248.6B (YoY +5.9%), and Free Cash Flow (FCF) of ¥86.3B sufficiently covered dividend payments.
[Revenue] Revenue totaled ¥3555.6B (+3.1%), led by the core Integrated Solutions Business with Revenue of ¥2330.5B (+6.6%), which strengthened its position as a central business with a 65.5% share of total sales by providing high-value-added services such as in-plant process contracting and mechanical engineering. Conversely, the International Logistics Business declined to ¥671.9B (▲6.4%). Normalization from the prior year’s high freight market depressed forwarding unit prices and reduced volumes, squeezing profitability. Domestic Logistics was a modest increase to ¥581.1B (+1.1%), securing stable operations at refrigerated/frozen warehouse sites but seeing growth constrained by competitive pressure and stagnating utilization rates. Cost of sales was ¥3122.3B, yielding a gross margin of 12.2% (prior year 11.7%, +0.5pt). The rise in high-margin projects and price revisions in the Integrated Solutions Business contributed to gross margin improvement.
[Profitability] Operating Income was ¥227.8B (+6.5%), with an operating margin of 6.4% (prior year 6.2%, +0.2pt). SG&A was ¥205.4B (prior year ¥189.4B), up approximately 8.5%, raising the SG&A ratio to 5.8% (prior year 5.5%, +0.3pt). Higher personnel expenses and expanded headquarters overhead contributed, but gross margin improvement in the core business absorbed the SG&A increase, maintaining positive operating leverage. Ordinary Income was ¥225.8B (+6.1%), with non-operating income of ¥15.9B (interest income ¥5.7B, dividend income ¥4.4B) partially offset by non-operating expenses of ¥17.9B (interest expense ¥5.8B, foreign exchange losses ¥2.6B); equity-method losses of ▲¥3.9B resulted in a near-neutral net contribution. Special gains/losses netted ▲¥4.3B (gain on sale of investment securities ¥4.2B, impairment losses ¥0.3B, loss on disposal of fixed assets ¥0.8B, etc.), limiting one-off impacts. Profit before income taxes was ¥221.5B (prior year ¥208.6B). Income taxes were ¥72.8B (effective tax rate 32.9%), up from ¥62.7B the prior year, resulting in Net Income attributable to owners of the parent of ¥142.7B (+1.5%). In summary, the company achieved revenue and operating profit growth, but Net Income growth lagged due to higher SG&A and tax burden.
The Integrated Solutions Business posted Revenue of ¥2330.5B (+6.6%), Operating Income of ¥238.6B (+14.8%), and an operating margin of 10.2%, maintaining high profitability. Expansion of orders for process contracting and mechanical engineering, plus price revisions, improved margins and accounted for a large share of consolidated operating profit. Domestic Logistics delivered Revenue of ¥581.1B (+1.1%) and Operating Income of ¥34.5B (▲4.6%), with an operating margin of 5.9%; while revenue edged up, margins deteriorated due to rising labor and operating costs despite stable refrigerated/frozen warehouse operations. International Logistics recorded Revenue of ¥671.9B (▲6.4%) and Operating Income of ¥39.7B (▲15.9%), with an operating margin of 5.9%, reflecting lower unit prices and reduced volumes after the prior year’s freight market recovery. Other Businesses produced Revenue of ¥11.5B (+18.4%) and an operating loss of ¥0.9B (reduced deficit), comprising small-scale activities like software development. Segment margin dispersion is wide, highlighting that high profitability in the core business underpins consolidated profitability.
[Profitability] Operating margin was 6.4% (prior year 6.2%, +0.2pt), and net margin was 4.0% (prior year 4.1%, ▲0.1pt), with higher SG&A ratio and tax burden suppressing net margin. Gross margin improved to 12.2% from 11.7% (+0.5pt), supported by a higher share of high-value-added projects in core businesses. ROE was 8.7% (prior year 9.3%); DuPont decomposition shows Net Margin 4.0% × Total Asset Turnover 1.186 × Financial Leverage 1.84, with declines in asset turnover (prior year 1.191) and slight net margin compression contributing. [Cash Quality] OCF was ¥248.6B, 1.74× Net Income of ¥142.7B, indicating strong cash generation. However, OCF/EBITDA ratio was 0.76×, below 0.9, as working capital ties (accounts receivable increase ▲¥33.4B) restrained cash conversion. Days Sales Outstanding (DSO) were about 72 days, indicating long collection lead times and room for working capital efficiency improvements. [Investment Efficiency] Capital expenditures were ¥125.7B, 1.26× depreciation expense of ¥99.9B, reflecting a balance between growth and renewal investments. Goodwill stood at ¥22.1B, 1.4% of net assets, and Goodwill/EBITDA ratio was 0.07×, very small, limiting M&A-related risk. [Financial Soundness] Equity Ratio improved to 54.5% (prior year 51.9%). Financial leverage was 1.84×, within a stable range. Debt/EBITDA was 0.39× and interest coverage was 39×, indicating very strong debt service capacity. Current ratio was 197%, Cash/short-term debt was 8.84×, providing ample liquidity; refinancing risk is limited despite a high short-term debt ratio of 58.3%.
OCF was ¥248.6B (YoY +5.9%), representing 1.74× Net Income of ¥142.7B. OCF before working capital changes was ¥312.9B, supported by non-cash charges including depreciation ¥99.9B and goodwill amortization ¥4.3B. Working capital changes included an accounts receivable increase of ▲¥33.4B that absorbed cash, and accounts payable increase of ¥12.1B that provided cash inflow; overall extended receivables hindered cash conversion. After income tax payments of ¥71.1B, OCF was ¥248.6B. Investing Cash Flow was ▲¥162.3B, driven by capital expenditures of ¥125.7B and acquisition of subsidiary shares ¥68.1B; proceeds from sale of marketable securities ¥6.99B and sale of property and equipment ¥2.7B were limited. Financing Cash Flow was ▲¥104.8B, with dividend payments ¥61.6B, long-term borrowings repayments ¥14.9B, bond redemption ¥50B, and lease liability repayments ¥9.9B as major outflows, partially offset by long-term borrowings of ¥27.4B. Free Cash Flow was ¥86.3B, covering dividend payments of ¥61.6B by 1.4× and securing internal reserves and growth investment funds. Cash and cash equivalents at period-end were ¥609.4B (prior year ¥627.0B, including foreign exchange effect +¥0.8B), maintaining ample liquidity.
Earnings quality is centered on recurring operating activities, with minor one-off effects. Non-operating income was ¥15.9B (0.45% of sales), mainly interest income ¥5.7B and dividend income ¥4.4B, within the range of recurring non-core income. Non-operating expenses of ¥17.9B were led by interest expense ¥5.8B and foreign exchange losses ¥2.6B; including equity-method losses of ▲¥3.9B, these do not materially impair recurrence. Special gains/losses netted ▲¥4.3B (gain on sale of investment securities ¥4.2B, impairment losses ¥0.3B, loss on disposal of fixed assets ¥0.8B, etc.), so distortion to Net Income is limited. Accrual ratio (Net Income − OCF / Total Assets) was ▲3.5%, indicating soundness, and OCF/Net Income of 1.74× supports cash realization of earnings. Conversely, OCF/EBITDA of 0.76× indicates working capital constraints such as delayed receivables collection, leaving room to improve cash conversion. The gap between Ordinary Income ¥225.8B and Net Income attributable to owners of the parent ¥142.7B is mainly due to tax burden (effective tax rate 32.9%) and minority interests ¥6.0B, reflecting structural factors.
The company has announced FY2027 (next fiscal year) full year guidance of Revenue ¥3610B (YoY +1.5%), Operating Income ¥210B (YoY ▲7.8%), Ordinary Income ¥210B (YoY ▲7.0%), and Net Income attributable to owners of the parent ¥140B (YoY ▲1.9%). The plan assumes an operating margin of 5.8% (down 0.6pt from the current 6.4%), conservatively assuming unit price declines from normalization in international logistics, continued increases in personnel and headquarters costs, and overall expense growth. While Revenue is expected to tick up slightly, Operating Income is forecast to decline; delayed price pass-through and weak utilization in International and Domestic Logistics are expected to pressure profits even as the Integrated Solutions Business maintains high profitability. The dividend forecast is ¥55 per share, half of the current fiscal year’s ¥110, suggesting a reallocation of profits toward retained earnings and growth investments. Progress rate versus full-year guidance is compared to full-year actuals; quarterly progress evaluation is excluded.
Dividends are ¥110 per share annually (interim ¥55, year-end ¥55), with a payout ratio of 43.9% (total dividends ¥61.6B / Net Income attributable to owners of the parent ¥142.7B). The dividend policy appears to target a mid-term payout ratio range of 40–50%, and this fiscal year was near the upper bound. Free Cash Flow of ¥86.3B covers dividend payments of ¥61.6B by 1.4×, indicating sustainability backed by cash generation. Net interest-bearing debt is effectively negligible; Debt/EBITDA of 0.39× indicates strong financial health and room to maintain dividends even under a profit-down scenario. There were no share buybacks this period; Total Return Ratio equals the payout ratio at 43.9%. DOE (dividend on equity) was 3.6%, reflecting a balance between capital efficiency and shareholder returns.
Segment concentration risk: The Integrated Solutions Business accounts for 65.5% of sales and the majority of operating profit; demand swings or weakening pricing power in this segment could have a large impact on consolidated earnings. Although the operating margin is high at 10.2%, changes in major customers’ investment cycles or project mix could make it difficult to sustain margins.
SG&A ratio increase from labor cost inflation: SG&A rose about 8.5% YoY, lifting the SG&A ratio to 5.8% (prior year 5.5%, +0.3pt). Continued wage hikes and higher headquarters costs could erode operating leverage and cap operating margin improvements. Low-margin Domestic and International Logistics businesses are particularly vulnerable if price pass-through is delayed.
Working capital funding constraint: DSO of about 72 days and an increase in accounts receivable of ▲¥33.4B have reduced OCF/EBITDA to 0.76×. Without working capital efficiency improvements, cash conversion may deteriorate, constraining funds for growth investment and shareholder returns.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 6.4% | 6.3% (3.7%–8.5%) | +0.1pt |
| Net Margin | 2.1% | 2.7% (1.6%–4.7%) | -0.6pt |
Profitability is broadly in line with the industry median; operating margin is 0.1pt above the median, while net margin lags by 0.6pt, suggesting tax burden and SG&A ratio impacts.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 3.1% | 5.0% (-0.4%–9.4%) | -1.9pt |
Growth lags the industry median by 1.9pt, with International Logistics’ revenue decline restraining company-wide growth.
※ Source: Company compilation
The core Integrated Solutions Business maintains high profitability with a 10.2% operating margin and drives the bulk of consolidated profit. Expansion of orders for process contracting and mechanical engineering plus price revisions have improved sales mix quality; if segment strengthening continues, it could lift the consolidated operating margin. Improvement in margins in International and Domestic Logistics (current 5.9%) and order trends in Integrated Solutions will be key to consolidated profitability.
Cash generation is strong, with OCF/Net Income 1.74× and FCF ¥86.3B covering dividends 1.4×. Financial soundness is strong — Debt/EBITDA 0.39×, interest coverage 39×, Equity Ratio 54.5% — providing capacity for growth investment and shareholder returns. However, accounts receivable collection lead time of about 72 days and OCF/EBITDA of 0.76× leave room to improve cash conversion; shortening DSO and optimizing accounts payable terms are levers to enhance capital efficiency.
Next year’s guidance is conservative with Operating Income ¥210B (▲7.8%), factoring in normalization in international logistics markets, rising personnel and headquarters costs, and accelerated SG&A growth. The dividend forecast of ¥55 (down from ¥110) reduces payouts, but given financial capacity and FCF generation, there remains scope to maintain dividends; monitoring actual dividend levels and profit progress is necessary.
This report is a financial 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 from public financial statements. Investment decisions are your responsibility; consult a professional advisor as needed before making investment decisions.