| Indicator | Current Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1555.0B | ¥1466.7B | +6.0% |
| Operating Income / Operating Profit | ¥147.6B | ¥132.1B | +11.7% |
| Ordinary Income | ¥160.8B | ¥142.8B | +12.6% |
| Net Income / Net Profit | ¥117.8B | ¥98.6B | +19.5% |
| ROE | 10.6% | 9.7% | - |
For the fiscal year ended March 2026 (FY2026), Hamakyorex reported Revenue ¥1,555.0B (vs prior year +¥88.3B, +6.0%), Operating Income ¥147.6B (vs prior year +¥15.5B, +11.7%), Ordinary Income ¥160.8B (vs prior year +¥18.0B, +12.6%), and Net Income attributable to owners of the parent ¥107.2B (vs prior year +¥17.9B, +20.0%), achieving year-over-year increases across all four metrics. Operating margin improved to 9.5% from 9.0% a year earlier (+0.5pt), and Net Income margin expanded to 7.6% (prior year 6.7%), aided by net special gains of ¥10.0B at the bottom line. Profitability improvements were driven by the Logistics Center Business (margin 12.9%) and profit growth in the Trucking Business (+17.5%), while non-operating income of ¥19.3B and special gains of ¥11.3B supported the final profit stage. Operating Cash Flow was ¥199.7B (vs prior year +41.5%), markedly strengthening cash generation, enabling Capital Expenditure of ¥98.5B while generating Free Cash Flow of ¥93.8B. However, the results fell short of the company plan (Revenue ¥1,655B; Operating Income ¥163B) by 6.0% in Revenue and 9.4% in Operating Income, suggesting insufficient progress on passing through price increases and utilization improvements.
[Revenue] Revenue totaled ¥1,555.0B (YoY +6.0%). By segment, the Logistics Center Business recorded ¥1,009.4B (+6.7%), representing 64.9% of consolidated Revenue, while the Trucking Business contributed ¥545.6B (+4.8%). Logistics Center revenue comprised contract-derived revenue of ¥1,000.7B and other revenue (e.g., warehouse leasing) of ¥8.7B; expansion of center delivery networks and deeper penetration with existing customers drove growth. Trucking benefited from increased general cargo and LTL shipments, but the pace of tariff pass-through lagged expectations, resulting in Revenue missing the company plan (¥1,655B) by 6.0%. Cost of sales was ¥1,355.9B (87.2% of sales), yielding a gross margin of 12.8% — a slight YoY improvement but remaining structurally low, indicating room for price pass-through and efficiency gains.
[Profitability] Gross profit was ¥199.1B (gross margin 12.8%). Selling, General and Administrative expenses were ¥51.5B (SG&A ratio 3.3%), resulting in Operating Income of ¥147.6B (Operating margin 9.5%). SG&A included salaries and allowances ¥12.4B and goodwill amortization ¥1.8B, and rose only ¥1.5B YoY, reflecting sound cost control and operating leverage. Net non-operating income of +¥13.2B (Non-operating income ¥19.3B — dividends received ¥1.6B, subsidies ¥6.3B, etc.; Non-operating expenses ¥6.1B — interest expense ¥2.6B, etc.) lifted Ordinary Income to ¥160.8B (+12.6%). Special gains were ¥11.3B (gain on sales of fixed assets ¥2.0B, gain on negative goodwill ¥1.2B, gain on sale of investment securities ¥0.5B, etc.), while special losses were ¥1.3B (impairment/loss on retirement of fixed assets ¥0.7B, etc.), resulting in a net special gain of ¥10.0B that increased pre-tax income by about 6%. After income taxes of ¥53.0B (effective tax rate 31.0%) and minority interests of ¥10.6B, Net Income attributable to owners of the parent was ¥107.2B (+20.0%). Comprehensive income was ¥122.3B, with Other Comprehensive Income of ¥4.5B (¥3.4B unrealized gains on securities and ¥1.1B remeasurements of defined benefit plans) added to Net Income. In conclusion, the company achieved revenue and profit growth (Revenue +6.0%; Operating Income +11.7%), and special gains accelerated the bottom-line growth.
The Logistics Center Business posted Revenue ¥1,009.4B (YoY +6.7%), Operating Income ¥130.7B (+11.4%), and a margin of 12.9%, generating 88.5% of consolidated Operating Income as the core segment. Profit growth outpaced Revenue growth, driven by a higher mix of high-value-added projects and realization of scale benefits, improving margins. The Trucking Business reported Revenue ¥545.6B (+4.8%), Operating Income ¥17.1B (+17.5%), and a margin of 3.1%; profit growth substantially exceeded Revenue growth but absolute margins remain low. Profitability improvement in trucking via tariff revisions and load efficiency is key to enhancing consolidated profitability. Intersegment transactions were properly eliminated, and both businesses secured independent operating profit growth, which is commendable.
[Profitability] Operating margin was 9.5% (up 0.5pt from 9.0% prior year), and Net Income margin expanded to 7.6% (prior year 6.7%). ROE was 10.6%, maintaining double-digit return on equity, and ROA (on Ordinary Income basis) was 9.7%, indicating efficient asset utilization. EBITDA was ¥216.2B (Operating Income ¥147.6B + Depreciation & Amortization ¥68.6B), with an EBITDA margin of 13.9%; the impact of goodwill amortization ¥1.8B was minimal. [Cash Quality] Operating CF / Net Income was 1.70x, and OCF / EBITDA was 92.3%, reflecting strong cash backing of profits. CAPEX / Depreciation ratio was 1.44x, supporting continued growth investment while generating FCF ¥93.8B, which covers dividends 2.95x. [Investment Efficiency] Total asset turnover was 0.90x, and Tangible fixed asset turnover was 1.41x, indicating stable asset efficiency. Interest burden ratio (Operating Income / Interest Expense) was 55.7x, very high, so low interest expense supports margins. [Financial Soundness] Equity Ratio was 64.5% (prior year 62.5%), improving; D/E ratio was 0.55x, and Debt/EBITDA was 1.15x, indicating conservative leverage. Current Ratio 138.9% and Quick Ratio 138.9% show good short-term safety, though Short-term Debt Ratio of 52.2% is somewhat high; Cash and Deposits were ¥265.1B (2.05x short-term debt), providing a liquidity cushion. Interest coverage was 55.7x, indicating strong resilience to interest increases.
Operating CF expanded significantly to ¥199.7B (YoY +41.5%). Starting from Pre-tax Income ¥170.8B, add-back of non-cash expenses including Depreciation ¥68.6B and adjustments for working capital changes (Decrease in trade receivables ¥8.3B, Increase in trade payables ¥3.9B, Taxes and dues ¥10.3B, etc.) and income taxes paid -¥45.1B led to an Operating CF subtotal of ¥245.5B from which the Operating CF was derived. Operating CF / Net Income was 1.70x and OCF / EBITDA was 92.3%, indicating strong cash conversion. Investing CF was -¥105.9B, comprising Capital Expenditure -¥98.5B (renewal and expansion of tangible fixed assets), Purchase of intangible fixed assets -¥1.3B, M&A-related -¥14.9B, net decrease of time deposits ¥0.9B, etc.; proceeds from sale of fixed assets ¥16.5B partially offset outflows. Free Cash Flow (Operating CF + Investing CF) was ¥93.8B, ample, covering dividend payments -¥27.8B by 2.95x. Financing CF was -¥62.4B, reflecting long-term debt repayments -¥35.3B, net decrease in short-term borrowings -¥18.0B, lease repayments -¥21.1B, dividend payments -¥27.8B, net proceeds from treasury stock transactions +¥0.4B, etc. Cash and cash equivalents increased by ¥31.4B from ¥216.5B at the beginning of the period to ¥247.9B at period end, maintaining ample liquidity.
Of Ordinary Income ¥160.8B, Operating Income ¥147.6B was core business earnings, and net non-operating income ¥13.2B (Non-operating income ¥19.3B - expenses ¥6.1B) represented 0.8% of Revenue, within an acceptable range. Non-operating income comprised subsidies ¥6.3B, dividends received ¥1.6B, miscellaneous income ¥3.3B, etc., and shows no concentration on specific customers or materially one-off non-operating items. Special gains ¥11.3B (gain on sales of fixed assets ¥2.0B, negative goodwill ¥1.2B, etc.) are one-time in nature with limited reproducibility next fiscal year. Meanwhile, Operating CF at 1.70x Net Income supports high accrual quality. Increase in trade receivables -¥8.3B is within a normal range given period-end Revenue growth, and increase in trade payables +¥3.9B reflects higher purchases and appropriate payment terms. The difference between Comprehensive Income ¥122.3B and Net Income ¥117.8B (¥4.5B) is explained by Other Comprehensive Income from unrealized gains on securities and pension remeasurements, with no structural divergence. Effective tax rate 31.0% is broadly in line with statutory effective rate, showing no tax anomalies. Overall, Ordinary Income quality is high, and aside from the temporary boost from special gains, the company’s earnings base appears sustainable.
The company plan called for Revenue ¥1,655.0B, Operating Income ¥163.0B, Ordinary Income ¥172.0B, and Net Income ¥108.0B. Actual results were Revenue ¥1,555.0B (vs plan -6.0%), Operating Income ¥147.6B (vs plan -9.4%), Ordinary Income ¥160.8B (vs plan -6.5%), and Net Income ¥107.2B (vs plan -0.7%). Shortfall in Revenue of ¥100B is attributed mainly to delayed ramp-up of new Logistics Center projects and slower-than-expected tariff pass-through in Trucking. Operating Income shortfall of ¥15.4B likely reflects lower Revenue plus fixed cost increases (personnel expenses, depreciation) exceeding assumptions, resulting in lower-than-expected gross margin. At the ordinary level, healthy non-operating income reduced the shortfall (to -¥11.2B), and the contribution of special gains brought Net Income close to plan. Progress ratio (Actual / Full-Year Plan) was Revenue 93.9%, Operating Income 90.6%, Ordinary Income 93.5%, and Net Income 99.3%, indicating that operating shortfalls were largely offset by non-operating and special items. To achieve targets going forward, expanding high-value-added Logistics Center projects, accelerating trucking fare revisions, and further tightening cost management are key.
Interim dividend was ¥18.75 and year-end dividend ¥23.00, totaling ¥41.75 (same level as prior year). Payout Ratio was 29.1%, a conservative level. A 4-for-1 stock split was effective October 1, 2024, and on a post-split basis the effective dividends are Interim ¥16.25, Year-end ¥23.00, Annual ¥39.25 equivalent. FCF coverage was 3.37x (FCF ¥93.8B / Total dividends ¥27.8B), indicating very high dividend sustainability. Net interest-bearing debt totaled Short-term borrowings ¥129.4B + Long-term borrowings ¥118.7B - Cash ¥265.1B = -¥17.0B (net cash), and conservative leverage with Debt/EBITDA 1.15x limits pressure to cut dividends. No share buybacks were executed; shareholder returns are dividend-focused. Payout Ratio 29.1% balances growth investment, and scope exists for dividend increases with future profit growth. Total Return Ratio equals the payout ratio at 29.1%, consistent with policy to allocate roughly 70% of FCF to growth investment.
Persistent low gross margin structure (Gross margin 12.8%): With Cost of Sales ratio at 87.2%, the business model has structurally low margins. If labor, fuel, or depreciation costs rise and price pass-through lags, margins could deteriorate rapidly. Although SG&A ratio is restrained at 3.3%, slower Revenue growth could reverse operating leverage and increase fixed-cost burden. Historical improvement in gross margin has been gradual; price correction and utilization gains are key, but competitive dynamics and customer bargaining power could stall improvements and cap ROE and profit growth.
High short-term debt ratio (52.2%) and refinancing risk: Of interest-bearing debt ¥248.1B, Short-term borrowings are ¥129.4B (52.2%), concentrating maturities and raising the risk that market stress or credit tightening could worsen refinancing terms, increasing interest burden or constraining liquidity. Cash ¥265.1B (2.05x short-term debt) provides a buffer, but if Operating CF underperforms, liquidity could be strained, limiting growth investment and dividends. Interest coverage 55.7x indicates strong resilience, but monitoring the short-term debt repayment schedule relative to Operating CF generation is important.
Segment concentration and reliance on specific operations: The Logistics Center Business accounts for 64.9% of Revenue and 88.5% of Operating Income, indicating high segment concentration. Loss of major customers, deterioration in contract terms, or delays in new project ramp-up in this segment could materially impact consolidated performance. The Trucking Business has a low margin of 3.1%; failure to improve profitability there would continue to dilute consolidated margins. The company’s plan shortfall (Revenue -6.0%; Operating Income -9.4%) appears to be driven by Logistics Center project delays and slow tariff revisions in Trucking, and similar delays in the future will affect the probability of meeting guidance.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 9.5% | 6.3% (3.7%–8.5%) | +3.2pt |
| Net Income Margin | 7.6% | 2.7% (1.6%–4.7%) | +4.8pt |
Profitability materially exceeds industry medians, with the high-value Logistics Center model providing a competitive advantage.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth (YoY) | 6.0% | 5.0% (-0.4%–9.4%) | +1.0pt |
Revenue growth outperforms the industry median by 1.0pt, placing the company in the mid-to-upper range.
※ Source: Company compilation
Operating Margin 9.5% (industry median +3.2pt) and Net Income Margin 7.6% (industry median +4.8pt) indicate above-average profitability within the industry, with the high-margin Logistics Center Business (margin 12.9%) as the source of competitive advantage. However, structural constraints from a gross margin of 12.8% remain; future margin improvement hinges on price correction, utilization increases, and expansion of high-value projects. Trucking’s low margin of 3.1% dilutes consolidated margins; progress on tariff revisions and efficiency will determine sustainable improvement.
Operating CF ¥199.7B (1.70x Net Income) and OCF/EBITDA 92.3% corroborate high earnings quality; FCF ¥93.8B and dividend coverage 2.95x indicate capacity to balance growth investment and shareholder returns. CAPEX / Depreciation 1.44x supports continued growth investment, while conservative leverage (Debt/EBITDA 1.15x) and Cash ¥265.1B (2.05x short-term debt) underpin financial flexibility. Nonetheless, Short-term Debt Ratio 52.2% warrants monitoring for refinancing risk; stability of Operating CF generation and alignment with debt maturities will be focal points for capital policy.
Missing company targets (Revenue -6.0%; Operating Income -9.4%) appears attributable to delayed Logistics Center project ramp-ups and slower trucking tariff pass-through. Special gains ¥11.3B kept Net Income close to plan, but operating shortfalls raise questions about next fiscal year guidance credibility. Areas to watch include pace of securing high-value projects, effectiveness of tariff pass-through, strict fixed-cost control, short-term debt rollover plans, and potential for raising payout ratio. While the company shows above-industry profitability and financial soundness, addressing the low gross margin structure and achieving guidance are critical inflection points for medium-to-long-term valuation.
This report is an AI-generated financial analysis document created by analyzing XBRL earnings release data. It is not a recommendation to invest in any particular security. Industry benchmarks are reference information compiled by the firm based on public financial disclosures. Investment decisions are your responsibility; consult a professional advisor as needed prior to making investment decisions.