MARUWN CORPORATION FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥23.18B
• Operating Income: ¥680M
• Net Income: ¥545M
• EPS: ¥18.19

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend 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

Verdict: Solid profit growth with healthy margins but structurally low capital efficiency and limited visibility due to sparse disclosures. Revenue reached 231.79 (100M JPY), with operating income of 6.80 (100M JPY), up 37.2% YoY, and ordinary income of 7.63 (100M JPY), up 37.0% YoY. Net income came in at 5.25 (100M JPY), up 3.1% YoY, implying a net margin of 2.3% (226 bps) on the reported base. Operating margin stands at 2.9% (293 bps), and ordinary income margin at 3.3% (329 bps), indicating beneficial contributions from non-operating items. We cannot compute YoY margin expansion/compression in basis points because prior-period revenue was not disclosed, but the +37% YoY uplift in operating income suggests positive operating leverage. Non-operating income totaled 0.93 (100M JPY), with dividend income of 0.43 (100M JPY) and interest income of 0.04 (100M JPY), accounting for a non-operating income ratio of 17.7%. Interest expense remains de minimis at 0.03 (100M JPY), supporting a very strong interest coverage of 226.7x. Balance sheet strength is a clear positive: equity of 262.55 (100M JPY) against total assets of 374.11 (100M JPY) implies an equity ratio of roughly 70%, and D/E of 0.42x is conservative. Liquidity is adequate with a current ratio of 138.1% and quick ratio of 136.9%, though short of the 150% best-practice benchmark. ROE is a modest 2.0% and ROIC is weak at 1.9% (below the 5% warning threshold), flagging capital efficiency as the key structural issue. The payout ratio is calculated at 104.8%, which, if representative of the full year rather than interim seasonality, would be a sustainability concern. Cash flow disclosure is absent, so we cannot corroborate earnings quality via OCF/NI or FCF coverage. Total comprehensive income of 9.72 (100M JPY) exceeded net income, likely aided by valuation gains in investment securities (33.97 (100M JPY) on the balance sheet), which can be volatile. With limited SG&A detail and no gross profit reported, cost structure granularity is low, constraining deeper margin diagnostics. Forward-looking, the combination of stronger ordinary income, low leverage, and solid liquidity provides resilience, but improving ROIC/ROE will require either margin gains or asset turnover improvement. Dividend sustainability hinges on cash generation; without OCF/FCF data, we treat the >100% payout ratio as a cautionary signal rather than a definitive red flag. Overall, the quarter shows operational progress, but capital efficiency and disclosure gaps temper the quality of the beat.

Profitability Analysis

ROE decomposition (DuPont): ROE 2.0% = Net Profit Margin (2.3%) × Asset Turnover (0.620) × Financial Leverage (1.42x). The low ROE is driven primarily by modest net margin (226 bps) and low asset turnover for a logistics operator, while leverage is intentionally conservative. Change analysis: Prior-period components are not disclosed, so we cannot quantify which factor changed most; however, the +37% YoY rise in operating income suggests margin tailwinds or better operating leverage. Business drivers: Non-operating income (notably dividend income) lifted ordinary income above operating income, while minimal interest expense preserved margins; lack of gross profit data limits insight into mix and cost pass-through (e.g., fuel and subcontracting). Sustainability: Non-operating contributions (dividends/market-related gains) can be volatile; core operating margin near 3% is defensible but not high in logistics. Flags: ROIC at 1.9% indicates returns below likely WACC; SG&A level is disclosed (17.23 (100M JPY)) but no YoY comparison—cannot confirm whether SG&A growth outpaced revenue. Overall margin quality is acceptable this quarter, but structural capital efficiency remains weak.

Growth Assessment

Top-line: Revenue printed at 231.79 (100M JPY); YoY growth rate is undisclosed, preventing assessment of volume vs price effects. Profit: Operating income grew 37.2% YoY to 6.80 (100M JPY) and ordinary income rose 37.0% YoY to 7.63 (100M JPY), indicating improved operating leverage and support from non-operating items. Bottom line: Net income rose 3.1% YoY to 5.25 (100M JPY), constrained by a 31.0% effective tax rate and potentially fewer below-the-line boosts. Mix: Non-operating income of 0.93 (100M JPY), including dividend income of 0.43 (100M JPY), provided a material uplift; this mix is less repeatable than core operations. Outlook: With low leverage and resilient margins, the company is positioned to navigate demand fluctuations, but sustained EPS growth likely requires either revenue acceleration, tighter cost control, or asset optimization to lift ROIC. Disclosure gaps (no gross profit, depreciation, or segment data) limit confidence in run-rate growth durability.

Financial Health

Liquidity: Current ratio 138.1% and quick ratio 136.9% indicate adequate near-term coverage; no warning (CR is above 1.0 but below the >1.5 best-practice benchmark). Working capital stands at 24.12 (100M JPY). Maturity profile: Short-term loans are 3.60 (100M JPY) vs current assets of 87.46 (100M JPY), implying low refinancing risk; long-term loans are only 0.60 (100M JPY). Solvency: D/E at 0.42x is conservative, and the implied equity ratio is about 70% (equity 262.55 / assets 374.11), signaling a strong balance sheet buffer. Interest coverage is very strong at 226.7x, reflecting minimal interest burden. Off-balance sheet: No disclosures provided; potential lease and subcontracting commitments typical for logistics are not quantified. Overall: Sound liquidity and very low leverage; no maturity mismatch concerns identified.

Cash Flow Quality

OCF and FCF are unreported, so OCF/Net Income and FCF coverage cannot be assessed—this is a key limitation. Earnings quality proxies: Interest coverage is robust and non-operating income is meaningful (17.7% of ordinary income), which introduces some volatility. Working capital movements cannot be evaluated; thus, we cannot rule in/out earnings-to-cash divergence. Capital intensity and depreciation are undisclosed, preventing assessment of maintenance capex needs and true FCF. Conclusion: Earnings quality is indeterminate due to missing cash flow data; monitoring OCF/NI (>1.0 benchmark) and FCF after capex relative to dividends is essential.

Dividend Sustainability

The calculated payout ratio is 104.8%, which, if on a full-year basis, would be above the <60% benchmark and potentially unsustainable; however, without OCF/FCF and with possible interim seasonality, we treat this as a caution rather than a definitive stress signal. Total dividends paid and DPS details are unreported, so coverage cannot be confirmed. Balance sheet flexibility (equity ratio ~70%, very low net debt) provides capacity to support dividends temporarily, but structurally low ROE (2.0%) and ROIC (1.9%) argue for careful capital allocation. Key test: FCF after maintenance capex should fully cover dividends; absent that data, dividend visibility is limited.

Risk Assessment

Business Risks:

• Demand variability in domestic logistics and distribution volumes amid macro uncertainty
• Fuel cost and subcontracting cost pass-through risk impacting low single-digit operating margins
• Labor availability and wage inflation (driver shortages, workstyle reform) pressuring SG&A and operating costs
• Dependence on non-operating income (dividends) introducing volatility to ordinary income
• Potential concentration risk in key customers or sectors (not disclosed)

Financial Risks:

• ROIC at 1.9% below 5% warning threshold, implying returns below likely WACC
• Payout ratio >100% (calculated) may not be sustainable absent strong FCF
• Market valuation swings in investment securities (33.97 (100M JPY)) impacting OCI and equity
• Disclosure gaps on cash flows, leases, and capex obscure liquidity and FCF risk
• Limited margin of safety if non-operating income normalizes lower

Key Concerns:

• Structural capital efficiency weakness (low ROE/ROIC) despite strong balance sheet
• Inability to verify earnings-to-cash conversion due to missing OCF/FCF data
• Potentially elevated dividend commitment relative to earnings without FCF support

Investment Implications

Key Takeaways:

• Profit growth is robust at the operating and ordinary income levels (+37% YoY), but net growth is modest (+3.1%)
• Margins are stable to healthy for the sector: OM ~2.9%, OI margin ~3.3%, NM ~2.3%
• Balance sheet is very strong (equity ratio ~70%, D/E 0.42x, interest coverage 226.7x)
• Capital efficiency is weak (ROE 2.0%, ROIC 1.9%), requiring improvement in margins and/or asset turnover
• Non-operating income contributes meaningfully, adding volatility versus pure operating earnings
• Dividend payout appears high (>100% calculated), raising sustainability questions pending FCF data

Metrics to Watch:

• OCF/Net Income (>1.0 target) and FCF after maintenance capex
• Operating margin progression and cost pass-through, especially fuel and subcontracting
• Asset turnover improvements (revenue/assets) and utilization rates
• Non-operating income composition (dividends vs others) and its stability
• Capex and lease obligations to gauge capital intensity
• Payout ratio on a full-year basis and any changes to dividend policy

Relative Positioning: Within Japanese logistics peers, the company exhibits stronger balance sheet conservatism and interest coverage but lags on capital efficiency (ROE/ROIC). Margin profile is in a typical low-single-digit range, with a higher-than-desired reliance on non-operating income to bridge to ordinary income.

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