| Metric | Current Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥3185.8B | ¥3024.9B | +5.3% |
| Operating Income / Operating Profit | ¥93.5B | ¥73.6B | +26.9% |
| Ordinary Income | ¥114.8B | ¥99.2B | +15.7% |
| Net Income / Net Profit | ¥111.2B | ¥100.9B | +10.2% |
| ROE | 3.9% | 3.5% | - |
For the fiscal year ended March 2026, Revenue was ¥3185.8B (YoY +¥160.9B +5.3%), Operating Income was ¥93.5B (YoY +¥19.9B +26.9%), Ordinary Income was ¥114.8B (YoY +¥15.6B +15.7%), and Net Income attributable to owners of the parent was ¥136.9B (YoY +¥49.2B +56.6%). Revenue growth above 5% was driven by higher sales in the core Transportation Business (+4.3%) and a large increase in the International Business (+28.5%). The operating margin improved to 2.9% from 2.4% a year earlier (+0.5pt), driven by a decline in cost of sales and contributions from higher-margin segments (Logistics and Charter). At the ordinary profit stage, non-operating income including dividend income of ¥16.3B and foreign exchange gains of ¥6.3B contributed. Recognition of special gains of ¥126.6B (primarily ¥125.3B gains on sales of investment securities) lifted profit before tax to ¥205.6B, producing a significant year-over-year increase; however, about 24% of net income depended on one-off items. Operating Cash Flow was ¥276.2B (YoY +12.9%), generating FCF of ¥198.9B, which largely covered total shareholder returns of ¥198.2B (dividends ¥28.1B and share buybacks ¥170.2B). Goodwill increased from ¥2.8B to ¥28.6B, suggesting M&A activity in the International Business, but this represents about 1% of equity and is immaterial. Interest-bearing debt increased by ¥202.8B to ¥819.5B (long-term borrowings), and Debt/EBITDA rose to 3.11x, but interest coverage (EBIT basis) at 9.6x indicates adequate capacity to service interest.
Revenue of ¥3185.8B (YoY +5.3%) was supported by steady performance in the Transportation Business focused on domestic freight (Revenue ¥2445.7B, share 76.8%, YoY +4.3%), a large increase in the International Business (Revenue ¥152.4B, YoY +28.5%), and growth in the Distribution Processing Business (Revenue ¥237.0B, YoY +6.0%). The Charter Business also performed solidly with Revenue ¥278.1B (YoY +5.9%). Other segments (real estate leasing, goods sales, etc.) recorded Revenue of ¥152.9B, a slight decline (YoY -0.6%). Segment composition: Transportation 76.8%, Charter 8.7%, Logistics 7.4%, International 4.8%, Other 2.3%. Gross profit was ¥194.3B (gross margin 6.1%, an improvement of +0.5pt from 5.6%), aided by a lower cost of sales ratio.
Profit: Operating Income ¥93.5B (YoY +26.9%, operating margin 2.9%) achieved double-digit growth due to improvements in cost of sales and expanded profits from high-margin segments. SG&A was ¥100.9B (SG&A ratio 3.2%, unchanged from prior year) and increased in line with higher sales but efficiency in cost management preserved margins. By segment, Logistics delivered Operating Income ¥38.2B (margin 16.1%, YoY +16.0%) as the highest margin contributor, Charter ¥25.8B (margin 9.3%, YoY +16.8%), Transportation ¥64.7B (margin 2.6%, YoY +31.3%) with substantial gains. International was ¥4.4B (margin 2.9%, YoY +55.7%) — small scale but high growth. Other segments were ¥9.3B (margin 6.1%, YoY -24.3%). Non-operating income totaled ¥35.0B (dividend income ¥16.3B, FX gains ¥6.3B, etc.) and non-operating expenses ¥13.7B (interest expense ¥9.7B, etc.), producing Ordinary Income of ¥114.8B (YoY +15.7%). Special gains of ¥126.6B (gains on sales of investment securities ¥125.3B, gains on sales of fixed assets ¥1.2B) and special losses of ¥35.7B (impairment losses ¥24.1B, loss on retirement of fixed assets ¥8.0B, etc.) resulted in profit before tax of ¥205.6B. After income taxes of ¥67.9B and non-controlling interests of ¥0.7B, Net Income attributable to owners of the parent was ¥136.9B (YoY +56.6%). In conclusion, core operating improvement and expansion of high-margin segments delivered top- and bottom-line growth, but net income was significantly supported by one-off gains from sales of investment securities.
Transportation Business (Revenue ¥2445.7B, Operating Income ¥64.7B, margin 2.6%) is the core segment representing 76.8% of Revenue, achieving Revenue growth of +4.3% and Operating Income growth of +31.3%. Margin improved +0.5pt from 2.1% due to cost efficiency and better load factors. Charter Business (Revenue ¥278.1B, Operating Income ¥25.8B, margin 9.3%) recorded Revenue +5.9% and Operating Income +16.8%, maintaining high margins. Logistics (Distribution Processing Business, Revenue ¥237.0B, Operating Income ¥38.2B, margin 16.1%) centered on 3PL services, with Revenue +6.0% and Operating Income +16.0%; it is the highest-margin segment and accounts for 40.9% of consolidated operating profit. International Business (Revenue ¥152.4B, Operating Income ¥4.4B, margin 2.9%) handles customs and international freight, showing high growth with Revenue +28.5% and Operating Income +55.7%. Goodwill amortization expense of ¥1.26B and goodwill impairment of ¥2.15B were recorded, but the segment remained profitable. Other segments (Revenue ¥152.9B, Operating Income ¥9.3B, margin 6.1%) — including real estate leasing, goods sales, and staffing — saw Revenue -0.6% and Operating Income -24.3%. Corporate-level expenses were ¥48.9B (advertising, HQ administrative costs, etc.), resulting in consolidated Operating Income of ¥93.5B. Segment profit composition (pre corporate cost allocation) was Logistics 40.9%, Transportation 69.2%, Charter 27.6%, International 4.7%, Other 9.9% (percentages of total segment profits). Mix improvement toward higher-margin segments contributed to the overall margin uplift, and rapid growth in International suggests future portfolio expansion.
Profitability: Operating margin 2.9% (up +0.5pt from 2.4%), gross margin 6.1% (up +0.5pt from 5.6%), net margin 4.3% (up +1.0pt from 3.3%, though largely due to one-offs). ROE 4.8% (prior year 3.5%) is calculated using Net Income ¥136.9B against shareholders’ equity of ¥2831B; improvements stem from higher net income and modest asset turnover gains, but capital efficiency remains low. EPS ¥369.5 (prior year ¥217.85, YoY +69.6%) based on average shares outstanding of 37,068 thousand; EPS was boosted by one-off gains. BPS ¥8,008.96, up from ¥7,207.3 (+11.1%). Cash quality: Operating Cash Flow ¥276.2B is 2.02x Net Income ¥136.9B, indicating good cash realization; accrual ratio (Operating CF – Net Income)/Total Assets = (¥276.2B – ¥136.9B)/¥4973.2B = 2.8%, low and showing no expansion of accruals. EBITDA (Operating Income ¥93.5B + Depreciation ¥215.5B) was ¥309.0B; OCF/EBITDA 0.89x slightly below the 0.9x benchmark but acceptable given income taxes paid ¥65.5B and interest paid ¥9.5B. FCF (Operating CF ¥276.2B + Investing CF -¥77.3B) was ¥198.9B, generated as operating CF exceeds capital expenditure of ¥202.1B. Investment efficiency: ROIC (NOPAT / Invested Capital) — NOPAT estimated at ¥61.4B (Operating Income ¥93.5B × (1 – effective tax rate 33.0%)); assuming invested capital = interest-bearing debt ¥1,110.7B + equity ¥2,831B = ¥3,941.7B, ROIC is around 1.6%, likely below cost of capital, indicating a need to improve capital efficiency. Total asset turnover 0.64x (Revenue ¥3,185.8B / average total assets ¥4,990.0B) is flat. Financial soundness: Equity Ratio 57.3% (prior 57.1%) indicates a solid capital base. Debt/Equity (interest-bearing debt ¥1,110.7B / equity ¥2,831B) is 0.39x — low leverage. Current ratio 102.9% (current assets ¥785.6B / current liabilities ¥763.1B) and quick ratio 102.9% show short-term liquidity is secured but buffers are thin. Cash and deposits ¥309.1B cover short-term borrowings ¥142.0B by 2.18x.
Operating CF was ¥276.2B (YoY +12.9%) calculated from operating CF subtotal before tax adjustments of ¥332.6B less income taxes paid ¥65.5B, increases in trade receivables ¥20.3B, etc. Depreciation ¥215.5B is a non-cash expense and a major source of cash generation, exceeding Operating Income ¥93.5B. Working capital effects were limited as the increase in trade receivables (-¥20.3B) and increase in trade payables (+¥4.6B) mostly offset each other; inventory changes were minimal (+¥0.2B). Interest and dividends received ¥17.2B and interest paid ¥9.5B are reflected on a cash basis, supporting stable cash generation from recurring operations. Investing CF was -¥77.3B, mainly capital expenditures ¥202.1B, but proceeds from sales of investment securities ¥181.7B and tangible fixed assets ¥3.3B reduced net outflow. M&A-related outlays included acquisitions of subsidiary shares ¥26.7B and intangible asset acquisitions ¥19.4B, indicating strategic investment in International Business and others. Financing CF was -¥193.2B: proceeds from long-term borrowings ¥351.4B and net short-term borrowings increase ¥642.5B were offset by long-term borrowings repayments ¥430.4B, net short-term borrowings decrease ¥552.5B, share buybacks ¥170.2B, dividends paid ¥28.0B, and lease liabilities repayments ¥3.2B. FCF (Operating CF ¥276.2B + Investing CF -¥77.3B) ¥198.9B covers dividends ¥28.0B by 7.1x and roughly funds total shareholder returns (dividends ¥28.0B + share buybacks ¥170.2B = ¥198.2B). Cash and cash equivalents increased from ¥296.3B at the beginning of the period to ¥303.9B at the end (+¥7.6B). Operating CF / Net Income 2.02x and OCF/EBITDA 0.89x indicate good cash conversion quality and a healthy cash cycle that funds capex and shareholder returns.
Core recurring earnings center on Operating Income ¥93.5B, calculated from Gross Profit ¥194.3B less SG&A ¥100.9B. Non-operating income ¥35.0B (1.1% of Revenue) comprises dividend income ¥16.3B (from non-equity-method affiliates, etc.), FX gains ¥6.3B, and other non-operating income ¥5.9B — well below a 5% threshold and within recurring range. Non-operating expenses ¥13.7B are mainly interest expense ¥9.7B, indicating an appropriate financial cost burden relative to interest-bearing debt ¥1,110.7B. Ordinary Income ¥114.8B was significantly boosted to profit before tax ¥205.6B by recognizing special gains ¥126.6B (mostly gains on sales of investment securities ¥125.3B). After special losses ¥35.7B (impairment losses ¥24.1B, loss on retirement of fixed assets ¥8.0B, etc.), the net impact was approximately +¥90.9B. Of Net Income ¥136.9B, special items account for roughly 66.4%, indicating high dependence on one-off items. Operating CF ¥276.2B is 2.02x Net Income and accrual ratio 2.8%, showing no excessive accrual expansion; cash is generated from operating CF subtotal ¥332.6B after working capital changes and tax/interest payments. Comprehensive income ¥170.4B (owners of parent ¥169.6B) exceeded Net Income ¥136.9B by ¥32.7B, mainly due to a positive ¥51.4B adjustment related to retirement benefits, offset by valuation differences on available-for-sale securities -¥20.6B and foreign currency translation adjustments ¥2.0B. The large positive net effect of special items (+¥90.9B) is the primary cause of the gap between Ordinary Income ¥114.8B and Net Income ¥136.9B; next year will require operating profit accumulation assuming special gains drop out.
Full-year guidance projects Revenue ¥3346.0B (YoY +5.0%), Operating Income ¥125.0B (YoY +33.7%), Ordinary Income ¥137.0B (YoY +19.4%), Net Income attributable to owners of the parent ¥170.0B, EPS ¥479.58, and annual dividend ¥50. Progress against current results (Revenue ¥3185.8B, Operating Income ¥93.5B, Ordinary Income ¥114.8B, Net Income ¥136.9B) is: Revenue 95.2%, Operating Income 74.8%, Ordinary Income 83.8%, Net Income 80.6%. The shortfall in Operating Income is material; an additional ¥31.5B in Operating Income is needed in the remaining period to achieve the full-year target. Given the one-off special gains of ¥126.6B that substantially boosted Net Income this period, the full-year Net Income guidance ¥170.0B (YoY +24.2%) appears to assume the drop-off of one-offs and stresses operating-level gains (price revisions, load factor improvements, expansion of high-margin segments). Revenue guidance assumes a 5.0% annual growth rate, roughly in line with the current period’s +5.3%. Annual dividend ¥50 (down from ¥76 this period) implies a Payout Ratio of 10.4% on EPS ¥479.58, a conservative and sustainable level.
Dividends totaled ¥76 (term-end ¥38, interim ¥38) (prior year ¥35, increase ¥41, +117.1%), with a Payout Ratio of 22.3% based on Net Income ¥136.9B (including one-offs). Dividend ¥76 vs. EPS ¥369.5 is sustainable, and dividends paid ¥28.0B are covered by FCF ¥198.9B by 7.1x, indicating ample capacity. Additionally, share buybacks of ¥170.2B were executed, making total shareholder returns ¥198.2B (dividends ¥28.0B + buybacks ¥170.2B), which is 144.8% of Net Income ¥136.9B. Total returns were almost fully covered by FCF ¥198.9B and dependence on borrowings is low. Treasury shares outstanding at period-end were 48.4 million shares (acquisition cost ¥189.7B), representing 12.1% of issued shares and signaling intent to improve capital efficiency. Next fiscal year’s dividend forecast is ¥50 (down from ¥76), which appears to be normalization considering this period’s one-off gains. Dividend sustainability on a dividend-only basis is well supported by cash and deposits ¥309.1B and operating CF generation; however, continuing buybacks of the same magnitude would require careful FCF and leverage management.
Low-margin structure and earnings sensitivity: With gross margin 6.1% and operating margin 2.9%, margins are thin and earnings are highly sensitive to cost inflation (fuel, labor). Heavy depreciation expense ¥215.5B (6.8% of Revenue) also presents a burden; delays in passing through higher costs or in capex replacement could compress profits. EBITDA ¥309.0B vs. Operating Income ¥93.5B indicates significant non-cash expense burden; strengthening earnings at the EBIT level is a key challenge.
Rising financial leverage and liquidity tightening: Debt/EBITDA 3.11x (interest-bearing debt ¥1,110.7B / EBITDA ¥309.0B) is somewhat elevated and reduces debt resilience in a downturn. Current ratio 102.9% offers limited buffer for increased short-term funding needs; cash ¥309.1B covers short-term borrowings ¥142.0B and long-term borrowings due within one year ¥149.2B (total ¥291.2B) by only 1.06x. Interest-bearing debt rose ¥190.7B from ¥920.0B last year, and further leverage increases are possible if investment expansion or continued high total returns persist.
Dependence on one-off gains and earnings quality risk: Of Net Income ¥136.9B, special gains ¥126.6B (gains on sales of investment securities ¥125.3B) contributed significantly; dependence on one-offs is about 66.4%. If one-off gains do not recur, Net Income could decline materially next year unless operating improvements (price adjustments, higher load factors, expansion of high-margin segments) are realized. Goodwill impairment of ¥2.15B indicates delays in monetizing International M&A benefits; monitoring post-merger integration (PMI) execution and earnings contribution from goodwill balance ¥28.6B (1.0% of equity) will be important.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 2.9% | 6.3% (3.7%–8.5%) | -3.4pt |
| Net Margin | 3.5% | 2.7% (1.6%–4.7%) | +0.8pt |
Operating margin trails the industry median (6.3%) by -3.4pt and ranks low within the sector. Net margin at 3.5% exceeds the median 2.7% by +0.8pt, largely reflecting this period’s one-off gains from sales of investment securities.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 5.3% | 5.0% (-0.4%–9.4%) | +0.3pt |
Revenue growth 5.3% slightly exceeds the industry median 5.0%, placing the company in the mid-to-upper range for growth within the sector.
※ Source: Company aggregation
Trend of operating margin improvement and expansion of high-margin segments: This period saw gross margin +0.5pt and operating margin +0.5pt improvement, with high-margin Logistics (16.1%) and Charter (9.3%) driving consolidated profits. Transportation margin improved to 2.6% (from 2.1%) showing cost efficiency gains. Key focus going forward will be realizing price revisions, improving load factors, and sustaining International growth to establish an operating margin above 3%. Given the -3.4pt gap vs. industry benchmark, continued mix improvement and cost control will be key evaluation criteria.
Cash generation and sustainability of total returns: Stable Operating CF ¥276.2B and FCF ¥198.9B support dividends ¥28.0B and share buybacks ¥170.2B (total ¥198.2B), largely funded from FCF with low borrowing reliance. Operating CF / Net Income 2.02x and accrual ratio 2.8% indicate strong cash conversion quality, with depreciation ¥215.5B as a primary non-cash source. Although Net Income is expected to decline when one-offs drop out next year, stable Operating CF supports the sustainability of dividend policy. Continued buybacks depend on FCF levels and investment needs, creating a trade-off with leverage management.
Need to achieve operating profit growth and improve capital efficiency after one-offs: Of Net Income ¥136.9B, special gains ¥126.6B had a major role; next year assumes the drop-off of these one-offs and requires operating profit accumulation (full-year Operating Income target ¥125.0B, YoY +33.7%). With ROE 4.8% and ROIC around 1.6%, capital efficiency remains weak; sustained margin improvement and higher asset turnover are medium-term drivers of valuation upside. Considering Debt/EBITDA 3.11x and tight current ratio 102.9%, balancing financial soundness with growth investments (M&A, digitalization, International expansion) and shareholder returns is critical. The goodwill impairment ¥2.15B indicates M&A monetization challenges; execution of PMI and profit contribution from the International Business will be important to monitor.
This report was automatically generated by AI analyzing XBRL financial statement data and is a financial analysis document. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are company-compiled reference information based on disclosed financial statements. Investment decisions are your responsibility; please consult professionals as appropriate before making investment decisions.