| Metric | Current Period | Prior Year | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥8129.6B | ¥7373.8B | +10.3% |
| Operating Income / Operating Profit | ¥376.1B | ¥298.8B | +25.8% |
| Ordinary Income | ¥372.6B | ¥281.2B | +32.5% |
| Net Income / Net Profit | ¥125.0B | ¥488.2B | -74.4% |
| ROE | 2.7% | 11.5% | - |
For the fiscal year ended March 2026, results settled at Revenue ¥8129.6B (YoY +¥755.9B +10.3%), Operating Income ¥376.1B (YoY +¥77.2B +25.8%), Ordinary Income ¥372.6B (YoY +¥91.4B +32.5%), and Net Income attributable to owners of the parent ¥125.0B (YoY +¥73.8B +36.0%). The core Transportation Business led performance with Revenue +13.8% and profit +32.2%, improving the Operating Margin to 4.6% (up 0.5pt from 4.1%) and Gross Margin to 12.0% (up 0.3pt from 11.7%). SG&A ratio declined to 7.4% (down 0.3pt from 7.7%), with scale benefits and cost discipline contributing to margin improvement. Net income attributable to owners included Special Gains of ¥51.1B (gain on sale of investment securities ¥24.0B, gain from negative goodwill ¥11.7B, etc.), but the earnings quality is sound as the increase was driven mainly at the ordinary level.
[Revenue] Revenue was ¥8129.6B (YoY +10.3%), with all major segments recording revenue increases. The Transportation Business was the largest driver at ¥6333.1B (+13.8%), accounting for 77.9% of consolidated revenue. Fare and ancillary fee optimization, utilization optimization, and efficiencies in joint delivery and relay hubs supported both unit price improvements and volume stability. The Automotive Sales Business recorded ¥1204.1B (-4.0%) reflecting a pullback but retained a 14.8% share of consolidated revenue. Merchandise Sales was ¥555.9B (+2.9%) and Other segments (information-related business, housing sales, taxi, travel agencies, etc.) were ¥389.0B (+5.4%), each showing resilience. Real Estate Leasing was ¥24.6B (+4.3%)—small in scale but functioning as a high-margin cushion.
[Profitability] Operating Income was ¥376.1B (YoY +25.8%), improving the Operating Margin to 4.6% (up 0.5pt). Gross Profit was ¥978.0B (Gross Margin 12.0%), up ¥111.9B from ¥866.1B (Gross Margin 11.7%), a +0.3pt improvement. SG&A was ¥601.9B (SG&A ratio 7.4%), up ¥34.6B from ¥567.3B (SG&A ratio 7.7%), but the increase was limited relative to revenue growth, resulting in a -0.3pt decrease in SG&A ratio. By segment, Transportation generated Operating Income ¥274.2B (Margin 4.3%, YoY +32.2%), improving both margin and absolute profit and accounting for ~73% of consolidated operating profit. Automotive Sales delivered ¥69.2B (Margin 5.7%, YoY -3.4%) in an adjustment phase but maintained a 5.7% margin supporting consolidated margins. Merchandise Sales produced ¥13.1B (Margin 2.4%, YoY +12.4%), Other segments ¥22.7B (Margin 5.8%, YoY +24.1%), and Real Estate Leasing ¥18.1B (Margin 73.7%, YoY +4.6%), each showing profit growth and highlighting the high profitability of Real Estate Leasing. Ordinary Income was ¥372.6B (YoY +32.5%), with Non-Operating Income ¥27.2B (dividend income ¥12.2B, other non-operating income ¥14.4B) and Non-Operating Expenses ¥30.6B (interest expense ¥13.1B, other non-operating expenses ¥4.0B), resulting in net non-operating loss of -¥3.4B. Interest expense doubled from ¥6.1B to ¥13.1B, likely due to temporary increases associated with refinancing into long-term borrowings, while Interest Coverage remained strong at 28.75x. Profit before income taxes was ¥416.1B (YoY +28.0%); Special Gains ¥51.1B (gain on sale of investment securities ¥24.0B, gain on sale of fixed assets ¥3.6B, gain from negative goodwill ¥11.7B, etc.) contributed, while Special Losses were limited at ¥7.7B (impairment losses ¥0.3B, valuation losses on investment securities ¥1.2B, etc.). Income taxes were ¥161.9B (effective tax rate 38.9%), up from ¥121.2B (effective tax rate 37.3%) and the higher tax burden constrained Net Margin. Net income attributable to non-controlling interests was ¥17.8B, and Net Income attributable to owners of the parent was ¥125.0B (YoY +36.0%, Net Margin 1.5%). In conclusion, fare revisions and operational efficiencies drove revenue and profit growth, realizing operating leverage.
The Transportation Business (Revenue ¥6333.1B, Operating Income ¥274.2B, Margin 4.3%) led the company with Revenue +13.8% and profit +32.2%, driven by fare optimization and utilization improvements. Automotive Sales (Revenue ¥1204.1B, Operating Income ¥69.2B, Margin 5.7%) experienced Revenue -4.0% and profit -3.4% but maintained a 5.7% margin supporting overall margins. Merchandise Sales (Revenue ¥555.9B, Operating Income ¥13.1B, Margin 2.4%) was steady with Revenue +2.9% and profit +12.4%. Other segments (information-related, housing sales, taxi, travel agencies, etc.; Revenue ¥389.0B, Operating Income ¥22.7B, Margin 5.8%) performed well with Revenue +5.4% and profit +24.1%. Real Estate Leasing (Revenue ¥24.6B, Operating Income ¥18.1B, Margin 73.7%) recorded Revenue +4.3% and profit +4.6%, functioning as a small but high-return stabilizer. Contribution to consolidated Operating Income: Transportation ~73%, Automotive Sales ~18%, Others ~9%.
[Profitability] Operating Margin 4.6% (up 0.5pt from 4.1%), Gross Margin 12.0% (up 0.3pt from 11.7%), SG&A Ratio 7.4% (down 0.3pt from 7.7%), Net Margin 1.5% (down 1.1pt from 2.6%). Improvements at the operating level were offset by higher tax burden which reduced Net Margin. ROE is 5.0% (calculation basis: Net Margin 1.5% × Total Asset Turnover 1.03 × Financial Leverage 1.68), improving 0.3pt from 4.7% but still low vs. peers. Effective tax rate remained high at 38.9% (up 1.6pt from 37.3%), with a tax burden coefficient of 0.57 suppressing Net Margin.
[Cash Quality] Operating Cash Flow (OCF) ¥565.9B is 4.53x Net Income ¥125.0B, showing strong cash backing of profits. OCF subtotal (before working capital changes) was ¥673.5B, indicating good operating profitability including Depreciation ¥264.7B. OCF/EBITDA ratio was 0.88x (calculation: EBITDA = Operating Income ¥376.1B + Depreciation ¥264.7B = ¥640.8B; OCF ¥565.9B ÷ EBITDA ¥640.8B), narrowly below the 0.9x guideline but generally healthy. Accrual ratio was -4.2% (calculation: [Net Income ¥125.0B - OCF ¥565.9B] ÷ Total Assets ¥7900.7B), supporting good cash conversion of earnings. Free Cash Flow was ¥231.7B (OCF ¥565.9B + Investing CF -¥334.2B), covering dividend payments ¥152.0B at an FCF coverage of 1.52x while balancing equity maintenance and additional investment capacity.
[Investment Efficiency] Total Asset Turnover was 1.03x (Revenue ¥8129.6B ÷ Total Assets ¥7900.7B), improved from 0.96x last year. Estimated ROIC was 4.9% (calculation: EBIT ¥376.1B × (1 - tax rate 0.389) ÷ Invested Capital ¥4712.7B), near the cost of capital, indicating scope for capital efficiency improvement.
[Financial Soundness] Equity Ratio 59.6% (up 4.7pt from 54.9%) indicates a strong financial base. Current Ratio 177.1% (Current Assets ¥2297.8B ÷ Current Liabilities ¥1297.4B) and Quick Ratio 160.2% ([Current Assets ¥2297.8B - Inventories ¥219.9B] ÷ Current Liabilities ¥1297.4B) show ample liquidity. Debt/Equity 0.68x (Interest-bearing debt ¥3207.9B ÷ Net Assets ¥4712.7B), Debt/Capital 16.0% (Interest-bearing debt ¥3207.9B ÷ [Net Assets ¥4712.7B + Interest-bearing debt ¥3207.9B]), Debt/EBITDA 1.40x (Interest-bearing debt ¥3207.9B ÷ EBITDA ¥640.8B), and Interest Coverage 28.75x (EBIT ¥376.1B ÷ Interest expense ¥13.1B) place credit metrics within investment-grade territory. Short-term debt ratio 7.7% (Short-term interest-bearing debt ¥86.8B ÷ Total liabilities ¥3187.9B) and Cash/Short-term debt 12.76x (Cash and deposits ¥878.2B ÷ Short-term interest-bearing debt ¥68.8B) indicate very strong short-term repayment capacity. Retirement benefit liability is ¥703.1B (8.9% of total assets), sizable but manageable given scale and asset base. Investment securities amount to ¥897.5B (11.4% of total assets), sizable and serving both mark-to-market risk and liquidity buffer roles.
OCF was ¥565.9B (YoY +7.3%), 4.53x Net Income ¥125.0B, indicating very strong cash backing. OCF subtotal (before working capital changes) was ¥673.5B, reflecting healthy operating profitability including Depreciation ¥264.7B. On working capital, a decrease in accounts receivable (change +¥97.0B) was a cash inflow, while a decrease in accounts payable (change -¥51.7B) was a cash outflow. Inventory increase (change -¥24.8B) was limited, and overall working capital changes had a neutral impact on OCF. Income tax payments were -¥147.5B, reflecting the high effective tax rate. Investing CF was -¥334.2B, driven mainly by capital expenditures (PPE and intangible assets acquisitions) of -¥374.7B; acquisition of subsidiary shares was -¥376.5B, collection of long-term loans ¥0.3B, and proceeds from sale/redemption of investment securities ¥26.8B. Capex was primarily directed to fleet and facility enhancements in the Transportation Business. FCF was ¥231.7B (OCF ¥565.9B + Investing CF -¥334.2B), covering dividend payments ¥152.0B at an FCF coverage of 1.52x and balancing equity maintenance with additional investment capacity. Financing CF was -¥165.7B, with long-term borrowings raised ¥787.0B, net decrease in short-term borrowings -¥762.6B, repayment of long-term borrowings -¥15.1B, dividend payments -¥152.0B, and proceeds from disposal of treasury stock ¥8.1B. The strategy of materially increasing long-term borrowings while substantially reducing short-term borrowings extended the maturity profile, reducing liquidity and refinancing risks. Cash and cash equivalents increased by ¥67.1B from ¥773.5B at the beginning of the period to ¥840.6B at the end, strengthening liquidity. OCF/EBITDA ratio was 0.88x (OCF ¥565.9B vs. EBITDA ¥640.8B) narrowly below the 0.9x benchmark; accrual ratio was -4.2%, indicating healthy cash conversion of profits.
Earnings quality is solid, driven mainly by recurring operating improvements. Operating Income ¥376.1B (YoY +25.8%) was led by fare optimization and efficiency in the Transportation Business, with Gross Margin +0.3pt and SG&A ratio -0.3pt reflecting realized operating leverage. Non-Operating Income ¥27.2B comprised dividend income ¥12.2B (0.15% of revenue) and other non-operating income ¥14.4B, indicating limited reliance on non-operating items. Non-Operating Expenses ¥30.6B were centered on interest expense ¥13.1B (doubled from ¥6.1B), likely a temporary increase tied to refinancing into long-term debt, while Interest Coverage remained strong at 28.75x. Special Gains ¥51.1B (gain on sale of investment securities ¥24.0B, gain on sale of fixed assets ¥3.6B, gain from negative goodwill ¥11.7B, etc.) were one-off, but Ordinary Income ¥372.6B (YoY +32.5%) was the main driver, indicating low dependence on special gains. Special Losses were limited at ¥7.7B. Profit before income taxes ¥416.1B against Income taxes ¥161.9B (effective tax rate 38.9%) shows the high tax burden suppressing Net Margin to 1.5%. Comprehensive income was ¥388.8B (Net Income ¥124.9B + Other Comprehensive Income ¥134.6B); Other Comprehensive Income included valuation gains on securities +¥120.8B, adjustments related to retirement benefits +¥7.2B, foreign currency translation adjustments +¥3.5B, and OCI share of associates +¥3.0B, with valuation gains on securities significantly boosting equity. OCF ¥565.9B is 4.53x Net Income and accrual ratio -4.2%, confirming very strong cash backing of earnings and high earnings quality.
Company plan for FY ending March 2027 forecasts Revenue ¥8255.0B (YoY +1.5%), Operating Income ¥414.0B (YoY +10.1%), Ordinary Income ¥418.0B (YoY +12.2%), Net Income attributable to owners of the parent ¥275.0B, and EPS ¥169.08. The revenue outlook assumes flat volumes with margin expansion driven by further unit price improvement and efficiency—a conservative scenario. Operating Margin is expected to improve to 5.0% (up 0.4pt from 4.6%), contingent on implementation of fare revision effects, full pass-through of higher labor and fuel costs, and improved utilization. Ordinary Income is projected to rise +12.2% mainly from operating improvements. Net Income ¥275.0B is a large increase from ¥125.0B last year; given last year included Special Gains ¥51.1B but net income was constrained by high tax burden, next year’s level is presumed on the basis of normalized tax burden. Dividend forecast is ¥43.00 per share, a substantial decrease from last year’s ¥104.00, possibly indicating a reset of dividend policy.
Annual dividend is ¥104.00 (Year-end ¥61.00 + Interim ¥43.00). The payout ratio on a nominal basis relative to Net Income attributable to owners of the parent ¥125.0B is 82.6% (Total dividend payments ¥151.5B ÷ Net Income ¥125.0B; actual dividend payment was ¥152.0B). FCF coverage is 1.52x (FCF ¥231.7B ÷ dividend payments ¥152.0B), indicating dividends are comfortably covered by OCF and FCF and sustainability is generally acceptable. However, the payout ratio of 82.6% is relatively high, leaving limited buffer against earnings volatility. The company’s forecast shows next year’s dividend at ¥43.00, suggesting priority may shift to retaining earnings and securing investment capacity through dividend normalization (reduction). Treasury stock at book value is -¥502.8B (improved by +¥274.6B from -¥777.4B), indicating disposal/cancellation of treasury shares has bolstered equity and improved flexibility for capital efficiency and shareholder returns. Details on total shareholder return (dividends + buybacks) are insufficiently disclosed, but the stance appears to emphasize dividends.
Cost escalation risk: If increases in fuel, electricity, tires and other operating costs outpace fare pass-through, margins could deteriorate under the structural constraint of Gross Margin 12.0%. Interest expense doubled from ¥6.1B to ¥13.1B; further interest rate rises could increase funding costs. The high effective tax rate of 38.9% will continue to suppress Net Margin and impede ROE improvement.
Labor shortage / wage risk: Driver shortages and wage pressure could raise labor costs and materially constrain operations. Retirement benefit liability ¥703.1B (8.9% of total assets) is sizable; adverse interest rate movements or poorer asset returns could increase pension obligations and cash outflow risk.
Market / volatility risk: Demand volatility from economic slowdown or slower growth in e-commerce logistics directly affects volumes and revenue. Investment securities ¥897.5B (11.4% of total assets) carry market price risk that could affect Other Comprehensive Income and equity. Large natural disasters or road restrictions causing network disruption and recovery costs also present business continuity risk.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 4.6% | 6.3% (3.7%–8.5%) | -1.7pt |
| Net Margin | 1.5% | 2.7% (1.6%–4.7%) | -1.2pt |
Both Operating Margin and Net Margin are below industry medians, and profitability improvement remains a challenge.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 10.3% | 5.0% (-0.4%–9.4%) | +5.3pt |
Revenue growth outperformed the industry median by +5.3pt, placing the company among the upper ranks for growth within the peer set.
※ Source: Company aggregation
Fare optimization and realized operating leverage improved Operating Margin to 4.6% (up 0.5pt from 4.1%), delivering Operating Income growth of +25.8%. The Transportation Business led with Revenue +13.8% and profit +32.2%, and SG&A ratio decreased by 0.3pt through cost control. OCF was ¥565.9B (4.53x Net Income) and accrual ratio -4.2%, indicating very strong cash backing. FCF ¥231.7B covered dividend payments ¥152.0B at FCF coverage 1.52x, balancing equity maintenance and additional investment capacity.
The maturity-extension strategy (short-term borrowings compressed -91.7%, long-term borrowings increased +1305.6%) reduced liquidity and refinancing risk. Liquidity and credit metrics—Current Ratio 177%, Quick Ratio 160%, Debt/EBITDA 1.40x, Interest Coverage 28.75x—are comfortably within investment-grade ranges. Equity Ratio 59.6% (up 4.7pt) demonstrates a strong financial base. Real Estate Leasing (Margin 73.7%) functions as a high-return cushion, and Automotive Sales (Margin 5.7%) helps complement margins, highlighting portfolio diversification.
However, a persistently high effective tax rate of 38.9% suppresses Net Margin to 1.5%, with ROE 5.0% and estimated ROIC 4.9% low within the peer group. Operating Margin 4.6% lags the industry median 6.3% by -1.7pt, and Net Margin 1.5% trails the industry median 2.7% by -1.2pt. Given the structural constraint of Gross Margin 12.0%, ongoing challenges include absorbing fixed costs via sustained improvements in fare unit price, load factor and utilization, appropriate pass-through of fuel price increases, CASK reduction through digitization, and tax management to improve ROIC and ROE. Next year’s guidance (Revenue +1.5%, Operating Income +10.1%) is conservative; achieving continued margin improvements is assessed as moderately achievable.
This report was auto-generated by AI analyzing XBRL earnings release data to produce a financial analysis. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information aggregated by the company from public financial statements. Investment decisions are your responsibility; please consult a professional advisor as needed.