| 指標 | 当期 | 前年同期 | YoY |
|---|---|---|---|
| Revenue / Net Sales | ¥1301.2B | ¥1192.0B | +9.2% |
| Operating Income / Operating Profit | ¥44.0B | ¥34.5B | +27.7% |
| Ordinary Income | ¥47.2B | ¥39.0B | +20.9% |
| Net Income / Net Profit | ¥28.6B | ¥21.9B | +30.5% |
| ROE | 13.4% | 11.6% | - |
For the fiscal year ended May 2026, Revenue was ¥1,301.2B (YoY +¥109.2B +9.2%), Operating Income was ¥44.0B (YoY +¥9.6B +27.7%), Ordinary Income was ¥47.2B (YoY +¥8.2B +20.9%), and Net Income attributable to owners of the parent was ¥27.6B (YoY +¥6.6B +30.5%), achieving both top-line and bottom-line growth. Operating margin improved by 0.5pt to 3.4% (prior year 2.9%), and SG&A ratio declined by 0.6pt to 53.4% (prior year 53.9%), which primarily drove profit expansion. Gross margin was 56.7%, essentially flat (prior year 56.8%), indicating bottom-line expansion driven by cost-efficiency improvements. ROE rose to 13.4% (prior year 10.8%), and Operating Cash Flow was ¥48.9B (YoY +59.8%), generating 1.77x of Net Income. Inventory build (+¥12.0B) absorbed part of the Operating CF subtotal (¥63.4B), leaving an OCF/EBITDA ratio at 0.72x. Share buybacks of ¥32.3B and dividends of ¥4.4B resulted in total returns equal to approximately 133% of Net Income, which is proactive; however, Free Cash Flow (FCF) was ¥18.5B, below shareholder distributions, and cash balances were maintained at cash and deposits of ¥64.6B.
【Revenue】 Revenue of ¥1,301.2B was up +9.2% YoY, with all segments achieving growth. Domestic Book Off Business totaled ¥1,127.6B (+8.1%), accounting for 86.7% of Group sales and continuing as the core stable-growth segment. Premium Services Business was ¥85.3B (+18.8%), maintaining high growth, driven by expansion in non-price domains such as major department store counters “hugall” and jewelry specialty store “aidect.” Overseas Business was ¥71.5B (+15.8%), with revenue increases in both the U.S. “BOOKOFF” and Malaysia “Jalan Jalan Japan” regions. Others (trading card specialty stores, etc.) recorded ¥27.8B (+18.5%)—small but high growth. Sales composition: Domestic Book Off 86.7%, Premium Services 6.6%, Overseas 5.5%, Others 2.1%, indicating continued high domestic concentration.
【Profitability】 Operating Income of ¥44.0B was up +27.7% YoY, reflecting operating leverage that outpaced the revenue growth rate (+9.2%). Cost of sales was ¥563.0B (prior year ¥514.5B), yielding gross profit of ¥738.3B and a gross margin of 56.7%, nearly flat (prior year 56.8%). SG&A was ¥694.2B (prior year ¥643.0B), up only +7.9%, below revenue growth, improving SG&A ratio by 0.6pt to 53.4%. Major line items included rent ¥121.3B, salaries and allowances ¥74.0B, and commissions and fees ¥76.2B, with cost increases from store network expansion absorbed through efficiency gains. Depreciation and amortization was ¥23.9B (prior year ¥22.0B), reflecting increased store renovations and capital investment; goodwill amortization was minimal at ¥0.1B. Non-operating income totaled ¥7.6B (mainly miscellaneous income ¥3.8B) and non-operating expenses ¥4.5B (interest expense ¥3.4B), resulting in Ordinary Income of ¥47.2B (+20.9%). Extraordinary items produced a net burden of -¥3.2B (extraordinary gains ¥1.6B—gain on sale of investment securities ¥0.7B, etc.; extraordinary losses ¥4.8B—impairment losses ¥2.3B, loss on disposal of fixed assets ¥0.7B, disaster losses ¥0.2B), leaving Pre-tax Income at ¥44.0B. After deducting income taxes of ¥15.3B (effective tax rate 34.8%) and non-controlling interests of ¥1.0B, Net Income attributable to owners of the parent was ¥27.6B (+30.5%). In conclusion, top-line and bottom-line growth were achieved, driven by SG&A ratio improvement and expansion of Operating Income margin.
Domestic Book Off Business recorded segment profit of ¥63.7B (prior year ¥53.5B, +19.1%) with a margin of 5.65%, serving as the Group’s profit pillar. Premium Services Business achieved segment profit of ¥1.6B (prior year ¥0.4B, +263.6%), a significant increase though margin remained low at 1.88%. Overseas Business posted segment profit of ¥6.9B (prior year ¥6.9B, -0.4%), essentially flat, but with the highest margin at 9.66%, highlighting superior profitability. Others recorded a segment loss of ¥3.3B (prior year -¥2.6B), widening the deficit. Consolidated Ordinary Income after company-wide cost allocations was ¥47.2B, reflecting a complementary relationship between domestic scale and high-margin overseas operations. Steady domestic profit contribution and expansion in premium areas are key to future margin improvement.
【Profitability】Operating margin 3.4% (prior year 2.9%, +0.5pt), Net margin 2.2% (prior year 1.8%, +0.4pt), Gross margin 56.7% (prior year 56.8%, -0.1pt), with SG&A ratio improvement to 53.4% (prior year 53.9%, -0.6pt) lifting Operating margin. ROE 13.4% (prior year 10.8%) rose above the company’s historical levels. EBITDA margin 5.2% (EBITDA ¥67.9B / Revenue) is calculated as Operating Income plus depreciation and amortization. 【Cash Quality】Operating CF / Net Income ratio 1.77x, Accrual ratio -3.5% are favorable, but OCF/EBITDA ratio 0.72x remains low due to working capital increases (Inventory +¥12.0B, Accounts receivable +¥6.4B). 【Investment Efficiency】Total asset turnover 2.14x (Revenue ¥1,301.2B / Ending total assets ¥609.4B), Inventory turnover 2.7x (Cost of sales ¥563.0B / Average inventory ¥208.1B) with Days Inventory Outstanding at 137 days—long—and CCC 144 days (DIO 137 days + DSO 13 days - DPO 6 days), indicating significant room for improvement. 【Financial Soundness】Equity Ratio 35.2% (prior year 32.9%, +2.3pt), Current Ratio 171.8% (prior year 166.0%) are healthy, though Quick Ratio 70.8% indicates high inventory dependence. Debt/EBITDA 1.98x, Debt/Capital 38.6%, Interest Coverage 13.11x (EBITDA / interest paid 20.24x) suggest investment-grade creditworthiness.
Operating CF of ¥48.9B resulted from an Operating CF subtotal (after adjustments for depreciation, goodwill amortization, etc.) of ¥63.4B, less inventory increase ¥12.0B and accounts receivable increase ¥6.4B, and plus accounts payable increase ¥1.8B, producing net absorption. After corporation tax payments of ¥12.4B, Operating CF still generated 1.77x of Net Income ¥27.6B, demonstrating strong cash generation. Investing CF was -¥30.4B, primarily capital expenditure ¥21.5B (investment/ depreciation ratio 0.90x against depreciation ¥23.9B) and software investment ¥3.1B. Including inflows such as long-term loan recoveries ¥0.5B, FCF was ¥18.5B. Financing CF was -¥21.0B, reflecting total shareholder returns of ¥36.7B (share buybacks ¥32.3B and dividend payments ¥4.4B), while securing funds via long-term borrowings ¥57.0B and bond issuance ¥40.0B, and executing short-term borrowings ¥26.6B, long-term borrowings repayments ¥34.5B, and bond redemptions ¥6.6B. As a result, cash decreased by ¥1.7B to ending cash and deposits of ¥64.6B. Although working capital increases pressured Operating CF, the inventory increase is judged to be necessary investment accompanying business expansion, with no signs of manipulation.
The gap between Ordinary Income ¥47.2B and Net Income ¥27.6B (-41.5%) is mainly due to income taxes ¥15.3B (effective tax rate 34.8%) and extraordinary items -¥3.2B. Of Non-operating income ¥7.6B, recurring items are limited (interest received approx. ¥0.3B), and the composition of the remaining miscellaneous non-operating income ¥3.8B is undisclosed but small. Extraordinary losses ¥4.8B consist of impairment losses ¥2.3B, loss on disposal of fixed assets ¥0.7B, and disaster losses ¥0.2B—one-time charges associated with store portfolio restructuring. Extraordinary gains ¥1.6B mainly consist of gains on sale of investment securities ¥0.7B and gains on sale of fixed assets ¥0.0B, both small. The difference between Comprehensive Income ¥31.1B and Net Income ¥27.6B is mainly foreign currency translation adjustments ¥2.4B, reflecting benefits from a weaker yen in overseas operations. Favorable indicators—Operating CF / Net Income 1.77x and Accrual ratio -3.5%—support recurring cash generation capability. Conversely, OCF/EBITDA ratio 0.72x appears temporarily depressed by working capital increases; improvements in inventory and receivables turnover could restore this to above 0.9x.
Full Year guidance: Revenue ¥1,390.0B (YoY +6.8%), Operating Income ¥47.0B (YoY +6.7%), Ordinary Income ¥50.0B (YoY +5.9%), Net Income attributable to owners of the parent ¥28.0B, EPS ¥159.52, forecasting revenue and profit growth. Progress against the first-half results (Revenue ¥1,301.2B, Operating Income ¥44.0B) shows high run rates at 93.6% for both Revenue and Operating Income, making FY targets achievable. Assumptions for next fiscal year include continued SG&A ratio improvement and inventory turnover efficiency, with comp store performance uplift and high growth in Premium Services as key drivers. Dividend forecast is stated as ¥0, but given the actual year-end dividend of ¥36 this fiscal year, detailed confirmation of next-year dividend policy is required.
A year-end dividend of ¥36 yields a payout ratio of 23.0% (based on EPS ¥157.45), a sustainable level. Against FCF ¥18.5B, dividend payments ¥4.4B provide an FCF coverage of 4.2x, indicating ample coverage; however, total returns including share buybacks ¥32.3B (total ¥36.7B) exceed Net Income ¥27.6B, making Total Return Ratio approximately 133%. Share buybacks were ¥32.3B on a cash basis, acquiring 0.3 million shares. The proactive total returns are supported by financial soundness and Operating CF generation, but inventory turnover improvements and CCC shortening are prerequisites for durable FCF expansion. Although next-year dividend is stated as ¥0, given this year’s payout, continuation of dividends next year is likely and confirmation of detailed shareholder return policy is needed.
Inventory stagnation and valuation loss risk: Inventories ¥210.8B represent 34.6% of total assets, with Days Inventory Outstanding of 137 days, indicating lengthening. Given the nature of reuse merchandise, misjudgment in purchase pricing or demand shifts could trigger markdowns, valuation losses, and disposal costs. CCC of 144 days signals extended working capital and potential volatility in cash generation.
Upward pressure on fixed store costs: Rent ¥121.3B (17.5% of SG&A) and salaries and allowances ¥74.0B (10.7% of SG&A) are major cost items. Continued rent inflation and wage increases could reverse operating leverage and reduce margins. Although SG&A ratio improved to 53.4% this year, cost pressures exceeding revenue growth could cause deterioration.
Concentration in core business and store restructuring costs: Domestic Book Off Business accounts for 86.7% of sales, indicating high business concentration. Impairment losses ¥2.3B and Asset Retirement Obligations ¥25.4B reflect costs related to store portfolio turnover, and increased cash outflows on closures/renovations pose liquidity risk. Quick Ratio 70.8% and high inventory dependence require attention to liquidity preservation in demand shocks.
Profitability & Returns
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Operating margin | 3.4% | 4.6% (1.7%–8.2%) | -1.2pt |
| Net margin | 2.2% | 3.3% (0.9%–5.8%) | -1.1pt |
The company’s profitability is below retail industry medians, indicating substantial room for improvement in cost efficiency and inventory turnover.
Growth & Capital Efficiency
| 指標 | 自社 | 中央値 (IQR) | Delta |
|---|---|---|---|
| Revenue growth rate (YoY) | 9.2% | 4.3% (2.2%–13.0%) | +4.9pt |
The company’s growth rate materially exceeds industry medians, with domestic and international expansion progressing well.
※Source: Company compilation
Continued top-line and bottom-line growth with SG&A ratio improvement: Operating margin improved to 3.4% (+0.5pt), with SG&A ratio declining to 53.4% (-0.6pt), driving profit expansion. SG&A growth (+7.9%) lagged revenue growth (+9.2%), evidencing operating leverage; if similar cost efficiency is maintained next year, Operating margin could exceed 3.5%. High growth in Premium Services (+18.8%) and margin improvement (segment profit +263.6%) indicate value-add expansion in non-price areas.
Room to improve inventory turnover and cash conversion: Days Inventory Outstanding 137 days and CCC 144 days are long versus peers, indicating large potential for shortening. Inventory increase this year (+¥12.0B) pressured Operating CF and kept OCF/EBITDA at 0.72x, but improving inventory turns and optimizing payables could raise this above 0.9x and expand FCF. Cash and deposits ¥64.6B and low Debt/EBITDA 1.98x show financial capacity; if inventory optimization succeeds, balancing dividends and growth investment will be more robust.
Financial soundness and active shareholder returns: Equity Ratio 35.2%, Current Ratio 171.8%, Interest Coverage 13.11x demonstrate high financial safety. Total Return Ratio approx. 133% (buybacks + dividends) is aggressive but supported by Operating CF ¥48.9B and low leverage. Large reduction in short-term borrowings (-41.3%) and lengthening of borrowings enhance resilience to interest rate rises. Asset Retirement Obligations ¥25.4B (6.4% of liabilities) are high but acceptable as costs to maintain flexibility in store strategy.
This report is an AI-generated earnings analysis document created by analyzing XBRL financial statement data. It does not constitute a recommendation to invest in any particular security. Industry benchmarks are reference information compiled by the Company based on public financial statement data. Investment decisions are your responsibility; seek professional advice as appropriate before making investment decisions.