| Metric | Current Period | Prior Year Period | YoY |
|---|---|---|---|
| Revenue | ¥280.3B | ¥278.4B | +0.7% |
| Operating Income | ¥20.5B | ¥21.9B | -6.3% |
| Ordinary Income | ¥23.9B | ¥24.3B | -1.6% |
| Net Income attributable to owners of the parent | ¥20.0B | ¥15.8B | +26.2% |
| ROE | 4.1% | 3.4% | - |
For the fiscal year ended March 2026, Revenue was ¥280.3B (YoY +¥1.9B +0.7%), Operating Income was ¥20.5B (YoY -¥1.4B -6.3%), Ordinary Income was ¥23.9B (YoY -¥0.4B -1.6%), and Net Income attributable to owners of the parent was ¥20.0B (YoY +¥4.2B +26.2%). Although revenue increased, operating profit declined; however, Net Income rose significantly due to a gain on sale of investment securities of ¥5.1B (special gains) and dividend income received of ¥3.7B (non-operating income). On the operating side, SG&A increased to ¥12.6B (YoY +11.9%), substantially outpacing revenue growth, and Operating Margin deteriorated by 0.6pt to 7.3% from 7.9% a year ago. Conversely, Comprehensive Income reached ¥45.7B (YoY +155%), and valuation differences on available-for-sale securities of ¥24.1B contributed to a significant increase in Net Assets.
[Revenue] Revenue was ¥280.3B (YoY +0.7%), showing only a slight increase. By segment, Domestic Logistics Business accounted for ¥223.2B (+0.1%), representing 79.6% of the total and remaining flat; International Cargo Business was ¥53.5B (+3.0%) and performed solidly; Real Estate Leasing Business was ¥3.6B (+1.1%) and maintained high profitability. Domestic Logistics revenue comprises ¥219.3B from contract-derived revenue (warehousing & transportation) and ¥3.9B from other income (warehouse leasing, etc.). International Cargo focuses on packaging and customs clearance, and increased volumes pushed up revenue, but growth remained in single digits. Overall, capture of new demand was limited, and improvements in volume and pricing with existing customers were modest.
[Profitability] Operating Income declined to ¥20.5B (YoY -6.3%). Cost of sales was ¥247.2B (88.2% of sales), roughly flat year-on-year, but SG&A rose to ¥12.6B from ¥11.3B (YoY +11.9%), pressuring profits. Within SG&A, salaries and allowances increased by ¥2.8B and taxes and public dues by ¥0.9B, with increases in segment-common costs and corporate administrative expenses weighing on results. As a result, Operating Margin fell to 7.3% from 7.9% a year earlier (down 0.6pt). Segment-level Operating Income: Domestic Logistics ¥25.3B (-1.1%), International Cargo ¥4.9B (-2.6%), Real Estate Leasing ¥1.5B (+0.1%); the margin decline in International Cargo (9.1%) was notable. Ordinary Income was ¥23.9B (YoY -1.6%), a modest decline, with non-operating income of ¥4.9B (including dividend income received of ¥3.7B) partially offsetting the operating shortfall. The recording of special gains of ¥5.1B (gain on sale of investment securities) expanded Pretax Income to ¥29.0B (+16.9%), and after income taxes of ¥8.2B (effective tax rate 28.2%), Net Income attributable to owners of the parent was ¥20.0B (+26.2%). In conclusion, despite revenue growth with operating profit decline, one-off gains and investment income led to a substantial final profit increase.
The Domestic Logistics Business recorded Revenue of ¥223.2B (YoY +0.1%), Operating Income of ¥25.3B (YoY -1.1%), and a margin of 11.4%. As the core segment, growth has slowed. It generates about 80% of consolidated Operating Income, but margin dipped slightly due to higher SG&A. International Cargo posted Revenue of ¥53.5B (YoY +3.0%) but Operating Income of ¥4.9B (YoY -2.6%), with a 9.1% margin, 2.3pt below Domestic Logistics. Higher costs in packaging and customs services pressured profitability. Real Estate Leasing recorded Revenue of ¥3.6B (YoY +1.1%), Operating Income of ¥1.5B (YoY +0.1%), and an exceptionally high margin of 42.5%, contributing to overall profit stability. Corporate-level expenses (head office administrative costs not allocated to segments) were ¥11.2B, up from ¥10.2B (YoY +9.8%), and after deducting from total segment profit of ¥31.7B, consolidated Operating Income was ¥20.5B.
[Profitability] Operating Margin was 7.3%, down 0.6pt from 7.9% a year earlier, while Net Income Margin improved to 7.1% from 5.7% (up 1.4pt). This improvement is due to special gains of ¥5.1B and non-operating income of ¥4.9B, indicating core operating profitability has declined. ROE was 4.1%, up 0.6pt from 3.5%; DuPont decomposition is explained by Net Profit Margin 7.4% × Total Asset Turnover 0.44 × Financial Leverage 1.30, with low asset turnover constraining capital efficiency. [Cash Quality] Operating Cash Flow (OCF) was ¥29.6B, 1.48x Net Income of ¥20.0B, which is healthy; OCF/EBITDA ratio was 0.76x (EBITDA = Operating Income ¥20.5B + Depreciation ¥18.5B = ¥39.0B), slightly below the standard 0.9x. Working capital variation was minor, and tax payments of ¥10.5B and adjustments for non-operating items slowed cash conversion. [Investment Efficiency] Against Total Assets of ¥636.6B, Investment Securities were ¥154.6B (24.3% of total assets) and Cash & Deposits were ¥88.8B (13.9%), totaling ¥243.4B or 38.2% of assets, a major factor behind the low asset turnover of 0.44x. Capital expenditures were ¥30.6B, 1.65x depreciation of ¥18.5B, indicating expansion of warehouses and logistics hubs. [Financial Soundness] Equity Ratio was 77.1%, slightly down from 77.7% a year ago but remaining very strong. Interest-bearing debt was ¥64.4B (short-term borrowings ¥29.0B, long-term borrowings ¥35.4B, corporate bonds ¥1.3B, lease liabilities ¥1.7B), Debt/EBITDA was 1.65x, and Interest Coverage was 19.2x (Operating Income ¥20.5B / Interest Expense ¥1.1B), reflecting a conservative profile. Current Ratio and Quick Ratio were both 197%, indicating sufficient liquidity.
Operating Cash Flow was ¥29.6B (YoY -28.1%), a large decline, but remained 1.48x Net Income of ¥20.0B, preserving cash-generating capacity. The decrease was driven by the reversal of prior-year working capital improvements (increase in accounts payable +¥3.97B, increase in accrued taxes +¥3.97B, etc.), while in the current period accrued taxes decreased by ¥3.6B, and the subtotal of operating cash flow before working capital changes was ¥37.4B versus ¥46.3B a year ago (down 19.2%). Investing Cash Flow was -¥20.1B (prior year -¥20.5B), with capital expenditures of -¥30.6B partly offset by proceeds from sale of investment securities of ¥5.7B and net increase in time deposits of ¥5.5B. Free Cash Flow was ¥9.6B (prior year ¥21.2B), halved, but covered dividend payments of ¥6.8B by 1.4x. Financing Cash Flow was a small positive ¥0.9B; long-term borrowings of ¥22.5B were executed to cover short-term borrowings -¥0.7B, long-term borrowings repayments -¥4.7B, bond redemption -¥1.2B, dividends -¥6.8B, and share buybacks -¥9.3B. Cash increased from ¥52.7B at the beginning of the period to ¥63.1B at the end (net +¥10.4B), leaving ample liquidity.
Of current-period Net Income ¥20.0B, a ¥5.1B gain on sale of investment securities (special gains) is included, indicating a significant one-off contribution. Non-operating income of ¥4.9B (1.7% of Revenue) comprises dividend income received ¥3.7B, interest income received ¥0.1B, etc., well below a 5% threshold, but dividends and sale gains from ¥154.6B of investment securities boosted Net Income. The difference between Ordinary Income ¥23.9B and Net Income ¥20.0B is mainly explained by special gains of ¥5.1B and taxes of ¥8.2B, so the impact of one-off items is limited. OCF of ¥29.6B is 1.48x Net Income, and the accrual ratio ((Net Income ¥20.0B - OCF ¥29.6B) / Net Income) = -0.48 is negative, indicating cash-backed earnings. Comprehensive Income of ¥45.7B (Net Income ¥20.0B + Other Comprehensive Income ¥24.9B) exceeded Net Income significantly due to valuation differences on available-for-sale securities of ¥24.1B, showing accumulation of unrealized gains. Interest burden was ¥1.1B, with Interest Expense/Operating Income = 5.4%, minimal, and the effective tax rate of 28.2% is at a standard level.
The company’s plan for the fiscal year ending March 2027 is Revenue ¥295.0B (YoY +5.2%), Operating Income ¥23.0B (YoY +12.1%), Ordinary Income ¥25.5B (YoY +6.4%), and Net Income attributable to owners of the parent ¥21.0B (YoY +1.6%). The double-digit increase in Operating Income reflects assumptions of SG&A restraint and improvements in utilization rates and pricing. Compared with this period’s Operating Income of ¥20.5B, an improvement of ¥2.5B (+12.1%) is expected, but due to the reversal of one-off gains such as gain on sale of investment securities, Net Income is projected to grow only modestly by +1.6%. Progress against the full-year plan stands at Revenue 95.0%, Operating Income 89.1%, Ordinary Income 93.7%, indicating that strengthening operations in Q4 is necessary to achieve full-year targets. Dividend guidance is ¥20 per share for the year, a reduction from the current-period ¥38 (interim ¥16 + year-end ¥22), reflecting a cautious stance to secure funds for investment amid the loss of one-off gains.
The annual dividend for the period was ¥38 (interim ¥16 + year-end ¥22), with a payout ratio of 42.6%, a sustainable level. This represents a significant increase of ¥23 from the prior year dividend of ¥15, reflecting the rise in Net Income due to gain on sale of investment securities. Total dividends were ¥6.8B, covered 0.71x by Free Cash Flow of ¥9.6B, which is sufficient. Share buybacks of ¥9.3B (financing cash flow) were executed, and treasury stock increased from ¥7.95B to ¥16.73B, roughly doubling. Total shareholder returns (dividends ¥6.8B + repurchases ¥9.3B = ¥16.1B) exceeded Free Cash Flow ¥9.6B, with the excess financed from cash on hand and long-term borrowings. Total Return Ratio relative to Free Cash Flow was 168%, high, but feasible given cash on hand of ¥88.8B and ample liquidity. Next fiscal year dividend guidance is ¥20 per share (cut from ¥38), reflecting the reversal of one-off gains and prioritization of capex.
Concentration risk in Domestic Logistics Business: The Domestic Logistics Business accounts for 79.6% of Revenue and roughly 80% of Operating Income, indicating high segment concentration. Fluctuations in domestic warehouse demand, transport supply-demand balance, or intensified price competition would directly impact consolidated performance. This period saw Domestic Logistics Operating Income at ¥25.3B (YoY -1.1%), signaling signs of growth deceleration.
Profitability pressure from cost inflation: SG&A increased to ¥12.6B (YoY +11.9%), far exceeding Revenue growth of +0.7%, and Operating Margin deteriorated to 7.3% (from 7.9%, down 0.6pt). Continued increases in fixed costs such as labor and taxes/public dues could offset revenue gains and sustain margin decline. In the International Cargo segment, Operating Margin at 9.1% lags Domestic Logistics’ 11.4%, and delayed cost pass-through has become evident.
Market volatility risk for investment securities: Investment Securities of ¥154.6B (24.3% of total assets) are a source of unrealized gains but pose a risk of valuation losses or dividend reductions in market downturns, which could materially affect earnings and Comprehensive Income. This period recognized valuation differences on available-for-sale securities of ¥24.1B, but in a market decline that could reverse. Short-term debt ratio of 45.1% indicates concentration of borrowings in short maturities; if market deterioration coincides with changing financial conditions, refinancing costs could rise.
Profitability & Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Margin | 7.3% | 6.3% (3.7%–8.5%) | +1.0pt |
| Net Income Margin | 7.1% | 2.7% (1.6%–4.7%) | +4.4pt |
Profitability exceeds industry median, ranking favorably for both Operating Margin and Net Income Margin. Investment income contribution has elevated Net Income Margin.
Growth & Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 0.7% | 5.0% (-0.4%–9.4%) | -4.3pt |
Growth lags the industry median, indicating relatively weak top-line expansion. While peers accelerate growth, the company remains in a flat range.
※ Source: Company aggregation
Recovery of core operating profitability is the focus for the next fiscal year. Operating Margin fell to 7.3% (down 0.6pt), and SG&A growth continues to outpace revenue. Next fiscal year management targets a double-digit Operating Income increase of +12.1%, but execution on price revisions, utilization improvements, and cost containment will be tested. Narrowing the margin gap between Domestic Logistics and International Cargo (11.4% vs. 9.1%) is also a priority; progress in cost pass-through in International Cargo is key to improving consolidated margins.
Significant scope for improving capital efficiency. ROE at 4.1% and Total Asset Turnover of 0.44x are low; Investment Securities ¥154.6B (24.3% of assets) and Cash & Deposits ¥88.8B totaling ¥243.4B weigh on asset efficiency. Investment income such as ¥370M in dividend income and valuation differences of ¥24.1B are substantial, but balance with core earnings power is in question. Capex of ¥30.6B, 1.65x depreciation, indicates capacity expansion, and subsequent utilization improvement will be the litmus test for asset turnover improvement. Share buybacks of ¥9.3B were implemented as part of efficiency measures, though sustainability depends on cash generation.
Financial robustness provides investment capacity and downside resilience. Equity Ratio 77.1%, Debt/EBITDA 1.65x, and Interest Coverage 19.2x reflect a very conservative capital structure, supporting additional investment and resilience to economic downturns. Free Cash Flow of ¥9.6B covers dividends of ¥6.8B by 1.4x, and total returns of ¥16.1B can be financed by cash on hand and borrowings. However, short-term debt ratio 45.1% poses refinancing risk, mitigated by a cash/short-term debt buffer of 3.06x. Next-year dividend guidance of ¥20 (cut) incorporates the loss of one-off gains, and stable dividend growth going forward will require steady expansion of Operating Cash Flow.
This report was automatically generated by AI analyzing XBRL financial statement data and is an earnings analysis document. It does not constitute a recommendation to invest in any specific security. Industry benchmarks are reference information aggregated by the company from public financial statements. Investment decisions are your responsibility; consult a professional advisor as appropriate.