e-LogiT co.,ltd. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥4.54B
• Operating Income: ¥-145M
• Net Income: ¥-193M
• EPS: ¥-19.72

Income Statement

Balance Sheet

Cash Flow Statement

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: FY2026 Q2 was weak, marked by double-digit revenue decline, negative operating income, and strained liquidity. Revenue fell to 45.38 (−20.5% YoY), while cost of sales remained elevated at 53.54, resulting in a thin gross profit of 3.56 and a gross margin of 7.8%. SG&A of 3.40 nearly consumed the entire gross profit, pushing operating income to −1.45 and EBITDA to −1.09. Ordinary income deteriorated to −1.78 despite modest non-operating income of 0.09 and non-operating expenses of 0.11. Notably, profit before tax is shown at +0.89, implying unreported special items (extraordinary gains) that temporarily offset operating weakness; however, bottom-line net income still landed at −1.93 (−69.3% YoY). DuPont indicates ROE at −11.1% on a net margin of −4.2%, asset turnover of 1.174, and financial leverage of 2.22x, underscoring profitability issues rather than excessive leverage. ROIC is −7.6%, well below management-quality thresholds, indicating value dilution this period. Liquidity is tight: current ratio is 68.5% and working capital is −5.56, signaling reliance on external funding or accelerated collections. Operating cash flow was −3.31, worse than net income, suggesting cash burn outpaced accounting loss this quarter. Capital expenditures were −0.39, implying an operating FCF proxy around −3.70 if we net OCF and capex (investing CF details were not disclosed). Interest coverage is deeply negative (−64.19x), a function of negative EBIT rather than high interest burden; interest-bearing debt itself is modest at 3.00 (ST 0.10, LT 2.90). Margin comparison in basis points cannot be quantified due to missing prior-period margin disclosures; directionally, margins contracted alongside the 20.5% revenue decline. Earnings quality is mixed: OCF/NI is 1.71x, which typically suggests healthy conversion, but both numbers are negative, so this ratio is not economically meaningful this quarter. Forward-looking, stabilization will require recovering volumes, better utilization of fixed logistics infrastructure, and price/cost pass-through to lift gross margin above SG&A intensity. Near term, liquidity preservation and working capital discipline are critical. Absent evidence of recurring extraordinary gains, core profitability must improve to restore ROE and ROIC.

Profitability Analysis

ROE decomposition: ROE (−11.1%) = Net Profit Margin (−4.2%) × Asset Turnover (1.174) × Financial Leverage (2.22x). The principal drag is net margin, which is negative due to a low gross margin (7.8%) and SG&A that nearly equals gross profit, driving negative operating margin. Asset turnover at 1.174 indicates reasonable utilization of the asset base for a logistics service model, but not enough to compensate for negative margins. Financial leverage at 2.22x is moderate and not the core issue; leverage is driven more by non-interest-bearing liabilities than debt. Business drivers: the 20.5% YoY revenue contraction implies lower throughput/volume and likely under-utilization of warehouse and labor capacity, pressuring unit economics and gross margin. Non-operating items were immaterial to reversing trends, and the apparent positive pre-tax line points to one-off extraordinary factors rather than a structural improvement. Sustainability: current margin pressure appears cyclical/volume-driven and could improve with demand recovery or pricing resets, but no evidence this quarter of sustainable fixes. Concerning trends: revenue decline outpaced our visibility into cost flex; SG&A of 3.40 did not adjust sufficiently to reduced gross profit, suggesting negative operating leverage. Without disclosed SG&A sub-lines, monitoring labor/rent and outsourced logistics costs is key.

Growth Assessment

Top-line contracted 20.5% YoY to 45.38, indicating significant volume or client demand softness. Gross profit of 3.56 on this lower base underscores weak pricing power or unfavorable mix. Operating income deteriorated to −1.45, reflecting negative operating leverage as fixed and semi-fixed costs could not flex down with revenue. Ordinary income at −1.78 confirms core profitability stress; the positive pre-tax number (+0.89) implies extraordinary items that are unlikely to recur. EPS (basic) was −19.72 JPY, consistent with the reported net loss of −1.93. With ROIC at −7.6%, current investments are not earning the cost of capital. Near-term growth will likely depend on demand normalization in e-commerce/3PL, client wins, and utilization gains in existing facilities. Absent disclosure of order backlog or new contracts, revenue recovery visibility is low. Cost actions to slim SG&A and optimize labor shifts could improve incremental margins on any rebound. Outlook bias near term remains cautious until volumes stabilize and gross margin recovers above SG&A intensity.

Financial Health

Liquidity is weak: current ratio 68.5% (<1.0 warning) and quick ratio 68.5%, with working capital of −5.56 indicating a short-term funding gap. Cash and deposits are 2.41 versus current liabilities of 17.64, highlighting limited immediate liquidity. Short-term loans are small at 0.10; principal current liabilities appear to be accounts payable of 4.52 and other short-term obligations. Solvency: total liabilities/ equity is 1.33x (within benchmark <1.5x), and interest-bearing debt is modest (3.00), implying leverage risk is moderate. However, interest coverage is −64.19x due to negative EBIT, signaling earnings capacity to service debt is currently insufficient. Maturity mismatch risk is present: current assets (12.08) are below current liabilities (17.64), pressuring near-term cash. No off-balance sheet obligations were disclosed in the dataset.

Cash Flow Quality

OCF was −3.31 versus net income of −1.93, so cash burn exceeded accounting loss; the reported OCF/NI ratio of 1.71x is not economically meaningful given both are negative. Working capital likely worsened (specific receivables/payables movements not disclosed), consistent with lower revenue and potential collection timing. Capex was −0.39; using OCF − capex as an operating FCF proxy implies about −3.70 this quarter (investing CF details beyond capex are unreported). Dividend and buyback cash outflows are unreported, limiting full FCF assessment. There are no obvious signs of working capital manipulation in the provided figures, but the gap between cash and current liabilities elevates liquidity risk.

Dividend Sustainability

Dividend data were not disclosed; payout ratios are not calculable. Given negative net income (−1.93) and negative OCF (−3.31), internal cash generation does not support distributions this period. Retained earnings are negative (−13.21), indicating accumulated deficits that typically constrain dividend capacity under JGAAP governance norms. Without positive, recurring FCF, sustainable dividends are unlikely in the near term. Any future distributions would likely require a return to profitability and positive OCF.

Risk Assessment

Business Risks:

• Volume volatility in e-commerce/3PL driving under-utilization of logistics assets
• Low gross margin (7.8%) with limited ability to flex fixed/semi-fixed costs
• Customer concentration risk (not disclosed but common in contract logistics)
• Pricing pressure from competitive logistics market

Financial Risks:

• Liquidity shortfall: current ratio 0.685 and working capital −5.56
• Negative OCF (−3.31) and negative interest coverage (−64.19x)
• Reliance on payables and short-term liabilities to fund operations
• ROIC −7.6% indicating value-destructive returns

Key Concerns:

• Inconsistency between ordinary income (−1.78) and pre-tax profit (+0.89) suggests undisclosed extraordinary items; sustainability is questionable
• Revenue decline of 20.5% YoY without offsetting cost reductions
• Thin cash balance (2.41) versus current liabilities (17.64) heightens near-term funding risk
• Limited disclosure (SG&A breakdown, investing CF) reduces transparency

Investment Implications

Key Takeaways:

• Significant top-line decline (−20.5% YoY) with negative operating income
• Gross margin at 7.8% is too low to cover SG&A of 3.40, causing operating losses
• ROE at −11.1% and ROIC at −7.6% underscore profitability challenges
• Liquidity under pressure: current ratio 0.685, working capital −5.56
• Negative OCF (−3.31) exceeds accounting loss, implying cash burn
• Apparent extraordinary gains likely lifted pre-tax profit but did not alter the net loss
• Interest-bearing debt modest, but earnings capacity to service obligations is currently inadequate

Metrics to Watch:

• Revenue run-rate and new contract wins (volume recovery)
• Gross margin progression (bps) and cost pass-through
• SG&A intensity versus sales (operating leverage)
• OCF trend and working capital days (DSO/DPO) to gauge liquidity
• Cash balance and undrawn credit facilities
• ROIC improvement toward >5% as an early sign of recovery

Relative Positioning: Within domestic logistics peers, the company currently sits in the weaker cohort on profitability and liquidity, with better-than-average balance sheet leverage but inferior earnings capacity and cash conversion.

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