toridori Inc. FY2025 Q3 Earnings Report

Financial Highlights

• Net Sales: ¥3.96B
• Operating Income: ¥531M
• Net Income: ¥245M
• EPS: ¥112.74

Income Statement

Balance Sheet

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

TORIDORI Co., Ltd. (93370) delivered strong FY2025 Q3 results on key profitability and growth metrics under JGAAP (consolidated). Revenue reached ¥3,955 million, up 27.6% YoY, indicating robust topline momentum in its core businesses. Operating income rose 71.1% YoY to ¥531 million, expanding operating margin to approximately 13.4%, reflecting improving operating leverage and cost discipline. Net income increased 82.6% YoY to ¥370 million, with net margin at 9.36%, surpassing revenue growth and confirming earnings scalability. Gross profit of ¥2,838 million implies a high gross margin of 71.8%, suggesting a favorable business mix, strong pricing power, or a platform/service-heavy model with limited direct cost of sales. DuPont decomposition shows ROE at 19.53%, driven by a balanced combination of solid net margin (9.36%), moderate asset turnover (0.596x), and relatively high financial leverage (3.50x). Balance sheet strength is reasonable: total assets are ¥6,631 million and total liabilities ¥3,351 million, implying equity of ¥1,895 million and an implied equity ratio around 28.6% (equity/total assets), despite the equity ratio field being undisclosed. Liquidity appears adequate with a current ratio of 135% and quick ratio of 131%, and working capital of approximately ¥924 million. Interest coverage is strong at 44.3x, indicating ample capacity to service interest costs. The effective tax rate shown as 0.0% is not representative; using disclosed income tax of ¥55 million and net income suggests an implied tax rate in the low-teens, acknowledging JGAAP classification nuances. Cash flow statements were not disclosed (zeros indicate unreported), limiting assessment of operating cash conversion and free cash flow coverage. No dividends were declared (DPS ¥0), consistent with a reinvestment-oriented posture at this growth stage. Debt-to-equity of 1.77x (liabilities/equity) indicates moderate leverage that amplifies ROE, but elevates sensitivity to earnings volatility. Inventory levels are modest at ¥109 million, consistent with an asset-light or service-centric model. Overall, the company demonstrates improving profitability and scale benefits, supported by healthy liquidity and manageable leverage, though the lack of cash flow disclosure constrains the evaluation of earnings quality and dividend capacity.

Profitability Analysis

ROE_decomposition: ROE 19.53% = Net Profit Margin 9.36% × Asset Turnover 0.596 × Financial Leverage 3.50. This indicates value creation from both margin and capital efficiency, with leverage providing an additional boost. margin_quality: Gross margin 71.8% (¥2,838m GP on ¥3,955m revenue) signals a high-value, likely platform/service-heavy mix. Operating margin ~13.4% (¥531m OI) expanded strongly YoY in line with 71.1% OI growth vs. 27.6% revenue, evidencing operating cost discipline and scale benefits. Net margin 9.36% captures limited non-operating drag; interest expense is modest at ~¥12m. operating_leverage: Revenue +27.6% YoY versus operating income +71.1% YoY implies positive operating leverage as fixed costs were spread over a larger revenue base. Sustaining this requires continued growth without proportional increases in SG&A.

Growth Assessment

revenue_sustainability: Revenue of ¥3,955m grew 27.6% YoY, suggesting strong demand and/or user base expansion. High gross margin points to sustainable unit economics if customer acquisition costs and churn remain controlled. profit_quality: Net income +82.6% YoY (margin 9.36%) outpaced revenue growth, underpinned by expanding operating margin. Interest burden is low (44.3x coverage), so profit growth is primarily operational, not financial. outlook: With solid ROE (19.5%) and scaling margins, the near-term outlook is constructive. Key to sustaining growth will be maintaining conversion, ARPU/monetization improvements, and controlled opex growth. Lack of OCF disclosure tempers confidence in cash-backed growth assessment.

Financial Health

liquidity: Current ratio 135% and quick ratio 130.9% indicate adequate short-term liquidity. Working capital stands at ~¥924m (CA ¥3,568m minus CL ¥2,643m). solvency: Total liabilities ¥3,351m vs. equity ¥1,895m implies a liabilities/equity ratio of 1.77x and an implied equity ratio of ~28.6% (equity/total assets), reasonable for a growing, asset-light business. capital_structure: Financial leverage of 3.50x (assets/equity) supports ROE but increases sensitivity to earnings fluctuations. Interest expense ¥12m is small relative to operating income, providing ample buffer.

Cash Flow Quality

earnings_quality: Operating cash flow data not disclosed; OCF/Net Income shows 0.00 by placeholder. As such, cash conversion cannot be assessed this quarter. Earnings quality appears supported by operating drivers (margin expansion, limited non-operating items), but confirmation via OCF is pending. FCF_analysis: Free cash flow not disclosed (0 indicates unreported). Capex and working capital outflows are unknown; therefore, we cannot evaluate FCF generation or reinvestment intensity. working_capital: Working capital of ¥924m and modest inventories (¥109m) suggest limited balance sheet drag. Without cash flow details, changes in receivables/payables and their impact on OCF cannot be analyzed.

Dividend Sustainability

payout_ratio_assessment: DPS is ¥0 and payout ratio is 0.0%, implying retention of earnings for growth. Given net income of ¥370m and strengthening profitability, capacity exists, but policy currently favors reinvestment. FCF_coverage: Unavailable due to unreported OCF/FCF; thus, dividend coverage cannot be assessed quantitatively. policy_outlook: With ROE at ~19.5% and expanding margins, continued earnings retention is plausible to fund growth. Future distributions would likely depend on visibility of durable FCF and capital needs.

Risk Assessment

Business Risks:

• Growth deceleration risk if customer acquisition slows or competition intensifies.
• Monetization risk if ARPU expansion or take rates soften.
• Dependence on platform ecosystems or key partners typical of asset-light models.
• Talent and technology execution risks impacting product roadmap and scalability.
• Potential regulatory or content/compliance risks depending on service mix.

Financial Risks:

• Moderate leverage (liabilities/equity 1.77x) amplifies earnings volatility.
• Cash conversion uncertainty due to unreported OCF and capex data.
• Working capital swings could pressure liquidity despite current ratio at 135%.
• Interest rate or refinancing risk if debt mix shifts higher.

Key Concerns:

• Lack of cash flow disclosure limits assessment of earnings quality and FCF.
• Sustainability of operating leverage as the company scales.
• Visibility on capital allocation priorities (organic investment vs. M&A vs. returns).

Investment Implications

Key Takeaways:

• Strong topline growth (+27.6% YoY) with outsized operating profit growth (+71.1% YoY) indicates positive operating leverage.
• High gross margin (71.8%) and solid net margin (9.36%) support attractive unit economics.
• ROE at 19.53% underpinned by healthy margins and moderate asset turnover, aided by leverage (3.50x).
• Liquidity is adequate (current ratio 135%), and interest coverage is robust (44.3x).
• Limited cash flow disclosure is the primary analytical constraint this quarter.

Metrics to Watch:

• Operating cash flow and free cash flow conversion relative to net income.
• Operating margin progression and SG&A as a percentage of sales.
• Customer acquisition costs, LTV/CAC, and churn/retention indicators (if disclosed).
• Revenue growth rate and ARPU/take-rate trends.
• Leverage trajectory (liabilities/equity) and interest coverage sustainability.

Relative Positioning: Within Japan’s growth-oriented, asset-light platforms/services peer set, TORIDORI’s margin profile and ROE are competitive, supported by robust operating leverage; however, transparency on cash flows trails best-in-class peers, tempering conviction on sustainability.

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