Cocorport,Inc. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥1.75B
• Operating Income: ¥237M
• Net Income: ¥168M
• EPS: ¥45.46

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

Cocorport (9346) reported FY2026 Q1 standalone results under JGAAP showing solid top-line growth with mixed margin dynamics. Revenue was 1,751 million yen, up 10.6% YoY, indicating continued demand and/or successful expansion of service capacity. Operating income of 237 million yen grew only 0.3% YoY, implying operating margin compression amid rising costs or investment for growth. Net income was 168 million yen, up 4.0% YoY, with a net margin of 9.6%, supported by minimal interest burden and a normalized tax charge. Gross profit was 492.7 million yen, with a gross margin of 28.1%, suggesting a relatively lean cost structure but also sensitivity to personnel and facility costs that typically dominate this sector. Operating margin stood at approximately 13.5% (237/1,751), down on a YoY basis given the slower operating income growth versus revenue. The DuPont breakdown indicates ROE of 5.72% for the quarter, driven by a 9.59% net margin, asset turnover of 0.469x, and modest financial leverage of 1.27x. The balance sheet is conservative: total assets were 3,737 million yen and total equity 2,939 million yen, implying an equity ratio of roughly 78.7% based on disclosed totals (the reported equity ratio line shows 0.0% and should be treated as undisclosed). Liquidity is strong with a current ratio of 426% and net working capital of 2,322 million yen, which provides ample buffer for near-term obligations. Interest expense was negligible at 0.08 million yen, yielding an exceptional interest coverage ratio of ~3,118x based on operating income. The effective tax rate, inferred from income tax expense of 75.3 million yen and ordinary income of 245 million yen, appears to be roughly 31%, consistent with standard Japanese corporate tax levels for a profitable entity. Cash flow statements were not disclosed this quarter in the provided data, limiting assessment of cash conversion and free cash flow. With Annual DPS shown as 0.00, there was no dividend for the period; payout and FCF coverage metrics are not meaningful due to undisclosed cash flows. Overall, the company demonstrates healthy revenue momentum and very strong balance sheet health, but faces near-term margin pressure as operating profit growth lags sales. Given the company’s business model (social welfare/employment support services) and typical cost drivers, continued focus on personnel cost efficiency, utilization per site, and unit price is critical. Data limitations (notably cash flow, depreciation, and share-related metrics) warrant caution when interpreting capital efficiency and payout capacity. The quarter points to a stable, low-leverage profile with room to invest, while the key debate centers on sustaining double-digit revenue growth without further margin erosion.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 0.0959
• asset_turnover: 0.469
• financial_leverage: 1.27
• calculated_ROE: 0.0572 margin_quality: Gross margin is 28.1% (492.7m/1,751m) and operating margin is ~13.5% (237m/1,751m). Net margin is 9.6% (168m/1,751m). Operating income grew only +0.3% YoY versus revenue +10.6% YoY, implying pressure from operating expenses (likely personnel and facility costs). Effective tax rate appears ~31% (75.3m/245m), consistent with ordinary levels and leaving little below-the-line distortion. operating_leverage: Revenue grew +10.6% YoY but operating income grew +0.3% YoY, indicating negative operating leverage in the quarter. This suggests incremental revenue was absorbed by higher operating costs (e.g., staffing, rent, site openings) or mix effects reducing margin. Interest burden is de minimis, so leverage is primarily operational not financial.

Growth Assessment

revenue_sustainability: Top-line growth of +10.6% YoY indicates healthy demand and/or network expansion. Sustainability will depend on center utilization, client retention, and ability to maintain unit pricing under public reimbursement frameworks. profit_quality: With ordinary income (245m) closely tracking operating income and minimal interest expense, profit quality appears clean from financial items. The tax charge is normal. However, margin compression versus sales growth suggests underlying cost growth; monitoring personnel costs as a share of sales is key. outlook: If the company can stabilize operating expenses while continuing mid-to-high single-digit to double-digit sales growth (via site rollout or higher utilization), operating leverage could turn positive. Conversely, continued investment in new sites may weigh on near-term margins while supporting medium-term scale.

Financial Health

liquidity: Current assets 3,034.0m vs current liabilities 711.7m yields a current ratio of ~426% and quick ratio ~426% (inventories undisclosed). Working capital stands at 2,322.4m, providing strong short-term liquidity. solvency: Total liabilities of 941.8m vs equity of 2,939.0m implies low leverage (debt-to-equity proxy using total liabilities/equity at ~0.32x). Interest expense is negligible (0.08m), and interest coverage is extremely strong (~3,118x). capital_structure: Computed equity ratio is ~78.7% (2,939/3,737), indicating a conservative, equity-heavy balance sheet. The reported equity ratio line item is undisclosed (shown as 0.0%). The structure provides capacity for investment without stressing solvency.

Cash Flow Quality

earnings_quality: Earnings appear primarily driven by operating activities with minimal financing effects; tax expense is consistent. However, absent cash flow disclosure, we cannot verify cash conversion or working capital swings. FCF_analysis: Operating CF and investing CF were not disclosed in this dataset (shown as 0). Free cash flow cannot be assessed for the quarter. working_capital: Net working capital is strong at 2,322.4m. Without cash flow statements, changes in receivables/payables cannot be analyzed; given the business model, receivables from public payors can influence cash timing.

Dividend Sustainability

payout_ratio_assessment: Annual DPS is shown as 0.00 and payout ratio 0.0%, suggesting no dividend for the period. With EPS at 45.46 yen for the quarter, theoretical capacity exists; however, policy is not inferable from this quarter alone. FCF_coverage: Not assessable due to undisclosed OCF and capex; FCF coverage metric presented as 0.00x should be treated as unavailable. policy_outlook: Given low leverage and strong liquidity, the company has flexibility, but near-term priority may remain on growth investment and capacity expansion. Confirmation requires management guidance and historical dividend policy.

Risk Assessment

Business Risks:

• Regulatory and reimbursement changes in welfare/employment support programs affecting unit pricing and margins
• Personnel cost inflation and staffing shortages impacting service delivery and profitability
• Execution risk from new site openings (ramp-up periods, utilization build, fixed-cost absorption)
• Customer acquisition and retention dynamics, including local competition for clients
• Geographic concentration risk if revenue is concentrated in specific prefectures
• Reputational and compliance risks inherent in social welfare services

Financial Risks:

• Cash flow timing risk due to receivables from public sector or insurers
• Potential working capital build during expansion (pre-opening expenses, deposits)
• Limited disclosure of cash flows this quarter impedes assessment of cash conversion
• Tax rate variability affecting net profit if incentives or deductions change

Key Concerns:

• Operating margin compression despite double-digit revenue growth
• Lack of cash flow and depreciation disclosure for the quarter
• Dependence on public policy/regulatory frameworks for pricing

Investment Implications

Key Takeaways:

• Revenue growth robust at +10.6% YoY, but operating income nearly flat (+0.3% YoY), indicating near-term cost pressure
• Strong balance sheet with computed equity ratio ~78.7% and current ratio ~426%
• Net margin 9.6% and ROE 5.7% driven by modest leverage and steady asset turnover
• Interest burden is negligible; financial risk is low
• Cash flow metrics are undisclosed; cannot verify cash conversion or FCF
• No dividend this period; capital allocation likely geared to growth investments

Metrics to Watch:

• Operating margin and SG&A/personnel cost ratio
• Same-site utilization and revenue per center
• Receivables days and cash conversion once OCF is disclosed
• Number of centers and ramp-up productivity
• Average reimbursement/unit price trends
• Effective tax rate stability

Relative Positioning: Within Japan’s welfare/employment support services space, Cocorport exhibits a conservative balance sheet and healthy top-line trajectory, but currently shows weaker operating leverage versus revenue growth; peers with tighter cost control or greater scale may demonstrate stronger margin expansion.

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