TRADIA CORPORATION FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥1.38B
• Operating Income: ¥151M
• Net Income: ¥148M
• EPS: ¥185.46

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Segment 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

トレーディア株式会社 (9365) reported FY2026 Q2 consolidated results under JGAAP with flat topline and materially stronger profits. Revenue was ¥1,380.0m (±0.0% YoY), but operating income rose 39.8% to ¥151.0m, indicating significant margin expansion despite stagnant sales. Net income surged 84.3% to ¥271.0m, well above the pace of operating income growth, implying sizable non-operating tailwinds. Ordinary income of ¥372.0m exceeded operating income by a wide margin, highlighting the importance of non-operating items this period. The operating margin improved to 10.9%, while the net margin reached 19.6%, driven by non-operating gains and/or lower below-OP expenses. DuPont analysis shows ROE of 5.2%, decomposed into a 19.64% net margin, 0.114x asset turnover, and 2.33x financial leverage. This ROE is held back by low asset turnover, partly offset by healthy margins and moderate leverage. Interest coverage is 5.1x (EBIT/interest), indicating manageable debt service capacity at current earnings levels. Liquidity appears tight with a current ratio of 96.8% and negative working capital of approximately ¥128m, suggesting near-term funding discipline is required. Operating cash flow (OCF) of ¥171.3m represents 0.63x of net income, pointing to softer earnings-to-cash conversion in the half. Financing cash outflows of ¥377.4m imply debt repayment and/or other financing uses, which, while improving leverage, may pressure liquidity if sustained. Several line items (e.g., cost of sales, gross profit, inventories, cash balance, investing CF, equity ratio, DPS, shares outstanding) are unreported in XBRL and thus cannot be assessed; zeros reflect non-disclosure, not actual zero values. Using reported assets and equity, the implied equity ratio is roughly 43% (equity/assets), providing a buffer despite the reported equity ratio field being undisclosed. Overall, the quarter displays improved profitability and ordinary income strength, but with some quality-of-earnings questions (OCF lagging NI, high non-operating contribution) and a tight short-term liquidity profile. Forward focus should be on sustainability of operating margin gains, normalization of OCF relative to earnings, and the composition and repeatability of non-operating income.

Profitability Analysis

ROE_decomposition: ROE 5.20% = Net margin 19.64% × Asset turnover 0.114 × Financial leverage 2.33. High net margin drives ROE, but low asset turnover materially restrains it; leverage provides a moderate boost. margin_quality: Operating margin is 10.9% (¥151.0m/¥1,380.0m), a notable YoY improvement given flat revenue. Net margin at 19.6% is materially above operating margin, indicating substantial non-operating gains or income (ordinary income ¥372.0m >> operating income). Gross margin is unreported, limiting granular assessment of cost control. Effective tax rate is not assessable from disclosures provided; a tax charge of ¥62.5m is recorded alongside strong NI. operating_leverage: With revenue flat and operating income up 39.8%, incremental operating leverage appears favorable, suggesting disciplined opex and/or improved pricing/mix. The magnitude of ordinary income uplift versus operating income signals that headline profit growth is not solely operational.

Growth Assessment

revenue_sustainability: Topline was flat YoY at ¥1.38bn. Without segment or volume/price disclosure, sustainability is uncertain; stability suggests a steady demand backdrop but no visible growth inflection yet. profit_quality: Operating profit growth outpaced sales, implying cost efficiencies or mix improvements. However, ordinary income outperformance versus operating income and OCF/NI at 0.63 temper profit quality, pointing to non-operating and working-capital effects. outlook: Key swing factors for 2H include sustaining the 10–11% operating margin, the repeatability of non-operating income, and normalization of cash conversion. If operating efficiencies persist and non-operating items moderate, profit growth should align more closely with operating fundamentals.

Financial Health

liquidity: Current ratio 96.8% and quick ratio 96.8% indicate modest short-term liquidity pressure; working capital is approximately -¥128m. Cash and equivalents are undisclosed, limiting assessment of immediate liquidity buffers. solvency: Debt-to-equity 1.18x implies moderate leverage. Interest coverage of 5.1x supports adequate debt service at current earnings. The implied equity ratio is ~43% (¥5.211bn/¥12.147bn), suggesting a reasonable capital cushion despite the equity ratio field being unreported. capital_structure: Total assets ¥12.147bn vs. total equity ¥5.211bn and total liabilities ¥6.141bn. Financing CF of -¥377.4m suggests net repayments or other financing outflows, which may modestly de-risk the balance sheet but can constrain liquidity near term.

Cash Flow Quality

earnings_quality: OCF/Net income at 0.63 indicates below-par cash conversion in H1, potentially due to working capital investment or timing effects. D&A of ¥68.2m implies EBITDA of ¥219.2m; cash generation trails accrual earnings this period. FCF_analysis: Investing CF is undisclosed; hence free cash flow cannot be reliably calculated. The provided FCF ‘0’ reflects non-disclosure, not actual performance. Visibility on capex is a key gap for assessing true FCF. working_capital: Negative working capital (≈-¥128m) and a sub-1.0 current ratio suggest tighter receivables/ payables dynamics or seasonality. The OCF softness is consistent with potential working capital outflows.

Dividend Sustainability

payout_ratio_assessment: Annual DPS and payout ratio are unreported; the zeros shown are placeholders. EPS is ¥185.46, implying capacity for dividends from an earnings perspective, but absent policy disclosure no assessment of targeted payout is possible. FCF_coverage: FCF is not available due to undisclosed investing CF, preventing coverage analysis. OCF of ¥171.3m, while positive, is below NI and would need to comfortably exceed maintenance capex to support sustainable dividends. policy_outlook: Dividend policy is unclear from available data. Sustainability, if a dividend exists or is contemplated, hinges on stabilizing operating cash flow, visibility on capex, and maintaining liquidity given a current ratio below 1.0.

Risk Assessment

Business Risks:

• Revenue stagnation with flat YoY growth, limiting operating leverage upside if cost efficiencies fade
• Dependence on non-operating gains to support ordinary and net income, which may be non-recurring
• Potential input cost or wage inflation risk not visible without gross margin disclosure
• Execution risk in sustaining improved operating margin with flat sales

Financial Risks:

• Tight liquidity: current ratio 96.8% and negative working capital (~¥128m)
• Earnings-to-cash conversion risk: OCF/NI at 0.63
• Refinancing and interest-rate exposure, partially mitigated by 5.1x interest coverage
• Visibility gaps: undisclosed cash balance, investing cash flows, and detailed debt profile

Key Concerns:

• Quality and repeatability of non-operating income driving ordinary/net income
• Sustained improvement in operating margin amid flat revenue
• Normalization of OCF relative to NI and working capital discipline

Investment Implications

Key Takeaways:

• Profitability improved materially despite flat sales; operating margin 10.9%, net margin 19.6%
• ROE 5.2% restrained by low asset turnover; leverage moderate at 2.33x assets/equity
• Ordinary income significantly above operating income, implying reliance on non-operating items
• Liquidity is tight (current ratio 96.8%, negative working capital), warranting monitoring
• Cash conversion soft (OCF/NI 0.63); FCF unassessable due to undisclosed investing CF
• Financing outflows (-¥377m) likely reduced leverage but may pressure liquidity

Metrics to Watch:

• Operating margin trend and cost discipline
• Composition of non-operating income and its recurrence
• OCF/NI and working capital turns (receivables/payables)
• Capex and investing CF disclosure to gauge FCF
• Interest-bearing debt levels and interest coverage
• Asset turnover improvement to support ROE

Relative Positioning: Within a flat-revenue backdrop, the company demonstrates stronger operating profitability and notably higher ordinary income, but exhibits tighter liquidity and weaker cash conversion; sustained performance will depend on maintaining operating discipline and improving cash flow visibility.

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