DAITO KOUN CO.,LTD. FY2026 Q2 Earnings Report

Financial Highlights

• Operating Income: ¥543M
• Net Income: ¥312M
• EPS: ¥45.53

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

Daito Koun FY2026 Q2 consolidated (JGAAP) results show solid profit expansion with operating income of ¥543m, up 45.7% YoY, and net income of ¥393m, up 30.2% YoY, despite revenue being undisclosed in XBRL for the period. Ordinary income reached ¥585m, indicating incremental non-operating gains and/or low financial costs aiding bottom-line performance. Depreciation and amortization were ¥144.1m, highlighting a tangible asset base typical of port and logistics services. Interest expense was modest at ¥10.6m, supporting a robust interest coverage of 51.1x and underscoring conservative financial risk. The balance sheet remains strong with total assets of ¥15.994bn and total equity of ¥9.937bn, implying financial leverage (assets/equity) of 1.61x. Liquidity is ample with a current ratio of 232.1% and quick ratio of 220.5%, supported by current assets of ¥7.519bn against current liabilities of ¥3.239bn. Working capital stands at ¥4.280bn, providing operational flexibility for seasonal swings in port activity. Operating cash flow of ¥358.3m equates to 0.91x net income, indicating broadly aligned cash conversion for the half-year. Income tax of ¥143.0m implies an effective rate around the mid-20% range when viewed against pre-tax income inferred from net income and tax, consistent with a normalized tax environment. While revenue, gross profit, and several margins are undisclosed, the strong growth in operating income suggests either improved mix, cost control, or operating leverage in key service lines. EBITDA is ¥687.1m, which, coupled with low interest burden, indicates healthy operating headroom. Debt-to-equity of 0.57x points to moderate balance sheet leverage within prudent parameters for an asset-intensive operator. Investing cash flow is undisclosed, so free cash flow cannot be determined from reported figures. Annual DPS and payout ratio are listed as zero for the period; dividend policy signals remain unclear pending full-year disclosures. Overall, profitability momentum, strong liquidity, and conservative leverage frame a stable financial profile, with the main limitations being lack of disclosed revenue and cash/cash-equivalents figures in XBRL for a fuller margin and cash analysis.

Profitability Analysis

ROE decomposition is constrained by undisclosed revenue and average equity. Using period-end equity as a rough proxy, ROE approximates 3.9% for the half-year (¥393m / ¥9,937m), which annualized would be high single digits, contingent on H2 performance. Net profit margin cannot be computed given revenue is undisclosed; however, operating income grew 45.7% YoY, implying margin expansion or strong cost discipline. Asset turnover is not derivable without revenue; financial leverage is 1.61x (assets/equity), indicating modest leverage aiding ROE without elevating risk unduly. Margin quality appears sound given ordinary income (¥585m) exceeds operating income (¥543m), suggesting positive non-operating contributions and limited drag from financing costs. The effective tax outflow (¥143m) against net income (¥393m) implies a mid-20% effective rate, consistent with a normalized structure. Operating leverage appears favorable: significant YoY operating income growth in the absence of reported revenue typically indicates either volume/mix tailwinds or fixed-cost absorption benefits in port logistics. EBITDA of ¥687.1m and interest expense of ¥10.6m produce an interest coverage of 51.1x, highlighting strong operating cushioning.

Growth Assessment

Top-line sustainability cannot be assessed due to undisclosed revenue; however, the 45.7% YoY rise in operating income and 30.2% YoY rise in net income indicate positive earnings momentum into 1H. The widening gap between operating and ordinary income suggests ancillary income or improved financial items contributed to growth. Profit quality is supported by OCF/NI of 0.91 for the half-year, indicating most earnings are cash-backed. D&A of ¥144.1m implies ongoing reinvestment needs; growth durability will depend on maintaining asset efficiency and capex discipline, which cannot be verified this quarter due to undisclosed investing cash flows. Outlook hinges on port cargo volumes, logistics demand, and pricing; current performance suggests favorable mix or utilization trends, but confirmation requires full-year revenue and segment disclosures.

Financial Health

Liquidity is strong with a current ratio of 232.1% and quick ratio of 220.5%, supported by current assets of ¥7.519bn versus current liabilities of ¥3.239bn. Working capital of ¥4.280bn provides ample buffer for operational needs. Solvency appears solid: total liabilities are ¥5.621bn against equity of ¥9.937bn, yielding debt-to-equity of 0.57x. Financial leverage (assets/equity) is 1.61x, conservative for an asset-intensive business. Interest burden is light at ¥10.6m, and coverage is high at 51.1x, reducing refinancing risk. The equity ratio is shown as 0.0% in the dataset but is evidently undisclosed; implied equity ratio from totals is approximately 62.1% (¥9.937bn / ¥15.994bn). Cash and equivalents are undisclosed in XBRL for this period, so immediate cash liquidity cannot be directly assessed.

Cash Flow Quality

Earnings quality is reasonable, with OCF/Net Income at 0.91, indicating that most accounting profits converted to operating cash in 1H. Accrual intensity appears moderate given D&A of ¥144.1m against operating income of ¥543m. Free cash flow cannot be computed because investing cash flow is undisclosed; the reported FCF figure of zero reflects non-disclosure rather than actual cash generation. Working capital appears manageable given strong liquidity metrics; the OCF result suggests no material adverse working capital swings in the half-year. Financing cash flow was an inflow of ¥276.5m, implying net borrowing or other financing sources; without capex data, we cannot infer whether financing supported growth investment or balance sheet optimization.

Dividend Sustainability

Annual DPS is reported as zero for the period, with a payout ratio of 0%. With no dividend outflow, coverage is a non-issue in 1H. If distributions were to resume, the combination of net income of ¥393m and OCF of ¥358m would indicate room for modest payouts while maintaining balance sheet strength, subject to capex needs that are undisclosed. Policy outlook cannot be inferred from the provided data; historical practice and full-year guidance, if any, would be needed to assess future dividends.

Risk Assessment

Business Risks:

• Exposure to cargo volume cyclicality in port and logistics operations
• Sensitivity to fuel, labor, and subcontracting costs affecting operating leverage
• Potential disruption from weather events and natural disasters impacting port activity
• Customer concentration risk typical in logistics and shipping ecosystems
• Regulatory and port concession risks affecting fees and compliance costs

Financial Risks:

• Undisclosed cash and investing cash flows constrain visibility on near-term liquidity and capex
• Potential capex intensity given D&A of ¥144.1m, which could pressure free cash flow in investment upcycles
• Interest rate risk on any floating-rate borrowings, albeit current interest burden is low
• Refinancing risk is low currently but depends on maturity profile not disclosed

Key Concerns:

• Revenue and gross margin are undisclosed, limiting assessment of margin drivers
• Free cash flow is indeterminable this quarter due to undisclosed investing cash flows
• Dividend policy signals are unclear with DPS shown as zero for the period

Investment Implications

Key Takeaways:

• Strong profit growth in 1H with operating income up 45.7% YoY and net income up 30.2% YoY
• Conservative balance sheet with equity of ¥9.937bn and financial leverage of 1.61x
• Robust liquidity: current ratio 232% and quick ratio 221%
• High interest coverage of 51x underscores low financial risk
• Cash conversion is healthy with OCF equal to 91% of net income
• Visibility on margins and FCF is limited due to undisclosed revenue and investing cash flows

Metrics to Watch:

• Full-year revenue and gross margin disclosure to validate operating leverage and pricing
• Capex and investing cash flows to determine true free cash flow
• Ordinary income components (non-operating gains/losses) for sustainability
• Working capital movements and OCF/NI ratio persistence
• Debt levels and interest expense trend versus EBITDA
• Dividend guidance and capital allocation updates

Relative Positioning: Within Japanese port and logistics peers, the company currently exhibits stronger-than-average balance sheet conservatism, high interest coverage, and positive earnings momentum, though relative margin and FCF positioning cannot be benchmarked this quarter due to undisclosed revenue and capex data.

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