GREENLAND RESORT COMPANY LIMITED FY2025 Q3 Earnings Report

Financial Highlights

• Net Sales: ¥4.77B
• Operating Income: ¥511M
• Net Income: ¥468M
• EPS: ¥34.45

Income Statement

Balance Sheet

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

For FY2025 Q3 (cumulative), Greenland Resort Co., Ltd. reported revenue of ¥4,770 million (-1.0% YoY), with operating income of ¥511 million (-22.3% YoY) and net income of ¥356 million (-23.9% YoY), indicating margin compression despite relatively stable top line. Gross profit was ¥1,151.8 million, translating to a gross margin of 24.1%, while the operating margin declined to 10.7%, reflecting higher operating costs and/or weaker pricing power. Ordinary income of ¥503 million was slightly below operating income, suggesting modest non-operating expense pressure, mainly interest expense of ¥29.8 million. Net profit margin stood at 7.46%, consistent with the company’s reported DuPont input. The DuPont decomposition shows ROE at 3.43%, driven by a 7.46% net margin, a low asset turnover of 0.239, and financial leverage of 1.92x. This implies that subdued asset efficiency is the principal drag on returns, with leverage providing only modest amplification. Balance sheet strength appears reasonable: total assets were ¥19,997 million, liabilities ¥8,832 million, and equity ¥10,393 million; this implies an equity ratio of about 52% (versus 0.0% shown, which reflects non-disclosure in XBRL). Liquidity, however, is tight: current assets of ¥848 million versus current liabilities of ¥4,429 million imply a current ratio of 0.19x and working capital of approximately -¥3,581 million. Interest coverage remains robust at 17.1x (operating income/interest expense), indicating manageable financial risk from interest-bearing debt. The reported effective tax rate in the “Calculated Metrics” section is 0.0%, but based on non-zero disclosures, tax expense was ¥195.1 million; comparing net income and ordinary income suggests an implied tax burden around 29–39% (range reflects uncertainty about extraordinary items and the exact pre-tax base). Cash flow statements are not disclosed (OCF/ICF/FCF reported as 0 indicate missing data), preventing direct assessment of earnings-to-cash conversion. The company reported EPS of ¥34.45, but share count and BVPS fields are undisclosed (shown as 0), which limits per-share trend analysis. No dividend is reported year-to-date (DPS 0), implying either a suspension or non-disclosure; payout ratio shows 0% on this basis. Overall, the earnings profile points to resilient revenue but pressured profitability, strong solvency, and very tight liquidity. Given seasonality typical to leisure/resort operations and potential timing effects on working capital, Q4 seasonality could be important for full-year outcomes. Data limitations (notably cash flow, depreciation, inventories, and share data) restrict the depth of analysis; conclusions rely on the available non-zero items and derived ratios.

Profitability Analysis

ROE_decomposition: ROE 3.43% = Net profit margin 7.46% × Asset turnover 0.239 × Financial leverage 1.92. The primary constraint is low asset turnover, with leverage providing modest tailwind and margins mid-single digit to high-single digit. margin_quality: Gross margin 24.1% and operating margin 10.7% indicate meaningful fixed-cost absorption but reduced operating efficiency vs. prior year (OI -22.3% YoY on -1.0% revenue). Net margin 7.46% reflects limited non-operating drag (interest ¥29.8m) and a normalizing tax burden. operating_leverage: Revenue declined just 1.0% YoY while operating income fell 22.3%, indicating negative operating leverage from fixed costs (labor, utilities, maintenance, SG&A). Ordinary income was close to operating income (¥503m vs ¥511m), suggesting core operations drove most of the decline.

Growth Assessment

revenue_sustainability: Top line was relatively stable at -1.0% YoY. Seasonality and event calendars likely influence quarterly patterns; current momentum suggests stable to slightly softer demand through Q3 YTD. profit_quality: The disproportionate decline in operating profit versus revenue implies cost inflation and/or lower mix/pricing. Interest expense is contained, so the profit pressure is operational rather than financial. outlook: Without cash flow and depreciation data, visibility on cost normalization is limited. If Q4 seasonality is favorable and cost controls improve, margins could stabilize; otherwise, the current negative operating leverage could persist.

Financial Health

liquidity: Current assets ¥848.5m vs current liabilities ¥4,429.1m implies a current ratio of 0.19x and working capital of -¥3,580.6m, indicating tight near-term liquidity and reliance on operating cash inflows and/or revolving facilities. Inventories are undisclosed. solvency: Total liabilities ¥8,832.4m and equity ¥10,393.0m imply liabilities/equity of 0.85x and an inferred equity ratio of ~52%. Interest coverage is strong at 17.1x, suggesting manageable interest burden. capital_structure: Financial leverage (assets/equity) is 1.92x. Debt-to-equity given as 0.85x aligns with total liabilities vs equity; interest-bearing debt specifics are not disclosed, but the interest expense level appears modest relative to operating income.

Cash Flow Quality

earnings_quality: OCF is undisclosed (reported as 0). Therefore, OCF/Net income of 0.00 in the calculated metrics reflects missing data, not true cash conversion. Earnings quality cannot be validated via cash flows. FCF_analysis: Investing and financing cash flows are undisclosed; depreciation is also undisclosed, preventing EBITDA and maintenance capex assessments. Consequently, FCF and FCF coverage cannot be determined. working_capital: Negative working capital (~-¥3.58bn) suggests significant current liabilities (e.g., advance receipts, accrued expenses, short-term borrowings) funding operations. The ability to roll over or reduce current liabilities is critical given the low current ratio.

Dividend Sustainability

payout_ratio_assessment: Annual DPS is reported as 0 and payout ratio 0%, which likely reflects no dividend or non-disclosure year-to-date. With net income at ¥356m, capacity exists in earnings terms, but lack of OCF/FCF data prevents assessment of cash-based coverage. FCF_coverage: Not assessable due to undisclosed OCF and capex. The reported 0.00x FCF coverage is a placeholder from missing data. policy_outlook: Given tight liquidity metrics (current ratio 0.19x) and profit pressure, a conservative stance on cash distributions would be consistent with preserving flexibility; however, explicit dividend policy details are not provided in the data.

Risk Assessment

Business Risks:

• Negative operating leverage from fixed cost base leading to profit sensitivity to small revenue changes
• Potential seasonality and weather/event risk affecting visitor numbers and occupancy
• Pricing power constraints amid cost inflation (labor, utilities, maintenance)
• Regional concentration risk typical for resort/theme park operations

Financial Risks:

• Tight liquidity with current ratio 0.19x and working capital of approximately -¥3.58bn
• Refinancing/rollover risk on short-term obligations if access to credit tightens
• Limited visibility on cash generation due to undisclosed OCF/FCF
• Potential capex needs (maintenance/safety/compliance) not visible due to undisclosed depreciation and investing CF

Key Concerns:

• Sustained margin pressure (OI -22.3% YoY on -1.0% revenue) indicating deteriorating cost efficiency
• Low asset turnover (0.239) capping ROE despite adequate leverage
• Absence of cash flow disclosures, which constrains assessment of earnings quality and dividend capacity

Investment Implications

Key Takeaways:

• Revenue essentially flat YoY (-1.0%) but operating income fell sharply (-22.3%), evidencing negative operating leverage
• ROE is modest at 3.43%, constrained mainly by low asset turnover (0.239)
• Balance sheet solvency appears solid (implied equity ratio ~52%), but near-term liquidity is tight (current ratio 0.19x)
• Interest burden is low with 17.1x coverage, limiting financial drag on earnings
• Cash flow data are not disclosed, preventing verification of cash conversion and FCF

Metrics to Watch:

• Q4 revenue and operating margin trajectory to gauge seasonality and cost control
• Working capital movements (advances, payables, short-term debt) and current ratio recovery
• Any disclosure of OCF and capex to assess FCF and earnings quality
• Visitor numbers/ADR/RevPAR or utilization metrics if disclosed, to parse mix and pricing vs volume
• Effective tax rate normalization and any extraordinary items impacting bottom line

Relative Positioning: Within domestic leisure/resort peers, Greenland Resort shows resilient top-line but greater profit sensitivity to cost pressures, producing a modest ROE and strong solvency but weaker liquidity; improved asset efficiency and cost control would be key to narrowing the profitability gap.

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