| Metric | Current Period | Prior-Year Period | YoY |
|---|---|---|---|
| Revenue | ¥57.8B | ¥56.3B | +2.6% |
| Operating Income | ¥0.4B | ¥3.2B | -87.6% |
| Ordinary Income | ¥2.4B | ¥5.1B | -53.0% |
| Net Income | ¥1.3B | ¥3.3B | -59.8% |
| ROE | 3.5% | 9.1% | - |
For FY2026 Q3 YTD, Revenue was ¥57.8B (+¥1.5B, +2.6% from ¥56.3B in the prior-year period), delivering modest top-line growth, while Operating Income was ¥0.4B (-¥2.8B, -87.6% from ¥3.2B), Ordinary Income was ¥2.4B (-¥2.7B, -53.0% from ¥5.1B), and Net Income was ¥1.3B (-¥2.0B, -59.8% from ¥3.3B), indicating a substantial deterioration in profitability. The increase in Revenue was driven by the Dining-out (¥48.9B), Retail (¥4.6B), and Overseas (¥11.0B) segments. However, SG&A expenses rose from ¥25.3B to ¥28.9B, compressing the Operating Margin sharply from 5.7% to 0.7%. Ordinary Income was supported by ¥2.7B in Non-operating Income, including ¥1.15B in dividend income, but a heavy tax burden of 43.5% compressed Net Income.
[Profitability] ROE 3.5% (down from 5.8% YoY), Operating Margin 0.7% (down -5.0pt from 5.7% YoY), Net Margin 2.3% (down -3.6pt from 5.9% YoY). Gross Margin was 39.0%, slightly down from 39.5%, indicating product competitiveness was maintained. EBIT margin was an extremely low 0.7%, primarily due to a rise in the SG&A ratio from 44.9% to 50.1%, which pressured Operating Income. DuPont analysis: Net Margin 2.3%, Total Asset Turnover 1.02x, and Financial Leverage 1.48x together yield ROE of 3.5%. The tax burden coefficient was 0.561 (effective tax rate 43.5%), with the high tax rate weighing on Net Income. [Cash Quality] Cash and deposits were ¥5.9B (down -41.9% from ¥10.1B), with a short-term liability coverage of 3.91x (cash/short-term liabilities), ensuring short-term liquidity. Accounts receivable were ¥9.7B (up +41.1% from ¥6.9B), and the increase in working capital strained cash. [Investment Efficiency] Total Asset Turnover was 1.02x (roughly flat vs. 1.01x YoY), and ROIC was a very low 0.6% (Operating Income ÷ Invested Capital). Dividend income of ¥1.15B contributed to earnings from Investment securities of ¥6.8B (up +27.5% from ¥5.5B). [Financial Soundness] Equity Ratio was 67.5% (improved from 66.1%), Current Ratio 163.7%, and Quick Ratio 146.5%, indicating healthy payment capacity. Interest-bearing debt was ¥5.0B, Debt-to-Equity ratio 0.48x, and Debt-to-Capital ratio 11.6%, representing a conservative capital structure.
Cash and deposits decreased by ¥4.2B (-41.9%) from ¥10.1B to ¥5.9B, revealing a deterioration in cash generation due to lower operating earnings. In working capital, accounts receivable increased by ¥2.8B (+41.1%) from ¥6.9B to ¥9.7B, and the increase in receivables far outpaced the 2.6% sales growth rate, pressuring cash. Accounts payable increased by ¥1.1B (+29.8%) from ¥3.8B to ¥4.9B, indicating greater use of supplier credit; however, the larger increase in receivables meant working capital was a net consumer of cash. On investing, Investment securities increased by ¥1.2B (+27.5%) from ¥5.5B to ¥6.8B, deploying funds and contributing to securing ¥1.15B in dividend income. In shareholder returns, the policy to maintain a Full-year dividend of ¥20 (Payout Ratio 45.8%) continued to allocate funds. With short-term liabilities of ¥1.5B covered 3.91x by cash of ¥5.9B, short-term liquidity is secured; however, given the sharp drop in cash balances and Operating Income, confirming the actual Operating Cash Flow (OCF) will be key to assessing funding conditions.
With Ordinary Income of ¥2.4B versus Operating Income of ¥0.4B, net non-operating contribution was about ¥2.0B. The breakdown was mainly ¥2.7B in Non-operating Income (dividend income ¥1.15B and other non-operating income ¥1.55B). Dividend income is confirmed as earnings from ¥6.8B in Investment securities. Dividend income equates to 2.0% of Revenue and accounts for about 48% of Ordinary Income, indicating high reliance on non-operating income. The low Operating Margin of 0.7% was primarily due to an increase in SG&A of ¥28.9B (SG&A ratio 50.1%), with increases in salaries and allowances and promotion expenses (fixed/semi-fixed costs) compressing operating profitability. From an accrual perspective, accounts receivable increased by an amount exceeding Net Income, weakening the cash backing of earnings. With Profit Before Tax of ¥2.4B and an effective tax rate of 43.5%, the heavy tax burden also detracted from earnings quality. Ordinary Income is supported by Non-operating Income, but operating-based earning power is fragile, making the structure susceptible to external factors (volatility in dividend income and the fixed nature of SG&A).
[Position within Industry] (Reference information - our research) Profitability: The Operating Margin of 0.7% is far below the industry median of 3.9% (IQR: 2.0%–9.5%, n=12 companies), placing the company near the bottom of the industry range. The Net Margin of 2.3% is roughly in line with the industry median of 2.2% (IQR: 0.5%–6.3%), but the fragility of the operating base stands out. ROE of 3.5% slightly exceeds the industry median of 2.9% (IQR: 0.8%–7.4%), driven by leverage effects, while operating profitability remains in the lower tier. Soundness: The Equity Ratio of 67.5% significantly exceeds the industry median of 48.9% (IQR: 37.6%–62.1%), placing financial safety in the upper tier within the industry. The Current Ratio of 163.7% is roughly in line with the industry median of 188% (IQR: 133%–273%), indicating solid short-term payment capacity. Efficiency: Total Asset Turnover of 1.02x is somewhat low compared to typical retail levels (annualized 1.3–1.5x). Sales growth of +2.6% is well below the industry median of +6.7% (IQR: 0.4%–11.7%), indicating underperformance in growth relative to peers. Industry: Retail (n=12 companies), Comparison set: Q3 2025, Source: our compilation
This report is an earnings analysis document automatically generated by AI based on XBRL earnings release data. It is not a recommendation to invest in any specific security. The industry benchmarks are reference information compiled by our company based on publicly available financial statement data. Investment decisions are your own responsibility; please consult a professional as necessary before making any decisions.