Toso Co Ltd

Toso maintains a strong liquidity position, with cash and equivalents amounting to ¥3.57 billion, representing 16.5% of total assets. The company's liquidity FPT (free cash flow to total liabilities) is robust, and its current ratio of 2.71 indicates a solid ability to meet short-term obligations. The debt-to-equity ratio of 0.11 suggests a conservative capital structure, with long-term debt at ¥1.62 billion and total equity at ¥14.34 billion.

Profitability metrics show a mixed picture. The company's return on equity (ROE) of 0.97% and return on assets (ROA) of 0.64% are below the industry median for Construction Supplies & Fixtures, indicating subpar capital efficiency. Gross profit of ¥2.26 billion and operating income of ¥209 million suggest a narrow margin structure, with operating margin at 3.6% and net margin at 2.4%. These figures are in line with the industry's low-margin profile but leave little room for volatility.

Geographically, Toso's revenue is concentrated in Japan, with no disclosed international operations. The company's exposure to domestic construction cycles is a key risk factor, as the industry is sensitive to macroeconomic fluctuations and housing demand. Segment-wise, the company operates as a single business unit, with no material diversification across product lines or customer bases.

Looking ahead, Toso's revenue is projected to grow by 1.2% in the current fiscal year and 0.8% in the next, based on analyst estimates and historical performance. Capital expenditures are expected to remain modest, with a negative CAGR of -10.7% in the most recent period, suggesting a focus on cost control rather than expansion. The company's operating cash flow of ¥691 million supports this strategy, but the low ROE and ROA suggest limited reinvestment opportunities.

Risk factors include exposure to domestic construction demand and potential regulatory changes in building standards. The company has no immediate liquidity or dilution flags, and its dilution potential is assessed as low, with no recent share issuance or ATM activity reported. However, the low ROE and ROA may pressure investor sentiment if margins fail to improve.

Recent filings and transcripts show no material changes in strategy or operations. The company's last actual EPS of ¥56.05 and revenue of ¥22.79 billion align with historical trends, with no significant deviations in earnings or revenue growth.

Net income surged 69.6% year-over-year to JPY 500 million in fiscal 2025, signaling a strong operational recovery.

Free cash flow jumped 264.9% to JPY 463 million, demonstrating significantly improved cash generation capabilities.

Cash conversion ratio of 4.95 ranks best-in-class among 239 construction supplies peers, highlighting superior efficiency.

Debt-to-equity ratio of 0.11 is well below the cohort median of 0.29, indicating a conservative capital structure.

Revenue grew 5.5% to JPY 22.8 billion in fiscal 2025, marking the first annual increase in four years.

Net income CAGR of -9.7% over four years reveals a long-term downward trend despite recent recovery.

Operating margin of 3.6% trails the cohort median of 4.6%, indicating weaker profitability relative to peers.

Net margin of 2.4% remains below the cohort median of 3.0%, reflecting persistent pressure on bottom-line profitability.

Revenue ¥5.84B, −1,4% YoY; Operating income +4,1% YoY.

• ▍Revenue ¥5.84B, −1,4% YoY
• ▍Operating income +4,1% YoY
• ▍Net income −3,0% YoY
• ▍Net margin 4.5%

Revenue ¥5.80B, +4,8% YoY; Operating income +50,9% YoY.

• ▍Revenue ¥5.80B, +4,8% YoY
• ▍Operating income +50,9% YoY
• ▍Net income +84,9% YoY
• ▍Net margin 2.3%

Revenue ¥5.35B, +6,9% YoY; Operating income +159,2% YoY.

• ▍Revenue ¥5.35B, +6,9% YoY
• ▍Operating income +159,2% YoY
• ▍Net income +141,7% YoY
• ▍Net margin 0.9%

Revenue ¥6.33B, +9,6% YoY; Operating income +85,8% YoY.

• ▍Revenue ¥6.33B, +9,6% YoY
• ▍Operating income +85,8% YoY
• ▍Net income +90,0% YoY
• ▍Net margin 4.2%

Revenue ¥5.93B; Operating income ¥359.2M.

• ▍Revenue ¥5.93B
• ▍Operating income ¥359.2M
• ▍Net margin 4.6%

Revenue ¥5.53B; Operating income ¥131.8M.

• ▍Revenue ¥5.53B
• ▍Operating income ¥131.8M
• ▍Net margin 1.3%

Revenue ¥5.00B; Operating income -¥136.3M.

• ▍Revenue ¥5.00B
• ▍Operating income -¥136.3M
• ▍Net margin -2.2%

Revenue ¥5.77B; Operating income ¥209.1M.

• ▍Revenue ¥5.77B
• ▍Operating income ¥209.1M
• ▍Net margin 2.4%

Revenue ¥22.79B, +5,5% YoY; Operating income +63,7% YoY.

• ▍Revenue ¥22.79B, +5,5% YoY
• ▍Operating income +63,7% YoY
• ▍Net income +69,6% YoY
• ▍Free cash flow +264,9% YoY
• ▍Net margin 2.2%

Revenue ¥21.61B, +1,4% YoY; Operating income −37,4% YoY.

• ▍Revenue ¥21.61B, +1,4% YoY
• ▍Operating income −37,4% YoY
• ▍Net income −19,6% YoY
• ▍Free cash flow −59,0% YoY
• ▍Net margin 1.4%

Revenue ¥21.30B, +2,1% YoY; Operating income −7,2% YoY.

• ▍Revenue ¥21.30B, +2,1% YoY
• ▍Operating income −7,2% YoY
• ▍Net income −31,0% YoY
• ▍Free cash flow −49,5% YoY
• ▍Net margin 1.7%

Revenue ¥20.86B, −2,6% YoY; Operating income −27,3% YoY.

• ▍Revenue ¥20.86B, −2,6% YoY
• ▍Operating income −27,3% YoY
• ▍Net income −29,2% YoY
• ▍Free cash flow −31,9% YoY
• ▍Net margin 2.5%