Agora Hospitality Group Co Ltd

Agora Hospitality Group maintains a liquidity position that is slightly strained, with a current ratio of 0.96, indicating that its current liabilities exceed its current assets. The company holds JPY 3.44 billion in cash and equivalents, but this is offset by JPY 8.84 billion in long-term debt, resulting in a debt-to-equity ratio of 2.48. The price-to-book ratio of 1.95 suggests that the market values the company at a premium to its book value, while the price-to-tangible-book ratio is identical, indicating no intangible asset premium.

Profitability metrics for Agora Hospitality Group are modest, with a return on equity (ROE) of 0.8% and a return on assets (ROA) of 0.14%. These figures are below the industry median for ROE and ROA, which are typically higher for firms in the hospitality sector due to the potential for high occupancy and margin leverage. The company's operating income of JPY 60.7 million and net income of JPY 28.6 million reflect a narrow profit margin, consistent with the capital-intensive nature of the industry.

The company's revenue is concentrated in a single business segment, as disclosed in its financial statements, with no material geographic diversification reported. This lack of diversification increases exposure to regional economic fluctuations and regulatory changes. The company's revenue of JPY 1.94 billion is derived primarily from its core hospitality operations, with no significant contributions from ancillary services or international markets.

Looking ahead, the company's revenue is projected to grow modestly, with a year-over-year increase of approximately 94.7% from the analyst-estimated revenue of JPY 9.91 billion to the reported revenue of JPY 19.38 billion. However, this growth is not expected to be sustained in the next fiscal year, as the company faces headwinds from rising interest rates and potential demand softening in the post-pandemic recovery phase. The company's capital expenditures are expected to remain flat, with no significant new projects disclosed in recent filings.

The risk profile of Agora Hospitality Group is characterized by medium liquidity risk and low dilution risk. The company's net cash position is negative after subtracting total debt, which could limit its ability to fund operations or pursue growth opportunities without external financing. The risk of dilution is low, as the company has not issued additional shares in the past year, and there are no material dilution sources identified in recent filings. The company's debt structure is primarily long-term, which reduces the immediate pressure of refinancing but increases exposure to interest rate risk.

Recent events include the company's Q4 earnings report, which showed a net income of JPY 28.6 million, below the industry median for firms of similar size. The company has not disclosed any material changes in its business strategy or capital structure in the past six months, and there are no significant regulatory or legal proceedings reported in the latest filings.

Revenue grew 31.1% CAGR over four years, reaching JPY 9.9 billion in fiscal 2026.

Net income surged 1,079.1% year-over-year to JPY 1.27 billion in fiscal 2026.

Operating income increased 343.7% year-over-year to JPY 2.15 billion in fiscal 2026.

Free cash flow turned positive, rising 181.2% to JPY 1.68 billion in fiscal 2026.

Gross profit expanded significantly to JPY 3.52 billion in fiscal 2026, supporting margin recovery.

Debt-to-equity ratio of 2.48 sits in the bottom quartile of the hotel cohort.

The company faces high credit risk and medium liquidity risk according to risk flags.

Revenue ¥2.56B, +7,1% YoY; Operating income −32,8% YoY.

• ▍Revenue ¥2.56B, +7,1% YoY
• ▍Operating income −32,8% YoY
• ▍Net income −261,3% YoY
• ▍Net margin -6.2%

Revenue ¥2.82B, +34,1% YoY; Operating income +642,4% YoY.

• ▍Revenue ¥2.82B, +34,1% YoY
• ▍Operating income +642,4% YoY
• ▍Net income +199,5% YoY
• ▍Net margin 10.3%

Revenue ¥2.18B, +12,5% YoY; Operating income +88,4% YoY.

• ▍Revenue ¥2.18B, +12,5% YoY
• ▍Operating income +88,4% YoY
• ▍Net income −146,4% YoY
• ▍Net margin -0.6%

Revenue ¥2.39B; Operating income ¥365.6M.

• ▍Revenue ¥2.39B
• ▍Operating income ¥365.6M
• ▍Net margin 4.1%

Revenue ¥1.95B; Operating income ¥3.7M.

• ▍Revenue ¥1.95B
• ▍Operating income ¥3.7M
• ▍Net margin -5.9%

Revenue ¥2.10B; Operating income ¥54.0M.

• ▍Revenue ¥2.10B
• ▍Operating income ¥54.0M
• ▍Net margin 4.6%

Revenue ¥1.94B; Operating income ¥60.7M.

• ▍Revenue ¥1.94B
• ▍Operating income ¥60.7M
• ▍Net margin 1.5%

Revenue ¥9.91B, +18,3% YoY; Operating income +343,8% YoY.

• ▍Revenue ¥9.91B, +18,3% YoY
• ▍Operating income +343,8% YoY
• ▍Net income +1 079,1% YoY
• ▍Free cash flow +181,2% YoY
• ▍Net margin 12.9%

Revenue ¥8.38B, +14,6% YoY; Operating income +534,8% YoY.

• ▍Revenue ¥8.38B, +14,6% YoY
• ▍Operating income +534,8% YoY
• ▍Net income +172,3% YoY
• ▍Free cash flow −123,4% YoY
• ▍Net margin 1.3%

Revenue ¥7.31B, +47,6% YoY; Operating income +92,9% YoY.

• ▍Revenue ¥7.31B, +47,6% YoY
• ▍Operating income +92,9% YoY
• ▍Net income +88,5% YoY
• ▍Free cash flow +44,4% YoY
• ▍Net margin -2.0%

Revenue ¥4.95B, +47,5% YoY; Operating income +12,5% YoY.

• ▍Revenue ¥4.95B, +47,5% YoY
• ▍Operating income +12,5% YoY
• ▍Net income +22,9% YoY
• ▍Free cash flow −16,4% YoY
• ▍Net margin -26.2%

Revenue ¥3.36B; Operating income -¥1.79B.

• ▍Revenue ¥3.36B
• ▍Operating income -¥1.79B
• ▍Net margin -50.1%