Lec Inc

LEC, INC. maintains a liquidity position with a current ratio of 5.67, indicating strong short-term liquidity, supported by cash and equivalents of ¥29.96 billion, which is partially offset by long-term debt of ¥46.34 billion. The company's debt-to-equity ratio of 1.34 suggests a moderate reliance on debt financing, with total liabilities of ¥54.78 billion compared to total equity of ¥34.64 billion. Profitability metrics show a return on equity (ROE) of 5.0% and a return on assets (ROA) of 1.94%, both below the typical thresholds for high-performing household products firms. The net income of ¥1.73 billion and operating income of ¥2.10 billion reflect a relatively modest margin structure, with gross profit of ¥17.45 billion on total revenue of ¥66.30 billion. The company operates in a single business segment, Daily Miscellaneous Products and Clothing, and does not disclose geographic revenue breakdowns. This lack of segmentation data limits visibility into geographic exposure and potential concentration risks. Looking ahead, the company is projected to maintain stable revenue, with no significant growth or decline expected in the next fiscal year. The operating cash flow of ¥4.21 billion and free cash flow of ¥3.12 billion support this outlook, though capital expenditures of ¥1.51 billion suggest ongoing investment in operations. The risk assessment highlights a medium liquidity risk due to the company's net cash position being negative after subtracting total debt. While dilution risk is currently low, the company's capital structure and potential for future financing activities should be monitored for changes in risk exposure. Recent financial filings and transcripts do not indicate any material events or strategic shifts. The company's financial performance remains consistent with historical trends, with no significant deviations in revenue or profitability metrics.