Studio Alice Co Ltd

Studio Alice maintains a strong liquidity position, with cash and equivalents amounting to ¥17.46 billion, representing 41.5% of total assets. The company's liquidity FPT (free cash flow to total liabilities) is robust, and the current ratio of 3.07 indicates a solid ability to meet short-term obligations. However, the company's return on equity (ROE) of -0.98% and return on assets (ROA) of -0.66% suggest underperformance relative to capital deployed.

The company's operating income of -¥344.95 million and net income of -¥276.85 million for the latest period indicate a loss-making position. This contrasts with the industry's preferred metrics, which typically emphasize stable or growing operating margins. Studio Alice's gross profit margin of 17.3% is in line with the industry median, but the negative operating margin of -4.2% is a concern.

Studio Alice's revenue is concentrated in a single business segment focused on animation production and distribution. The company's geographic exposure is primarily domestic, with no material international revenue disclosed. This concentration increases vulnerability to domestic market fluctuations.

The company's revenue for the latest period was ¥8.13 billion, a decline from the analyst-estimated ¥32.93 billion in the prior period. This suggests a significant contraction in top-line performance. The outlook for the current fiscal year indicates a continuation of this trend, with no clear signs of recovery in the near term.

Risk factors include the company's negative net income and operating income, which could pressure liquidity if sustained. However, the company's low debt-to-equity ratio of 0.03 and minimal dilution risk suggest that financial distress is not an immediate concern. No dilution sources were identified in recent filings, and the company has not issued new shares in the past year.

Recent events include the disclosure of a negative earnings report and a decline in revenue. No material regulatory or legal issues were identified in the latest filings. The company's management has not provided a detailed explanation for the earnings shortfall, but industry observers suggest that declining demand for traditional animation services may be a contributing factor.

Long-term debt decreased significantly to JPY 945 million in FY2026, indicating strong deleveraging and reduced financial risk.

The debt-to-equity ratio of 0.03 ranks in the top quartile, reflecting a highly conservative capital structure.

Free cash flow improved to JPY 1.9 billion in FY2025, demonstrating enhanced cash generation capabilities before recent decline.

Low dilution and liquidity risks suggest stable shareholder value and adequate short-term financial flexibility.

Gross profit remained relatively stable at JPY 8.3 billion in FY2024 and FY2025, showing some top-line resilience.

Revenue declined by 5.1% annually over four years, signaling persistent contraction in core business operations.

Operating and net margins are negative, placing the company in the bottom quartile of the Personal Services cohort.

Return on equity and return on assets are negative, failing to generate value for shareholders or asset holders.

High credit risk flags suggest potential difficulties in meeting financial obligations or securing favorable financing terms.

Revenue ¥8.21B, −6,3% YoY; Operating income −77,3% YoY.

• ▍Revenue ¥8.21B, −6,3% YoY
• ▍Operating income −77,3% YoY
• ▍Net income −97,3% YoY
• ▍Net margin 0.1%

Revenue ¥10.35B, −9,8% YoY; Operating income −14,6% YoY.

• ▍Revenue ¥10.35B, −9,8% YoY
• ▍Operating income −14,6% YoY
• ▍Net income −12,8% YoY
• ▍Net margin 14.8%

Revenue ¥6.53B, −9,7% YoY; Operating income −60,8% YoY.

• ▍Revenue ¥6.53B, −9,7% YoY
• ▍Operating income −60,8% YoY
• ▍Net income −66,8% YoY
• ▍Net margin -8.2%

Revenue ¥7.84B, −3,6% YoY; Operating income +153,3% YoY.

• ▍Revenue ¥7.84B, −3,6% YoY
• ▍Operating income +153,3% YoY
• ▍Net income +156,9% YoY
• ▍Net margin 2.0%

Revenue ¥8.76B; Operating income ¥401.6M.

• ▍Revenue ¥8.76B
• ▍Operating income ¥401.6M
• ▍Net margin 2.3%

Revenue ¥11.47B; Operating income ¥2.64B.

• ▍Revenue ¥11.47B
• ▍Operating income ¥2.64B
• ▍Net margin 15.4%

Revenue ¥7.23B; Operating income -¥444.5M.

• ▍Revenue ¥7.23B
• ▍Operating income -¥444.5M
• ▍Net margin -4.4%

Revenue ¥8.13B; Operating income -¥345.0M.

• ▍Revenue ¥8.13B
• ▍Operating income -¥345.0M
• ▍Net margin -3.4%

Revenue ¥32.93B, −7,5% YoY; Operating income −19,4% YoY.

• ▍Revenue ¥32.93B, −7,5% YoY
• ▍Operating income −19,4% YoY
• ▍Net income −14,9% YoY
• ▍Free cash flow −31,2% YoY
• ▍Net margin 3.5%

Revenue ¥35.60B, −2,2% YoY; Operating income +21,2% YoY.

• ▍Revenue ¥35.60B, −2,2% YoY
• ▍Operating income +21,2% YoY
• ▍Net income +17,9% YoY
• ▍Free cash flow +168,3% YoY
• ▍Net margin 3.8%

Revenue ¥36.40B, −5,6% YoY; Operating income −47,6% YoY.

• ▍Revenue ¥36.40B, −5,6% YoY
• ▍Operating income −47,6% YoY
• ▍Net income −48,7% YoY
• ▍Free cash flow −15,6% YoY
• ▍Net margin 3.2%

Revenue ¥38.56B, −5,2% YoY; Operating income −37,6% YoY.

• ▍Revenue ¥38.56B, −5,2% YoY
• ▍Operating income −37,6% YoY
• ▍Net income −37,5% YoY
• ▍Free cash flow −50,3% YoY
• ▍Net margin 5.9%