Eltes Co Ltd

Eltes operates with a debt-to-equity ratio of 2.01 and a current ratio of 1.28, indicating moderate liquidity risk. The company holds 1.83 billion JPY in cash and equivalents but faces 3.71 billion JPY in long-term debt, resulting in negative net cash. The price-to-book ratio of 1.97 suggests market valuation is above tangible asset value, while the EV/EBITDA of 43.12 reflects a high multiple relative to earnings. Profitability metrics show significant underperformance: ROE of -9.14% and ROA of -2.36% indicate the company is eroding shareholder and asset value. Operating income of 127.9 million JPY is sharply down from revenue of 8.96 billion JPY, with a net loss of 168.5 million JPY. These results fall well below typical performance metrics for Business Support Services firms. The company's revenue is concentrated in its Social Risk segment, which provides consulting, monitoring, and intelligence services. Geographic exposure is primarily domestic, with no material international revenue disclosed. This concentration increases vulnerability to sector-specific downturns. Outlook data shows a challenging trajectory: revenue is projected to decline in the current fiscal year, with no clear recovery path in the next fiscal year. The company's free cash flow of 100.3 million JPY is insufficient to cover capital expenditures of 228.7 million JPY, signaling potential liquidity constraints. Risk assessment highlights medium liquidity risk due to negative net cash and a high debt load. Dilution risk is currently low, but the company's net loss and negative operating cash flow raise concerns about future financing needs. Adjustments in valuation models reflect these risks through conservative earnings assumptions. Recent filings show continued operational losses and negative cash flow from operations. No material events or earnings calls have been disclosed in the last quarter, but the company's financial position suggests potential for increased scrutiny from creditors and investors.