E-Supportlink Ltd

E-Supportlink maintains a strong liquidity position, with cash and equivalents amounting to ¥2.55 billion, representing 48.6% of total assets. The company's liquidity FPT (free cash flow to total debt) is robust, supported by a current ratio of 3.47 and a debt-to-equity ratio of 0.18. These metrics indicate a low liquidity risk profile, with ample capacity to service obligations without external financing.

Profitability metrics reveal a mixed picture. The company's return on equity (ROE) of 0.17% and return on assets (ROA) of 0.11% are significantly below the industry median for IT Services & Consulting, which typically exceeds 5% ROE and 3% ROA. Gross profit margin of 33.5% is in line with the sector, but operating margin of 1.0% is notably weak, suggesting inefficiencies in cost management or pricing power.

Geographic and segment exposure is not explicitly disclosed in the available data, but the company's revenue concentration appears to be primarily domestic. Given the lack of international revenue breakdown, it is difficult to assess diversification risk. The absence of segment-specific financials also limits visibility into growth drivers or underperforming areas.

Growth trajectory is muted, with no significant revenue acceleration in the most recent period. The company reported ¥1.29 billion in revenue, with no disclosed YoY growth rate. Analyst estimates for revenue and EPS align closely with reported figures, suggesting stable but unremarkable performance. The outlook for the current and next fiscal years remains neutral, with no material changes in direction or magnitude.

Risk factors are minimal in the short term, with low dilution and liquidity risk scores. The company has not issued new shares recently, and there are no immediate filing-based flags for dilution. However, the high price-to-earnings ratio of 743.24 and elevated EV/EBITDA of 1,897.82 suggest potential overvaluation, particularly given the low returns on equity and assets. These valuations may be sensitive to earnings volatility or macroeconomic shifts.

Recent events include the publication of the latest financial results, which show a narrow operating margin and low net income. No material regulatory or litigation events were disclosed in the most recent filings. The company's capital structure remains stable, with no significant changes in debt or equity issuance in the past year.

Revenue surged 19.7% year-over-year to JPY 6.47 billion in FY2026, demonstrating strong top-line growth momentum.

Free cash flow improved by 225.4% to JPY 222.8 million, indicating significantly enhanced cash generation capabilities.

Long-term debt decreased substantially to JPY 496.4 million in FY2025, reflecting a strong deleveraging trend.

Cash conversion ratio of 17.76 ranks as best-in-class within the IT Services & Consulting cohort.

Net income recovered to JPY 135.3 million in FY2025, marking a return to profitability after previous losses.

Operating margin of 0.1% falls significantly below the IT Services cohort median of 5.13%.

Return on equity of 0.17% is well below the cohort median of 4.27%, indicating poor capital efficiency.

The company faces high credit risk, posing potential challenges for financial stability and borrowing costs.

Net margin of 0.46% remains substantially below the industry median of 3.88%, highlighting weak profitability.

Revenue ¥1.60B, +2,7% YoY; Operating income −9,2% YoY.

• ▍Revenue ¥1.60B, +2,7% YoY
• ▍Operating income −9,2% YoY
• ▍Net income −82,6% YoY
• ▍Net margin 0.2%

Revenue ¥1.73B, +23,5% YoY; Operating income +61,5% YoY.

• ▍Revenue ¥1.73B, +23,5% YoY
• ▍Operating income +61,5% YoY
• ▍Net income +98,8% YoY
• ▍Net margin 7.8%

Revenue ¥1.70B, +18,8% YoY; Operating income −96,3% YoY.

• ▍Revenue ¥1.70B, +18,8% YoY
• ▍Operating income −96,3% YoY
• ▍Net income −110,2% YoY
• ▍Net margin -0.2%

Revenue ¥1.49B, +14,8% YoY; Operating income +763,2% YoY.

• ▍Revenue ¥1.49B, +14,8% YoY
• ▍Operating income +763,2% YoY
• ▍Net income −188,8% YoY
• ▍Net margin -0.4%

Revenue ¥1.55B; Operating income ¥43.5M.

• ▍Revenue ¥1.55B
• ▍Operating income ¥43.5M
• ▍Net margin 1.4%

Revenue ¥1.40B; Operating income ¥25.3M.

• ▍Revenue ¥1.40B
• ▍Operating income ¥25.3M
• ▍Net margin 4.9%

Revenue ¥1.43B; Operating income ¥48.5M.

• ▍Revenue ¥1.43B
• ▍Operating income ¥48.5M
• ▍Net margin 2.2%

Revenue ¥1.29B; Operating income ¥1.3M.

• ▍Revenue ¥1.29B
• ▍Operating income ¥1.3M
• ▍Net margin 0.5%

Revenue ¥6.47B, +19,7% YoY; Operating income −26,1% YoY.

• ▍Revenue ¥6.47B, +19,7% YoY
• ▍Operating income −26,1% YoY
• ▍Net income +8,5% YoY
• ▍Free cash flow +225,4% YoY
• ▍Net margin 2.3%

Revenue ¥5.41B, +18,5% YoY; Operating income +59,6% YoY.

• ▍Revenue ¥5.41B, +18,5% YoY
• ▍Operating income +59,6% YoY
• ▍Net income +188,1% YoY
• ▍Free cash flow −20,8% YoY
• ▍Net margin 2.5%

Revenue ¥4.56B, −5,9% YoY; Operating income −36,5% YoY.

• ▍Revenue ¥4.56B, −5,9% YoY
• ▍Operating income −36,5% YoY
• ▍Net income −69,8% YoY
• ▍Free cash flow −234,6% YoY
• ▍Net margin 1.0%

Revenue ¥4.85B, −6,5% YoY; Operating income +118,8% YoY.

• ▍Revenue ¥4.85B, −6,5% YoY
• ▍Operating income +118,8% YoY
• ▍Net income +116,5% YoY
• ▍Free cash flow +113,5% YoY
• ▍Net margin 3.2%