Performance trends of Koa Corporation Holdings <9273>

3. Financial Condition and Management Indicators

As of the end of June 2024, the consolidated financial position showed total assets of ¥32,004 million, an increase of ¥3,539 million compared to the previous year-end. Looking at the main factors of increase and decrease, cash and deposits increased by ¥3,187 million, buildings and structures (net amount) increased by ¥553 million, construction temporary accounts increased by ¥314 million, electronic record receivables increased by ¥197 million, while commodities and products decreased by ¥264 million, other current assets decreased by ¥134 million, and accounts receivable decreased by ¥122 million.

Total liabilities decreased by ¥588 million to ¥6,952 million compared to the previous year-end. Looking at the main factors of increase and decrease, electronic record liabilities increased by ¥31 million, while long-term borrowings decreased by ¥349 million, other current liabilities decreased by ¥225 million, unpaid corporate taxes decreased by ¥78 million, and promissory notes and accounts payable decreased by ¥17 million. The total borrowings, including long-term and short-term borrowings, decreased by ¥315 million to ¥2,825 million. In addition, net assets increased by ¥4,128 million to ¥25,051 million. This was mainly due to an increase of ¥2,470 million in retained earnings, ¥816 million in capital stock, and ¥816 million in capital surplus.

As a result, the equity ratio is high at 78.3% (an increase of 4.8 points compared to the previous year-end). It maintains a significantly higher level of safety at 78.3% compared to the industry average of 33.3% listed on the main board market in March 2024. Similarly, the current ratio is high at 497.8%, indicating sufficient liquidity to meet short-term liabilities. In terms of profitability, the ROA is 14.4%, and ROE is 12.8%, surpassing the industry average of 4.5% and 9.6% listed on the main board market in March 2024, reflecting strong profitability.

The cash and cash equivalents (referred to as funds) at the end of June 2024 increased by ¥3,159 million compared to the previous year-end, reaching ¥13,195 million. The situation of each cash flow and its factors are as follows:

Funds acquired through operating activities amounted to ¥3,830 million (an increase of ¥1,093 million compared to the previous year). This was mainly due to the current net income before tax adjustments of ¥4,368 million, depreciation of ¥726 million, decrease in inventory assets of ¥196 million, while payments of corporate taxes amounted to ¥1,534 million, and an increase in accounts receivable of ¥87 million.

Funds used for investment activities amounted to ¥1,471 million (an increase of ¥1,167 million). This was primarily due to spending on fixed asset acquisitions of ¥1,439 million.

Funds obtained through financial activities amounted to 7.95 billion yen (compared to 8.12 billion yen in the previous consolidated fiscal year). This was mainly due to income from the issuance of stocks totaling 16.27 billion yen, while there were expenses such as dividend payments of 4.75 billion yen and repayments of long-term borrowings of 3.25 billion yen.

Therefore, the free cash flow, which subtracts the funds used in investment activities from the funds obtained through operating activities, stood at an income of 23.59 billion yen, maintaining a high level.

(Written by FISCO guest analyst Nozomi Kokushige).