Performance Trends of Sakai Heavy Industries <6358>

3. Financial position

Regarding the financial condition as of the end of the first quarter of the fiscal year ending March 2025, current assets decreased by 1,630 million yen compared to the end of the previous period, to 284,730 million yen. The main reasons for this are an increase of 4,640 million yen in cash and deposits, a decrease of 23,270 million yen in bills and accounts receivable (including electronic record claims), and an increase of 14,690 million yen in inventory assets. Fixed assets increased by 3,020 million yen to 159,020 million yen, with the main factors being an increase of 1,730 million yen in tangible fixed assets, an increase of 3,020 million yen in intangible fixed assets, and a decrease of 1,740 million yen in investments and other assets (mainly a decrease of 1,050 million yen in investment securities). As a result, total assets increased by 1,380 million yen to 4,437,500 million yen. Despite the increase in inventory assets, the company stated that the construction machinery market is entering an adjustment period in the midst of a global economic slowdown and is currently adjusting to an appropriate inventory level.

Although the total liabilities decreased by 3,730 million yen to 146,980 million yen compared to the end of the previous period, the main reasons for this are a decrease of 329 million yen in accounts payable (commercial paper and trade accounts payable, electronic record liabilities) within current liabilities, a decrease of 165 million yen in short-term loans, and an increase of 220 million yen in long-term liabilities. The total net assets increased by 5,110 million yen to 296,770 million yen. As a result, the self-capital ratio at the end of the first quarter of the fiscal year ending March 2025 was 66.7% (compared to 65.8% at the end of the previous period).

The net working capital (accounts receivable + inventory assets - accounts payable) at the end of the first quarter of the fiscal year ending March 2025 increased by 9,400 million yen compared to the same period of the previous year, to 125,030 million yen. This was mainly due to a decrease of 2,560 million yen in accounts receivable, an increase of 14,690 million yen in inventory assets, and a decrease of 20,330 million yen in accounts payable. Despite robust sales (revenue), the sales-to-inventory turnover ratio decreased by 0.36 times compared to the same period of the previous year, to 2.65 times, due to the construction machinery market entering an adjustment period.

(Written by FISCO guest analyst Noboru Terashima)