Wakita & Co. FY2026 Analysis: Guidance Points to Moderate Recovery in Coming Year
Wakita & Co., Ltd. (株式会社ワキタ, TSE:8125), a leading Japanese construction machinery rental and manufacturer, reported a modest revenue increase for the full year ending February 2026, but faced a significant decline in operating and net profit. The company has provided forward-looking guidance for the next fiscal year, suggesting a potential rebound in performance.
Key Numbers (JPY bn)
| Metric | FY2026 (Actual) | YoY Change |
|---|---|---|
| Revenue | 93.2 | +1.0% |
| Operating Profit | 5.28 | -17.3% |
| Ordinary Income | 5.49 | -15.7% |
| Net Profit | 3.45 | -11.8% |
| Operating Margin | 5.7% | N/A |
| Equity Ratio | 69.1% | N/A |
Business Overview Wakita & Co. operates as a construction machinery rental company with a strong focus on civil engineering equipment, and also engages in the manufacturing of small-scale machinery. The company diversifies its operations by also running a real estate business, which contributes to revenue diversification.
Analysis While Wakita & Co. achieved a slight revenue increase of 1.0% year-over-year, the decline in operating profit by 17.3% highlights the challenges the company is facing in maintaining profitability. This decline is attributed to a combination of factors, including rising costs, intensified price competition, and potential increases in raw material prices. The operating margin of 5.7% is in line with industry averages, but the drop in operating profit suggests that the company is struggling to pass on cost increases to customers or improve efficiency.
The decrease in net profit by 11.8% further underscores the pressure on the company’s bottom line. This decline is not solely due to the drop in operating profit but may also be influenced by changes in non-operating income and expenses, as well as shifts in cash flow from financial and investment activities.
Next Year Guidance The company has provided forward-looking guidance for the next fiscal year, which suggests a more optimistic outlook:
| Metric | FY2027 (Forecast) | YoY Change vs. FY2026 |
|---|---|---|
| Revenue | 100.0 | +7.3% |
| Operating Profit | 5.8 | +9.8% |
| Ordinary Income | 5.95 | +8.5% |
| Net Profit | 3.6 | +4.3% |
Revenue target: JPY 100.0bn (+7.3% YoY) — in-line with industry expectations; operating profit target implies a modest recovery in margins.
What to Watch 1. Margin Recovery: The company’s ability to improve operating profit despite rising costs will be a key indicator of its operational efficiency and pricing.