All scenarios, assumptions, sources, sensitivities and reproducible calculations.
f-code 9211
Our conditional research model
Base case · Research cutoff: 4 November 2026 · Fiscal years end in December
Read the accompanying article ↗
A conditional first estimate. Seller-payment terms and future funding require broad JII assumptions. This 4 November model is separate from the 27 October article’s guidance-based valuation. Its recurring basic EPS is not company-guided or reported IFRS EPS.
The annual outlook
JII base-case estimates · ¥ billion, except EPS and margins
| Fiscal year | FY12/26E | FY12/27E | FY12/28E | FY12/29E |
|---|---|---|---|---|
| Revenue | 17.51 | 20.11 | 21.42 | 22.49 |
| Recurring operating profit¹ | 2.58 | 3.02 | 3.18 | 3.19 |
| Recurring operating margin (%) | 14.8 | 15.0 | 14.8 | 14.2 |
| Recurring parent profit¹ | 1.22 | 1.52 | 1.72 | 1.89 |
| Recurring basic EPS (¥)¹ | 99.83 | 123.89 | 140.21 | 153.61 |
| Closing cash / equivalents | 8.18 | 6.50 | 4.76 | 1.87 |
| Closing bank / bond debt | 13.26 | 12.90 | 12.03 | 10.81 |
| Put / earnout payments² | 0.15 | 1.29 | 1.95 | 3.18 |
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E = JII estimate. FY12/26 sales and earnings combine actual H1 with estimated H2. ¹ Recurring operating earnings remove liability-revaluation income and impairment while retaining residual operating expenses; recurring EPS also reflects tax, interest and nonparent claims. ² FY12/26 payments cover estimated H2 only; later payment rows cover full years. Closing cash and debt are year-end balances.
Base recurring basic EPS rises from ¥99.83 to ¥153.61. FY12/29 bear / bull estimates are −¥99.74 / ¥182.97. Cash falls as seller obligations are paid; base-case refinancing is conditional and no new acquisition is included. See the full dataset for all annual cash flows, reserves and dilution.
The assumptions that matter
| Driver | Base-case assumption | Basis |
|---|---|---|
| Delivered activity / scope | H2 FY12/26 activity +6%; FY12/27–29 +8%, +6.5%, +5%. No new M&A. | JII assumptions; acquired revenue annualized over observed ownership periods. H1 acquisition notes, pp27–29. |
| Cash costs / investment | Price and mix +1.5%; variable input inflation +2.5%; fixed cash costs +5.5%. Maintenance capex ¥100m/year plus 2% of incremental revenue. | H1 recurring operating anchor ¥1,214.861m; costs include the residual operating expense. Depreciation follows capex. H1 statements, pp17–20. |
| Minority earnings | AI ONE 25% outside ownership; Roombox 15%; residual minority profit modeled separately. | Observed ownership and partial-period net profit anchor the claims. Purchase cash extinguishes the same covered claim; actual put mapping is undisclosed. H1 acquisition notes, pp27–29. |
| Seller payments | Put exercise: 0% / 20% / 30% / 50% of the original covered pool. Earnouts: 10% / 25% / 30% / 35%. | JII schedules and cash-price assumptions. ¥3.715bn put PV and ¥1.420bn earnout FV are starting points, never payment ceilings. H1 financial instruments, pp36–38. |
| Customer advances | Opening ¥2.594bn earned 50% / 40% / 10% / 0%; no new advances or base-case refunds. | Delivery reduces the liability without a second cash receipt; paid service costs remain. Refund and delivery stresses retained. H1 acquisition / liability notes. |
| Fixed deferred price | ¥750m AI ONE payment treated as additional: ¥250m in each of 2027–29. | Conservative JII classification; an already-included variant is tested. AI ONE acquisition note, p27. |
| Funding / dilution | Bank rate 2.5%; rollover limited to principal repaid. One month of sales in cash plus reserves for unsettled claims. | Refinancing is uncommitted. Equity, when needed, is issued at a 20% discount with dilution. Current maturities accelerated; later ladder is a JII proxy. H1 debt and financial instruments; FY12/25 annual notes. |
| Tax / EPS / guidance | 30% normalized tax; basic share denominator including modeled funding. No future liability-revaluation gains or compensation cash recovery. | Recurring EPS differs from IFRS EPS. Company FY12/26 guided EPS ¥155.62 is a separate comparator and does not drive estimates. H1 presentation, p5. |
Sources and calculation basis
Primary evidence: H1 FY12/26 statutory report, H1 results statements, FY12/25 annual securities report and H1 results presentation. Exact locators are retained in the download. The calculation uses existing service activity and acquisition-scope annualization, with explicit seller, minority, customer-cash and funding bridges.
Principal uncertainty: put-to-entity mapping, strike formulas, exercise timing and the ¥750m fixed-price classification remain unresolved. Fair values are conditional cash anchors, not contractual caps. Partial-period subsidiary earnings are weak annual proxies. New credit and equity are not committed; consolidated cash is not wholly free for distribution.
The October article used FY12/26 company-guided EPS ¥155.62 and an illustrative 10× multiple to produce ¥1,556. That historical valuation is not generated or updated by this independent recurring-EPS model. The published article remains the dated research narrative; this page records the later conditional calculations.
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