# WATTS CO., LTD.: business model and financials

> Latest period: FY ending Aug 2025, consolidated, J-GAAP
> Unit: JPY millions
> Sources: 有価証券報告書－第31期(2024/09/01－2025/08/31) (S100X626)
> Page: https://vizora.meequs.com/en/company/watts
> Retrieved: 2026-09-30T21:32:51.461Z

## Company

Watts, founded in 1995, is a company in Furniture, Interior & Lifestyle Goods listed on TSE Standard. It has 418 employees (consolidated).

| Field | Value |
| --- | ---: |
| Legal name | WATTS CO., LTD. |
| Ticker | 2735 |
| Stock price | View on Yahoo Finance (https://finance.yahoo.co.jp/quote/2735.T) |
| Listing | TSE Standard |
| Head office | 大阪市中央区城見一丁目4番70号 住友生命OBPプラザビル |
| Representative (per filing) | 代表取締役社長執行役員 平岡 史生 |
| Founded | Feb 1995 |
| Share capital | ¥440.3M |
| Employees (consolidated) | 418 |
| Average salary (parent only) | ¥5M |
| Fiscal year end | August |
| Website | www.watts-jp.com (https://www.watts-jp.com/) |
| Corporate number | 4120001106103 |
| EDINET | E03391 |
| Industries (Vizora) | Furniture, Interior & Lifestyle Goods |

> Profile source: annual securities report (S100X626, filed 2025-11-25). As of filing

## Five-axis industry profile

Primary industry: Furniture, Interior & Lifestyle Goods (2025-08-31)

| Axis | Industry percentile | Peers |
| --- | ---: | ---: |
| Revenue growth | 60.7 | 14 |
| Profitability | 25 | 18 |
| Cash conversion | 14.7 | 17 |
| Efficiency | 86.1 | 18 |

Each axis is shown independently. Missing values are labeled unavailable; no combined score is calculated. Industry rank is not an investment recommendation.

## Key points (generated from figures)

- Watts brought in ¥61.6B in revenue.
- Out of every ¥100 of sales, about ¥2 is left as operating profit.
- Revenue changed +0.5% from the prior year, operating profit +13.8%.

## Key figures at a glance

| Metric | Value | Note |
| --- | ---: | ---: |
| Revenue | ¥61.6B |  |
| Operating income | ¥1.42B | Margin 2.3% |
| Net income | ¥870.7M | Margin 1.4% |
| Free cash flow | -¥2.81B |  |
| Employees (consolidated) | 418 |  |
| EPS | ¥12.05 |  |
| Book value per share | ¥724.41 |  |
| Equity ratio | 47.3% |  |
| Shares outstanding | 13,458,800 |  |
| Treasury shares | 225,900 |  |
| Shareholders | 11,380 |  |
| Average salary (parent only) | ¥5M | Filing company only |
| Cash ratio | 22.5% | Cash ÷ revenue 10.0% |
| Vs. industry median margin | -2 pp | Furniture, Interior & Lifestyle Goods |
| ROE | 6.9% | Derived from disclosed figures |
| ROA | 3.0% | Derived from disclosed figures |

## Notable figures

- FY2025, employees -4% while operating income rose 14%

## What changed in 5 years

| Metric | FY ending Aug 2020 | FY ending Aug 2025 | Change |
| --- | ---: | ---: | ---: |
| Revenue | ¥52795694000 | ¥61578772000 | +16.6% |
| Operating income | ¥1768703000 | ¥1419443000 | -19.7% |
| Operating margin | 3.4% | 2.3% | -1 pp |
| Employees | 445 people | 418 people | -6.1% |
| Cash and equivalents | ¥6591348000 | ¥6187421000 | -6.1% |

### Change in segment revenue mix

Span: FY ending Aug 2020 → FY ending Aug 2025. Stable segment keys are connected; unmatched shares are marked as new or reorganized. Shares use total segment revenue.

## Income statement（FY ending Aug 2025, consolidated, J-GAAP）

| Item | Amount (JPY mn) | % of revenue | Source |
| --- | ---: | ---: | ---: |
| Revenue | 61,579 | 100.0% | S100X626 |
| Cost of revenue | 37,671 | 61.2% | S100X626 |
| Gross profit | 23,908 | 38.8% | S100X626 |
| SG&A | 22,488 | 36.5% | S100X626 |
| Operating income | 1,419 | 2.3% | S100X626 |
| Ordinary income | 1,429 | 2.3% | S100X626 |
| Pretax income | 1,370 | 2.2% | S100X626 |
| Income tax | 499 | 0.8% | S100X626 |
| Net income | 871 | 1.4% | S100X626 |
| Net income attributable to owners | 871 | 1.4% | S100X626 |

## Per ¥100 of revenue（FY ending Aug 2025）

| Part | JPY |
| --- | ---: |
| Cost of revenue | 61 |
| SG&A | 37 |
| Operating income | 2 |
| (Ref.) Net income | 1 |

### Margin funnel

Gross margin 38.8% → Operating margin 2.3% → Net margin 1.4%
Derived from reported figures (DERIVED).

## Revenue and profit pattern

Pattern: Revenue and profit up
Revenue growth: +0.5%; Core profit growth: +13.8%
Growth quality: margin-expansion
Operating leverage (core profit growth ÷ revenue growth): 26.39×
Calculated from comparable annual consolidated filings.

## Year over year（FY ending Aug 2024 → FY ending Aug 2025、JPY mn）

| Metric | Prior | Current | Change | % change |
| --- | ---: | ---: | ---: | ---: |
| Revenue | 61,257 | 61,579 | 321 | +0.5% |
| Gross profit | 23,591 | 23,908 | 317 | +1.3% |
| Operating income | 1,247 | 1,419 | 173 | +13.8% |
| Net income attributable to owners | 904 | 871 | -33 | -3.7% |
| Operating cash flow | 4,044 | -1,768 | -5,812 | -143.7% |
| Free cash flow | 3,433 | -2,814 | -6,247 | -182.0% |

## History（JPY mn）

| Period | Revenue | Op. income | Op. margin | Net income | Op. CF | FCF | Source |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| FY ending Aug 2019 | 51,399 | 717 | 1.4% | 71 | 2,280 | 1,641 | S100K931 |
| FY ending Aug 2020 | 52,796 | 1,769 | 3.4% | 774 | 922 | 380 | S100MXLE |
| FY ending Aug 2021 | 50,703 | 1,670 | 3.3% | 966 | 378 | -384 | S100POPS |
| FY ending Aug 2022 | 58,348 | 999 | 1.7% | 781 | 1,722 | 1,072 | S100SD0O |
| FY ending Aug 2023 | 59,309 | 622 | 1.0% | 251 | 221 | -399 | S100UUC6 |
| FY ending Aug 2024 | 61,257 | 1,247 | 2.0% | 904 | 4,044 | 3,433 | S100X626 |
| FY ending Aug 2025 | 61,579 | 1,419 | 2.3% | 871 | -1,768 | -2,814 | S100X626 |

## People and productivity（FY ending Aug 2025, consolidated, J-GAAP）

| Metric | Value |
| --- | ---: |
| Revenue per employee (consolidated) | ¥147.3M |
| Operating income per employee (consolidated) | ¥3.4M |
| Net income per employee (consolidated) | ¥2.1M |

Employees, revenue and profit are consolidated. Average annual salary is a separate parent-company figure. Calculated from disclosed figures (DERIVED).

| History | FY ending Aug 2021 | FY ending Aug 2022 | FY ending Aug 2023 | FY ending Aug 2024 | FY ending Aug 2025 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Employees (consolidated) | 443 | 482 | 469 | 436 | 418 |
| Average salary (parent company) | ¥5.1M | ¥5M | ¥4.8M | ¥4.7M | ¥5M |
| Average age (parent company) | 45.1 years | 45.4 years | 44.1 years | 45.1 years | 45.8 years |
| Average tenure (parent company) | 14.1 years | 15.0 years | 13.0 years | 13.1 years | 14.6 years |

Year over year: Employees (consolidated) -4.1% · Revenue (consolidated) +0.5%

## Revenue by geography

No geographic revenue breakdown was disclosed.

## Cash flow（FY ending Aug 2025, consolidated, J-GAAP）

| Item | Amount (JPY mn) | % of revenue | Source |
| --- | ---: | ---: | ---: |
| Operating cash flow | -1,768 | -2.9% | S100X626 |
| Capital expenditure | 1,046 | 1.7% | S100X626 |
| Free cash flow | -2,814 | -4.6% | 算出 |
| Investing cash flow | -1,079 | -1.8% | S100X626 |
| Financing cash flow | -351 | -0.6% | S100X626 |
| Dividends paid | 402 | 0.7% | S100X626 |
| Change in cash | -3,193 | -5.2% | S100X626 |
| Cash and equivalents | 6,187 | 10.0% | S100X626 |

## Balance sheet

Figures are as of each fiscal year end. Derived values are marked as such in the source column. Lease liabilities are excluded from interest-bearing debt.

| Metric | FY ending Aug 2021 | FY ending Aug 2022 | FY ending Aug 2023 | FY ending Aug 2024 | FY ending Aug 2025 | Source |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Cash and equivalents | 6,169 | 6,688 | 5,647 | 9,380 | 6,187 | S100SD0O, S100UUC6, S100X626 |
| Total assets | 21,341 | 25,601 | 25,489 | 30,280 | 27,511 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Net assets | 11,222 | 11,931 | 11,965 | 12,517 | 13,030 | S100SD0O, S100UUC6, S100X626 |
| Share capital | 440 | 440 | 440 | 440 | 440 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Trade receivables | 2,151 | 2,687 | 2,797 | 3,530 | 3,502 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Property, plant and equipment | 1,552 | 2,156 | 2,011 | 2,072 | 2,343 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Intangible assets excluding goodwill | 612 | 1,106 | 850 | 619 | 403 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Goodwill | 12 | 539 | 407 | 275 | 143 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Investment securities | 327 | 350 | 346 | 350 | 360 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Current assets | 16,050 | 18,561 | 18,920 | 24,050 | 21,186 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Current liabilities | 8,621 | 9,933 | 9,966 | 14,116 | 11,021 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Trade payables | 3,118 | 3,944 | 3,975 | 5,613 | 3,924 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Short-term borrowings | 200 | — | — | — | — | S100POPS |
| Long-term borrowings | 396 | 2,312 | 2,105 | 2,208 | 1,962 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Total liabilities | 10,119 | 13,670 | 13,524 | 17,763 | 14,481 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Equity attributable to owners of parent | 11,251 | 11,870 | 11,852 | 12,376 | 12,893 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Retained earnings | 9,730 | 10,215 | 10,262 | 10,964 | 11,433 | S100POPS, S100SD0O, S100UUC6, S100X626 |
| Treasury stock | -273 | -133 | -201 | -153 | -116 | S100POPS, S100SD0O, S100UUC6, S100X626 |

### Assets and funding mix

| Assets | Share | Source |
| --- | ---: | ---: |
| Cash | 22% | S100X626 |
| Receivables | 13% | S100X626 |
| Property, plant and equipment | 9% | S100X626 |
| Intangibles and goodwill | 2% | S100X626 |
| Investment securities | 1% | S100X626 |
| Other assets | 53% | S100X626 |

| Funding source | Share | Source |
| --- | ---: | ---: |
| Trade payables | 14% | S100X626 |
| Other liabilities | 39% | S100X626 |
| Equity | 47% | S100X626 |

### Balance sheet history

| Metric | FY ending Aug 2021 | FY ending Aug 2022 | FY ending Aug 2023 | FY ending Aug 2024 | FY ending Aug 2025 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Total assets | 21,341 | 25,601 | 25,489 | 30,280 | 27,511 |
| Equity | 11,222 | 11,931 | 11,965 | 12,517 | 13,030 |
| Interest-bearing debt | — | — | — | — | — |
| Cash | 6,169 | 6,688 | 5,647 | 9,380 | 6,187 |

## Asset intensity and goodwill

Ratios are derived from reported values. Goodwill is used only when separately reported, never inferred from combined intangible assets.

| Metric | Value | Sources |
| --- | ---: | ---: |
| Asset intensity (fixed assets ÷ revenue) | 3.8% | S100X626 |
| Fixed assets ÷ total assets | 8.5% | S100X626 |
| Goodwill ÷ parent equity | 1.1% | S100X626 |

Goodwill over 4 years: 12 → 143 JPY; total investing cash flow: -4,040 JPY. This does not imply causation.

### Cash quality

Net cash = cash − interest-bearing debt. Net debt ratio = (interest-bearing debt − cash) ÷ positive operating cash flow. Omit when debt components are incomplete; other ratios are derived from reported figures.

| Metric | Value |
| --- | ---: |
| Cash ratio (cash ÷ total assets) | 22.5% |
| Cash ÷ revenue | 10.0% |
| Net cash (cash − interest-bearing debt) | — |
| Net debt ÷ operating cash flow | — |
| Cash conversion (operating CF ÷ operating income) | -124.6% |
| Cash vs. profit gap | -2,639 JPY mn (of net income -303.1%) |
| Shareholder returns / net income | — |
| Shareholder returns / FCF | — |
| Shareholder payments — dividends / net income | 46.1% |
| Shareholder payments — dividends / FCF | — |
| CapEx intensity (capex ÷ revenue) | 1.7% |
| Investing CF relative to operating CF | — |

## ROA and ROE

ROE is decomposed into net margin × asset turnover × financial leverage. Leverage can raise ROE, so the ratio alone does not assess a company's condition. Ending balances are used without a prior year; total equity approximates parent equity when unavailable.

| Period | Net margin | Asset turnover | ROA | Financial leverage | ROE | Sources |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| 2021 | 1.9% | 2.38× | 4.5% | 1.90× | 8.6% | S100POPS |
| 2022 | 1.3% | 2.49× | 3.3% | 2.03× | 6.8% | S100SD0O |
| 2023 | 0.4% | 2.32× | 1.0% | 2.15× | 2.1% | S100UUC6 |
| 2024 | 1.5% | 2.20× | 3.2% | 2.30× | 7.5% | S100X626 |
| 2025 | 1.4% | 2.13× | 3.0% | 2.29× | 6.9% | S100X626 |

## Ownership

| Counterparty | Relation | Ratio | As of |
| --- | ---: | ---: | ---: |
| ㈱カシオペア | Major shareholder | 15.3% | 2025-08-31 |
| 大阪中小企業投資育成㈱ | Major shareholder | 4.9% | 2025-08-31 |
| 平岡 滿子 | Major shareholder | 4.5% | 2025-08-31 |
| ㈲アカリ | Major shareholder | 4.3% | 2025-08-31 |
| 平岡 史生 | Major shareholder | 3.6% | 2025-08-31 |
| 衣笠 敦夫 | Major shareholder | 2.8% | 2025-08-31 |
| 平岡 紀子 | Major shareholder | 2.8% | 2025-08-31 |
| ㈱三井住友銀行 | Major shareholder | 2.4% | 2025-08-31 |
| 福光 宏 | Major shareholder | 2.2% | 2025-08-31 |
| ワッツ従業員持株会 | Major shareholder | 2.2% | 2025-08-31 |

## Sources

| Document | ID | Published | URL |
| --- | ---: | ---: | ---: |
| 有価証券報告書－第31期(2024/09/01－2025/08/31) | S100X626 | 2025-11-25 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100X626,, |
| 有価証券報告書－第30期(2023/09/01－2024/08/31) | S100UUC6 | 2024-11-27 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100UUC6,, |
| 有価証券報告書－第29期(2022/09/01－2023/08/31) | S100SD0O | 2023-11-28 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100SD0O,, |
| 有価証券報告書－第28期(令和3年9月1日－令和4年8月31日) | S100POPS | 2022-11-25 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100POPS,, |
| 有価証券報告書－第27期(令和2年9月1日－令和3年8月31日) | S100MXLE | 2021-11-25 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100MXLE,, |
| 有価証券報告書－第26期(令和1年9月1日－令和2年8月31日) | S100K931 | 2020-11-25 | https://disclosure2.edinet-fsa.go.jp/WZEK0040.aspx?S100K931,, |

## Definitions

- Amounts are in millions of JPY (rounded). The period is stated in each table heading
- Operating margin = operating income ÷ revenue. Net income is attributable to owners of the parent when disclosed
- Free cash flow (FCF) = operating cash flow − capital expenditure
- ¥100 model = breakdown per ¥100 of revenue (rounded so parts sum to 100)
- Segment revenues include inter-segment sales and may not sum to consolidated revenue
- Source IDs are EDINET document IDs (docID). "算出" (derived) means computed from other disclosed values
- All figures are extracted mechanically from filings. AI-written text never generates figures
- Source: company filings submitted to EDINET (Financial Services Agency of Japan). Figures were extracted, edited and processed, and charts and text were created, by Vizora — not by the FSA (used under the Public Data License v1.0).