AECC AERO-ENGINE CONTROL (000738) Q2 2026 earnings summary

Executive summary

• Revenue for H1 2026 reached ¥2.76 billion, up 0.87% year-over-year, achieving over half of the annual target.

• Net profit attributable to shareholders was ¥216.91 million, down 29.69% year-over-year.

• Cash flow from operating activities was ¥551.63 million, a 45.31% decrease year-over-year.

• The company maintained its strategic focus on military, civil, and derivative markets, fulfilling major delivery tasks.

Financial highlights

• Operating income: ¥2.76 billion (+0.87% YoY); operating cost: ¥2.09 billion (+5.25% YoY).

• Net profit: ¥216.91 million (-29.69% YoY); basic/diluted EPS: ¥0.1649 (-29.71% YoY).

• Gross margin for main products: 24.32% for engine/gas turbine control systems (-3.74pp YoY).

• R&D investment: ¥246.65 million (-5.76% YoY).

• Total assets at period end: ¥16.64 billion (+1.94% from year-end 2025).

• Net assets attributable to shareholders: ¥12.59 billion (+0.99% from year-end 2025).

Outlook and guidance

• The company expects continued pressure on short-term profitability as new products are still in the market cultivation phase.

• Plans to strengthen R&D, cost control, and digital transformation to drive long-term competitiveness.

• No interim dividend, bonus shares, or capital increase from reserves planned for H1 2026.