AGC (5201) Q3 2024 earnings summary

Executive summary

• Net sales for the nine months ended September 30, 2024, rose to ¥1,534.2 billion, up 3.4% year-over-year, driven by strong Electronics and Chemicals, but offset by declines in Architectural Glass and Automotive.

• Operating profit decreased by 1.6% year-over-year to ¥94.0 billion, mainly due to lower sales prices, cost deterioration in Automotive and Life Science, and losses from the Russian business transfer.

• Profit attributable to owners of the parent fell by ¥164.0 billion to a loss of ¥106.4 billion, impacted by impairment losses in Biopharmaceuticals CDMO and losses on sale of subsidiaries.

• Profit before tax fell sharply to a loss of ¥74.4 billion, reflecting significant impairment losses and a loss on the sale of Russian operations.

• Advanced Vision 2030 strategy, including new investments in green hydrogen-related production and the transfer of Russian businesses.

Financial highlights

• Net sales: ¥1,534.2 billion (+¥50.4 billion YoY); operating profit: ¥94.0 billion (−¥1.5 billion YoY); profit before tax: −¥74.4 billion (−¥173.6 billion YoY).

• Gross profit for the period was ¥371.8 billion, up from ¥355.3 billion year-over-year.

• Free cash flow improved to ¥70.1 billion from ¥16.9 billion YoY.

• D/E ratio improved to 0.41 from 0.42 at year-end 2023.

• Cash and cash equivalents at period end were ¥113.8 billion, down from ¥146.1 billion at the start of the year.

Outlook and guidance

• FY2024 guidance maintained: net sales ¥2,100.0 billion (+¥80.7 billion YoY), operating profit ¥130.0 billion (+¥1.2 billion YoY), profit attributable to owners of the parent −¥95.0 billion (−¥160.8 billion YoY).

• Segment outlook: Electronics expected stronger, Architectural Glass and Automotive weaker, Chemicals in line, Life Science slightly better.

• Dividend forecast unchanged at ¥210/share.

• No revision to the previously announced forecast.