Aichi Steel (5482) Q4 2023 earnings summary

Executive summary

• FY23 revenue reached a record ¥2,851億円, up 9% YoY; operating profit rose to ¥32億円 as price pass-through and subsidiary gains outweighed lower volumes and higher input costs.

• FY24 guidance calls for further record revenue of ¥3,140億円 and operating profit of ¥50億円, while structural reforms target persistent volume and cost-recovery gaps.

Financial highlights

• FY23 revenue was ¥2,851億円, up ¥250億円 (+9%); operating profit was ¥32億円, up ¥11億円 (+52%); profit attributable to owners was ¥16億円, up ¥5億円 (+47%).

• FY23 actuals exceeded the Feb. 3 forecast by ¥11億円 in revenue and ¥32億円 in operating profit; pricing, overseas subsidiaries, purchasing-cost changes and cost reductions contributed to the profit beat.

• Operating profit improvement reflected sales-price increases and subsidiary gains, offset by lower sales volumes, weaker cost absorption and higher purchased-item prices.

Outlook and guidance

• FY24 revenue forecast is ¥3,140億円 (+10% YoY), operating profit ¥50億円 (+53%), and profit attributable to owners ¥30億円 (+86%).

• FY24 standalone sales volume is forecast at 1,094千トン, up 11%; steel, stainless and forging volumes are expected to recover from FY23 but remain subdued, while electronic components stay strong.

• FY24 operating-profit bridge anticipates sales-price gains and volume growth to offset continued high energy and purchased-item costs, with factory cost reductions also supporting earnings.

• FY24 dividend forecast is ¥20 per share interim and ¥50 full-year, versus ¥30 full-year in FY23.