Ajinomoto (2802) Q2 2025 earnings summary

Executive summary

• Achieved record interim and first-half sales and business profit for FY2024, with double-digit business profit growth year-over-year, even excluding currency effects, and upward revisions to full-year forecasts.

• Functional materials and CDMO biopharma services showed strong recovery and revenue growth, while healthcare led overall growth.

• Overseas seasonings and foods maintained stable organic growth, with strong performance in ASEAN and frontier markets; domestic food profit margins declined, especially in coffee and frozen foods, due to higher raw material costs and a weak yen.

• Announced a two-for-one stock split and share repurchase up to JPY 40 billion in the second half, reflecting a proactive return of cash to shareholders.

• Consolidated sales rose 8% year-over-year to ¥744.2 billion for the first half, with business profit up 13% to ¥86.9 billion.

Financial highlights

• Interim sales reached 108% of the previous year (¥744.2 billion), and business profit was 113% (¥86.9 billion); profit attributable to owners was 108% (¥50.2 billion).

• Second-quarter sales were ¥378.7 billion (108% of FY2023), and business profit was ¥43.8 billion (130% of FY2023).

• Upwardly revised FY2024 sales forecast to ¥1,532.5 billion and business profit to ¥160.0 billion.

• Operating cash flow forecast revised upward to ¥195 billion.

• Currency translation contributed ¥21.9 billion to sales and ¥3.9 billion to business profit in the first half.

Outlook and guidance

• Full-year sales and business profit forecasts revised upward, with functional materials expected to exceed previous record highs.

• Coffee business in Japan faces continued margin pressure due to raw material costs and currency; further price actions possible.

• Overseas food and frozen food businesses expected to maintain or regain growth through targeted initiatives.

• FY2024 assumed exchange rate for H2: ¥145/USD.

• Aims for sustained business profit growth of 10-15% annually toward 2025 and 2030 targets.