CKD (6407) Q2 2024 earnings summary

Executive summary

• 1H FY23 net sales fell 17% YoY to ¥66.5bn; operating income declined ¥4.1bn to ¥6.1bn, and net income fell 44% to ¥4.0bn.

• Full-year guidance was cut from the May forecast: net sales to ¥132.5bn and operating income to ¥11.4bn.

Financial highlights

• 1H FY23 net sales were ¥66.5bn versus ¥80.2bn a year earlier; operating income was ¥6.1bn versus ¥10.2bn.

• Ordinary income was ¥6.1bn and net income ¥4.0bn, down ¥4.1bn and ¥3.1bn YoY, respectively.

• Operating income analysis attributed the ¥4.1bn decline mainly to a ¥4.1bn impact from lower sales; cost-rate changes added ¥0.2bn, lower SG&A added ¥0.5bn, and FX fluctuations added ¥0.6bn.

Outlook and guidance

• Revised FY23 forecast: net sales ¥132.5bn, operating and ordinary income ¥11.4bn, and net income ¥7.6bn; YoY changes were -17%, -46%, and -49%, respectively.

• Versus May guidance, full-year net sales were reduced from ¥142.0bn to ¥132.5bn, operating and ordinary income from ¥14.5bn to ¥11.4bn, and net income from ¥10.0bn to ¥7.6bn.

• 2H forecast: net sales ¥66.0bn, operating income ¥5.3bn, and net income ¥3.6bn.

• FY23 estimated exchange rate: ¥142/$ for 2H and full year.