Cosmo Energy Holdings (5021) Q2 2025 earnings summary

Executive summary

• Ordinary profit excluding inventory valuation impact was ¥77.6 billion, nearly flat year-over-year, reflecting a firm margin environment despite a negative time lag from declining crude oil prices.

• Consolidated ordinary profit was ¥58.8 billion, a decrease of ¥24.3 billion year-over-year, with profit attributable to owners of parent excluding inventory valuation at ¥33.8 billion, down ¥9.6 billion year-over-year.

• Net sales for the first half of FY2024 rose 1.0% year-over-year to ¥1,321.1 billion, while operating profit fell 45.7% to ¥41.2 billion.

• Comprehensive income decreased 55.8% year-over-year to ¥24.4 billion.

• FY2024 earnings forecast remains unchanged despite inventory losses, supported by a favorable earnings environment.

Financial highlights

• Net sales for 2Q FY2024 were ¥1,321.1 billion, up ¥12.6 billion year-over-year.

• Operating profit was ¥41.2 billion, down ¥34.7 billion year-over-year.

• Net worth at the end of 2Q FY2024 was ¥593.7 billion, with a net worth ratio of 26.8%.

• Free cash flow turned positive at ¥146.6 billion, compared to negative ¥96.9 billion in the prior year period.

• Net income per share for the period was ¥237.17, compared to ¥537.70 in the prior year.

Outlook and guidance

• Full-year FY2024 guidance remains unchanged: net sales of ¥3,200 billion (+17.2% YoY), operating profit of ¥154 billion (+3.2%), ordinary profit of ¥165 billion (+2.1%), and profit attributable to owners of parent of ¥79 billion (-3.7%).

• Dividend forecast for FY2024 is ¥300 per share, with a total payout ratio target of at least 60%.

• Management targets ROE of at least 10% and a net D/E ratio of 1.0 times or less.