Daiichi Kigenso Kagaku Kogyo (4082) Q2 2025 earnings summary

Executive summary

• Issued Integrated Report 2024 and scheduled a briefing session for December 2024.

• Revenue for the first half of FY2025 was ¥17,012 million, down 3.1% year-over-year, with operating profit rising 8.2% to ¥1,555 million, but net loss attributable to shareholders was ¥450 million due to special losses.

• Progressing with Vietnam business to diversify supply chain and reduce country-specific risk; full operation expected June 2025.

• Entered collaborative research with Emulsion Flow Technologies to advance rare metal recycling and sustainable materials.

• The company faced a challenging macro environment, including global economic uncertainty, currency fluctuations, and weaker demand in the automotive sector.

Financial highlights

• Net sales for 1H FY3/2025 were ¥17,012 million, down 3.1% year-over-year; operating profit increased 8.2% to ¥1,555 million.

• Ordinary profit dropped 99.4% YoY to ¥16 million due to significant exchange losses on loans to the Vietnamese subsidiary.

• Profit attributable to owners of parent was -¥450 million, impacted by impairment loss on a former Vietnamese plant.

• Comprehensive income rose to ¥2,862 million, mainly from foreign currency translation adjustments.

Outlook and guidance

• Revised FY3/2025 net sales forecast to ¥34,000 million, down ¥4,000 million from initial guidance.

• Operating profit forecast reduced to ¥2,200 million; ordinary profit to ¥1,400 million.

• Sales volumes expected to decrease due to weak car sales and inventory adjustments in strategic areas.

• No change to the previously announced forecast; exchange rate assumption is ¥143/USD.

• Anticipates recording subsidy income under extraordinary income.