Daiwabo Holdings (3107) Q1 2025 earnings summary

Executive summary

• Net sales rose 8.8% year-over-year to ¥227.8 billion, driven by robust domestic IT demand, especially in IT infrastructure distribution.

• Operating income declined 13.4% to ¥4.27 billion and net profit fell 10.6% to ¥3.08 billion, impacted by large-scale government projects and shipment timing.

• The textile business was excluded from consolidation after an 85% share transfer in March 2024, affecting year-over-year comparisons.

Financial highlights

• Net sales: ¥227.8 billion (+8.8% YoY); operating income: ¥4.27 billion (−13.4% YoY); net profit: ¥3.08 billion (−10.6% YoY).

• Gross profit margin decreased to 6.5% from 8.0% YoY; gross profit fell to ¥14.76 billion from ¥16.71 billion.

• Operating profit margin at 1.9%, down from 2.4% YoY.

• Total assets decreased by ¥29.7 billion to ¥375.6 billion, mainly due to lower receivables.

• Net assets declined to ¥140.4 billion from ¥142.1 billion at March 31, 2024.

Outlook and guidance

• Full-year net sales forecast revised up to ¥1,012.4 billion (+4.6% YoY); operating income forecast at ¥31.1 billion (+0.4% YoY); net income projected at ¥21.8 billion (+409% YoY), with EPS of ¥234.03.

• 2Q cumulative net sales forecast at ¥475.5 billion (+6.6% YoY); operating income at ¥13.02 billion (+1.8% YoY).

• Dividend per share forecast raised to ¥70 for FY2025.

• Management notes uncertainty due to global instability, high resource prices, and yen depreciation.