ENEOS (5020) Q2 2025 earnings summary

Executive summary

• First half FY24 profit attributable to owners was ¥68.2 billion, down 60% year-over-year due to inventory impact, negative time lag, and absence of prior year one-time gain in metals.

• Revenue for 1H FY2024 was ¥6,348.4 billion, down 4% year-over-year; operating profit dropped 50% to ¥146.0 billion.

• Full-year FY2024 profit forecast was raised by ¥10.0 billion to ¥220.0 billion, and operating profit forecast to ¥420.0 billion, reflecting yen depreciation, higher copper prices, and margin improvements.

Financial highlights

• 1H FY2024 operating profit (excluding inventory valuation) was ¥208.2 billion, down 23% year-over-year; inventory valuation impact was negative ¥62.2 billion.

• Petroleum products operating profit (excluding inventory valuation) decreased ¥72.3 billion year-over-year to ¥54.7 billion, impacted by time lag and absence of asset sale gain.

• High-performance materials operating profit rose to ¥9.1 billion (+264% year-over-year), driven by elastomer sales and favorable FX.

• Electricity segment operating profit increased to ¥14.2 billion (+168% year-over-year), aided by margin improvement and one-time profit.

• Oil and natural gas E&P operating profit declined to ¥46.7 billion (down 10% year-over-year), despite volume growth.

Outlook and guidance

• Full-year operating profit forecast raised by ¥20.0 billion to ¥420.0 billion; net profit forecast up ¥10.0 billion to ¥220.0 billion.

• Upward revision reflects improved petroleum margins, higher sales in Oil & Gas E&P and ICT Materials, and favorable FX/copper price assumptions.

• Segment guidance: Electricity (+¥11.0 billion), Renewable Energy (+¥4.0 billion), Metals (+¥20.0 billion), ICT Materials (+¥6.0 billion), Metals & Recycling (+¥28.0 billion) vs. May forecast.

• Petroleum products profit forecast lowered by ¥15.0 billion from May due to weaker sales and margins.