Gun Ei Chemical Industry (4229) Q4 2024 earnings summary

Executive summary

• FY Mar 2024 revenue fell 3.4% YoY to ¥30,310m, while operating income rose 64.4% to ¥2,729m on price pass-through and overseas subsidiary cost reductions.

• Net income attributable to owners increased 69.9% to ¥2,040m; annual dividend was raised from ¥90 to ¥100 per share.

Financial highlights

• Ordinary income rose 63.0% to ¥3,162m; net income attributable to owners was ¥2,040m versus ¥1,201m in FY Mar 2023.

• Operating income increased ¥1,070m, with lower sales reducing profit by ¥1,010m, lower cost of sales adding ¥2,050m, and lower SG&A adding ¥90m.

• Total assets rose ¥6,409m to ¥61,010m; net assets increased ¥4,173m to ¥50,281m, primarily reflecting capital investment and retained earnings growth.

• Operating cash flow was ¥3,638m, investing cash flow was negative ¥2,162m, and financing cash flow was negative ¥774m; year-end cash was ¥8,613m.

Outlook and guidance

• FY Mar 2025 revenue is forecast at ¥31,000m, up 2.3%; operating income ¥2,100m, down 23.1%; ordinary income ¥2,300m, down 27.3%; net income ¥1,600m, down 21.6%.

• Revenue is expected to recover on stronger electronic-material resins and solvent-recovery Kynol, while machinery resins and starch sugars remain weak; higher raw materials and fixed costs pressure profit.

• Semiconductor demand is expected to recover on replacement demand and AI investment; global auto production recovery is expected to continue gradually, while machinery demand in China remains weak.

• FY Mar 2025 sales outlook includes increases in legacy and advanced semiconductor materials, solvent recovery, and aerospace; food sales face product-mix declines and continuing liquor-tax effects.