Hamamatsu Photonics (6965) Q4 2024 earnings summary

Executive summary

• FY24 sales declined 7.9% year-over-year to ¥203.9B due to a reactionary decline from prior advanced orders, but began to recover in Q4.

• Operating profit dropped 43.3% year-over-year to ¥32.1B, with net profit down 41.4% to ¥25.1B.

• FY25 is forecasted to see sales rise 7.4% to ¥218.9B, but operating profit is expected to fall 24.9% to ¥24.1B due to aggressive growth investments.

• Medium-term plan targets sales of ¥259.1B and operating profit of ¥37.7B (14.6% margin) by FY27, with FY30 sales goal of ¥300B and 20% operating margin.

Financial highlights

• FY24 gross profit margin was 50.9%, down from 54.2% in FY23.

• EBITDA for FY24 was ¥49.8B (24.4% margin), down 30.3% year-over-year.

• FY25 guidance: gross profit margin 50.2%, EBITDA ¥46.1B (21.1% margin), net profit ¥18.0B.

• FX fluctuations had a ¥5.0B positive impact on FY24 operating profit; expected to be -¥2.6B in FY25.

Outlook and guidance

• Sales expected to grow in FY25 across most applications, with recovery in medical-bio and industrial segments.

• Operating profit to decline in FY25 due to increased SG&A and R&D expenses as part of upfront investments.

• Stable growth anticipated from FY26 onward as effects of investments and M&A materialize.

• ROE expected to exceed 8% by FY27 after temporary decline due to investments and inventory adjustments.