Hitachi Construction Machinery (6305) Q1 2025 earnings summary

Executive summary

• Revenue, adjusted operating income, and net income declined sharply year-over-year due to weak North American markets, yen appreciation, and higher costs, with revenue down 6.7%, adjusted operating income down 31.9%, and net income attributable to owners down 54.1%.

• Sales in Asia and Europe remained steady, but declines in North America, Oceania, Latin America, and Japan weighed on overall results.

• U.S. tariffs, global demand slowdown, and high interest rates led to a downward revision of the full-year earnings forecast.

• Operating and free cash flow improved year-over-year, supported by reductions in working capital.

Financial highlights

• Q1 FY2025 revenue: ¥306.2 billion (down 6.7% year-over-year); adjusted operating income: ¥22.1 billion (down 31.9%); net income attributable to owners: ¥11.3 billion (down 54.1%).

• EBIT fell 48% year-over-year to ¥22.2 billion.

• Free cash flow improved to ¥10.0 billion, supported by better operating cash flow.

• Total assets as of June 30, 2025, were ¥1,777.6 billion, down 0.7% from March 31, 2025.

• Cash and cash equivalents at quarter-end were ¥150.7 billion.

Outlook and guidance

• Full-year revenue forecast revised down to ¥1,300.0 billion; adjusted operating income forecast cut to ¥130.0 billion; net income forecast reduced to ¥73.0 billion.

• Mining revenue expected to decrease 5% year-over-year due to demand slowdown from U.S. tariffs.

• Value chain revenue forecast to rise 4% year-over-year, driven by growth in specialized parts, service business, and rental.

• Annual dividend plan maintained at ¥175 per share.

• Continued demand challenges in North America and a global mining sector slowdown are expected.