Hokko Chemical Industry (4992) Q2 2024 earnings summary

Executive summary

• H1 revenue rose 2.2% YoY to ¥28,938 million; operating income fell 8.0% to ¥3,402 million, while net income attributable to owners rose 4.8% to ¥2,677 million.

• Agricultural chemicals led growth on resilient domestic sales, stronger Latin American and Korean exports, and yen depreciation; fine chemicals and textile materials declined.

• Comprehensive income increased 139.7% YoY to ¥8,469 million, mainly from gains on securities.

Financial highlights

• Revenue increased ¥625 million YoY; operating income declined ¥294 million and ordinary income declined ¥40 million to ¥3,966 million, including a ¥134 million foreign-exchange gain.

• Net income attributable to owners rose ¥122 million, helped by lower tax expenses; gross profit was ¥7,118 million.

• Operating margin fell to 11.8% from 13.1%; net income margin rose to 9.2% from 9.0%.

• Total assets were ¥83,214 million, up ¥15,735 million from fiscal year-end; equity ratio was 66.0% versus 69.3%.

• EPS was ¥98.84 versus ¥94.34 YoY; period-end cash and equivalents were ¥2,419 million, up ¥418 million YoY.

Outlook and guidance

• FY2024 forecasts unchanged: revenue ¥46,000 million, operating income ¥4,120 million, ordinary income ¥5,100 million, and net income attributable to owners ¥3,450 million.

• H1 achieved 62.9% of forecast revenue, 82.6% of operating income, 77.8% of ordinary income, and 77.6% of net income; all progress rates exceeded prior-year comparable rates.

• Full-year dividend forecast unchanged at ¥32.00 per share; actual results may vary with economic, market, industry, and other factors.