IHI (7013) Q2 2025 earnings summary

Executive summary

• Orders received reached JPY 760.2 billion, up 58.3% year-over-year, and revenue was JPY 757.4 billion for Q2 FY2024, with strong momentum from civil aero engines and defense.

• Operating profit surged to JPY 77.2 billion, up 61.2 billion yen year-over-year, with an operating margin of 10.2%.

• Civil aero engines business remained the main profit driver, with record profits and robust spare parts sales.

• Significant improvement in cash flows from operating activities, mainly due to EBITDA growth and construction payment collections.

• Upward revision of full-year operating profit forecast by JPY 35 billion to JPY 145 billion, driven by civil aero engines.

Financial highlights

• Operating profit increased by JPY 61.2 billion year-over-year, mainly due to strong spare parts sales and favorable FX.

• EBITDA reached 112.3 billion yen, up 61.9 billion yen year-over-year.

• Profit attributable to owners of parent increased to 39.3 billion yen, up 27.2 billion yen year-over-year.

• Debt-to-equity ratio improved to 1.36x and equity ratio to 19.3% as profits accumulated.

• Cash flows from operating activities improved by 74.0 billion yen year-over-year, reaching -7.4 billion yen.

Outlook and guidance

• Full-year operating profit forecast revised upward to JPY 145 billion, a record high, with revenue forecast maintained at JPY 1,600.0 billion.

• Year-end dividend forecast increased from JPY 50 to JPY 70 per share.

• FX assumption for H2 remains at JPY 140/USD; each JPY 1 move impacts operating profit by JPY 700 million.

• Aftermarket and spare parts growth expected to continue, though at a slower pace in H2.

• Profit attributable to owners of parent forecast at 85.0 billion yen; EBITDA forecast at 215.0 billion yen.