INFRONEER Holdings (5076) Q2 2024 earnings summary

Executive summary

• 6M FY2024 net sales rose 12.6% YoY to ¥353.1bn; operating profit increased 35.6% to ¥19.9bn, while parent-attributable profit rose 1.9% to ¥13.5bn.

• Civil engineering margins improved sharply; full-year forecasts were revised upward on stronger construction progress and civil engineering performance.

• Voluntary IFRS adoption is planned from FY2024, with full-year forecasts presented under both IFRS and Japanese GAAP.

Financial highlights

• 6M net sales were ¥353.1bn vs. ¥313.5bn; gross profit was ¥51.3bn vs. ¥42.8bn and operating profit was ¥19.9bn vs. ¥14.7bn.

• Ordinary profit rose 30.2% to ¥20.9bn; parent-attributable profit rose 1.9% to ¥13.5bn; EPS was ¥53.75 vs. ¥50.65.

• Comprehensive income was ¥27.7bn vs. ¥13.1bn, including a ¥11.7bn positive valuation change on available-for-sale securities.

• Operating cash flow used ¥13.1bn, investing cash flow used ¥33.7bn and financing cash flow provided ¥48.5bn.

Outlook and guidance

• Revised FY2024 Japanese GAAP forecast: net sales ¥762.9bn, operating profit ¥41.3bn, ordinary profit ¥42.5bn and parent-attributable profit ¥27.5bn.

• Revised FY2024 IFRS forecast: net sales ¥768.2bn, business profit ¥48.1bn, operating profit ¥48.0bn and parent-attributable profit ¥31.7bn.

• Japanese GAAP guidance increased by ¥22.9bn for net sales, ¥3.0bn for operating profit, ¥3.3bn for ordinary profit and ¥2.3bn for parent-attributable profit.

• Segment plans were expected to be achieved; building construction orders targeted ¥280bn at a 7% margin, while civil engineering orders and margins and machinery’s annual plan were expected to remain on track.

• Renewable energy project sale deferred to FY2024 or later; sales of development facilities were expected to generate ¥0.9bn.