Kansai Paint (4613) Q1 2027 earnings summary

Executive summary

• Net sales rose 9.1% year-over-year to ¥157.9 billion in Q1 FY2026, with all overseas regions achieving both sales and profit growth, while Japan saw profit decline despite higher sales, amid global economic uncertainty and inflationary pressures.

• Operating profit declined 14.3% year-over-year to ¥10.5 billion due to delays in passing on higher raw material costs and increased fixed costs.

• Profit attributable to owners of parent fell 23.6% year-over-year to ¥6.5 billion, mainly due to a decrease in gain on sale of non-current assets.

• Full-year earnings forecast was revised upward, reflecting strong overseas performance and anticipated recovery in Japan.

• Annual dividend increased by ¥6 per share to ¥116, and a share buyback of up to ¥10 billion was announced.

Financial highlights

• Gross profit rose to ¥51,059 million from ¥46,528 million year-over-year; gross margin for Q1 FY2026 was 32.4%, up from 32.2%.

• EBITDA increased 5.1% year-over-year to ¥21.3 billion; EBITDA margin was 13.5%.

• Ordinary profit was ¥13,646 million, down 5.1% year-over-year.

• Basic earnings per share for the quarter were ¥36.82, down from ¥48.13 a year earlier.

• Segment profit margin declined to 8.5% from 9.5% a year earlier.

Outlook and guidance

• Full-year FY2027 net sales forecast is ¥630.0 billion (up 6.8% year-over-year), operating profit forecast is ¥55.0 billion (up 10.6%), and annual dividend forecast raised to ¥116 per share.

• The impact of the Turkish affiliate consolidation is not yet included in the forecast.

• Price pass-through in Japan is expected to drive profit recovery from Q2.