Kanto Denka Kogyo (4047) Q2 2025 earnings summary

Executive summary

• Net sales for H1 FY2024 decreased by 10.3% year-over-year to ¥31,265 million, mainly due to lower battery materials, Fine Chemicals, and Fundamental Chemicals sales.

• Operating profit rose to ¥1,721 million, up from a ¥428 million loss in H1 FY2023, driven by improved raw material and fuel prices and reduced inventory valuation losses.

• Ordinary profit increased to ¥2,412 million, supported by higher operating profit and dividend income.

• Profit attributable to owners of parent grew to ¥1,432 million, despite lower gains from investment securities and environmental expenses.

• High cost of sales persisted due to inventory valuation losses and elevated raw material prices for batteries.

Financial highlights

• Net sales: ¥31.2 billion (down 10.3% year-over-year).

• Operating profit: ¥1.7 billion (up from a ¥0.4 billion loss in H1 FY2023).

• Ordinary profit: ¥2.4 billion (up from ¥0.1 billion in H1 FY2023).

• Basic EPS: ¥24.93 (up from ¥4.48 year-over-year).

• Equity ratio improved to 67.5% from 65.5% at the previous year-end.

Outlook and guidance

• FY2024 revised net sales forecast: ¥63.4 billion, down from initial ¥69.0 billion.

• FY2024 revised operating profit forecast: ¥3.8 billion, down from initial ¥4.9 billion.

• Profit attributable to owners of parent forecast at ¥2,850 million.

• Annual dividend forecast raised to ¥16.00 per share, up from ¥14.00 in the previous year.

• H2 FY2024 net sales expected to rise to ¥32.1 billion, with operating profit forecast at ¥2.0 billion.