Kanto Denka Kogyo (4047) Q2 2026 earnings summary

Executive summary

• Net sales for H1 FY2025 were ¥30.8 billion, down 1.4% year-over-year, mainly due to lower battery materials and Fine Chemicals sales, and absence of technical support fees, despite higher specialty gas sales.

• Operating profit dropped by 52.6% to ¥0.8 billion, ordinary profit by 59.7% to ¥0.97 billion, and profit attributable to owners by 92.6% to ¥0.1 billion, impacted by a recorded loss on disaster.

• The Shibukawa plant fire significantly impacted results, causing extraordinary losses, operational disruptions, and a fatality.

• Comprehensive income decreased 61.8% year-over-year to ¥901 million.

Financial highlights

• Gross profit for H1 FY2025 was ¥5,841 million, down from ¥6,532 million year-over-year.

• Operating profit: ¥0.8 billion (-52.6% YoY); ordinary profit: ¥0.97 billion (-59.7% YoY); net income: ¥0.1 billion (-92.6% YoY).

• Basic EPS fell from ¥24.93 to ¥1.86.

• Cash and deposits declined by ¥5.8 billion; cash and cash equivalents at period end were ¥13,845 million, down from ¥20,098 million.

• Equity ratio improved to 54.0%.

Outlook and guidance

• FY2025 full-year net sales forecast revised to ¥64.5 billion; operating profit to ¥3.3 billion; net income to ¥1.7 billion.

• Basic earnings per share forecast at ¥29.60.

• Recovery to pre-accident levels not expected until Q4 or later.

• Battery materials sales expected to rise from FY2026 due to supply chain shifts away from China.