Kubota (6326) Q2 2024 earnings summary

Executive summary

• Revenue for FY 2024 2Q rose 3.9% year-over-year to ¥1,579.6 billion, driven by overseas growth despite a decline in Japan.

• Operating profit increased 12.3% year-over-year to ¥207.3 billion, mainly due to favorable exchange rates and price increases.

• Profit attributable to owners grew 17.1% to ¥150.8 billion.

• Overseas revenue rose 5.7% to ¥1,273.9 billion, while domestic revenue fell 3.0% to ¥305.7 billion.

• Free cash flow turned positive at ¥3.5 billion, reflecting improved working capital and higher profits.

Financial highlights

• Total assets as of June 30, 2024, were ¥6,080.8 billion, up ¥721.6 billion since December 2023.

• Operating margin improved to 13.1% from 12.1% year-over-year.

• Net cash provided by operating activities was ¥129.4 billion, a ¥227.5 billion improvement year-over-year.

• Foreign exchange rates contributed ¥129.0 billion to revenue growth.

• Cash and cash equivalents increased by ¥64.9 billion since December 2023.

Outlook and guidance

• Full-year 2024 revenue forecast is ¥3,000.0 billion, revised downward due to expected declines in Europe and North America.

• Operating profit forecast raised to ¥330.0 billion, up 3.1% from prior guidance.

• Profit attributable to owners forecast at ¥235.0 billion, up 4.0% from previous guidance.

• Foreign exchange expected to add ¥135.0 billion to full-year revenue.

• Assumptions include exchange rates of ¥150/USD and ¥161/EUR.