LIXIL (5938) Q4 2025 earnings summary

Executive summary

• Revenue and profit increased year-on-year for FY2025, driven by strong renovation demand in Japan and growth in Europe, the Middle East, and India, with significant improvement in free cash flow by JPY 53.8 billion.

• Structural reforms, including the transfer of the US bathing business and closure of a Thailand plant, were largely completed, improving profitability.

• Operating and free cash flow improved significantly, with free cash flow up JPY 53.8 billion year-on-year.

Financial highlights

• FY2025 revenue: JPY 1,504.7 billion, up JPY 21.5 billion or 1.4% year-on-year.

• Core earnings: JPY 31.3 billion, up JPY 8.2 billion or 35.3% year-on-year; EBITDA: JPY 114.5 billion, up JPY 10 billion.

• Net profit: JPY 2.0 billion, up JPY 15.9 billion year-on-year, reversing a prior year loss.

• Basic EPS: JPY 6.97, up JPY 55.40 year-on-year.

• Gross profit margin improved by 1.2 percentage points; core earnings margin at 2.1%, up 0.5pp.

Outlook and guidance

• FY2026 forecast: revenue of JPY 1,540.0 billion, core earnings of JPY 35.0 billion, net profit of JPY 8.0 billion, and annual dividend of JPY 90 per share.

• Segment reporting will expand to three units: Water Technology, Housing Technology, and Living Business.

• Expect continued strength in renovation business and further structural reforms, with minimal additional restructuring costs anticipated.

• International business outlook assumes neutral impact from U.S. tariff policies; Japan's new housing starts expected to remain weak.