Mabuchi Motor (6592) Q2 2024 earnings summary

Executive summary

• Net sales for the first half of 2024 reached ¥95.267 billion, up 16.8% year-over-year, driven by strong automotive and life & industrial product sales, price revisions, and yen depreciation, with motor sales accounting for nearly all revenue.

• Operating income surged 120.7% year-over-year to ¥9.163 billion, reflecting improved product mix, selling prices, and favorable exchange rates.

• Ordinary income rose 54.1% to ¥19.393 billion, and profit attributable to owners increased 23.5% to ¥12.506 billion.

• Comprehensive income grew 26.8% year-over-year to ¥37.086 billion.

Financial highlights

• Gross profit increased to ¥24.369 billion year-over-year, with a gross margin of 25.6%.

• SG&A expenses rose 7.8% to ¥15.2 billion.

• Cash flow from operating activities improved by ¥2.8 billion year-over-year, with net cash provided by operating activities at ¥14.127 billion for the first half.

• Dividend per share is expected to reach a record ¥76, with a total return ratio of 101.8% and DOE benchmark of 3.0%-4.0%.

• Total assets increased to ¥367.298 billion as of June 30, 2024, with net assets at ¥334.011 billion and an equity ratio of 90.9%.

Outlook and guidance

• Full-year 2024 net sales forecast is ¥189.0 billion, up 5.8% year-over-year; operating income is projected at ¥18.9 billion, up 21.6%.

• Ordinary income and profit attributable to owners are expected to decline 11.5% and 20.7%, respectively.

• Automotive product sales are expected to grow modestly, supported by price revisions and yen weakness, while life & industrial product sales may remain sluggish due to weak consumer spending.

• Cost increases, especially in R&D, are anticipated but should be offset by improved sales prices and product mix.

• Forecasts are based on an assumed exchange rate of ¥145/USD for the second half.