Makino Milling Machine (6135) Q1 2025 earnings summary

Executive summary

• Orders in 1Q FY24/FY2025 totaled ¥53.6 billion, down 7.8% year-over-year, with 53% progress toward the 1H plan and signs of recovery in Asian markets.

• Net sales/revenue were ¥51.9 billion, a 3.7% decrease from 1Q FY23, with operating income down 30.6% to ¥2.96 billion and net income attributable to owners at ¥3.24 billion, down 29.6%.

• Segment I (Japan/domestic) and IV (Europe) saw significant declines in orders and sales, while Segment II (Asia) showed resilience and Segment III (Americas) remained stable.

• Decline in sales narrowed due to continued JPY depreciation, which positively impacted reported results.

Financial highlights

• Operating income/profit margin fell to 5.7%, down from 7.9% year-over-year.

• Net income attributable to owners was ¥3.24 billion, down 29.6% from 1Q FY23.

• Exchange rate fluctuations contributed ¥4.8 billion to sales and ¥359 million to operating income.

• Cash and cash equivalents at quarter-end were ¥77.1 billion.

• Equity ratio improved slightly to 61.6%.

Outlook and guidance

• FY24 full-year sales/revenue forecast is ¥222 billion (+1.5% YoY), with operating income projected at ¥15.5 billion (7.0% margin, –5.3% YoY).

• 1H FY24 sales and operating income are forecast at ¥101.5 billion and ¥5.2 billion, respectively.

• Exchange rate assumptions for 2H: USD/JPY 145, EUR/JPY 155, SGD/JPY 107.

• Interim dividend forecast is ¥80 per share, with a full-year dividend of ¥160 per share.

• No changes to previously announced guidance.