MEC Company (4971) Q2 2025 earnings summary

Executive summary

• Net sales for 1H FYE12/2025 reached ¥9,387 million, up 5.7% year-over-year, driven by strong demand in chemicals for advanced semiconductor package substrates, especially for generative AI applications.

• Operating income increased 3.3% year-over-year to ¥2,440 million, while net income was nearly flat at ¥1,893 million, aided by extraordinary income from a government subsidy.

• Chemical sales grew 7.6% year-over-year, with shipments up 8.6% and strong performance in the CZ series.

• Overseas sales ratio increased to 81.2%, or 80.8% including indirect exports, reflecting robust international demand, especially in China and Taiwan.

• Extraordinary income included a government subsidy for growth investment and wage increases for SMEs.

Financial highlights

• Gross profit rose to ¥5,804 million, up 7.8% year-over-year, with a gross profit margin of 61.8%.

• EBITDA increased by 8.5% to ¥3,287 million year-over-year.

• Ordinary income declined 5.6% year-over-year to ¥2,493 million, mainly due to foreign exchange impacts.

• Net income for 1H was ¥1,893 million, nearly flat year-over-year.

• Cash and cash equivalents at period-end were ¥7,791 million, down ¥2,463 million from the previous year-end.

Outlook and guidance

• Full-year FYE12/2025 net sales forecast at ¥20,000 million, up 9.7% year-over-year; operating income projected at ¥5,000 million, up 9.6%; net income forecast at ¥3,600 million, up 57.1%.

• Annual dividend per share to be maintained or increased, with a consolidated payout ratio target of 30%.

• ROE quantitative target set at a minimum of 10%.

• No changes to previously announced earnings or dividend forecasts.