MEC Company (4971) Q4 2023 earnings summary

Executive summary

• FY2023 net sales were ¥14,020 million, down 14.1% YoY; operating income was ¥2,492 million, down 37.7% YoY.

• Lower chemical shipments and sales weighed on results; favorable FX contributed ¥305 million to sales and ¥111 million to operating income YoY.

Financial highlights

• Net sales fell ¥2,309 million YoY; chemical sales declined ¥2,277 million to ¥13,764 million.

• Gross profit was ¥8,316 million, down 15.2% YoY; gross margin was 59.3%, down 0.7 percentage points.

• SG&A rose ¥24 million to ¥5,824 million; operating margin fell to 17.8% from 24.5%.

• Net income was ¥2,304 million, down 24.8% YoY; EPS was ¥122.29 versus ¥161.22.

Outlook and guidance

• FY2024 forecast: net sales ¥16,300 million, up 16.3%; operating income ¥3,000 million, up 20.3%.

• FY2024 net income forecast is ¥2,150 million, down 6.7% YoY; EPS forecast is ¥114.82.

• New Kitakyushu production base planned to begin operations in July 2025; planned capacity ~30,000 tonnes per year.