Morinaga&Co (2201) Q2 2025 earnings summary

Executive summary

• H1 FY2025 net sales rose 8.4% YoY to ¥118,845 million; operating income fell 2.2% to ¥13,855 million, while profit attributable to owners of parent rose 3.6% to ¥10,631 million.

• Strong domestic Confectionery & Foodstuffs and Frozen Desserts sales supported growth; raw-material inflation and business-strengthening investments weighed on operating income.

Financial highlights

• Gross profit increased 5.5% to ¥48,673 million; gross margin was 41.0%, down 1.1pt. SG&A rose 8.9% to ¥34,817 million, including advertising expense up 13.4% to ¥5,450 million.

• Ordinary income decreased 2.1% to ¥14,099 million; extraordinary income rose to ¥1,141 million, including ¥895 million from investment-security sales, contributing to higher parent-attributable profit.

• H1 sales were 108.4% of initial forecast; operating income reached 97.8% and profit attributable to owners was 103.6%.

• Operating cash flow was ¥10,796 million versus ¥17,868 million; investing cash outflow was ¥7,285 million and financing cash outflow was ¥7,749 million.

Outlook and guidance

• FY2025 forecast: net sales ¥227,000 million, operating income ¥21,300 million, ordinary income ¥21,700 million and parent-attributable profit ¥16,700 million; year-end dividend forecast remains ¥60 per share.

• Versus the May forecast, net sales rose ¥5.0bn and operating income ¥0.8bn; H1 outperformance, domestic growth and pricing benefits partly offset expected H2 raw-material cost pressure.

• H2 forecast: sales ¥108,154 million, up 4.2%; operating income ¥7,444 million, up 21.9% YoY, with flexible price revisions and sales growth expected to counter cost inflation.

• Forecast overseas subsidiaries use ¥147 per U.S. dollar; a ¥1 yen depreciation is estimated to reduce annual profit by slightly less than ¥0.1bn.