NEC (6701) Q4 2024 earnings summary

Executive summary

• FY2024 revenue rose 5.0% YoY to ¥3,477,262 million; adjusted operating profit was ¥223,562 million and non-GAAP net profit was ¥177.8B.

• Operating profit increased 10.3% to ¥188,012 million, while net profit attributable to owners rose to ¥149,521 million; results exceeded previous forecasts across reported levels.

Financial highlights

• Non-GAAP operating profit rose 15.5% to ¥227,580 million; non-GAAP EPS increased to ¥667.54 from ¥492.40.

• Free cash flow increased ¥92.7B to ¥195.2B; EBITDA rose ¥31.7B to ¥379.5B.

• Profit before income taxes increased 10.3% to ¥185,011 million; net profit rose 25.3% to ¥164,752 million.

• FY2024 annual dividend was ¥120 per share, up from ¥110.

Outlook and guidance

• FY2025 revenue is forecast at ¥3,370,000 million, down 3.1% YoY; adjusted operating profit is forecast at ¥255,000 million, up 14.1%.

• FY2025 non-GAAP operating profit is forecast at ¥255,000 million; non-GAAP profit attributable to owners is forecast at ¥165,000 million, with EPS of ¥619.24.

• FY2025 EBITDA is forecast at ¥380B and free cash flow at ¥160B; dividend is planned at ¥140 per share.

• FY2026 targets include revenue of ¥3,500B, adjusted operating profit of ¥300B, non-GAAP net profit of ¥185B and EBITDA of ¥425B.

• FY2025 adjusted operating profit growth includes ¥15B reversal of FY2024 Telecom Services one-time expenses and ¥27.4B from marginal profit and profitability changes, partly offset by ¥15B JAE deconsolidation.