Nippon Paint (4612) Q3 2024 earnings summary

Executive summary

• Q3 FY2024 revenue reached ¥405.6bn, up 3.2% year-over-year, with operating profit at ¥47.3bn, down 1.3% year-over-year; OP margin was 11.7%.

• Nine-month revenue hit a record ¥1,222.7bn (+12.6% YoY), operating profit ¥141.8bn (+7.7% YoY), with profit attributable to owners up 5.1%.

• Decorative segment drove growth, while automotive revenue declined in Japan and China but rose in the Americas.

• Hyperinflationary accounting in Türkiye negatively impacted profit.

Financial highlights

• 3Q Non-GAAP revenue: ¥399.7bn (+1.8% YoY); operating profit: ¥41.3bn (-13.1% YoY); OP margin: 10.3%.

• Gross profit for the nine months was ¥492,242 million, up from ¥431,213 million year-over-year.

• Basic and diluted EPS for the period were ¥41.81, compared to ¥39.79 in the prior year.

• Net cash provided by operating activities was ¥66,226 million, down from ¥108,815 million year-over-year.

• 3Q profit attributable to owners: ¥31.9bn (-2.1% YoY).

Outlook and guidance

• Full-year 2024 revenue is forecast at ¥1,600,000 million (+10.9% YoY), with operating profit projected at ¥184,000 million and profit attributable to owners at ¥124,000 million.

• Guidance remains unchanged, with expectations to exceed initial forecasts by about 2% for revenue and 0.5-1% for operating profit if FX rates hold.

• Q4 revenue and operating profit are projected to increase by about 15% year-over-year.

• India business buybacks and acquisitions to contribute from Q4.