Nippon Paint (4612) Q3 2025 earnings summary

Executive summary

• Achieved record-high revenue and operating profit in Q3 FY2025, with revenue up 14.9% to ¥465.9 billion and adjusted operating profit up 42.5% to ¥72.8 billion, driven by M&A, improved price/mix, and AOC acquisition.

• Adjusted profit figures are now proactively disclosed for better peer comparison and clarity, reflecting investor feedback.

• Both organic (+8.7%) and inorganic (+33.8%) growth contributed to profit, with margin improvement of about 3 percentage points.

• NIPSEA China grew operating profit despite revenue decline, while NIPSEA Except China saw robust volume and price/mix growth.

• The AOC acquisition contributed significantly to both revenue and profit, with AOC recognized as a new reportable segment.

Financial highlights

• Q3 revenue increased by 14.9% year-over-year to ¥465.9 billion; adjusted operating profit surged 42.5% to ¥72.8 billion; adjusted EPS up 41.0% to ¥21.3.

• Gross profit margin improved by 200bps to 41.9%; adjusted operating profit margin up 300bps to 15.6%.

• 9M FY2025 revenue grew 7.8% to ¥1,318.4 billion; 9M adjusted operating profit up 32.6% to ¥201.0 billion.

• Sale of land in Shinagawa expected to add around JPY 7 billion in Q4.

• Total assets increased to ¥3,794,153 million from ¥3,068,582 million at year-end 2024.

Outlook and guidance

• FY2025 revenue is expected to reach a new record high, though full-year revenue may fall slightly short of JPY 1.8 billion guidance if current FX persists.

• Operating profit is expected to largely achieve the pre-adjusted guidance of JPY 244 billion.

• Q4 market conditions anticipated to be nearly flat, with some upside potential if the yen remains weak.

• No revisions to previously announced guidance.

• Expecting over ¥9.0 billion in PPA and other expenses for AOC, and a ¥7.0 billion gain on sale of Shinagawa Office.