Nippon Steel (5401) Q4 2025 earnings summary

Executive summary

• FY2024 underlying business profit reached ¥793.7bn, surpassing forecasts despite a harsh global steel environment and declining demand.

• Structural reforms and profit improvement measures enabled relatively high earnings compared to global peers.

• Net profit for FY2024 was ¥350.2bn, exceeding prior guidance but down 36.2% year-over-year.

• Major initiatives included facility optimization, overseas expansion, carbon neutrality efforts, and digital transformation.

• Annual dividend for FY2024 proposed at ¥160/share; FY2025 forecast at ¥120/share, maintaining a 30% payout ratio.

Financial highlights

• FY2024 revenue was ¥8,695.5bn, down 1.9% year-over-year; underlying BP fell ¥141.3bn from FY2023.

• Consolidated business profit (BP) for FY2024 was ¥683.2bn, down 21.4% year-over-year.

• EPS for FY2024 was ¥350; ROE at 6.9%.

• Free cash flow improved to ¥516.1bn, with record-high operating cash flows.

• Total assets increased to ¥10,942.5bn; total equity rose to ¥5,903.4bn.

Outlook and guidance

• FY2025 underlying BP expected to exceed ¥700bn, with a minimum of ¥600bn secured even under adverse conditions.

• Net profit for FY2025 forecast at over ¥200bn, factoring in a ¥230bn restructuring loss from the AM/NS Calvert equity transfer.

• Annual dividend for FY2025 maintained at ¥120/share, with a cumulative payout ratio of ~30% over five years.

• Medium- to long-term management plan to be announced by end of 2025, targeting further growth and carbon neutrality.

• The impact of the potential transfer of AM/NS Calvert is not included in forecasts; if realized, a ¥230bn loss would be recorded, but dividend guidance remains unchanged.