Nittoseiko Co (5957) Q2 2025 earnings summary

Executive summary

• Net sales rose 6.5% year-over-year to ¥23,859 million in 2Q FY2025, driven by the fastener segment and contributions from the Indian subsidiary.

• Operating income increased slightly by 0.8% year-over-year to ¥1,505 million, with margin pressure from M&A-related expenses and higher SG&A.

• Ordinary income declined 11% year-over-year to ¥1,432 million due to foreign exchange losses, especially from the Indonesian rupiah.

• Net income attributable to shareholders fell 13.3% year-over-year to ¥873 million.

• Earnings per share decreased from ¥27.56 to ¥24.09 year-over-year.

Financial highlights

• Gross profit improved 7.9% year-over-year, reflecting successful price pass-through in fastener products.

• SG&A expenses rose 10.7% year-over-year, mainly due to M&A costs and wage increases.

• Comprehensive income dropped sharply to ¥557 million from ¥1,852 million year-over-year, mainly due to negative foreign currency translation adjustments.

• Free cash flow turned negative due to the acquisition of an Indian subsidiary and capital investments.

• Total assets remained stable at ¥55,513 million as of June 30, 2025.

Outlook and guidance

• FY2025 consolidated net sales forecast at ¥50,100 million (+6.4% year-over-year), with operating profit projected at ¥3,600 million (+8.2%).

• Net income forecasted to rise 4.6% to ¥2,300 million, with EPS of ¥63.36.

• Annual dividend forecast is ¥20.00 per share.

• Continued focus on price revisions, cost reductions, and expanding high-value-added product sales.

• Indian subsidiary expected to contribute positively in the second half.