Noritsu Koki Co (7744) Q3 2024 earnings summary

Executive summary

• Revenue for FY24 1-3Q rose 21.2% year-over-year to ¥78.4 billion, driven by audio equipment/peripherals growth and a weaker yen.

• Operating profit increased 28.9% to ¥16.1 billion, despite forex translation losses.

• Net profit surged 64.7% to ¥12.9 billion, aided by higher operating profit and a gain from the sale of PreMedica shares.

• The medical testing business (PreMedica) was divested and is now classified as discontinued operations.

Financial highlights

• Operating EBITDA for FY24 1-3Q was ¥20.1 billion, up 47.6% year-over-year, with margin improving to 25.7%.

• Cash and cash equivalents increased by ¥18.0 billion to ¥88.2 billion, partly due to an income tax refund.

• Net debt improved by ¥23.6 billion, reaching ¥76.3 billion in net cash.

• Gross profit for the nine months was ¥39.5 billion, up from ¥28.8 billion year-over-year.

• Basic earnings per share rose to ¥361.84 from ¥219.84 year-over-year.

Outlook and guidance

• FY24 full-year revenue forecast is ¥103.1 billion, with a slight downward revision due to sluggish pen nib recovery and shipment suspensions at Alpha Theta.

• Operating profit and net profit forecasts raised by ¥1.2 billion and ¥0.8 billion, respectively, reflecting improved profitability.

• Operating EBITDA for the full year is forecast at ¥22.7 billion, a 28.3% increase.

• Basic earnings per share for the full year is expected to reach ¥386.55.

• New medium-term management plan to be announced in February 2025, as FY25 targets are forecast to be achieved one year early.