Pigeon (7956) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 FY2024 rose 6.9% year-over-year to ¥51,313 million, driven by growth in China and Lansinoh segments and favorable FX rates.

• Operating income declined 10.6% year-over-year to ¥5,822 million due to increased SG&A and growth investments, especially in China.

• Net income attributable to owners fell 21.7% year-over-year to ¥3,574 million, reflecting higher expenses and extraordinary items.

• Extraordinary income and loss of ¥648 million each were recorded, related to a plant subsidy and tax reduction.

• Pigeon Manaka Corporation was excluded from consolidation after share transfer in April 2024.

Financial highlights

• Gross profit increased 7.4% year-over-year to ¥25,021 million, with margin improving to 48.8%.

• Comprehensive income increased to ¥8,971 million, up from ¥7,947 million a year earlier.

• Total assets grew to ¥108,392 million as of June 30, 2024, up ¥7,952 million from December 2023.

• Net assets rose to ¥84,953 million, with a notable increase in foreign currency translation adjustment.

• Equity ratio at 75.4% at end of Q2 FY2024, down from 77.2% at year-end 2023.

Outlook and guidance

• Full-year FY2024 forecast remains unchanged: net sales ¥101,000 million (+6.9% YoY), operating income ¥11,400 million (+6.3% YoY), net income ¥7,600 million (+2.4% YoY), EPS ¥63.54.

• Continued focus on sustainable growth, especially recovery in China, and expansion into new product areas globally.