Rengo Co (3941) Q3 2025 earnings summary

Executive summary

• Net sales for Apr–Dec 2024 rose 7.2% year-over-year to ¥741.5 billion, driven by subsidiary additions and product price revisions.

• Operating profit declined 22% year-over-year to ¥33.4 billion, and profit attributable to owners of parent dropped 20.1% to ¥26.4 billion, mainly due to higher raw material and fixed costs.

• Extraordinary gains included a gain on bargain purchase, while losses were driven by plant renewal and disaster-related expenses.

• Comprehensive income decreased 41.9% year-over-year to ¥33,807 million.

Financial highlights

• Operating profit fell by ¥9.3 billion year-over-year, mainly due to higher OCC costs, unfavorable product mix, and increased fixed costs.

• Total assets increased by ¥81.8 billion to ¥1,254.3 billion as of Dec 31, 2024.

• Shareholders' equity ratio decreased to 35.9%.

• EBITDA for FY2024 is forecast at ¥94.5 billion, down from ¥101.1 billion in FY2023.

• Basic earnings per share declined to ¥106.34 from ¥133.15 year-over-year.

Outlook and guidance

• FY2024 net sales forecast remains at ¥1,000.0 billion, but operating profit guidance was revised down to ¥38.0 billion (from ¥50.0 billion).

• Profit attributable to owners of parent is projected at ¥28.0 billion, down from the previous forecast of ¥35.0 billion.

• Capital expenditures are expected to rise to ¥101.5 billion, a 37.5% increase year-over-year.

• Assumptions include a stronger yen and lower crude oil prices compared to prior forecasts.