Sanwa (5929) Q1 2026 earnings summary

Executive summary

• Net sales for the three months ended June 30, 2025, were ¥140,775 million, a 1.1% decrease year-over-year, with operating profit at ¥9,924 million, nearly flat, and profit attributable to owners at ¥7,218 million, down 1.5%.

• The business environment was challenging due to global trade friction, economic slowdown in China, and geopolitical risks.

• Operating profit remained stable as price pass-throughs and cost reductions offset lower sales volumes.

• Profit margins improved in Japan but declined in North America and Asia.

• Strategic initiatives included strengthening core businesses, expanding service offerings, and sustainability efforts.

Financial highlights

• Gross profit increased to ¥44,759 million from ¥44,075 million year-over-year.

• Ordinary profit declined 3.4% year-over-year to ¥10,409 million.

• Comprehensive income turned negative at ¥(2,609) million, mainly due to foreign currency translation losses.

• Earnings per share for the quarter were ¥33.75, up from ¥33.50 year-over-year.

• Forex fluctuations had a minor negative impact on results.

Outlook and guidance

• Full-year forecast for fiscal year ending March 31, 2026: net sales ¥654,000 million (down 1.3%), operating profit ¥81,000 million (up 0.6%), profit attributable to owners ¥58,000 million (up 0.8%), EPS ¥270.70.

• Tariff impacts in the U.S. are expected to be absorbed by further price pass-throughs and cost reductions in 2Q.

• Full-year sales and profit forecasts anticipate continued cautious customer sentiment and gradual market recovery.

• No changes to previously announced forecasts.