Sanyo Chemical Industries (4471) Q1 2025 earnings summary

Executive summary

• Net sales for Apr-Jun FY2024 increased 1.9% year-over-year to ¥39.65 billion, driven by price revisions and recovery in key markets, despite withdrawal from the superabsorbent polymer business.

• Operating profit surged 209.8% year-over-year to ¥2.18 billion, reflecting improved profitability and demand recovery in automotive and semiconductor sectors.

• Ordinary profit increased 25.7% year-over-year to ¥3.57 billion.

• Profit attributable to owners of parent declined 18.8% year-over-year to ¥2.40 billion, mainly due to lower extraordinary gains and absence of prior year’s gain on sale of investment securities.

• Comprehensive income rose 13.0% year-over-year to ¥4.28 billion.

Financial highlights

• Gross profit increased to ¥8.27 billion from ¥6.72 billion year-over-year.

• Cash and cash equivalents at end of period were ¥21.15 billion, up ¥3.50 billion from the previous year but down ¥6.03 billion from the previous fiscal year end.

• Free cash flow turned negative at ¥-0.10 billion due to higher capital investment and business restructuring payments.

• Total assets decreased by ¥7.0 billion from March 31, 2024, to ¥198.8 billion, mainly from lower receivables and inventory.

• Basic earnings per share was ¥108.80, down from ¥134.13 year-over-year.

Outlook and guidance

• FY2024 net sales forecast at ¥145.0 billion, with ordinary profit at ¥12.0 billion and operating profit projected at ¥8.0 billion.

• Profit attributable to owners of parent forecast at ¥2.5 billion; interim and year-end dividends forecast at ¥85.00 per share each.

• Focus on high-value-added products contributing to carbon neutrality and quality of life, with FY2024 segment sales forecast at ¥34.5 billion and operating margin at 15.3%.

• Progress toward full-year profit forecast is high, with 96.1% of profit attributable to owners of parent already achieved in Q1.

• No changes to previously announced earnings or dividend forecasts.