Sanyo Chemical Industries (4471) Q1 2026 earnings summary

Executive summary

• Net sales for Apr–Jun FY2025 declined 19.3% year-over-year to ¥31.98 billion, mainly due to withdrawal from the superabsorbent polymer business and intensified competition from low-cost Chinese products.

• Operating profit decreased 14.9% to ¥1.85 billion, and ordinary profit dropped 36.0% to ¥2.28 billion, impacted by foreign exchange losses and lower equity method profits.

• Profit attributable to owners of parent surged 274.2% to ¥8.99 billion, driven by recognition of deferred tax assets and tax effects from the absorption-type merger with SDP Global Co., Ltd.

• Comprehensive income increased 146.3% year-over-year to ¥10.53 billion.

Financial highlights

• Net sales dropped by ¥7.66 billion year-over-year, with all major segments except Information and Electrics/Electronics experiencing declines.

• Gross profit for the quarter was ¥7.64 billion, down from ¥8.27 billion year-over-year.

• Basic earnings per share rose to ¥406.51 from ¥108.80 year-over-year.

• Free cash flow improved to ¥1.02 billion from negative ¥0.10 billion year-over-year.

• Total assets as of June 30, 2025, were ¥181.21 billion, up ¥4.84 billion from March 31, 2025.

Outlook and guidance

• The company is accelerating growth in high-value-added product categories, focusing on chemicals for special fibers, electronics, lubricant additives, permanent antistatic agents, and medical/pharmaceutical products.

• Full-year net sales forecast for FY2026 is ¥130.00 billion, down 8.6% year-over-year.

• Profit attributable to owners of parent is forecast at ¥16.00 billion, up 285.4% year-over-year, reflecting tax effects from the merger.

• Interim and year-end dividends are forecast at ¥85.00 per share each, totaling ¥170.00 for the year.

• FY2025 forecasts anticipate continued emphasis on carbon neutrality and quality of life improvements.