Sanyo Chemical Industries (4471) Q2 2025 earnings summary

Executive summary

• Net sales for Apr–Sep FY2024 were ¥77.03 billion, down 2.8% year-over-year, mainly due to withdrawal from the superabsorbent polymer business.

• Operating profit more than doubled to ¥4.45 billion, up 120.5% year-over-year, driven by improved profitability and recovery in automotive and semiconductor demand.

• Profit attributable to owners of parent dropped sharply to ¥0.94 billion due to extraordinary losses from business restructuring and absence of prior-year gains.

• Upward revision of full-year forecasts: operating profit now expected at ¥9.0 billion and profit attributable to owners of parent at ¥4.0 billion, reflecting improved performance and lower-than-expected extraordinary losses.

Financial highlights

• Operating profit increased by ¥2.43 billion year-over-year, driven by improved sales mix, cost reductions, and supply chain reforms.

• Ordinary profit increased 0.9% year-on-year to ¥4.99 billion, with foreign exchange losses offsetting operating gains.

• Free cash flow for the half-year was ¥1.43 billion, down from ¥6.83 billion in the prior year period.

• Total assets decreased to ¥187.1 billion as of September 30, 2024, mainly due to lower receivables and cash.

• Net assets declined to ¥139.1 billion, with an equity ratio rising to 72.9%.

Outlook and guidance

• Full-year operating profit forecast raised to ¥9.0 billion and profit attributable to owners of parent to ¥4.0 billion, with EPS revised to ¥181.11.

• Full-year forecast for FY2025: net sales ¥145.0 billion (down 9.1% YoY), operating profit ¥9.0 billion (up 84.2%), ordinary profit ¥10.0 billion (up 22.1%), profit attributable to owners of parent ¥4.0 billion, and EPS ¥180.92.

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

• Automotive-related industries are recovering despite broader industry slumps, supporting the upward revision.