Shinwa (7607) Q4 2025 earnings summary

Executive summary

• Achieved record consolidated sales of ¥86.1 billion for FY2025, driven by robust domestic automotive sector demand and high-value product offerings, with net sales rising 10.7% year-over-year.

• Operating profit rose to ¥4.54 billion, up 27.5% year-over-year, and net profit attributable to owners of parent increased 21.3% to ¥3.31 billion.

• Growth was led by strong domestic sales, especially in production equipment for electric vehicles and automation, despite mixed overseas performance.

• Key strategies from the 4th Medium-term Management Plan focused on profitability through pricing, value-added products, and cost efficiency.

• Outlook for FY2026 anticipates higher sales but lower profits due to increased personnel investment, wage hikes, and global uncertainties.

Financial highlights

• FY2025 revenue: ¥86.1 billion (+10.7% YoY); operating profit: ¥4.54 billion (+27.5% YoY); net profit: ¥3.31 billion (+21.3% YoY).

• Gross profit increased to ¥13.87 billion from ¥12.10 billion YoY; gross profit margin improved to 16.1% (+0.6% YoY).

• Ordinary profit rose 23.3% to ¥4.81 billion; basic earnings per share increased to ¥247.22.

• Total assets grew to ¥74.4 billion, equity ratio at 58.4%, and cash and cash equivalents at year-end increased to ¥28.79 billion.

• Domestic sales ratio increased to 68.4% as overseas sales declined.

Outlook and guidance

• FY2026 sales forecast: ¥87.0 billion (+1.0% YoY); operating profit: ¥4.3 billion (−4.8% YoY); net profit: ¥3.1 billion (−6.4% YoY); ordinary profit: ¥4.5 billion (−6.4% YoY).

• Dividend per share forecast for FY2026 is ¥124.00, with a payout ratio of 53.6%.

• Strategic investments in smart factory innovation and global expansion, with a new facility planned.

• Management expects continued economic recovery but notes risks from global instability, rising prices, and uncertainty in automotive investment trends.