THK (6481) Q3 2024 earnings summary

Executive summary

• Revenue for the nine months ended September 30, 2024, was ¥265,130 million, down 1.1% year-over-year amid global economic uncertainty and a high prior-year order backlog.

• Operating income declined 32.7% year-over-year to ¥12,919 million, with margin dropping to 4.9% due to higher SGA expenses and a rise in cost-to-revenue ratio.

• Profit attributable to owners of the parent fell 34.7% year-over-year to ¥9,190 million; basic EPS was ¥74.96, down from ¥114.81.

Financial highlights

• Gross profit for the nine months was ¥60,499 million, down from ¥62,240 million year-over-year.

• SGA expenses increased 9.2% to ¥48,279 million, raising the SGA-to-revenue ratio to 18.2%.

• Total assets decreased to ¥547,172 million from ¥556,351 million at the previous fiscal year-end, mainly due to lower cash and cash equivalents.

• Total equity rose to ¥373,083 million, driven by higher retained earnings and other equity components.

• Net cash provided by operating activities was ¥20,317 million, while investing activities used ¥24,935 million and financing activities used ¥18,292 million.

Outlook and guidance

• Full-year 2024 revenue forecast is ¥350,000 million (down 0.6% year-over-year), with operating income projected at ¥17,000 million (down 28.3%).

• Profit attributable to owners of the parent is forecast at ¥12,100 million (down 34.2%), with projected EPS of ¥98.68.

• Year-end dividend to be calculated based on a DOE of 4% for the half-year.