Tokyo Seimitsu (7729) Q2 2025 earnings summary

Executive summary

• Sales and profits increased year-over-year in 1H FY2025/3, mainly driven by the Semiconductor Production Equipment (SPE) segment, with orders up in both segments.

• Extraordinary gains of approximately ¥4.3B were recorded in 2Q from the sale of tangible fixed assets.

• Operating profit margin in 2Q reached 22% due to increased sales.

• Orders increased 19.5% YoY to ¥71.1B, reflecting robust demand in the semiconductor segment, especially for generative AI and Chinese domestic production.

• Net profit per share increased to ¥335.01 from ¥212.17 YoY.

Financial highlights

• 1H FY2025/3 sales: ¥71.4B (+12% YoY), operating profit: ¥13.4B (+18% YoY), net profit: ¥13.6B (+59% YoY).

• Dividend per share for 1H: ¥114, up ¥25 YoY.

• Free cash flow improved to ¥27.9B in 1H FY2025/3, driven by reduced inventory growth and asset sales.

• Cash and cash equivalents rose by ¥21.6B to ¥58.3B at period end.

• Gross profit for 1H FY2025/3 was ¥28.9B, up from ¥25.7B YoY; operating margin improved to 18.8%.

Outlook and guidance

• FY2025/3 full-year sales forecast revised upward to ¥145.0B (+8% YoY), operating profit to ¥28.0B (+11% YoY), net profit to ¥23.0B (+19% YoY).

• Dividend forecast raised to ¥228 per share (+¥36 YoY).

• Net profit per share for the full year is projected at ¥568.57.

• SPE sales and orders expected to increase slightly HoH in 2H; Metrology sales to recover moderately.

• Gen. AI and China demand to support SPE, while power semiconductors remain sluggish.