Zeon (4205) Q2 2027 earnings summary

Executive summary

• H1 FY2027 net sales rose 8.9% YoY to ¥224.872bn; operating profit increased 65.0% to ¥31.921bn, and profit attributable to owners rose 17.8% to ¥26.274bn.

• Stronger battery-materials and COP shipments, selling-price revisions and lower inventory losses supported earnings growth; full-year forecasts were revised upward.

Financial highlights

• H1 ordinary profit rose to ¥33.562bn from ¥19.133bn; profit before income taxes was ¥37.992bn and net profit was ¥26.352bn.

• Gross profit was ¥73.788bn versus ¥61.712bn YoY; SG&A was ¥41.867bn versus ¥42.360bn.

• Q2 revenue was ¥115.4bn and operating income ¥15.6bn; QoQ changes were +¥5.9bn and -¥0.7bn, respectively.

Outlook and guidance

• FY2027 forecast: net sales ¥430.0bn (+4.4% YoY), operating profit ¥45.5bn (+25.1%), ordinary profit ¥46.5bn (+16.1%) and parent-attributable profit ¥43.0bn (+18.7%).

• Revised segment forecasts: Specialty Materials sales ¥134.0bn and operating income ¥31.5bn; Elastomer sales ¥231.5bn and operating income ¥11.5bn.

• H2 operating income forecast is ¥13.6bn versus H1 ¥31.9bn; cited headwinds include ¥7.1bn price/cost impact, ¥4.6bn construction-expense timing and ¥3.0bn H1 advance shipments.

• H2 assumptions: ¥157/$, ¥178/€, naphtha ¥102,000/KL and Asian butadiene $1,400/MT; annual operating-income sensitivity to yen depreciation is ~¥0.4bn per ¥1/$ and ~¥0.1bn per ¥1/€.

• Cathode binder shipments are expected to rise ~80% YoY for the year, despite H2 effects from H1 advance shipments and Q4 Chinese New Year-related declines.