AGC (5201) Q1 2026 earnings summary

Executive summary

• Q1 FY2026 net sales rose by JPY 38.4 billion year-over-year to JPY 538 billion, with operating profit up JPY 12.6 billion to JPY 38.5 billion, driven by yen depreciation, higher shipments in Essential Chemicals Southeast Asia, and improved pricing in architectural glass in Europe.

• Profit before tax increased by JPY 18 billion to JPY 35 billion, and profit attributable to owners rose by JPY 16.2 billion to JPY 22.8 billion year-over-year.

• Comprehensive income for the period reached JPY 35,005 million, reversing a loss in the prior year.

• Strategic businesses contributed 48% of total consolidated operating profit, with strong performance in Performance Chemicals and Life Science.

• Foreign exchange gains and cost reductions contributed to profit growth, while restructuring expenses partially offset gains.

Financial highlights

• Operating cash flow was JPY 42.6 billion; investment cash flow was negative JPY 59.7 billion, resulting in free cash flow of negative JPY 17.1 billion.

• CapEx for Q1 was JPY 44.1 billion (down JPY 5.5 billion quarter-on-quarter), depreciation JPY 48.1 billion, and R&D JPY 13.9 billion.

• D/E ratio stood at 0.41 as of March 2026; total assets increased to JPY 2.9955 trillion.

• Cash and cash equivalents increased by JPY 25.2 billion from December 2025 to March 2026, reaching JPY 119.8 billion.

• Basic earnings per share rose to JPY 107.73 from JPY 31.35 year-over-year.

Outlook and guidance

• Full-year outlook remains unchanged despite higher crude oil price assumptions (now $100/barrel), with only minimal expected impact from Middle East developments.

• FY2026 full-year net sales forecast at JPY 2,200 billion, operating profit at JPY 150 billion, and profit attributable to owners projected at JPY 77 billion.

• Dividend forecast unchanged at JPY 210 per share for FY2026.

• Q2 is expected to see a dip in both net sales and operating profit, mainly due to seasonality in automotive and electronics, and the absence of one-time gains in chemicals.

• Strategic businesses are projected to achieve JPY 560 billion in net sales and JPY 80 billion in operating income for the full year.