Azbil (6845) Q2 2026 earnings summary

Executive summary

• Operating income rose significantly in H1 FY2025, exceeding plan, despite lower orders and net sales due to the FY2024 transfer of Azbil Telstar; excluding this effect, both orders and sales increased substantially.

• Net sales for the six months ended September 2025 were ¥132,897 million, down 4.6% year-over-year, mainly due to the exclusion of Azbil Telstar from consolidation.

• Operating income rose 21.0% to ¥17,718 million, and net income attributable to owners of parent increased 23.0% to ¥13,463 million, reflecting enhanced profitability and foreign exchange gains.

• The full-year FY2025 financial plan was revised upward, projecting a fifth consecutive year of operating income growth, with robust BA and AA business performance and continued investments in human capital.

• Dividend is set to increase for the eleventh consecutive year, and share repurchases and cancellations were completed to enhance shareholder returns.

Financial highlights

• H1 FY2025 net sales: ¥132.8B (down ¥6.3B YoY, mainly due to subsidiary transfer); operating income: ¥17.7B (up ¥3.0B YoY); net income attributable to owners: ¥13.4B (up ¥2.5B YoY).

• Gross margin improved by 4.2pp to 46.2%; operating margin rose to 13.3% from 10.5% YoY.

• Ordinary income rose 24.9% to ¥18,320 million, and comprehensive income surged 63.8% to ¥16,721 million.

• EPS for the period was ¥26.37, up from ¥20.74, adjusted for a 4-for-1 stock split.

• Overseas sales ratio was 18.2%, with notable growth in North America but declines in Asia and China.

Outlook and guidance

• FY2025 full-year net sales forecast: ¥298.0B (slight decrease due to subsidiary transfer); operating income: ¥45.5B (up ¥4.0B YoY); net income attributable to owners: ¥33.5B (down due to prior year’s extraordinary gain).

• Segment guidance: BA sales ¥154.0B, AA sales ¥111.0B, LA sales ¥34.5B; all expected to meet or exceed initial forecasts.

• Dividend planned at ¥26 per share, with DOE improving to 5.6%.

• BA and AA segments are expected to maintain strong performance; LA segment to stabilize after the impact of the subsidiary transfer.