Denka Company (4061) Q3 2025 earnings summary

Executive summary

• FY2024 3Q cumulative sales reached 301.6 billion yen, up 3.0% year-over-year, with operating income at 11.8 billion yen, down 5.1% year-over-year, and net income at 2.6 billion yen, down 1.0 billion yen year-over-year.

• Profit attributable to owners of parent dropped 51.8% year-over-year to 4.3 billion yen, and comprehensive income declined 77.2% year-over-year to 4.2 billion yen.

• Progress is generally in line with expectations, but demand recovery is slowing, prompting strengthened efforts to achieve the full-year forecast.

• The company is investigating the impact of new regulations on DPE and has not yet factored in the impact of fundamental measures for the chloroprene rubber business.

Financial highlights

• Operating income for 3Q cumulative was 11.8 billion yen (down 0.7 billion yen YoY); net income was 2.6 billion yen (down 1.0 billion yen YoY).

• Ordinary income declined to 4.3 billion yen (down 4.1 billion yen YoY), mainly due to foreign exchange losses and other non-operating expenses.

• Basic earnings per share for the nine months was 29.92 yen, down from 41.56 yen in the prior year period.

• Total assets as of December 31, 2024, were 660.1 billion yen, up from 616.2 billion yen at March 31, 2024.

• Net assets increased to 319.6 billion yen, with an equity-to-asset ratio of 46.0%.

Outlook and guidance

• FY2024 full-year sales forecast remains at 420.0 billion yen, with operating income at 18.0 billion yen and net income at 9.0 billion yen, unchanged from the initial forecast.

• Operating profit is projected at 18.0 billion yen (up 34.6%), ordinary profit at 12.0 billion yen (up 119.2%), and profit attributable to owners of parent at 9.0 billion yen (down 24.7%).

• Basic earnings per share for the full year is forecast at 104.44 yen.

• Dividend forecast is unchanged at 100 yen per share, with a total return ratio of 96%.

• The company expects improved cash flow next year and beyond, considering the impact of fundamental measures in the chloroprene rubber business.