Idemitsu Kosan Co. (5019) Q1 2026 earnings summary

Executive summary

• Operating and equity income excluding inventory impact fell ¥48.3B year-over-year, mainly due to negative time lag from crude oil price drop, lower coal prices, and weaker basic chemical margins.

• Net sales for the three months ended June 30, 2025, were ¥1,843.0B, down 18.5% year-over-year, with an operating loss of ¥21.0B and net income attributable to owners of ¥5.2B, down 94.5%.

• 1Q results exceeded initial forecasts due to robust domestic margins, but full-year guidance remains unchanged.

• Comprehensive income was negative ¥13.4B, compared to ¥126.2B in the prior year period.

Financial highlights

• Net sales decreased 18.5% year-over-year to ¥1,843.0B; operating income dropped to -¥21.0B from ¥122.5B.

• Net income attributable to owners fell 94.5% year-over-year to ¥5.2B; excluding inventory impact, net income was ¥40.3B, down 34.8%.

• Inventory impact was -¥50.5B, a swing of -¥98.5B year-over-year.

• Gross profit for the quarter was ¥104.6B, down from ¥245.5B year-over-year.

• Equity ratio improved to 38.3% from 36.0% at prior quarter-end.

Outlook and guidance

• FY2025 full-year forecasts remain unchanged: net sales ¥7,900.0B, operating income ¥37.0B, net income attributable to owners ¥50.0B.

• Assumptions: Dubai crude oil at $65/bbl, Australian coal at $95/ton, exchange rate at ¥145/USD.

• Sensitivity: ±$10/bbl crude oil impacts operating income by ±¥30B (excluding inventory) and ±¥68B (inventory impact).

• No change in the previously announced forecasts as of May 13, 2025.