IHI (7013) Q3 2025 earnings summary

Executive summary

• Orders received rose 38.5% year-over-year to 1,214.2 billion JPY, with revenue up 32.7% to 1,149.9 billion JPY, driven by strong growth in civil aero engines, defense, and large-scale power projects.

• Operating profit reached 103.4 billion JPY, reversing a prior-year loss, with a 9.0% margin and profit attributable to owners at 76.7 billion JPY.

• EBITDA improved to 156.4 billion JPY, and comprehensive income rose to 91.9 billion JPY from a loss in the previous year.

• Financial soundness indicators and equity attributable to owners improved, reflecting solid business performance.

• Significant business reforms included the transfer of Materials Handling System Business and other non-core operations.

Financial highlights

• Operating profit increased by 207.2 billion JPY year-over-year, mainly from higher civil aero engine spare parts sales and cost structure improvements.

• EBITDA reached 156.4 billion JPY, and operating cash flow was an outflow of 52.3 billion JPY, improving by 35.5 billion JPY year-over-year.

• Net profit forecast for FY2024 was revised upward by 5 billion JPY to 90 billion JPY after a tax refund.

• D/E ratio improved to 1.39x; equity attributable to owners of parent rose to 19.4%.

• Basic earnings per share was 507.33 JPY, compared to a loss per share of 724.32 JPY in the prior year.

Outlook and guidance

• Full-year revenue forecast remains at 1,600 billion JPY, with operating profit of 145 billion JPY and profit attributable to owners of parent of 90 billion JPY.

• Free cash flow forecast improved to 25 billion JPY; dividends per share projected at 120 JPY.

• ROIC and ROE are expected to improve to 10.8% and 22.3%, respectively.

• Q4 exchange rate assumption remains at 140 JPY/USD; 1 yen change impacts operating profit by 0.4 billion JPY.

• Management expects continued robust demand in aero engines and defense, with ongoing portfolio reforms and investment in growth and clean energy businesses.