Kobe Steel (5406) Q3 2026 earnings summary

Executive summary

• Net sales for the cumulative third quarter were 1,778.1 billion yen, down 5.6% year-over-year, mainly due to lower unit selling prices in steel and electric power.

• Ordinary profit for the cumulative third quarter fell to 89.5 billion yen, down 32.6% year-over-year due to higher fixed costs and the absence of prior compensation income in construction machinery.

• Profit attributable to owners of parent decreased to 84.3 billion yen, a 27.8% year-over-year decline.

• Operating profit decreased 24.2% year-over-year to 94.4 billion yen.

Financial highlights

• Cumulative third quarter net sales: 1,778.1 billion yen (down 5.6% year-over-year).

• Ordinary profit: 89.5 billion yen (down 32.6% year-over-year).

• Profit attributable to owners of parent: 84.3 billion yen (down 27.8% year-over-year).

• Free cash flow forecast for the full year revised upward to 110.0 billion yen.

• Extraordinary income for the third quarter was 18.1 billion yen, mainly from gains on sale of cross-shareholdings and land, offset by a provision for expected loss on sale of shares.

Outlook and guidance

• Full-year net sales forecast is 2,440.0 billion yen, a 4.5% decrease year-over-year.

• Ordinary profit and profit attributable to owners of parent are forecast to remain at 110.0 billion yen and 100.0 billion yen, respectively.

• ROIC and ROE are expected to remain at approximately 5% and 8%, respectively.

• Free cash flow forecast revised upward due to postponed investments.

• Year-end dividend of 40 yen per share (annual 80 yen) with a payout ratio of 31.5%.