Nabtesco (6268) Q4 2024 earnings summary

Executive summary

• FY2024 sales declined 3.1% year-on-year to JPY 323.4 billion, with operating profit down 14.9% to JPY 14.8 billion, mainly due to weak CMP demand and impairment losses, despite strong TRS and ACB performance and Project 10-driven outperformance.

• Net income attributable to owners dropped 30.5% to JPY 10.1 billion, with basic EPS at 84.25 yen.

• Orders received increased 0.7% year-on-year to JPY 335.1 billion, and order backlog rose to JPY 166.9 billion, led by transport solutions.

• The company is transitioning to a three-pillar profit structure: CMP, TRS, and ACB.

• Achieved payout ratio and CO₂ reduction targets, and advanced innovation initiatives.

Financial highlights

• Sales for FY2024 were JPY 323.4 billion, down 3.1% year-on-year; operating profit was JPY 14.8 billion, a 14.9% decrease year-on-year.

• Gross profit margin improved year-on-year, with gross profit at JPY 87.1 billion, but operating margin fell to 4.6%.

• Net income attributable to owners was JPY 10.1 billion, with basic EPS at 84.25 yen.

• Overseas sales ratio rose to 50.3% in FY2024 from 47.2% in FY2023.

• Non-current assets increased due to capital investment in the Hamamatsu plant; equity ratio at 60.6%.

Outlook and guidance

• FY2025 sales are forecast to rise 3.9% to JPY 336 billion, with operating profit expected to increase 26% to JPY 18.7 billion and net income to JPY 13.1 billion.

• OPM targeted at 5.6% for FY2025 and 10.5% by FY2027; ROIC target set at 10% or higher by FY2027.

• Full-scale demand recovery in CMP is expected in the second half of 2025, with a U-shaped rebound.

• Dividend per share is projected to remain at 80 yen, with a payout ratio of 73.3%.

• CO₂ emissions to be reduced by 50% from 2015 levels by 2027.