Nippon Paint (4612) Q4 2025 & Strategy update earnings summary

Executive summary

• Record high revenue and operating profit in FY2025, driven by both organic and inorganic growth, including the acquisition of AOC and strong segment performance.

• Asset Assembler strategy and disciplined M&A remain central, with a focus on EPS compounding and market share expansion.

• Margin improvement and operational efficiencies prioritized, with partner companies delivering steady post-acquisition growth.

• Goodwill impairment for Cromology Group was offset by revenue growth, improved cost ratios, and a gain on asset transfer.

• FY2026 guidance anticipates new record highs in revenue and profit despite macroeconomic uncertainty.

Financial highlights

• FY2025 revenue reached ¥1,774.2bn, up 8.3% year-over-year (+11.4% on a comparable basis), with adjusted operating profit up 37.8% to ¥274.9bn and adjusted OP margin improving by 330bps to 15.5%.

• Adjusted EPS rose 42.3% to ¥86.0; net profit and EPS outperformed guidance.

• Q4 revenue up 14% year-over-year, adjusted operating profit up 54%, and adjusted EPS up 75%.

• Return on equity improved to 10.6% from 8.5% year-over-year.

• Cash and cash equivalents at year-end were ¥424,337 million, up from ¥288,301 million.

Outlook and guidance

• FY2026 revenue is forecast at ¥1,920,000 million (+8.2%), operating profit at ¥283,000 million (+10.1%), and profit attributable to owners of parent at ¥198,000 million (+10.1%).

• Adjusted EPS is expected to grow by ~10% and dividend per share to rise to ¥17.

• AOC expected to return to low single-digit revenue growth; NIPSEA China targets high single-digit profitable growth.

• Management adopts a more conservative mid-term outlook, revising revenue growth targets to mid-single digits and EPS growth to high single digits.