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

Executive summary

• Achieved record-high revenue and operating profit in FY2025, driven by both organic and inorganic growth, notably the AOC acquisition, and strong performance across several regions.

• Margin improvements and disciplined cost control led to adjusted EPS and operating profit significantly exceeding guidance.

• The Asset Assembler strategy remains central, focusing on EPS compounding, market share expansion, and balancing organic and inorganic growth, with a more conservative outlook due to market uncertainties.

• Ongoing commitment to maximizing shareholder value (MSV), responsive adjustments to investor feedback, and high IR and sustainability ratings.

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

Financial highlights

• FY2025 revenue reached ¥1,774.2bn, up 8.3% year-over-year (+11.4% comparable), with adjusted operating profit up 38% to ¥274.9bn and adjusted OP margin improving by 3.3 points to 15.5%.

• Adjusted EPS rose 43.3% to JPY 76.7, with basic and diluted EPS at ¥76.66, and 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 guidance projects revenue growth of ~8% to ¥1,920,000 million, adjusted operating profit and net profit growth of ~10%, and EPS up 11.4% to JPY 85.3.

• Dividend per share is projected to rise to ¥17, with a progressive dividend policy.

• AOC expects a return to low single-digit revenue growth; NIPSEA China targets high single-digit profitable growth in TUC.

• Medium-term targets revised to mid-single-digit revenue growth and high single-digit EPS growth, reflecting a more cautious stance on China and AOC.

• Focus remains on sustainable EPS growth, M&A, and expanding market share across all regions.