Nippon Sheet Glass Company (5202) Q2 2025 earnings summary

Executive summary

• Operating profit declined sharply year-over-year, mainly due to the European economic slowdown impacting the Architectural segment, while revenue remained stable, aided by a weaker JPY.

• Shareholders' equity ratio fell to 11.1%, and interest-bearing debt increased, reflecting negative free cash flow and seasonal working capital movements.

• Free cash flow decreased year-over-year, with a higher outflow in H1, though a small inflow was generated in Q2, partially offsetting the operating profit decline.

• Net loss attributable to owners was JPY 6.3 bn, compared to a profit of JPY 2.7 bn in the prior year; total comprehensive income was a loss of JPY 24.8 bn, impacted by currency translation.

• Basic earnings per share was negative, down from the prior year.

Financial highlights

• Cumulative H1 revenue was JPY 422.4 bn, up JPY 2.3 bn year-over-year; operating profit dropped to JPY 10.2 bn from JPY 26.0 bn.

• Return on sales fell to 2.4% from 6.2% year-over-year.

• EBITDA for H1 was JPY 17.5 bn, down from JPY 22.6 bn year-over-year.

• Gross profit declined to JPY 85.1 bn from JPY 97.5 bn year-over-year.

• Basic earnings per share was JPY (53.18), down from JPY 96.70 in the prior year.

Outlook and guidance

• Full-year profit forecasts were revised downward due to the ongoing European slowdown; revenue is now expected at JPY 850.0 bn and operating profit at JPY 26.0 bn.

• Profit attributable to owners is forecast at JPY 1.0 bn, a 90.9% decrease year-over-year; basic EPS for FY2025 is projected at JPY (21.40).

• Stable energy and material costs are assumed, but labor and other costs are expected to rise with inflation.

• The company is taking actions to improve profits, including cost reductions and price negotiations.

• The Group is pursuing its "2030 Vision: Shift the Phase" medium-term plan, targeting JPY 64 bn operating profit and a 7% return on sales by FY2027.