Nippon Soda (4041) Q2 2025 earnings summary

Executive summary

• Net sales for 2Q FY2025 were ¥67.08B, down 2.6% year-over-year; operating profit rose 9.6% to ¥7.08B.

• Ordinary profit fell 10.0% to ¥8.36B; profit attributable to owners decreased 15.8% to ¥6.35B.

• Comprehensive income dropped 72.1% year-over-year to ¥4,337 million.

• Chemical Materials segment saw sales and profit growth, while Agri Business experienced declines due to shipping adjustments and prior year shipment timing.

• Foreign exchange losses were recorded this year, contrasting with gains in the previous year.

Financial highlights

• Net sales: ¥67.08B (down ¥1.82B, -2.6% YoY); operating profit: ¥7.08B (up ¥0.62B, +9.6% YoY).

• Gross profit increased to ¥19,460 million from ¥19,074 million YoY; operating margin improved to 10.5%.

• EPS: ¥115.24 (down ¥20.0, -14.8% YoY), adjusted for 2-for-1 share split.

• Free cash flow improved to ¥6.68B from ¥1.86B YoY.

• Total assets as of September 30, 2024, were ¥282,596 million, down from ¥290,492 million at March 31, 2024.

Outlook and guidance

• FY2025 net sales forecast revised to ¥153.0B (0.7%–0.9% decrease YoY); operating profit to ¥13.5B (down 2.7%).

• Chemical Materials and Engineering expected to drive growth; Agri Business to remain subdued.

• Basic EPS forecast for the full year is ¥228.77, reflecting the share split.

• Dividend forecast remains unchanged, with a total annual dividend of ¥240 per share if not split.

• Exchange rate assumptions for 2H: ¥145/USD, ¥155/EUR.