Sumitomo Chemical Company (4005) Q2 2026 earnings summary

Executive summary

• Core operating income and net income attributable to owners rose sharply year-over-year, driven by strong Sumitomo Pharma sales, improved trade terms in Essential & Green Materials, a sales milestone for Orgovyx, and partial divestiture of the Asian business.

• Compared to the previous forecast, stronger pharma sales, favorable forex, and reduced tax liabilities further improved results.

• Sales revenue for Q2 FY2025 was ¥1,095.4 billion, down 11.8% year-over-year, but core operating income surged 268.8% to ¥108.7 billion, and net income attributable to owners improved to ¥39.7 billion from a loss in Q2 FY2024.

• Interim dividend set at ¥6 per share; full-year dividend forecast raised to ¥12 per share.

Financial highlights

• Sales revenue for Q2 FY2025 was ¥1,095.4 billion, down 11.8% year-over-year.

• Core operating income surged to ¥108.7 billion (up ¥79.2 billion year-over-year, 268.8% increase).

• Net income attributable to owners was ¥39.7 billion, reversing a ¥6.5 billion loss in Q2 FY2024.

• Free cash flow was ¥41.0 billion, down from ¥138.0 billion year-over-year.

• ROE improved to 4.3% from -0.7% year-over-year.

Outlook and guidance

• Full-year FY2025 sales revenue forecast revised down to ¥2,290.0 billion (down 2.1% from previous forecast).

• Core operating income forecast raised to ¥185.0 billion, up 32% year-over-year and above previous forecast.

• Net income attributable to owners projected at ¥45.0 billion, up 17% year-over-year and above previous forecast.

• Annual dividend forecast maintained at ¥12.00 per share.

• Business environment remains uncertain with persistent low petrochemical margins, global economic slowdown, and ongoing price competition in agrochemicals.