Zeon (4205) Q1 2025 earnings summary

Executive summary

• Q1 FY2024 saw year-over-year and quarter-over-quarter increases in both sales and profits, with net sales rising 15.4% YoY to ¥106,105 million, operating profit up 47.9% to ¥9,041 million, and profit attributable to owners of parent up 40.3% to ¥8,190 million, driven by cost reduction initiatives, production reforms, and improved performance in Elastomer and Specialty Materials segments.

• Recovery in demand for mobile devices and production resumption post-earthquake boosted specialty plastics, while synthetic rubbers drove elastomer segment growth.

Financial highlights

• Q1 FY2024 net sales: ¥106.1B (+¥14.2B YoY, +¥7.6B QoQ); operating income: ¥9.0B (+¥2.9B YoY, +¥4.5B QoQ); net income: ¥8.2B (+¥2.4B YoY, -¥2.0B QoQ).

• Ordinary income rose to ¥12.2B (+¥3.9B YoY, +¥5.2B QoQ); gross profit increased to ¥30,582 million from ¥25,363 million YoY.

• Basic earnings per share increased to ¥38.77 from ¥27.62.

• Total assets grew to ¥560,248 million, and net assets to ¥370,586 million, with an equity-to-asset ratio of 65.9%.

• Overseas subsidiary Tokyo Zairyo (Guangzhou) newly consolidated.

Outlook and guidance

• H1 FY2024 net sales forecast revised up to ¥210.0B and operating income to ¥15.0B.

• Full-year net sales forecast revised to ¥397,000 million (up 3.9% YoY), with operating profit expected at ¥26,500 million (up 29.3%).

• Profit attributable to owners of parent is forecast at ¥17,500 million, a 43.7% decrease YoY, and EPS at ¥84.13.

• Dividend forecast for FY2024/FY2025: ¥47/share (+¥2 YoY), marking 15 consecutive years of increases.

• H2 forecast revised downward due to expected rebound; full-year forecast unchanged at ¥397.0B net sales and ¥26.5B operating income.