Fiscal Year Ending December 2025 (FY2025) Earnings Presentation

Performance Overview

For FY2025 on a consolidated basis, net sales were 350 billion yen (YoY -0.3%), operating income was 20.8 billion yen (YoY +1.7%), ordinary income was 20.9 billion yen (YoY -0.6%), and net income attributable to owners of the parent was 10.3 billion yen (YoY -44.2%). The operating income margin improved by 0.1 points to 5.9%. Net sales remained steady supported by growth in coating materials and adhesives for displays despite the impact of foreign exchange and revenue declines in some business areas. Operating income increased due to domestic cost reductions, price revision effects, and the expanded sales of growth businesses overseas. However, net income declined significantly due to impairment losses recorded at the new factory in Kentucky, USA, and the Hungarian plant amid the weak EV market.

Impairment Loss Recording and Business Segment Trends

The total impairment loss recorded was 7.27 billion yen, mainly booked at locations in Kentucky, USA (4.95 billion yen), Hungary (1.26 billion yen), Zhuhai, China (970 million yen), and domestic manufacturing sites (90 million yen). The primary causes were postponement of operation plans and reduced operating rates following the sharp slowdown in EV market expansion, as well as delays in market development due to VOC regulations. By business segment, pigments & functional materials posted net sales of 84.3 billion yen (down 2.1%) and operating income of 2.3 billion yen (down 33.1%), showing declines in both revenue and profit. Polymers & coatings achieved 90.3 billion yen in net sales (up 2.0%) and 8.3 billion yen in operating income (up 15.9%), marking growth in both areas. Packaging recorded 92.5 billion yen in net sales (up 1.1%) and 5.5 billion yen in operating income (up 0.9%), maintaining solid performance. Printing & information saw net sales of 81.0 billion yen (down 2.8%) and operating income of 4.5 billion yen (down 7.3%), experiencing declines in revenue and profit.