KPP Group reports mixed Q1 amid global slowdown, M&A boosts some segments

KPP Group Holdings reported a 1.9% year-on-year decrease in net sales to JPY 159,324 million for the three months ended June 30, 2025. The company attributed the decline to a sluggish global economy, particularly in Europe and China, and a temporary yen appreciation. Operating profit fell 42.8% to JPY 1,707 million, while ordinary profit saw a significant 57.8% drop to JPY 949 million due to increased interest expenses. Profit attributable to owners of parent was JPY 1,289 million, down 21.8%.

Despite the overall decline, the packaging and visual communications businesses saw increased sales due to M&A activities in the previous fiscal year, though this was insufficient to offset the downturn in the paper business. The Northeast Asia segment's net sales decreased 3.5% to JPY 72,368 million, with operating profit down 43.5% to JPY 647 million. Europe/Americas net sales also fell 3.6% to JPY 71,212 million, and operating profit decreased 64.6% to JPY 529 million. In contrast, the Asia Pacific business recorded a 15.9% increase in net sales to JPY 15,368 million and a 32.8% rise in operating profit to JPY 514 million. The Real Estate Leasing segment also saw a 7.1% increase in operating profit to JPY 160 million.

Total assets stood at JPY 354,650 million, up JPY 2,615 million from the previous fiscal year-end, primarily due to higher trade receivables and cash. Liabilities increased by JPY 5,413 million to JPY 271,232 million, driven by higher trade payables and short-term borrowings. Net assets decreased JPY 2,797 million to JPY 83,418 million, lowering the equity ratio by 1.0 point to 23.5%. The full-year financial forecast remains unchanged.