Nippon Shokubai expects full-year profit drop despite upward revision

Nippon Shokubai announced its financial results for the second quarter of the fiscal year ending March 2026, reporting a decline in both revenue and operating profit year-on-year. Revenue for the first half of FY2025 was 200.2 bn yen, a 6.7 bn yen decrease from the previous year, while operating profit fell by 1.4 bn yen to 9.0 bn yen. This reduction was primarily attributed to worsening profitability in the Materials segment, despite wider spreads and higher sales volumes, and increased processing costs and selling, general, and administrative (SG&A) expenses.

For the full fiscal year ending March 2026, Nippon Shokubai maintained its revenue forecast at 405.0 bn yen, which represents a 4.3 bn yen decrease from FY2024. However, the company revised its full-year operating profit forecast upwards to 18.0 bn yen, a 1.0 bn yen improvement from its initial May 13 forecast, though still a 1.1 bn yen decrease year-on-year. The revised forecast for profit attributable to owners of parent remains at 15.0 bn yen. The Materials segment is expected to be impacted by weak overseas market conditions, while both segments anticipate increased sales volumes.

Nippon Shokubai also outlined its shareholder return policy for FY2024-FY2027, committing to distributing dividends based on the greater of a payout ratio of 100% or a DOE of 2.0%. The company projects an annual dividend of 100.0 yen for FY2025, with an interim dividend of 50.0 yen and a year-end dividend of 50.0 yen. The total return ratio for FY2025 is projected to reach approximately 146%, exceeding the previous year's level.