SMC (6273) investor relations material

Executive summary

• Net sales for FY25 rose 6.4% year-over-year to ¥842.5B, driven by strong semiconductor and digital device demand, especially in Greater China and Japan, and yen depreciation.

• Operating profit remained stable at ¥190.5B (up 0.2% YoY), with net profit at ¥167.3B, and robust performance in Greater China and Japan.

• Ordinary profit increased 12.2% to ¥235.5B, mainly due to higher foreign exchange gains.

• Orders recovered in Japan, North America, and South Korea in the latter half of FY25, with semiconductor and EV-related industries leading growth.

• Comprehensive income surged 97.8% year-over-year to ¥276.3B, reflecting significant foreign currency translation gains.

Financial highlights

• FY25 gross profit was ¥381.4B (45.3% of sales), with operating profit margin at 22.6%.

• Total assets rose 10.0% to ¥2,311.8B, with notable increases in trade receivables, inventories, and property, plant, and equipment.

• Net assets climbed 9.7% to ¥2,115.2B, supported by profit retention and foreign currency translation adjustments.

• Cash and cash equivalents at year-end were ¥573.8B, up ¥42.1B from the prior year.

• Free cash flow remained positive at ¥81.4B, though down ¥150.5B year-over-year.

Outlook and guidance

• FY26 net sales forecasted at ¥1T (+18.7% YoY), with operating profit projected at ¥219B (+14.9%).

• Demand recovery expected in semiconductor and hybrid vehicle-related industries; automation and labor-saving trends to drive growth in machine tool, food machinery, and medical equipment sectors.

• Capex planned at ¥100B, focusing on Vietnam plant and overseas sales bases.

• Dividend per share to remain at ¥1,000, with up to ¥50B in share buybacks.

• Continued focus on expanding direct sales, distributor channels, and energy-saving product lines.