Daitron (7609) Q2 2024 earnings summary

Executive summary

• 2Q FY2024 net sales reached ¥44,775 million, down 2.4% year-over-year, with operating income at ¥2,660 million (down 23.5% y/y) and net income at ¥1,884 million (down 20.0% y/y).

• Overseas sales ratio increased to 21.8% from 19.6% y/y, with notable growth in North America and China, while domestic demand was sluggish due to inventory adjustments and a slowdown in China.

• The company is executing its 11th Medium-Term Business Plan (2024–2026) as the second step toward its 2030 Vision, targeting over ¥100 billion in consolidated net sales.

Financial highlights

• Total assets rose to ¥70,371 million, up ¥2,583 million y/y; equity ratio improved to 44.3%.

• Gross profit for the period was ¥8,700 million, down from ¥9,316 million y/y; operating profit margin declined to 5.9% from 7.6% y/y.

• Cash and cash equivalents at period-end increased by ¥4,111 million to ¥15,335 million.

• Dividend forecast for FY2024 is ¥125 per share, with a payout ratio of 33.9%.

• Shareholders’ equity increased by ¥1,747 million y/y, and net asset per share rose to ¥2,806.92.

Outlook and guidance

• Full-year FY2024 forecast: net sales ¥92,500 million (up 0.4% y/y), operating income ¥6,000 million (up 0.9% y/y), net income ¥4,100 million (up 2.1% y/y).

• Dividend forecast was revised upward to ¥125 per share for the year.

• Management aims for sustained expansion in net sales and operating income, with a gross profit margin target of 20%.

• Guidance was updated to reflect first-half results, with caution on potential future revisions due to market uncertainties.

• Strategic focus on reinforcing domestic and overseas business, expanding original products, and nurturing new business pillars.