Kuraray (3405) Q2 2027 earnings summary

Executive summary

• Net sales rose 7.8% year-over-year to ¥431,035 million for the six months ended June 30, 2026, with operating income up 9.8% to ¥28,839 million and net income attributable to owners up 1.4% to ¥14,230 million, supported by product price revisions and yen depreciation amid higher raw material and fuel costs.

• Comprehensive income improved significantly to ¥31,970 million from a loss of ¥17,652 million in the prior year period.

• Full-year FY2026 forecasts were revised upward, reflecting strong interim results and current business trends.

• Organizational reform shifted Electronics Materials Promotion Division from “Others” to “Functional Materials.”

Financial highlights

• 1H FY2026 net sales: ¥431.0B (+¥31.1B YoY); operating income: ¥28.8B (+¥2.6B YoY); net income: ¥14.2B (+¥0.2B YoY).

• Gross profit increased to ¥128,987 million from ¥117,764 million year-over-year.

• Operating cash flow increased to ¥59.0B; free cash flow turned positive at ¥3.0B.

• Total assets as of June 30, 2026: ¥1,350.8B; equity ratio: 55.9%.

• Cash and deposits rose to ¥122,060 million.

Outlook and guidance

• FY2026 full-year forecast: net sales ¥880.0B, operating income ¥70.0B, net income ¥40.0B, EPS ¥132.76, dividend per share ¥64 (including ¥10 commemorative dividend).

• ROIC forecast at 6%, ROE at 5%, EBITDA margin at 18%.

• Annual dividend forecast unchanged, including commemorative dividend for 100th anniversary.