Pola Orbis Holdings (4927) Q1 2025 earnings summary

Executive summary

• Consolidated net sales rose 1.0% year-over-year to ¥41,313 million in Q1 FY2025, driven by ORBIS brand growth and domestic market recovery.

• Operating income increased 23.5% year-over-year to ¥4,148 million, mainly due to higher gross profit from increased sales.

• Profit attributable to owners of parent fell 58.1% year-over-year to ¥1,310 million, mainly due to a swing from foreign exchange gains to losses.

• Ordinary income declined 47.1% year-over-year to ¥2,470 million, impacted by foreign exchange losses.

• The Japanese cosmetics market remained stable with inbound demand, while the Chinese market showed signs of recovery but with uncertain consumption trends.

Financial highlights

• Gross profit increased 1.5% year-over-year to ¥34,042 million, with the cost of sales ratio improving from 18.0% to 17.6%.

• SG&A expenses decreased 0.9% year-over-year to ¥29,894 million, supporting higher operating margins (10.0% vs. 8.2% last year).

• Net assets per share at the end of Q1 FY2025 were ¥721.83, down from ¥744.16 at the end of FY2024.

• Comprehensive income for Q1 FY2025 was ¥1,921 million, down 30.9% year-over-year.

• Ordinary income dropped 47.1% year-over-year to ¥2,470 million due to foreign exchange losses.

Outlook and guidance

• FY2025 full-year guidance is unchanged: consolidated net sales of ¥174,000 million (+2.1% year-over-year), operating income of ¥14,500 million (+5.0%), and profit attributable to owners of parent of ¥8,500 million (-8.5%).

• Dividend forecast maintained at ¥52 per share (payout ratio 135.4%).

• No revisions to previously announced forecasts.