■Future Outlook LeTech <3497> expects an increase in sales and ordinary income of more than 20%, with sales of 2.14 billion yen (+33.8% YoY), operating income of 150 million yen (+7.7% YoY), ordinary income of 100 million yen (+21.7% YoY), and net income of 1.03 billion yen (-11.4% YoY) for the July 2024 term, and has maintained its initial forecast (announced in September 2023).
Outlook for consolidated performance for the fiscal year ending March 2025.
The consolidated performance outlook for Riken NPR <6209> for the fiscal year ending March 2025 is revenue of 171,000 million yen, operating profit of 10,400 million yen, ordinary profit of 12,700 million yen, and net income attributable to parent company shareholders of 8,000 million yen. The company does not anticipate any foreign exchange gains from non-operating income, and it anticipates a decrease in special profits due to the negative goodwill generated in the previous period. When compared to the consolidated performance for the 12-month period ending March 2024 for both Riken NPR and Riken, revenue is expected to increase by 1% from the previous period, operating profit is expected to decrease by 2% from the previous period, and ordinary profit is expected to decrease by 7% from the previous period. The anticipated net income attributable to parent company shareholders, excluding the negative goodwill generated in the previous period, is expected to decrease by 8% from the previous period. The assumed exchange rates are 145 yen/dollar and 155 yen/euro (actual for the previous period was 140 yen/dollar and 152 yen/euro).
The company expects a slight decline in profits due to considerations such as uncertainty in automobile production volumes and strategic investments in growth areas despite an increase in revenue due to the consolidation effect of Shinwa Banex, which was brought in as a subsidiary in February 2024. The factors contributing to 0.2 billion yen decrease in operating profit by category analysis (estimation) * are expected to decrease by 1.2 billion yen due to lower sales, increase by 0.3 billion yen due to exchange rate fluctuations, increase by 0.5 billion yen due to price transfers, decrease by 0.7 billion yen due to rising raw material and energy prices, decrease by 0.7 billion yen due to increases in personnel expenses, and decrease by 0.5 billion yen due to increases in depreciation and research and development expenses, while it is expected to increase by 2 billion yen due to progress in rationalization. The company plans to invest in equipment, with 10 billion yen, an increase of 2.3 billion yen from the previous period, planned for cost-competitive equipment introduction, environmental investments related to next-core businesses such as new products and businesses in growth areas and carbon neutrality. Depreciation expenses are planned to be 9.5 billion yen, an increase of 0.2 billion yen from the previous period, and research and development expenses are planned to be 4.7 billion yen, an increase of 0.3 billion yen from the previous period. Research and development expenses will be devoted towards fuel efficiency reduction technology that contributes to carbon neutrality, evaluation of hydrogen fuel, biofuel, and e-fuel, modification development to hydrogen engines, and investment of management resources towards the development of new products and businesses. We believe that the company's forecast is conservative, given factors such as the current exchange rate being lower than the company's anticipated exchange rate, and there is a possibility that it may exceed expectations.
* The financial results for the fiscal year ending March 2024 reflect the performance of both Riken and Riken NPR for the 12-month period.
(Authored by FISCO guest analyst Masanobu Mizuta)