■Tensho Electric Industries <6776> Performance Trends
1. Summary of financial results for the interim period ending March 31, 2025
Consolidated financial results for the interim period ending 2025/3 were sales of 13667 million yen (up 6.4% from the same period last year), operating income of 291 million yen (down 42.0% from the same period), ordinary profit of 309 million yen (down 57.4% from the same period), and interim net income attributable to parent company shareholders 174 million yen (down 69.2% from the same period), and operating profit fell far below the initial forecast (550 million yen).
Since automobile manufacturers, which are the main targets, made production adjustments due to data falsification issues, the company's domestic sales fell far short of expectations. Meanwhile, manufacturing of logistics products, which have been actively invested in the United States, has steadily expanded, but it has not made up for automobiles, and overall sales remained 6.4% higher than the same period last year. As sales for automobiles declined, the operating rate declined, and gross profit was 1996 million yen (down 5.1% from the same period). As a result, while gross profit margin deteriorated to 14.6% (down 1.8 points from the same period), sales and administration expenses, including labor costs, increased 6.4% from the same period, so operating profit declined drastically.
On the other hand, since depreciation and amortization expenses were 1103 million yen (up 2.3% from the same period), operating income before depreciation (EBITDA) was 1394 million yen (down 11.8% from the same period), and it should be closely watched that it has not fallen as much as operating income.
By segment, sales of the “Japan Molding-related Business” were 9750 million yen (down 5.2% from the same period last year), and segment profit was 52 million yen (down 87.0% from the same period last year). The main reason for the decline in sales was that production volumes of automobile manufacturers, which are major destinations, remained sluggish in connection with data falsification issues.
Sales of the “China molding related business” were 304 million yen (up 35.3% from the same period), and segment losses were 3 million yen (loss of 18 million yen in the same period last year). There are ups and downs depending on the product, and black quality has not been established.
Sales of the “American molding related business” were 3470 million yen (up 58.7% from the same period), and segment profit was 116 million yen (loss of 2 million yen in the same period last year). Full-scale operation of the Mexican Plant 2, where large-scale capital investments were made, began, and sales increased drastically, and segment profit and loss also improved drastically.
The “real estate-related business” had sales of 142 million yen (up 0.0% from the same period) and segment profit of 124 million yen (up 8.0% from the same period).
Financial details are improving, and the capital adequacy ratio is 31.4%
2. Financial Status and Cash Flow Status
As for the financial situation for the interim period ending 2025/3, current assets were 14588 million yen (increase of 1825 million yen from the end of the previous fiscal year), but in the main subjects, cash and deposits increased 1148 million yen from the end of the previous fiscal year, notes receivable and accounts receivable including electronic record claims increased 587 million yen, and inventory assets increased 23 million yen. Fixed assets were 16338 million yen (1149 million yen increase from the same period). As for the breakdown, tangible fixed assets increased by 1189 million yen, intangible fixed assets increased by 1 million yen, and investments and other assets decreased by 40 million yen. As a result, total assets were 30927 million yen (2975 million yen increase from the same period).
Current liabilities were 10,818 million yen (663 million yen increase from the same period). The main fluctuating factors are that notes payable and accounts payable, including electronic record obligations, increased 160 million yen from the end of the previous fiscal year, and long-term loans scheduled to be repaid within 1 year increased by 437 million yen. The fixed debt was 8459 million yen (up 1594 million yen from the same period). Mainly due to an increase of 1702 million yen in long-term loans. Net assets were 11648 million yen (up 717 million yen from the same period). Mainly due to an increase in retained earnings of 90 million yen due to the recording of interim net profit attributable to parent company shareholders, an increase of 399 million yen in exchange conversion adjustment accounts, and an increase of 261 million yen in non-controlling shareholding due to capital increases in consolidated subsidiaries. As a result, the capital adequacy ratio at the end of the interim period ending 2025/3 was 31.4% (33.1% at the end of the previous fiscal year).
Also, cash flow from operating activities for the interim period ending 2025/3 was income of 921 million yen. The main income was 311 million yen of recorded interim net profit before tax adjustments, depreciation and amortization expenses of 1103 million yen, a decrease in inventory assets of 66 million yen, and an increase in purchase debt of 55 million yen, and the main expenses were an increase of 442 million yen in sales receivables. Cash flow from investment activities amounted to 1349 million yen of expenditure, and the main expenditure was 1293 million yen of expenditure due to the acquisition of tangible fixed assets centered on molds. Cash flow from financial activities amounted to 1408 million yen, but the main income was an increase in long and short term loans (net) of 1623 million yen. As a result, cash and cash equivalents increased by 1148 million yen compared to the end of the same period last year, and the balance at the end of the interim period was 6407 million yen.
(Written by FISCO Visiting Analyst Noboru Terashima)
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