AHRESTY CORPORATION Consolidated Financial Results (Japanese Accounting Standards) for the First Half of the
Fiscal Year Ending March 31, 2024
November 14, 2023 | ||||
Company name: | Ahresty Corporation | Stock Exchange Listing: Tokyo | ||
Code Number: | 5852 | URL: https://www.ahresty.co.jp | ||
Representative: | (Title) | President & COO | (Name) Shinichi Takahashi | |
Contact for | (Title) | Director and Managing Executive Officer, | (Name) Hideki Nariya | TEL +81-3-6369-8660 |
inquiries: | Chief of General Administrative Command | |||
Planned date for filing of | Planned date for | |||
November 14, 2023 | start of dividend December 5, 2023 | |||
quarterly securities report: | ||||
payment: |
Supplementary documents for quarterly
results:
Yes
Quarterly results briefing: | Yes | (for securities analysts and institutional investors) |
(Amounts of less than 1 million yen are rounded off)
1. Consolidated results for the first half of the year ending March 2024 (from April 1, 2023 to September 30, 2023)
(1) Consolidated operating results (for the six months ended September 30, 2023)
(% shows year-on-year change from previous year)
Net income attributable | ||||||||||||
Net sales | Operating income | Recurring income | to owners of parent | |||||||||
million yen | % | million yen | % | million yen | % | million yen | % | |||||
First half of year ending | 77,750 | 16.9 | 601 | － | 938 | － | 900 | － | ||||
March 2024 | ||||||||||||
First half of year ended | 66,536 | 21.8 | (1,198) | － | (820) | － | (830) | － | ||||
March 2023 | ||||||||||||
(Notes) 1. Comprehensive income: | First half of year ending March 2024: 4,290 million yen (-19.6%) | |||||||||||
First half of year ended March 2023: 5,335 million yen (－%) | ||||||||||||
(Reference) EBITDA: | ||||||||||||
First half of year ending March 2024: 6,885 million yen (37.2%) First half of year ended March 2023: 5,019 million yen (23.7%) | ||||||||||||
* EBITDA = operating income + depreciation and amortization | ||||||||||||
Net income per share | Fully diluted net income per share | |||||||||||
yen | yen | |||||||||||
First half of year ending March 2024 | 34.82 | 34.59 | ||||||||||
First half of year ended March 2023 | (32.08) | － | ||||||||||
(2) Consolidated financial position
Total assets | Net assets | Equity ratio | |
million yen | million yen | % | |
First half of year ending March 2024 | 143,630 | 60,587 | 42.1 |
Year ended March 2023 | 137,069 | 56,649 | 41.2 |
(Reference) Shareholders' equity: First half of year ending March 2024: 60,469 million yen Year ended March 2023: 56,527 million yen
2. Dividend payments
Dividend per share | |||||
End of first quarter | End of second quarter | End of third quarter | End of year | For the year | |
yen | yen | yen | yen | yen | |
Year ended March 2023 | － | 5.00 | － | 5.00 | 10.00 |
Year ending March 2024 | － | 10.00 | |||
Year ending March 2024 | － | 10.00 | 20.00 | ||
(Forecast) | |||||
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(Note) Revisions to dividend forecast published most recently: No
3. Forecast of consolidated results for year ending March 2024 (from April 1, 2023 to March 31, 2024)
(% shows the year-on-year change) | |||||||||||
Net income | Net income per | ||||||||||
Net sales | Operating income | Recurring income | attributable to owners | ||||||||
share | |||||||||||
of parent | |||||||||||
million yen | % | million yen | % | million yen | % | million yen | % | yen | |||
Full year | 155,000 | 10.0 | 2,400 | － | 2,200 | － | 1,400 | － | 54.16 | ||
(Notes) 1. Revisions to consolidated results forecast published most recently: No
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- Notes:
- Significant changes to subsidiaries during the current term (changes for a specified subsidiary accompanying a change in the scope of consolidation): No
- Application of specific accounting treatment to the preparation of quarterly consolidated financial statements: No
- Changes in accounting policies and changes in or restatement of accounting estimates
(i) Changes in accounting policies associated with revision of accounting standards, etc.: | No |
(ii) Changes in accounting policies other than (i): | No |
(iii) Changes in accounting estimates: | No |
(iv) Restatement: | No |
- Number of shares outstanding (Common stock)
- Number of shares outstanding at end of period (including treasury shares)
- Number of treasury shares at end of period
- Average number of shares (for first half)
2Q of year ending | Year ended March | ||
26,076,717 | shares | 26,076,717 | shares |
March 2024 | 2023 | ||
2Q of year ending | Year ended March | ||
455,282 | shares | 149,822 | shares |
March 2024 | 2023 | ||
2Q of year ending | 2Q of year ended | ||
25,851,313 | shares | 25,895,763 | shares |
March 2024 | March 2023 | ||
- Quarterly consolidated financial statements are placed outside the scope of quarterly reviews performed by a certified public accountant or an audit corporation.
- Explanation for appropriate use of financial forecasts and other special remarks
The forecasts presented herein are based on information currently available and certain assumptions deemed reasonable by the Company, and actual results may differ significantly from these forecasts due to various factors. For notes on the use of the business forecasts and assumptions as the basis for the results forecasts, please see "1. Qualitative Information on Consolidated Operating Results, etc. for First Half (3) Explanation of Consolidated Earnings Forecasts and Other Information for Future Outlook" on page 3 of the accompanying materials.
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Accompanying Materials - Contents
1. Qualitative Information on Consolidated Operating Results, etc. for First Half | 2 | |
(1) | Explanation of Operating Results | 2 |
(2) | Explanation of Financial Position | 3 |
(3) | Explanation of Consolidated Earnings Forecasts and Other Information for Future Outlook | 4 |
2. Consolidated Quarterly Financial Statements and Key Notes | 5 | |
(1) | Quarterly Consolidated Balance Sheet | 5 |
(2) | Quarterly Consolidated Income Statement and Quarterly Consolidated Statement of Comprehensive Income | 7 |
Quarterly Consolidated Income Statement | ||
First Half | 7 | |
Quarterly Consolidated Statement of Comprehensive Income | ||
First Half | 8 | |
(3) | Quarterly Consolidated Statement of Cash Flows | 9 |
(4) | Notes | 10 |
(Notes on Going Concern Assumption) | 10 | |
(Notes on Significant Change in Amount of Shareholders' Equity) | 10 | |
(Segment Information, etc.) | 11 |
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1. Qualitative Information on Consolidated Operating Results, etc. for First Half
(1) Explanation of Operating Results
During the first half of the consolidated fiscal year under review, the world economy saw a further slowdown due to negative factors such as the ongoing high raw material and energy prices resulting from the situation in Ukraine and other geopolitical tensions,, the interest rate hike led by central banks of many countries to curb inflation, and the stagnant recovery in the Chinese economy. In the U.S., the significant raising of the interest rate affected the overall economy, increasing the possibility that the U.S. economy will slow down in the first half of next year. At the same time, inflation continued due to the tightening supply of labor, and the policy interest rate is expected to be left unchanged till the end of this year. In China, although the prolonged adjustments in the real estate market contributed to the slowdown in the Chinese economy, the pace of slowdown is expected to be moderate thanks to infrastructure investments and service consumption, which supported the economy. In the Japanese economy, despite the ongoing recovery in service consumption and inbound demand, growth is likely to be low in the second half of this fiscal year due to the slowdown in overseas economies, which negatively affected external demand.
Under these economic circumstances, during the first half of the consolidated fiscal year under review, the Ahresty Group's business performance got back on a steady recovery track due to the recovery in the volume of orders received in line with the global easing of the shortage of semiconductors in car production. In Asia, we faced difficulty due to the impact of the intensification of competition between Japanese automobile companies and local manufacturers in the Chinese market. However, overall, we were able to record surpluses for operating income, recurring income, and net income thanks to the advancement in the shift of the rise in energy prices into selling prices and the recording of foreign currency exchange gains resulting from the weakening of the yen. Seeing the volume of orders recovering, the Ahresty Group continued efforts to establish an efficient production system, reduce capital investment by promoting the utilization of idle internal facilities, etc., and strengthen its business structure through starting or expanding businesses with companies with an advantage in parts for electric vehicles.
Starting from the consolidated fiscal year under review, the Ahresty Group has promoted its 10-year Business Plan, a long- term management plan toward fiscal 2030, and the 2224 Medium-Term Management Plan, the milestone plan for the first three years of the 10-year Business Plan. Under the 2224 Medium-Term Management Plan, in response to changes in the external environment, such as the acceleration of electrification of automobiles and moves toward carbon neutrality, we set "establishing low-cost, highly productive MONOZUKURI," "reducing CO2 emissions in production," and "shifting the business portfolio to predominantly parts for electric vehicles" as the pillars of our strategy. Based on these pillars, we are making efforts to secure net sales, improve productivity, and enhance our earnings strength. Furthermore, we formulated financial strategies for the 10- year Business Plan in June this year, aiming to achieve, in addition to the income targets that have already been released, an equity ratio of 40%, a dividend payout ratio of 35%, capital investment of 140 billion yen, and an ROE of 9% as the four pillar financial targets for the period of the 10-year Business Plan.
Consequently, for the first half of the consolidated fiscal year under review, the Group recorded net sales of ¥77,750 million (up 16.9% year on year), operating income of ¥601 million (an operating loss of ¥1,198 million for the first half of the previous year), recurring income of ¥938 million (a recurring loss of ¥820 million for the first half of the previous year), and net income attributable to owners of parent of ¥900 million (a net loss attributable to owners of parent of ¥830 million in the first half of the previous year).
Operating results by segment are as follows:
(i) Die Casting Business: Japan
In the Japanese automobile market, as car production recovered due to the stabilization of supply of semiconductors, resulting in an increase in the volume of orders received, our net sales increased to ¥31,282 million (up 11.3% year on year). On the profitability side, despite the ongoing high energy prices, etc., the segment recorded a profit of ¥181 million (a segment loss of ¥423 million was recorded a year earlier) due to the recovery in orders received, which was associated with a recovery in production.
(ii) Die Casting Business: North America
In the automobile market in North America, as car production recovered due to the stabilization of supply of semiconductors, resulting in an increase in the volume of orders received, our net sales increased to ¥22,971 million (up 35.0% year on year). On the profitability side, despite an increase in manufacturing costs due to the rise in labor costs, etc., the segment recorded a profit of ¥693 million (a segment loss of ¥713 million was recorded a year earlier) due to the recovery in orders received, which was associated with a recovery in production.
(iii) Die Casting Business: Asia
In the automobile market in Asia, despite the impact of a decrease in the volume of orders received reflecting stagnant sales of our major customers in the Chinese market, net sales increased 3.9% year on year to ¥16,302 million due to an increase in the volume of orders received thanks to the start of mass production of new products at our plant in India. On the profitability side,
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the segment recorded a loss of ¥988 million (a segment loss of ¥250 million was recorded a year earlier) due to the decrease in orders received associated with a decrease in production in China and the impact of higher costs pertaining to the ongoing instability in production of some products in India.
(iv) Aluminum Business
In the Aluminum Business, the sales weight decreased 3.6% year on year. Net sales decreased 10.5% year on year to ¥3,509 million due to the decline in aluminum prices. On the profitability side, the segment recorded a profit of ¥88 million (down 42.1% year on year) due to the impact of the decrease in the sales volume and the soaring raw material costs.
(v) Proprietary Products Business
In the Proprietary Products Business, net sales increased 105.4% year on year to ¥3,684 million, mainly reflecting an increase in orders for projects of the main customers, such as a clean room at a semiconductor-related company. On the profitability front, the segment achieved a stable profit of ¥487 million (up 337.7% year on year) partly due to the increase in net sales.
- Explanation of Financial Position
- Assets, liabilities and net assets
(Assets)
Total assets at the end of the consolidated first half under review increased by ¥6,561 million from the end of the previous consolidated fiscal year, to ¥143,630 million. Current assets stood at ¥63,627 million, an increase of ¥2,327 million from the end of the previous consolidated fiscal year. This was mainly due to an increase of ¥5,146 million in notes and accounts receivable despite decreases of ¥2,618 million in cash and time deposits and ¥774 million in inventories. Fixed assets were ¥80,002 million, up ¥4,233 million from the end of the preceding fiscal year. This was due chiefly to increases of ¥3,260 million in tangible fixed assets and ¥801 million in deferred tax assets included in Others.
(Liabilities)
Liabilities at the end of the consolidated first half under review increased by ¥2,623 million from the end of the previous consolidated fiscal year to ¥83,043 million. Current liabilities stood at ¥60,996 million, an increase of ¥1,719 million from the end of the previous consolidated fiscal year. The principal factors contributing to this result included increases of ¥2,566 million in notes and accounts payable, ¥557 million in obligations for equipment included in Others, ¥441 million in accounts payable also included in Others, ¥350 million in accrued expenses, ¥392 million in accrued consumption taxes and others, and ¥124 million in deposits received in contrast to a decrease of ¥3,235 million in short-term loans payable. Long-term liabilities stood at ¥22,046 million, an increase of ¥904 million from the end of the previous consolidated fiscal year. This was mainly due to an increase of ¥840 million in long-term loans payable.
(Net assets)
Net assets at the end of the consolidated first half under review increased ¥3,937 million from the end of the previous consolidated fiscal year, to ¥60,587 million. This was attributable primarily to increases of ¥770 million in retained earnings and ¥3,265 million in foreign currency translation adjustments.
As a result, the equity ratio was up from 41.24% at the end of the previous consolidated fiscal year to 42.10%.
(ii) Cash flows
Cash and cash equivalents ("cash") decreased ¥3,041 million during the first half of the consolidated fiscal year under review from the end of the previous consolidated fiscal year, coming to ¥9,949 million at the end of the first half of the consolidated fiscal year under review.
The status of each of the cash flow segments and contributing factors for the first half of the consolidated fiscal year under review are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities totaled ¥7,442 million (net cash provided of ¥4,265 million in the same period of the previous year). This result was mainly due to factors decreasing cash, such as an increase in notes and accounts receivable of ¥4,108 million, as well as factors increasing cash, such as income before income taxes and others of ¥529 million, depreciation and amortization of ¥6,284 million, a decrease in inventories of ¥1,466 million, an increase of notes and accounts payable of ¥2,007 million, an increase of accounts payable of ¥396 million, and an increase of accrued consumption taxes and others of ¥456 million.
(Cash flows from investing activities)
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Net cash used in investing activities was ¥6,105 million (net cash used of ¥4,457 million in the same period of the previous year). This was chiefly due to factors decreasing cash such as payments into time deposits of ¥412 million and expenditures on purchases of tangible fixed assets of ¥5,678 million.
(Cash flows from financing activities)
Net cash used in financing activities was ¥4,612 million (net cash used of ¥1,091 million in the same period of the previous year). This result was primarily due to factors decreasing cash such as expenditures for repayments of short-term loans of ¥57,739 million and long-term loans of ¥6,489 million, in comparison to factors increasing cash such as proceeds from short-term loans of ¥54,328 million and long-term loans of ¥6,100 million.
(3) Explanation of Consolidated Earnings Forecasts and Other Information for Future Outlook
In view of recent trends in business performance, the Company has revised its consolidated full-year business forecasts released on May 18, 2023. For details, please refer to the "Notice on Recording of Non-operating Income and an Extraordinary Loss, and Revisions to Consolidated Business Forecasts (First Half and Full Year) and Dividend Projection for Fiscal Year Ending March 2024" released on October 25, 2023.
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2. Consolidated Quarterly Financial Statements and Key Notes
- Quarterly Consolidated Balance Sheet
(Million yen)
Previous consolidated fiscal year | Consolidated first half under | |
review | ||
(March 31, 2023) | ||
(September 30, 2023) | ||
(Assets) | ||
Current assets | ||
Cash and time deposits | 12,991 | 10,372 |
Trade notes and accounts receivable, and contract | 27,140 | 31,581 |
assets | ||
Electronically recorded monetary claims - | 4,116 | 4,822 |
operating | ||
Merchandise and products | 6,304 | 5,440 |
Partly finished goods | 5,637 | 5,655 |
Raw materials and inventories | 3,462 | 3,532 |
Others | 1,823 | 2,420 |
Allowance for doubtful accounts | (176) | (197) |
Total current assets | 61,299 | 63,627 |
Fixed assets | ||
Tangible fixed assets | ||
Buildings and structures, net | 13,521 | 13,979 |
Machinery and delivery equipment, net | 36,362 | 36,883 |
Land | 5,076 | 5,139 |
Construction in progress | 7,221 | 9,359 |
Others, net | 7,721 | 7,802 |
Total tangible fixed assets | 69,903 | 73,163 |
Intangible fixed assets | 1,642 | 1,653 |
Investments and other assets | ||
Investment securities | 1,261 | 1,340 |
Others | 2,978 | 3,860 |
Allowance for doubtful accounts | (15) | (15) |
Total investments and other assets | 4,223 | 5,185 |
Total fixed assets | 75,769 | 80,002 |
Total assets | 137,069 | 143,630 |
(Liabilities) | ||
Current liabilities | ||
Notes and accounts payable | 11,670 | 14,051 |
Electronically recorded obligations - operating | 9,144 | 9,330 |
Short-term loans | 18,599 | 15,363 |
Current portion of long-term loans | 10,600 | 10,203 |
Accrued income taxes | 147 | 187 |
Bonus allowances | 1,530 | 1,623 |
Provision for product warranties | 53 | 65 |
Others | 7,532 | 10,171 |
Total current liabilities | 59,277 | 60,996 |
Long-term liabilities | ||
Long-term loans | 14,319 | 15,160 |
Long-term accounts payable | 123 | 121 |
Net defined benefit liability | 3,305 | 3,348 |
Others | 3,393 | 3,415 |
Total long-term liabilities | 21,142 | 22,046 |
Total liabilities | 80,419 | 83,043 |
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(Million yen)
Previous consolidated fiscal year | Consolidated first half under | |
review | ||
(March 31, 2023) | ||
(September 30, 2023) | ||
(Net assets) | ||
Shareholders' equity | ||
Common stock | 6,964 | 6,964 |
Additional paid-in capital | 10,206 | 10,223 |
Retained earnings | 30,454 | 31,224 |
Treasury stock | (58) | (294) |
Total shareholders' equity | 47,566 | 48,117 |
Other accumulated comprehensive income | ||
Difference on revaluation of other marketable | 538 | 611 |
securities | ||
Foreign currency translation adjustments | 9,026 | 12,292 |
Remeasurements of defined benefit plans | (604) | (553) |
Total other accumulated comprehensive income | 8,961 | 12,351 |
Share warrants | 121 | 117 |
Total net assets | 56,649 | 60,587 |
Total liabilities and net assets | 137,069 | 143,630 |
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Quarterly Consolidated Income Statement and Quarterly Consolidated Statement of Comprehensive Income Quarterly Consolidated Income Statement
(First Half)
(Million yen) | ||
Six months ended September 30, | Six months ended September 30, | |
2022 | 2023 | |
(April 1, 2022 to | (April 1, 2023 to | |
September 30, 2022) | September 30, 2023) | |
Net sales | 66,536 | 77,750 |
Cost of goods sold | 62,585 | 71,397 |
Gross profit | 3,950 | 6,353 |
Selling, general and administrative expenses | 5,148 | 5,752 |
Operating income (or loss) | (1,198) | 601 |
Non-operating income | ||
Interest income | 19 | 55 |
Dividends received | 23 | 24 |
Foreign currency exchange gain | 436 | 466 |
Gain on sales of scraps | 118 | 132 |
Employment adjustment subsidies | 113 | － |
Others | 20 | 53 |
Total non-operating income | 731 | 732 |
Non-operating expenses | ||
Interest expenses | 335 | 374 |
Others | 19 | 20 |
Total non-operating expenses | 354 | 394 |
Recurring income (or loss) | (820) | 938 |
Extraordinary gains | ||
Gain on sales of fixed assets | 55 | 12 |
Gain on sales of investment securities | － | 34 |
Subsidy income | 69 | 73 |
Total extraordinary gains | 125 | 119 |
Extraordinary losses | ||
Loss on sales and retirement of fixed assets | 63 | 107 |
Loss related to Chinese business | － | 422 |
Total extraordinary losses | 63 | 529 |
Income (loss) before income taxes and others | (759) | 529 |
Income taxes and enterprise taxes | 254 | 212 |
Deferred income taxes | (182) | (583) |
Total income taxes | 71 | (370) |
Net income (loss) | (830) | 900 |
Net income (loss) attributable to owners of parent | (830) | 900 |
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AHRESTY Corporation published this content on 24 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2023 12:40:09 UTC.
