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Financial results presentation6203Howa Machinery,Ltd.Machinery

Financial Results Briefing Materials

For the fiscal year ended March 2026, the Firearms business delivered substantial increases in revenue and profit, driven mainly by higher shipments of defense equipment. However, consolidated revenue and operating profit declined due to lower sales and deteriorating profitability in the Machine Tools-Related business, as well as inventory valuation losses. For the fiscal year ending March 2027, the Company aims to return the Machine Tools-Related business to profitability through structural reform, while the Firearms business is expected to post lower revenue and profit as there will be no sales from specific initiative contracts.

Worth reading
47Recurring
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Mixed performance
Direction inferred from the company’s description.
Scale
-66
¥ million (year-on-year change in operating profit)
Wording
Conditional
How definitive the wording is.

Contents of this document

Financial results presentationFiscal year ending March 20267 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales¥24,064 million-3.1%
Operating profit¥1,186 million-5.3%
Ordinary income¥1,382 million-2.2%
Net income¥741 million-1.1%
Gross Profit Margin17.6%
Operating profit margin4.9%
Full-year earnings forecast
Net Sales
¥23,560 million
Gross profit
¥4,698 million
Operating profit
¥1,410 million
Ordinary income
¥1,580 million
Net income for the current fiscal year
¥1,080 million
ROE
5.0%
ROIC
3.5%
What the company explained in this material
Self-assessment against the planThe company's self-assessment against its own plan.
Profit margin below the earnings forecast (Special-Purpose Vehicles business)
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
  • The number of Type 20 rifles delivered is expected to increase
  • Surging prices for raw materials such as aluminum
  • Continued weakness in demand for machine tools
New initiatives
  • Dissolution and liquidation of the Chinese subsidiary
  • Narrowing the Machine Tools-Related product lineup, standardization and model consolidation, and a review of the production structure
  • Joint acquisition with EIWA CORPORATION of all shares in マシンサービス株式会社 for the road-sweeper reuse business
  • Launch of an autonomous-driving EV robot sweeper and a medium-sized EV town sweeper
  • Launch of sales of submersible waterproof doors
  • Launch of a new sports rifle model
  • Launch of the large-bore hollow power chuck H3KBA
Key KPIsA metric the company considers important as a management benchmark.
  • Number of Type 20 rifles delivered12,000 Rifles
    Year on year against the same period last year4x the initial-year figure of 3,000 rifles
  • Type 20 rifle sales target13,000 Rifles
  • Overseas Revenue Mix13.1%
    Year on year against the same period last yearDown from 20.8% in FY3/25
  • Order backlog at period-end¥22,454 million
    Year on year against the same period last yearDown from ¥24,776 million in FY3/25
  • Equity ratio58.7%
    Year on year against the same period last yearUp from 55.0% in FY3/25
  • DER0.3 times
    Year on year against the same period last yearDown from 0.4x in FY3/25
Segment results
Firearms
Net Sales
¥8,965 million
Year-on-year change in revenue+13.4%
Operating profit
¥1,255 million
Year-on-year operating profit growth+37.8%
Special-purpose vehicles
Net Sales
¥2,922 million
Year-on-year change in revenue-12.2%
Operating profit
¥37 million
Year-on-year operating profit growth-71.3%
Building materials
Net Sales
¥3,232 million
Year-on-year change in revenue+7.2%
Operating profit
¥276 million
Year-on-year operating profit growth+607.7%
Machine-tools business
Net Sales
¥5,421 million
Year-on-year change in revenue-22.1%
Operating profit
¥-1,017 million
Year-on-year operating profit growthWidening losses
Real Estate
Net Sales
¥508 million
Year-on-year change in revenue+2.8%
Operating profit
¥411 million
Year-on-year operating profit growth+3.8%
Other
Net Sales
¥3,014 million
Year-on-year change in revenue-3.5%
Operating profit
¥223 million
Year-on-year operating profit growth-3.9%
Medium-term management plan targets
Period CoveredFiscal years ending March 2026 to March 2028
Firearms
Revenue for the fiscal year ending March 2028¥8,200 million
Operating profit for the fiscal year ending March 2028¥700 million
Special-purpose vehicles
Revenue for the fiscal year ending March 2028¥3,500 million
Operating profit for the fiscal year ending March 2028¥360 million
Building materials
Revenue for the fiscal year ending March 2028¥3,300 million
Operating profit for the fiscal year ending March 2028¥210 million
Machine-tools business
Revenue for the fiscal year ending March 2028¥6,400 million
Operating profit for the fiscal year ending March 2028¥360 million
Orders received and order backlog
Order backlog at period-end
¥22,454 million
Contents of this document
ItemDetails
Document typeFinancial results presentation
Fiscal Period CoveredFiscal year ending March 2026
Net Sales¥24,064 million (YoY -3.1%)
Operating profit¥1,186 million (YoY -5.3%)
Ordinary income¥1,382 million (YoY -2.2%)
Net income¥741 million (YoY -1.1%)
Gross Profit Margin17.6%
Operating profit margin4.9%
Full-year earnings forecastNet Sales ¥23,560 million / Gross profit ¥4,698 million / Operating profit ¥1,410 million / Ordinary income ¥1,580 million / Net income for the current fiscal year ¥1,080 million / ROE 5.0% / ROIC 3.5%
Self-assessment against the planProfit margin below the earnings forecast (Special-Purpose Vehicles business)
Segment resultsFirearms Net Sales ¥8,965 million / Year-on-year change in revenue +13.4% / Operating profit ¥1,255 million / Year-on-year operating profit growth +37.8% / Special-purpose vehicles Net Sales ¥2,922 million / Year-on-year change in revenue -12.2% / Operating profit ¥37 million / Year-on-year operating profit growth -71.3% / Building materials Net Sales ¥3,232 million / Year-on-year change in revenue +7.2% / Operating profit ¥276 million / Year-on-year operating profit growth +607.7% / Machine-tools business Net Sales ¥5,421 million / Year-on-year change in revenue -22.1% / Operating profit ¥-1,017 million / Year-on-year operating profit growth Widening losses / Real Estate Net Sales ¥508 million / Year-on-year change in revenue +2.8% / Operating profit ¥411 million / Year-on-year operating profit growth +3.8% / Other Net Sales ¥3,014 million / Year-on-year change in revenue -3.5% / Operating profit ¥223 million / Year-on-year operating profit growth -3.9%
Key KPIsIndicator name Number of Type 20 rifles delivered / Value 12,000 Rifles / Year on year against the same period last year 4x the initial-year figure of 3,000 rifles, Indicator name Type 20 rifle sales target / Value 13,000 Rifles / Year on year against the same period last year Not disclosed, Indicator name Overseas Revenue Mix / Value 13.1% / Year on year against the same period last year Down from 20.8% in FY3/25, Indicator name Order backlog at period-end / Value ¥22,454 million / Year on year against the same period last year Down from ¥24,776 million in FY3/25, Indicator name Equity ratio / Value 58.7% / Year on year against the same period last year Up from 55.0% in FY3/25, Indicator name DER / Value 0.3 times / Year on year against the same period last year Down from 0.4x in FY3/25
Assumptions Underlying the Business OutlookThe number of Type 20 rifles delivered is expected to increase, Surging prices for raw materials such as aluminum, Continued weakness in demand for machine tools
Medium-term management plan targetsPeriod Covered Fiscal years ending March 2026 to March 2028 / Firearms Revenue for the fiscal year ending March 2028 ¥8,200 million / Operating profit for the fiscal year ending March 2028 ¥700 million / Special-purpose vehicles Revenue for the fiscal year ending March 2028 ¥3,500 million / Operating profit for the fiscal year ending March 2028 ¥360 million / Building materials Revenue for the fiscal year ending March 2028 ¥3,300 million / Operating profit for the fiscal year ending March 2028 ¥210 million / Machine-tools business Revenue for the fiscal year ending March 2028 ¥6,400 million / Operating profit for the fiscal year ending March 2028 ¥360 million
Orders received and order backlogOrder backlog at period-end ¥22,454 million
New initiativesDissolution and liquidation of the Chinese subsidiary, Narrowing the Machine Tools-Related product lineup, standardization and model consolidation, and a review of the production structure, Joint acquisition with EIWA CORPORATION of all shares in マシンサービス株式会社 for the road-sweeper reuse business, Launch of an autonomous-driving EV robot sweeper and a medium-sized EV town sweeper, Launch of sales of submersible waterproof doors, Launch of a new sports rifle model, Launch of the large-bore hollow power chuck H3KBA
Items this document does not state (15)
Selling, general and administrative expensesResults for the three months of the current quarterProgress against full-year forecastBreakdown of Factors Affecting the ChangeUnit price and quantity metricsNumber of stores and locationsNumber of employeesRisk amount incorporated into the outlookFinancial targetsAnnual DividendPayout ratioAcquisition of treasury sharesCapital expendituresMarket Size / ShareKey points of the Q&A

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

The Firearms business recorded higher sales from increased shipments of defense equipment, including Type 20 rifles, and revenue from specific initiative contracts. Meanwhile, the Machine Tools-Related business recorded lower sales of machine tools and air-hydraulic equipment, deteriorating profitability, and expenses including inventory valuation losses on inventories for China.

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Financial Results Briefing Materials | Howa Machinery,Ltd. (6203) timely disclosure | Komori