【RORZE raises full-year forecast and increases dividend】 “Semiconductor-related equipment” accounts for 98% of sales growth. Can the surge in orders support the plan? Exploring the key factors for the second half (Money Post WEB)

RORZE, a manufacturer of automation and material-handling equipment, raised its full-year earnings forecast on 8 October, forecasting ordinary profit of ¥54.889 billion and revenue of ¥180.007 billion. It also raised its year-end dividend forecast from ¥20 to ¥28. The main reason for the upward revision was a sharp increase in orders for semiconductor-related equipment, which has been incorporated into the second-half earnings plan. In the previous interim period, revenue was ¥79.733 billion and operating profit was ¥23.096 billion.

Approximately 98% of the increase in the revenue forecast came from semiconductor-related equipment, for which the revenue forecast was revised upward to ¥152.970 billion. By contrast, forecasts for FPD-related equipment and analytical equipment were reduced by approximately ¥3.475 billion. The company explained in its earnings presentation materials that demand for semiconductor equipment is strong, with capital investment expanding for advanced memory and advanced logic. The second-half operating profit forecast is ¥29.981 billion, and achievement of the full-year plan is viewed as dependent on the timing of second-half revenue recognition.

Second-half orders are expected to support performance. Orders for semiconductor-related equipment from June to August increased to ¥78.509 billion, 3.2 times the level in the same period of the previous year. The order backlog at the end of August reached a record ¥103.863 billion, while the second-half revenue forecast is ¥85.832 billion. Customer concentration is also increasing: Applied Materials accounts for 21.7% of revenue and TSMC for 14.6%, for a combined 36.3%.

However, delays in acceptance inspections after delivery of analytical equipment have raised the possibility that revenue recognition from orders may be pushed back. Orders are growing, particularly from North American memory manufacturers, with more orders for wafer-sorting and storage equipment. The rising level of customer dependence by region is also cited as a point to watch.