Nippon Tungsten increased current-period ordinary profit to ¥1.86 billion, 4.2x the prior-year period, and raised its full-year forecast 2.4x, from the previous ¥1.01 billion to ¥2.45 billion. In addition, the annual dividend, including the previous ¥70 dividend, is expected to be substantially increased to ¥140.
Nippon Tungsten announced its earnings summary, reporting that cumulative second-quarter consolidated ordinary profit for the current period rose sharply to ¥1.86 billion, 4.2x the prior-year period. The results indicate substantial improvement in each profit measure alongside higher sales.
The full-year ordinary profit forecast was raised from the previous ¥1.01 billion to ¥2.45 billion, implying the first record-high profit in 5 periods. At the same time, the company stated that profitability could decline in the second half amid persistently high raw material prices and procurement difficulties.
The year-end dividend was raised substantially above the previous plan of ¥90 to ¥140, and the annual dividend is expected to be ¥140. The company has announced a policy of strengthening shareholder returns, but also stated that dividend revisions will be affected by changes in market conditions and other factors.
Ordinary profit for the latest July-September quarter rose to ¥1.07 billion, 6.2x the prior-year period, while the operating margin improved sharply from 3.2% to 28.9% in line with improvements in sales and the cost of sales. The expansion of semiconductor-related demand may also have supported performance.
Regarding the outlook, demand for the semiconductor-related and automotive markets is expected to remain firm, while the impact of higher raw material costs associated with tighter Chinese export controls is expected to continue. The company indicated that rising cost ratios could affect profitability.