Furukawa Electric raised its interim profit forecast. The revenue forecast was left unchanged at ¥720 billion, while improved product mix and thorough cost control are said to have boosted profit in the short term.
Furukawa Electric is reported to have raised its interim profit outlook. The article summarizes the factors behind the upward revision to profit attributable to owners of the parent, while leaving the revenue outlook unchanged at ¥720 billion, as including, in addition to higher sales volumes, improved product mix and tighter cost management in the short term.
It points out that execution quality and cash generation will drive profit fluctuations in the short term. It also notes that, although ROE is high, the share price is highly volatile, and assesses that operating cash flow alone is not sufficient to cover the company’s debt.
The article reports that the body of the report does not address the company’s views on the continued conversion of profits into cash in its infrastructure investment-intensive businesses, including future funding needs and the handling of large one-off items.
It introduces a range of fair value estimates for the company, including assessments indicating up to 60% upside from the current share price.