KOA (6999) raised its operating profit forecast for the year ending March 2027 to ¥8.31bn from ¥5.36bn, an increase of 55.0%. The revision followed first-half operating profit of ¥3.74bn, against the ¥2.54bn the company had forecast on 23 July.
What management says drove it
KOA's forecast revision notice says first-half sales beat the prior forecast mainly on growth in AI-related equipment, centred on China. Sales reached ¥43.63bn, up 26.0% from a year earlier. On profit, the notice cites higher sales and differences in closing adjustments.
For the rest of the year, KOA says it expects demand from automotive, industrial equipment and AI-related equipment customers to stay firm. It assumes an average rate of ¥159 to the dollar from the third quarter, unchanged from its previous forecast.
| Measure | Previous forecast | Revised forecast | Change |
|---|---|---|---|
| Sales | ¥87.3bn | ¥91.5bn | +¥4.2bn (+4.8%) |
| Operating profit | ¥5.36bn | ¥8.31bn | +¥2.95bn (+55.0%) |
| Ordinary profit | ¥6.04bn | ¥8.56bn | +¥2.52bn (+41.7%) |
| Net profit | ¥7.74bn | ¥9.66bn | +¥1.92bn (+24.8%) |
The earnings supplement puts the implied second-half operating profit at ¥4.57bn on sales of ¥47.87bn, against ¥3.74bn on ¥43.63bn in the first half. It assumes raw-material cost pressure stays at second-quarter levels.
Orders, costs and the yen
Second-quarter orders were ¥28.6bn, with the biggest increases from Chinese automotive and AI-related equipment customers and Japanese industrial equipment. KOA says part of those orders were placed early by customers to secure supply, which may matter when reading them as a measure of underlying demand.
Costs are not absent. Higher raw-material prices, which the supplement links to precious metals, added ¥2.82bn to first-half material costs, including the effect of higher volumes. The company says a stronger sales line and a weaker yen, at ¥160 to the dollar against ¥146 a year earlier, more than covered that.
Net profit carries a one-off
The revised net profit forecast of ¥9.66bn includes ¥3.098bn in relocation compensation tied to a factory move at a Chinese subsidiary. KOA says this gain was already in its earlier forecast and is not a reason for the revision. Interim net profit was ¥5.82bn.
Dividend
KOA raised its year-end dividend forecast to ¥46.50 a share from ¥31.50. With the ¥31.50 interim dividend, the annual dividend is forecast at ¥78, up from a previous forecast of ¥63 and against ¥32 for the year to March 2026.
The company says its policy sets an annual dividend floor of ¥30 a share and a consolidated payout ratio of around 30%.
Caveats
KOA states that the forecasts rest on information available now and that actual results may differ. Its interim results summary is not subject to auditor review. The company plans a briefing for institutional investors and analysts on 26 October.