Nichirin, the Hyogo-based maker of automotive rubber hoses (TSE: 5184), grew first-half revenue 18.3% to ¥42.3bn for the six months to June 2026, but its North America segment swung to an operating loss as additional US tariffs bit into margins.
The company's own profit bridge shows why growth at the top line did not fully reach the bottom line. Consolidated operating profit rose 5.9% to ¥5.2bn, with a ¥1.8bn lift from higher sales volume and ¥800mn combined from currency effects and price increases. Those gains were mostly offset by a ¥1.6bn increase in fixed costs and, separately, a ¥400mn increase from US additional tariffs in the bridge. The North America segment itself, where sales rose 42.9% to ¥9.9bn, posted an operating loss of ¥250mn, which the company attributes to additional tariffs among other factors, reversing a ¥547mn profit in the same period last year.
| Metric | H1 2025 (¥bn) | H1 2026 (¥bn) | YoY change |
|---|---|---|---|
| Revenue | 35.7 | 42.3 | +18.3% |
| Operating profit | 4.9 | 5.2 | +5.9% |
| Ordinary profit | 4.3 | 5.5 | +27.4% |
| Net profit | 3.0 | 2.9 | -4.1% |
Ordinary profit, which includes non-operating items, rose a stronger 27.4% to ¥5.5bn, but net profit attributable to shareholders fell 4.1% to ¥2.9bn, the one line in the results that moved backward.
Management kept its full-year forecast unchanged at ¥78bn revenue, ¥9.3bn operating profit and ¥5.6bn net profit, even after raising its second-half dollar assumption to ¥160 from ¥150 at the start of the year. The company said there is room for the results to beat plan, but it is holding the guidance flat given continuing uncertainty around the North America business, additional tariffs, raw material prices and the aftermath of the Reiwa 8 Kumamoto earthquake. Half a year into the fiscal year, the company has already booked 54.2% of its full-year revenue plan and 56.0% of its operating-profit plan.
On shareholder returns, Nichirin confirmed a ¥190-per-share annual dividend (¥95 interim, ¥95 year-end), targeting a 45% payout ratio with a dividend-on-equity floor of 2.5%, plus a buyback of up to ¥1.5bn with all repurchased shares slated for cancellation. Under its 2026-2028 capital plan, the company intends to allocate ¥35bn in total, split among ¥20.5bn for strategic investment, ¥13bn for shareholder returns and ¥1.5bn for other investment, with ¥5.6bn, or 15.9%, of that plan executed in the first half. Its price-to-book ratio stood at 0.85 times against a 1.00-times target embedded in the same plan, with the stock closing the period at ¥4,050.
The tariff-driven North America swing is a company-specific data point, not a sector-wide benchmark: Nichirin's guidance implies management believes the pressure is manageable within its current full-year numbers, provided the dollar does not weaken further than the revised ¥160 assumption.