NPC Incorporated, a Tokyo-listed maker of solar-cell production equipment, has set a numeric test for its reliance on one customer. Its board approved a five-year plan on 7 October that targets at least 60% of sales from outside First Solar, against a projected 70% to 75%.
Why now
The plan covers the fiscal years ending August 2027 to August 2031. NPC says its business environment has improved enough to forecast the medium term. It says volatile results have weighed on its cost of capital and made investment and shareholder returns hard to commit to.
The numbers
Other targets are a gross margin held at about 30% (projected average 29.6%) and average annual sales growth of 10% or more (projected 12.0%). Projected sales rise from ¥9.9bn in the year to August 2027 to ¥15.6bn in the year to August 2031. Operating profit is projected to climb from ¥1.4bn to ¥3.3bn, which NPC calls a record in year five.
NPC expects about ¥7.3bn of operating cash flow over the five years. It plans about ¥4bn of investment, about ¥2bn of shareholder returns and a cash buffer of about ¥4.9bn. Spending includes possible acquisitions of automatic-machine makers and metal-working firms. The dividend policy is a 25% payout ratio with a floor of about 2% on dividend on equity (DOE).
What is won and what is hoped for
Orders already won are modest. NPC cites about ¥350mn for inkjet coating equipment from its capital partner Gosan Tech, and a repeat order in the year to August 2026 for satellite solar-cell equipment from a domestic customer.
The larger figures are projections. Panel recycling equipment is projected at ¥9.7bn of sales over five years, against ¥34.3bn for solar-cell manufacturing equipment. The plan ties recycling demand to a legal framework it expects to take effect by the end of 2027. It assumes parts sales to First Solar stay flat.