Ichikoh Industries : Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending December 31, 2024

Published November 13, 2024 at 8:01 a.m. UTC

Source: MarketScreener

Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.

Consolidated Financial Results

for the Nine Months Ended September 30, 2024

[Japanese GAAP]

November 13, 2024

Company name: ICHIKOH INDUSTRIES, LTD.

Listing: Tokyo

Securities code: 7244

URL: http://www.ichikoh.com/

Representative: Christophe Vilatte

President, CEO, Representative director

Inquiries: Tomonori Hisano

GM of Corporate Planning Department

Telephone: +81-463-96-1442

Scheduled date to commence dividend payments: -

Preparation of supplementary material on financial results: None

Holding of financial results briefing: None

(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated Financial Results for the Nine Months Ended September 30, 2024 (January 1, 2024 to September 30, 2024)

(1) Consolidated Operating Results

(Percentages indicate year-on-year changes.)

Net sales

Operating profit

Ordinary profit

Profit attributable to

owners of parent

Nine months ended

Millions of yen

September 30, 2024

92,068

(16.5)

2,165

(56.4)

3,364

(35.2)

2,538

(53.7)

September 30, 2023

110,239

12.0

4,965

95.3

5,187

59.2

5,479

147.4

(Note) Comprehensive income:

Nine months ended September 30, 2024:

3,917 million

[

(48.2) %]

Nine months ended September 30, 2023:

7,557 million

[

61.5%]

Basic earnings

Diluted earnings per

per share

Nine months ended

Yen

September 30, 2024

26.40

September 30, 2023

56.99

(2) Consolidated Financial Position

Total assets

Net assets

Capital adequacy ratio

As of

Millions of yen

September 30, 2024

121,747

67,508

54.7

December 31, 2023

129,417

64,730

49.5

(Reference) Equity: As of

September 30, 2024:

66,619 million

As of

December 31, 2023:

64,038 million

2. Dividends

				Annual dividends

	1st	2nd		3rd	Year-end	Total
	quarter-end	quarter-end	quarter-end

	Yen		Yen	Yen	Yen	Yen
Fiscal year ended December 31, 2023	-		5.50	-	5.50		11.00
Fiscal year ending December 31, 2024	-		6.50	-

Fiscal year ending December 31, 2024					6.50		13.00
(Forecast)

(Note) Revision to the forecast for dividends announced most recently:	None

3. Consolidated Financial Results Forecast for the Fiscal Year Ending December 31, 2024(January 1, 2024 to December 31, 2024) (Percentages indicate year-on-year changes.)

		Net sales	Operating profit	Ordinary profit	Profit attributable to	Basic earnings
		owners of parent	per share

		Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Full year		122,000	(16.4)	3,600	(51.5)	5,100	(37.3)	3,800	(51.5)	39.51
(Note) Revision to the financial results forecast announced most recently:	Yes
* Notes:
(1) Significant changes in the scope of consolidation during the period:	Yes
Newly included:	-	(Company name:							)
Excluded:	1	(Company name: PIAA Corporation					)

Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: Yes
Changes in accounting policies, changes in accounting estimates, and restatement
1. Changes in accounting policies due to revisions to accounting standards and other regulations: None
2. Changes in accounting policies due to other reasons: None
3. Changes in accounting estimates: None
4. Restatement: None
Number of issued shares (common shares)
1. Total number of issued shares at the end of the period (including treasury shares):

September 30, 2024:	96,363,161	shares
December 31, 2023:	96,334,226	shares
2) Number of treasury shares at the end of the period:
September 30, 2024:	181,390	shares
December 31, 2023:	180,942	shares

3) Average number of shares outstanding during the period:
Nine months ended September 30, 2024:	96,167,539	shares
Nine months ended September 30, 2023:	96,137,656	shares

Review of the Japanese-language originals of the attached consolidated quarterly financial statements by certified public accountants or an audit firm: None
Proper use of earnings forecasts, and other special matters
As for the future statements of performance forecast, etc. contained in this material, the statements are based on the information

currently available to the company and certain information that the company deems reasonable. Please note that actual results may differ due to various factors

1. Qualitative Information on Quarterly Results

(1) Analysis of operating results

The Japanese economy of the consolidated cumulative period of the third quarter of this fiscal year maintained a mild trend toward recovery along with the domestic demand by wage increase and capital investment but overseas demand kept gradual slowdown due to the economic slowdown in China. The U.S. economy continued to be firm driven by the personal consumption caused by the growth in employment and slowed inflation. The economy in ASEAN was strong in general due to investment in infrastructure and personal consumption in Indonesia, overseas demand in Thailand and personal consumption in Malaysia caused by improvement in the employment and income environment.

Under this relatively stable economic environment, car production volume in this cumulative period of the third quarter decreased year- on-year in Japan due to the effect of the shutdown of some car manufacturers. Car production volume in Malaysia increased year-on- year, but it decreased in Indonesia due to the decrease in car sales affected by high interest rate of automotive loans and it also decreased in Thailand because of stagnant car sales, and the total car production volume of three countries in ASEAN decreased year-on-year.

As a result, for this cumulative period of the third quarter, the decrease ratio of our sales was smaller than that of the ASEAN market, but it was larger comparing our mainstay Japan because of suspensions of production and shipments of some vehicles to which we supply the products and of decrease in sales of tooling, and sales largely decreased to 92,068 million yen (down 16.5% year-on-year).

Profits decreased due to the impact of decreased sales though there were positive aspects such as the promotion of price pass-through and improvement of non-quality ratio and productivity, and operating income was 2,165 million yen (down 56.4% year-on-year) and ordinary income was 3,364 million yen (down 35.2% year-on-year). Net income attributable to shareholders of the parent company was 2,538 million yen (down53.7% year-on-year) despite recording a gain of 881 million yen on the sale of shares of the affiliate which was the transfer of PIAA shares.

Results by each segment are as follows:

1. Auto-Components business

The decrease ratio of our sales was smaller than that of the ASEAN market, but it was larger comparing our mainstay Japan because of suspensions of production and shipments of some vehicles to which we supply the products and of decrease in sales of tooling, and sales was 87,869 million yen (down 15.9% year-on-year).

2. After-Market business

We recorded the results of our subsidiary PIAA in the After-market business up to June because of the share transfer of PIAA at the end of August. As a result, sales decreased to 5,002 million yen (down 29.1% compared with Q3 last year), but as for profits, operating increased to 206 million yen (up 4.7% compared with Q3 last year) due to the effect of price increases reflecting inflation.

(3) Description of future outlooks such as consolidated earnings forecast

Regarding our earnings forecast, sales will be roughly in line with the forecast, offsetting the decrease in domestic sales by the increase in overseas sales. However, overseas sales are decreasing on a local currency basis and actual sales after deducting the impact of the weak yen are decreasing. As for profits, there were positive aspects such as improvements in the non-quality rate and productivity, but due to a decrease in actual sales and a greater-than-expected increase in raw material costs such as inflation and soaring prices of imported materials, we have revised our full-year forecast downward as below.

Year-end dividend forecast has not been changed.

				Net Income
	Net Sales	Operating	Ordinary	Attributable to	Net Income per
	Income	Income	Shareholders of the	Share

				Parent Company
Previous Forecast 䠝	122,000	4,700	5,700	4,300	44.71 yen

Revised Forecast 䠞	122,000	3,600	5,100	3,800	39.51 yen

Difference 䠞䠉䠝	0	(1,100)	(600)	(500)
Ratio 䠂	0.0	(23.4)	(10.5)	(11.6)
(Ref) Results of Previous
full of the Term ending	145,897	7,422	8,130	7,838	81.53 yen
December 2023

As for the future statements of performance forecast, etc. contained in this material, the statements are based on the information currently available to the company and certain information that the company deems reasonable. Please note that actual results may differ due to various factors

Quarterly Consolidated Financial Statements

Quarterly Consolidated Balance Sheets

					(Millions of yen)
				As of December 31, 2023	As of September 30, 2024

Assets
	Current assets

		Cash and deposits		8,937	9,898
		Notes and accounts receivable - trade		24,401	20,643

		Electronically recorded monetary claims -		379	20
		operating

		Merchandise and finished goods	4,172	2,558

		Work in process		782	1,835
		Raw materials and supplies		4,427	4,234

		Short-term loans receivable		21,648	19,201
		Other	2,671	2,485

		Allowance for doubtful accounts		(82)	(71)
		Total current assets		67,337	60,805

	Non-current assets
		Property, plant and equipment

		Buildings and structures, net		10,803	10,062
		Machinery, equipment and vehicles, net	17,337	16,822

		Tools, furniture and fixtures, net		2,271	2,152
		Land	2,302	1,768

		Leased assets, net		3,383	3,388
		Construction in progress		3,602	3,362

		Total property, plant and equipment		39,701	37,558
		Intangible assets

		Other		123	44
		Total intangible assets		123	44

		Investments and other assets
		Investment securities		2,958	3,267

		Long-term loans receivable		737	754
		Deferred tax assets		4,804	4,472

		Other		13,757	14,846
		Allowance for doubtful accounts	(2)	(2)

		Total investments and other assets		22,255	23,338
		Total non-current assets		62,079	60,941

	Total assets		129,417	121,747

							(Millions of yen)
						As of December 31, 2023	As of September 30, 2024

Liabilities
	Current liabilities

		Notes and accounts payable - trade			15,724	13,713
		Electronically recorded obligations - operating			16,956	13,722

		Short-term borrowings			1,150	-
		Current portion of long-term borrowings	920	-

		Lease liabilities			640	683
		Income taxes payable			1,376	407

		Accrued expenses			5,480	5,514
		Provision for bonuses	910	1,545

		Provision for bonuses for directors (and other			25	33
		officers)

		Provision for product warranties			1,764	1,729

		Other			8,961	6,624
		Total current liabilities		53,910	43,975

	Non-current liabilities
		Lease liabilities			3,257	3,144

		Retirement benefit liability			7,296	6,970
		Asset retirement obligations	26	26

		Other			195	122
		Total non-current liabilities		10,775	10,263

	Total liabilities		64,686	54,238
Net assets

	Shareholders' equity
		Share capital	8,996	9,003

		Capital surplus			2,515	2,523
		Retained earnings			51,536	52,921

		Treasury shares			(55)	(56)
		Total shareholders' equity		62,993	64,392

	Accumulated other comprehensive income
		Valuation difference on available-for-sale			89	-
		securities

		Foreign currency translation adjustment			2,014	3,098
		Remeasurements of defined benefit plans			(1,058)	(871)

		Total accumulated other comprehensive income			1,044	2,227
	Non-controlling interests		692	888

	Total net assets		64,730	67,508
Total liabilities and net assets		129,417	121,747

Quarterly Consolidated Statements of Income and Comprehensive Income

Quarterly Consolidated Statements of Income (For the nine months)

				(Millions of yen)
			For the nine months	For the nine months
			ended September 30, 2023	ended September 30, 2024

Net sales		110,239	92,068
Cost of sales	90,005	76,487

Gross profit		20,233	15,580
Selling, general and administrative expenses		15,268	13,415

Operating profit		4,965	2,165
Non-operating income

	Interest income		121	133
	Dividend income	5	6

	Share of profit of entities accounted for using equity		575	1,332
	method

	Other		11	34

	Total non-operating income		714	1,507
Non-operating expenses

	Interest expenses		80	95
	Commission expenses		5	5

	Foreign exchange losses		362	207
	Other		44	0

	Total non-operating expenses		492	308
Ordinary profit		5,187	3,364

Extraordinary income
	Gain on disposal of non-current assets		3,971	-

	Gain on sale of shares of subsidiaries and associates		-	889
	Total extraordinary income		3,971	889

Extraordinary losses
	Loss on disposal of non-current assets		583	62

	Business restructuring expenses		300	179
	Impairment losses	40	-

	Loss on sale of shares of subsidiaries and associates		1,237	-
	Total extraordinary losses		2,162	242

Profit before income taxes		6,996	4,010
Income taxes		1,461	1,359

Profit		5,535	2,650
Profit attributable to non-controlling interests		56	112

Profit attributable to owners of parent		5,479	2,538

Quarterly Consolidated Statements of Comprehensive Income (For the nine months)

				(Millions of yen)
			For the nine months	For the nine months
			ended September 30, 2023	ended September 30, 2024

Profit		5,535	2,650
Other comprehensive income

	Valuation difference on available-for-sale securities		18	(89)
	Foreign currency translation adjustment		835	852

	Remeasurements of defined benefit plans, net of tax		111	187
	Share of other comprehensive income of entities		1,056	315
	accounted for using equity method

	Total other comprehensive income		2,022	1,266
Comprehensive income		7,557	3,917

Comprehensive income attributable to
	Comprehensive income attributable to owners of		7,462	3,721
	parent

	Comprehensive income attributable to non-controlling		95	196
	interests

(3)Note on assumptions for going concern There is no item to be reported.

(4) Segment Information

Ⅰ. Previous Third Quarter January 1, 2023 to September 30, 2023 1. Sales and profits or losses for each reportable segment

		(Millions of yen)

		Segments
			Total
	Automotive
	Automotive Aftermarket
	Parts

Net sales
Domestic	74,344	5,202	79,546
Oversea	30,100	592	30,692

Revenue from contracts with customers	104,444	5,794	110,239

Other income	-	-	-

Sales to Outside Customers	104,444	5,794	110,239
Intersegment Sales or Transfers	18	1,257	1,275

TOTAL	104,463	7,051	111,515

Segment income	4,767	197	4,964

2. Total amount for profit and loss in reportable segment and

Details of adjustment in the quarterly consolidated statement (Adjustment amounts and items

			(Millions of yen)

	Profit		Amount

	Total amount for Segment		4,964
	Elimination for intersegment		0

	Operating income in quarterly consolidated statement	4,965

Ⅱ. Current Third Quarter January 1, 2024 to September 30, 2024
1. Sales and profits or losses for each reportable segment
			(Millions of yen)

			Segments
				Total
		Automotive
		Automotive Aftermarket
		Parts

	Net sales
	Domestic	60,229	3,892	64,122
	Oversea	27,640	305	27,945

	Revenue from contracts with customers	87,869	4,198	92,068

	Other income	-	-	-

	Sales to Outside Customers	87,869	4,198	92,068
	Intersegment Sales or Transfers	0	803	803

	TOTAL	87,869	5,002	92,871

	Segment income	1,970	206	2,176

2. Total amount for profit and loss in reportable segment and

Details of adjustment in the quarterly consolidated statement (Adjustment amounts and items

	(Millions of yen)

Profit	Amount

Total amount for Segment	2,176
Elimination for intersegment	(11)

Operating income in quarterly consolidated statement	2,165