Kaga Electronics Co., Ltd. TSE:8154
Kaga Electronics : Financial Results Briefing Material FY2026/3 H1 (with notes)
Source: MarketScreener
FY2026/March H1 (April-September) Financial Results Briefing Material
KAGA ELECTRONICS CO., LTD.
TSE Prime Market 8154 November 27, 2025
2023 - 2025
2021 - 2025
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FY2026/3 H1 Summary/Financial Highlights/Results by Segment・Company Balance Sheet/Cash flows Forecasts for FY2026/3 Shareholder Returns | |||
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Key Message for FY2026 H1 Results EMS Business - Construction of Third Factory in Thailand Production Equipment Developed In-House Progress of Making Kyoei Sangyo a Consolidated Subsidiary Kyoei Sangyoʼs Strengths and Uniqueness | |||
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Summary of Financial Results for FY2026/3 H1 | |||
(billion yen) Net Sales Operating income Net income H1 Results 288.9 13.0 15.0 YoY +29.9 +1.5 +7.0 Results for ⚫ All items, from net sales to net income, increased year on year. The upward momentum continues. FY2026/3 H1 ⚫ Net sales : Electronic components (EMS business), information equipment (PC and software product sales), and others (amusement equipment sales) business all maintained （April - September） robust performance, contributing to a year-on-year increase in net sales. In addition, Kyoei Sangyo was consolidated from Q2 (Jul.-Sep.).
Shareholder and year-end dividend of 60 yen each (a 10 yen increase from the previous fiscal year) Return *A two-for-one stock split was executed in October 2024. Up 10 yen from the previous fiscal year is calculated after adjustment for the stock split. 2 | |||
I am Ishihara of Kaga Electronics.
Thank you very much for your continued support and thank you for watching our financial results briefing today.
I would like to present an overview of our financial results for the first half of the fiscal year ending March 31, 2026.
These are the results for the first half of the fiscal year ending March 31, 2026.
Net sales increased by 29.9 billion yen year on year to 288.9 billion yen. Sales increased for the electronic components business, primarily in the EMS business, thanks to indications of a recovery after the inventory adjustments carried out by major customers. Information equipment also continued to perform strongly, mainly thanks to PC and security software product sales, as did others, such as sales of amusement equipment to the U.S.
Kyoei Sangyo Co., Ltd. Also joined the Group in the second quarter, contributing to the increase in revenue.
Operating income increased by 1.5 billion yen year on year to 13.0 billion yen.
The gross profit margin improved by 0.5 percentage points to 13.7% thanks to a better sales mix, in addition to the increase in sales. This
resulted in a year-on-year increase in gross profit of 5.4 billion yen. This increase in gross profit more than compensated for factors such as an increase in variable expenses due to the increase in sales, as well as an increase in SG&A expenses due to the consolidation of Kyoei Sangyo, leading to a year-on-year increase in operating income. The operating income margin also improved by 0.1 percentage point year on year.
Ordinary income increased by 2.1 billion yen from the previous year to
13.4 billion yen thanks to an improvement in non-operating income and expenses resulting from factors such as a decrease in foreign exchange losses. Profit attributable to owners of parent increased by 7.0 billion yen year on year to 15.0 billion yen, partly thanks to the recording of a gain on bargain purchase associated with the corporate acquisition and a gain on sale of investment securities. As in the first quarter, we achieved an increase across all revenue and income items, from net sales and gross profit to profit attributable to owners of parent. Even excluding the boost in performance from the acquisition of Kyoei Sangyo and the gain on bargain purchase, we still ended the period with year-on-year increases in both net sales and income.
Next, I will explain the full year earnings forecast for the fiscal year ending March 31, 2026.
On August 7, 2025, with the inclusion of Kyoei Sangyo in the Group, we announced an upward revision to our earnings forecast, reflecting the outlook for Kyoei Sangyo from the second quarter onward, as well as the gain on bargain purchase associated with this corporate acquisition.
This was the second upward revision in the earnings forecast this fiscal year, reflecting the strong earnings progress during the first half. We expect net sales and operating income to be 21.0 billion yen and 1.5 billion yen, respectively, higher than the previous forecast.
After this revision, we forecast a full-year increase in both net sales and income, with net sales of 595.0 billion yen, up 47.2 billion yen year on year, operating income of 25.5 billion yen, up 1.8 billion yen year on year, and net income of 26.0 billion yen, up 8.9 billion yen year on year.
I will now explain our shareholder returns.
On August 7 of this year, we revised our dividend forecast for the fiscal year ending March 31, 2026, upward from 110 yen to 120 yen per share, reflecting the upward revision in our earnings forecast.
As of the first half of the fiscal year, we have left our annual dividend forecast unchanged at 120 yen per share.
Financial Highlights for FY2026/3 H1 | ||
H1 Results Forecasts （April - September） （Announced on August 7, 2025） Note: 1. The effect of exchange rates on the conversion into yen is approximately -4,606 million yen on net sales and -102 million yen on operating income. 2. The Company conducted a two-for-one stock split of its common stock effective October 1, 2024. EPS for the previous fiscal year is calculated on the assumption that the stock split was conducted at the beginning of the previous fiscal year. 3 | ||
（million yen） | FY2025/3 | Composition Ratio | FY2026/3 | Composition Ratio | YoY 11.5% | FY2026/3 Composition Progress rate Ratio 574,000 100.0% 50.3% | |||
Net Sales | 259,064 | 100.0% | 288,959 | 100.0% | |||||
Gross Profit | 34,133 | 13.2% | 39,544 | 13.7% | 15.9% | ー | ー | ー | |
SG&A | 22,631 | 8.7% | 26,495 | 9.2% | 17.1% | ー | ー | ー | |
Operating income | 11,501 | 4.4% | 13,049 | 4.5% | 13.5% | 24,000 | 4.2% | 54.4% | |
Ordinary income | 11,278 | 4.4% | 13,443 | 4.7% | 19.2% | 23,800 | 4.1% | 56.5% | |
Profit attibutable to owners of parent | 7,941 | 3.1% | 15,033 | 5.2% | 89.3% | 24,200 | 4.2% | 62.1% | |
EPS（yen） | 151.15 | ー | 293.86 | ー | 94.4% | 488.45 | ー | ー | |
Exchange rate | yen / US$ | 152.63 | ー | 146.04 | ー | ー | 140.00 | ー | ー |
The financial highlights on the next page are as I have just explained. Earnings per share (EPS) for the first half of this fiscal year amounted to
293.86 yen, an increase of 94.4% year-on-year.
The average exchange rate during the first half was 146.04 yen against the U.S. dollar, which represents an appreciation of 6.59 yen per dollar from the previous yearʼs level of 152.63 yen.
However, the yen currently remains weaker than the assumed exchange rate of 140 yen in the full year earnings forecast.
The year-on-year impact of exchange rate fluctuations was a decrease in net sales of approximately 4.6 billion yen and a decrease in operating income of approximately 0.1 billion yen. We achieved an increase in net sales and income despite these negative factors.
Results for FY2026/3 H1 by Business Segment | ||||||
H1 Results Forecasts （April - September） （Announced on August 7, 2025） FY2026/3 profit Progress rate margin 501,000 49.5% 17,500 3.5% 51.2% 45,000 47.9% 3,500 7.8% 46.2% 3,000 56.0% 500 16.7% 33.1% 25,000 71.7% 2,500 10.0% 84.9% 574,000 50.3% 24,000 4.2% 54.4% Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment adjusted (operating income). 4 | ||||||
（million yen） | FY2025/3 | profit margin | FY2026/3 | profit margin | YoY | ||
Electronic Component | Net sales | 225,866 | 247,788 | 9.7% | |||
Segment | income | 8,679 | 3.8% | 8,967 | 3.6% | 3.3% | |
Information Equipment | Net sales | 18,633 | 21,571 | 15.8% | |||
Segment | income | 1,392 | 7.5% | 1,616 | 7.5% | 16.1% | |
Software | Net sales | 1,471 | 1,679 | 14.1% | |||
Segment | income | 256 | 17.4% | 165 | 9.8% | -35.6% | |
Others | Net sales | 13,093 | 17,919 | 36.9% | |||
Segment | income | 1,094 | 8.4% | 2,122 | 11.8% | 94.0% | |
Total | Net sales | 259,064 | 288,959 | 11.5% | |||
Segment | income | 11,501 | 4.4% | 13,049 | 4.5% | 13.5% | |
These are the results by business segment.
The electronic components business recorded net sales of 247.7 billion yen, up 21.9 billion yen year on year, and segment income of 8,967 million yen, up 288 million yen. The mainstay components sales business saw a year-on-year increase in both net sales and income amid indications of a recovery after the inventory adjustments in the supply chain, which it was feared would persist long-term, as well as the effect of the acquisition of Kyoei Sangyo. The EMS business also saw an increase in both net sales and income thanks to a continued strong performance from products for medical equipment, air-conditioning equipment, and industrial equipment, despite a decline in demand from some customers.
The information equipment business recorded net sales of 21,571 million yen, up 2.9 billion yen year on year, and segment income of 1,616 million yen, up 224 million yen. Sales of PCs for educational institutions performed strongly thanks to factors such as an increase in sales volume. Sales to mass retailers were strong, boosted by replacement demand associated with the end of support for Windows 10, in addition to the enhancement of major PC suppliersʼ product lineups.
Sales were also high for relatively profitable security software,
contributing to an increase in income.
The LED installation business and the electric facility work business, including solar panels, also performed well.
Net sales in the software business recovered to 1,679 million yen, up 0.2 billion yen year on year, due to our efforts to expand orders for computer graphics production for games and amusement equipment. However, despite eliminating the segment operating loss recorded in the first quarter, segment income decreased year on year.
In the others business, the amusement equipment business continued to experience the vigorous demand seen in the previous fiscal year, maintaining its strong sales performance in Japan and the U.S. The PC product and PC peripheral recycling business also performed strongly.
As a result, net sales increased by 4.8 billion yen year on year to 17,919 million yen, segment income increased by 1.0 billion yen to 2,122 million yen, and segment income margin increased from 8.4% to 11.8%.
Please also refer to pages 8 and 9, which contain information by business segment.
Results for FY2026/3 H1 by Company | ||
H1 Results （April - September） Note : 1.With respect to gross profit and operating income, figures presented above are before consolidation adjustments between the four companies. 2. Kyoei Sangyo became a consolidated subsidiary effective July 18, 2025. 5 | ||
（million yen） | FY2025/3 | Composition Ratio | FY2026/3 | Composition Ratio | YoY | |
Kaga Electronics | Net sales | 148,154 | 100.0% | 164,858 | 100.0% | 11.3% |
Gross Profit | 23,685 | 16.0% | 26,947 | 16.3% | 13.8% | |
Operating income | 9,689 | 6.5% | 11,121 | 6.7% | 14.8% | |
Kaga FEI | Net sales | 96,783 | 100.0% | 97,943 | 100.0% | 1.2% |
Gross Profit | 8,678 | 9.0% | 8,873 | 9.1% | 2.2% | |
Operating income | 991 | 1.0% | 1,022 | 1.0% | 3.1% | |
Excel | Net sales | 14,127 | 100.0% | 13,028 | 100.0% | -7.8% |
Gross Profit | 1,735 | 12.3% | 1,670 | 12.8% | -3.7% | |
Operating income | 693 | 4.9% | 647 | 5.0% | -6.7% | |
Kyoei Sangyo | Net sales | ー | ー | 13,128 | 100.0% | ー |
Gross Profit | ー | ー | 2,058 | 15.7% | ー | |
Operating income | ー | ー | 187 | 1.4% | ー | |
Total | Net sales | 259,064 | 100.0% | 288,959 | 100.0% | 11.5% |
Gross Profit | 34,133 | 13.2% | 39,544 | 13.7% | 15.9% | |
Operating income | 11,501 | 4.4% | 13,049 | 4.5% | 13.5% |
Next, I will explain our performance by company.
In the Kaga Electronics Group, net sales increased by 16.7 billion yen year on year. This was mainly thanks to indications of a recovery after the supply chain inventory adjustments in the electronic components business, strong sales of products for medical devices, air-conditioning equipment, and industrial equipment in the EMS business, and the continued strong performance of amusement equipment in the others business. The gross profit margin improved by 0.3 percentage points due to a better sales mix, in addition to the increase in sales, resulting in a year-on-year increase of 3.2 billion yen in gross profit. Operating income also came in 1.4 billion yen higher year on year, with higher gross profit offsetting an increase in SG&A expenses due to the impact of rising personnel expenses and logistics costs.
Likewise, in the Kaga FEI Group, net sales increased by 1.1 billion yen year on year, the gross profit margin increased by 0.1 percentage point thanks to an improved sales mix, and gross profit increased by approximately 0.2 billion yen. Despite an increase in SG&A expenses due to an increase in litigation expenses, as well as personnel expenses and logistics costs, operating income also increased year on year, albeit only slightly.
In the Excel Group, we were able to increase the gross profit margin by
0.5 percentage points year on year through an improved sales mix, but the decrease of 1.0 billion yen in net sales resulted in a slight decrease in operating income.
The Kyoei Sangyo Group, which joined the Group from the second quarter, recorded net sales of 13.1 billion yen, gross profit of 2.0 billion yen, and operating income of 187 million yen during these three months, contributing to the increase in consolidated net sales and income.
The quarterly information for the last three months is presented on pages 10 to 12.
The figures for the second quarter include the results for the Kyoei Sangyo Group, which helped to boost net sales and income, but even without including these results, the increase in consolidated net sales and
income seen in the first quarter has continued over the past three months. Please also see this information.
Analysis of Net Sales/Operating Income Changes by Item | |||||||||
N売et上sa⾼les Oper営at業ing利in益come （billion yen） Gross Profit +5.4 （billion yen） Personnel expenses Electric Information Software Others 288.9 +1.4 -0.2 -1.7 Components Equipment -3.6 Packing and freightage +21.9 +2.9 +0.2 +4.8 +3.9 Litigation expenses -0.5 259.0 expenses Sales mix 13.0 （Improvement in amusement 11.5 gross profit margin） Others EMS equipment Around +11.8 around +6.4 Sales Volume SG&A -3.8 Electric （"-" figures for SG&A Components expenses indicate increase +10.4 in expenses ） Sales Increase Income Increase JPY 29.9 bn JPY 1.5 bn （of which, impact of exchange rates - 4.6 bn ） （of which, impact of exchange rates - 0.1 bn ） FY25/3 FY26/3 FY25/3 FY26/3 H1 Result H1 Result H1 Result H1 Result 6 | |||||||||
I will now explain the factors behind the year-on-year changes in net sales and operating income.
Net sales increased across all business segments, including an increase of
21.9 billion yen in the electronic components business, where there were indications of a recovery after inventory adjustments in component sales and a strong performance from the EMS business, as well as an increase of 6.4 billion yen in the amusement equipment business, which has maintained strong sales in Japan and the U.S. These increases were more than enough to compensate for the negative impact of 4.6 billion yen due to exchange rate movements, and total net sales increased by
29.9 billion yen year on year.
Operating income increased by 1.5 billion yen from the previous year. Although SG&A expenses increased by 3.8 billion yen year on year due to factors such as an increase of 0.2 billion yen in litigation expenses at Kaga FEI and the increase in rising personnel expenses and logistics costs including expenses associated with the addition of Kyoei Sangyo to the Group, this was compensated for by an increase of 5.4 billion yen in gross profit thanks to the increase in sales volume and the improvement in gross profit margin resulting from an improved sales mix.
Please also see the information for each company on page 7.