Mitsubishi Steel Mfg.co., Ltd.TSE: 5632

Financial Results for the First Half of the Fiscal Year Ending March 2025

Nov 7, 2024 at 6:18 AM UTC · Issued by Mitsubishi Steel Mfg.co., Ltd.

November 7, 2024

I. FY2024 1H Results

II. Full-year Forecasts for FY2024

Summary of 1H results

I. FY2024 1H Results

Net sales declined YoY due to declining demand for construction machineries and for automobiles.
Operating income grew YoY despite reduction in sales volume due to improvements in costs and selling prices and start of a large-scale project in the strategic business of precision spring components.
Ordinary income and net income were down sharply YoY despite higher operating income, due to foreign exchange losses and the recording of an extraordinary loss (JPY1.1 billion) on our withdrawal from the German Springs business.

The 1H end exchange rate was $1 = JPY143 vs. an initial forecast of $1 = JPY150.

	FY2023 1H results	FY2024 1H results	YoY change

Net sales	866	805	△61

Operating income	29	32	3

Ordinary income	21	17	△4

Net income	9	0	△9
attributable to
owners of parent
company

		2

(JPY100M)

(Reference)

Previous	vs. previous
forecast
forecast
(August 8)


830	△25

28	4

22	△5

7	△7

Factors contributing to changes in net sales and operating income

(YoY comparison)	I. FY2024 1H Results
Net sales
	(JPY100M)

Sales

Consolidation

Selling prices

Sales under

Foreign

volumes

contract*

exchange

adjustments,

etc.

gains/losses

FY2023 1H

FY2024 1H

results

*: Sales under contract to Nippon Steel Corporation

Operating income

(JPY100M)

Production

Inventory

Raw

Energy

costs

valuation,

material

costs

etc.

Sales

Selling

prices

volumes

prices

FY2023 1H

FY2024 1H

results

Results by segment

I. FY2024 1H Results

		FY2023 1H	FY2024 1H	YoY change
		results	results


Special Steel	Net sales	473	411	△62
Bars	Operating	19	19	0
	income
Springs	Net sales	350	336	△14
Operating	4	6	2

	income
Formed &	Net sales	45	46	1
Fabricated
Operating	2	3	1
Products
income
Machinery	Net sales	45	47	2
Operating	3	3	0

	income
Other	Net sales	17	18	1
Operating income	0	1	1

Consolidation	Net sales	△63	△54	9
adjustments	Operating income	0	0	0

Total	Net sales	866	805	△61
Operating	29	32	3

	income
			4

(JPY100M)

(Reference)

Previous	vs. previous
forecast
forecast
(August 8)

429	△18

15	4

354	△18

8	△2

46	0

2	1

46	1

2	1

17	1

0	1

△62	8

0	0

830	△25

28	4

Impact of non-operating income/loss and extraordinary income/loss

I. FY2024 1H Results

Non-operatingincome/loss worsened YoY due to foreign exchange losses on foreign currency assets, despite lower forex hedging costs, a key negative factor on income/loss last year.
Extraordinary income/loss worsened YoY due to the recording in the first quarter of a loss on business liquidation associated with German Spring business.

			FY2023 1H results	FY2024 1H results	YoY change

Operating income	29	32	3
	Non-operating income/loss	△8	△15	△7
		Translation (exchange	1	△8	△9
		profit and loss)
		Interest paid	△9	△8	1
Ordinary income	21	17	△4
	Extraordinary income/loss	0	△9	△9
		Insurance income	0	2	2
		Loss on business	0	△11	△11
		liquidation*
Net income before income	20	8	△12
taxes and other adjustments
Tax expenses	△9	△6	3

Net income attributable to non-	△2	△1	1
controlling interests
Net income attributable to	9	0	△9
owners of parent company

		(JPY100M)
(Reference)
Previous forecast		vs. previous

(August 8)		forecast
28		4

△6		△9

2		△10

△8		0

22		△5

△8		△1

2		0

△10		△1

14		△6

△6		0

△1		0

7		△7

5	* Including provision of allowance

I. FY2024 1H Results

II. Full-year Forecasts for FY2024

Summary of full-year performance forecasts II. Full-yearForecasts for FY2024

We expect lower net sales due to continuing challenging conditions in demand for construction machineries and other users, despite higher sales volumes by precision spring components, which mass production has begun.
We expect sharp growth in operating income due to progress in selling prices and cost improvements, in addition to contributions to revenue from precision spring components.
Despite the recording of an extraordinary loss associated with withdrawal from German Spring business, we expect net income to recover sharply and to climb into the black, thanks to higher operating income and lower non-operating expenses.

We project an exchange rate of $1 = JPY150.

FY2023		FY2024 forecasts
1H	2H		YoY change
results	Full-year
results	forecasts

Net sales	1,699	805	845	1,650	△49
Operating income	48	32	48	80	32
Ordinary income	19	17	45	62	43
Net income
attributable to	△10	0	33	33	43
owners of parent
company

(JPY100M)

(Reference)

Previous	vs. previous
forecast
forecast
(August 8)


1,750	△100

68	+12

55	+7

30	+3

【The factors contributing to improved profits in the 2H compared to the 1H FY2024】

Operating income ： contributions to revenue from the start of a large-scale project in precision spring components, and increasing demand for construction machineries and for automobiles
Ordinary income ：Going out of foreign exchange loss incurred at the end of the second quarter. The year-end exchange rate FY 2023 was $1 = JPY151 vs. 1H FY2024 exchange rate $1 = JPY143 → an forecast year-end rate of $1 = JPY150.
Net income attributable to owners of parent company ： the recording of an extraordinary loss (JPY1.1 billion) on our withdrawal from the German Springs business in １Ｑ FY2024

Factors contributing to changes in net sales and operating income (YoY comparison)

II. Full-year Forecasts for FY2024

Net sales

(JPY100M)

Sales		Sales under	Foreign	Consolidation
	Selling prices
volumes		contract*	exchange	adjustments,
			gains/losses	etc.

FY2023 results

FY2024 forecast

Operating income

*: Sales under contract to Nippon Steel Corporation

(JPY100M)

Inventory

Raw

Production

Energy

valuation,

material

costs

etc.

prices

Selling

Sales

prices

volumes

FY2023 results

FY2024 forecast

Performance forecasts by segment

II. Full-year Forecasts for FY2024

		FY2023		FY2024 forecasts	YoY
				2H
		results	1H results	Full-year	change
		forecasts


Special	Net sales	889	411		430	841	△48

Steel Bars	Operating	23	19		22	41	18
	income
Springs	Net sales	706	336		349	685	△21

Operating	10	6		18	24	14

	income
Formed &	Net sales	94	46		49	95	1
Fabricated
Operating	8	3		3	6	△2
Products
income
Machinery	Net sales	100	47		55	102	2

Operating	7	3		4	7	0

	income
Other	Net sales	34	18		17	35	1

Operating	1	1		1	2	0

	income

Consolidation	Net sales	△123	△54		△54	△108	15

adjustments	Operating	0	0		0	0	0
	income

Total	Net sales	1,699	805		845	1,650	△49

Operating	48	32		48	80	32

	income
					9

(JPY100M)

(Reference)

Previous	vs. previous
forecast
forecast
(August 8)

909	△68

30	11

736	△51

23	1

96	△1

8	△2

102	0

6	1

33	2

1	1

△127	19

0	0

1,750	△100

68	12

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