Zacros CorporationTSE: 7917

Supplementary Materials: First-Half Financial Results for Fiscal Year 2024, Ending March 2025

Nov 15, 2024 at 9:59 AM UTC · Issued by Zacros Corporation

Supplementary Materials: First-Half Financial Results

for Fiscal Year 2024, Ending March 2025

(April 1, 2024-September 30, 2024)

ZACROS Corporation

November 13, 2024

1	Copyright (C) ZACROS Corporation All Rights Reserved.

Business Segments

Wellness	Environmental Solutions	Electronic Materials	Industrial Infrastructure

							Contributing to strengthening
			Promoting mental and		Addressing environmental	Providing highly functional	the industrial infrastructure
Details of			issues and providing value	components and materials supporting people's lives, and
	physical health through the
business			necessary for a recycling-	necessary for an ultrasmart	promoting the provision of
	company's products
				oriented society	society	value through planned and

							proposed products

			Pharmaceutical and medical		Daily and industrial packaging	Displays	Building materials
Product
					Civil engineering materials
fields
	Biomedical		Containers	Electronic components
				Chemicals


			Pharmaceutical and medical		Cosmetic, refill, food	Protective films	Industrial chimneys, void
				slabs, pipes for air

			packaging		packaging
					conditioning

Main		Single-use bags for		OA equipment packaging	Release films	Tunnel construction


products		biopharmaceuticals, other		Information recording
		materials
			products
					materials


			Medical devices and in vitro		Plastic liquid containers	Other materials for	Plastic raw materials, products,
			diagnostics		(bag-in-box)
				information-related devices	and related machinery



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Financial Results

The company's sales and profits increased in the first half of fiscal year 2024 compared with the

same period a year earlier and are anticipated to increase for the full year compared with the

previous fiscal year.

(Million yen)

Consolidated			Year on year
	FY 2023 1H	FY 2024 1H
	Increase/	Growth rate

			decrease


Net sales	65,917	75,449	9,531	14.5％
Operating
3,865	5,624	1,759	45.5％
income


Ordinary income	4,315	5,842	1,527	35.4％
Net income
attributable to	3,453	3,622	168	4.9％
owners of

parent

FY 2023 full	FY 2024	Year on year

year	forecast	Change	Growth rate


136,155	150,000	13,844	10.2％
8,344	10,500	2,155	25.8％

8,910	11,000	2,089	23.5％
4,532	6,700	2,167	47.8％

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Income by Segment

						(100 million yen)

FY 2023 1H	FY 2024 1H	Increase/	Growth	FY 2023	FY 2024	Growth
decrease	rate	full year	forecast	Change
		rate

Net sales	659	100.0%	754	100.0％	95	14.5％	1,361	100.0%	1,500	100.0％	138	10.2％

		Wellness	131	20.0%	133	17.7％	1	1.1％	260	19.2％	280	18.7％	19	7.3％

		Environmental	171 26.1% 169 22.5％	(2)	(1.4％)	334	24.6％	330	22.0％	(4)	(1.4％)
		Solutions


		Electronic	201 30.6% 263 34.9％	61	30.7％	449	33.0％	530	35.3％	80	18.0％
		Materials


		Industrial	153 23.3% 188 24.9％	34	22.4％	316	23.2％	360	24.0％	43	13.7％
		Infrastructure


Operating	38	5.9%	56	7.5％	17	45.5％	83	6.1％	105	7.0％	21	25.8％
income


		Wellness	7	5.5%	3	2.3％	(4)	(57.8％)	8	3.2％	8	2.9％	-	-

		Environmental	8	5.0%	8	4.9％	(0)	2.3％	14	4.3％	13	3.9％	(1)	(10.0％)
		Solutions


		Electronic	7	3.6%	21	8.1％	14	192.1％	30	6.7％	44	8.3％	13	45.8％
		Materials


		Industrial	15	10.1%	23	12.4％	7	51.1％	30	9.6％	40	11.1％	9	31.1％
		Infrastructure



								4		Copyright (C) ZACROS Corporation All Rights Reserved.

Wellness

				Increase/
				decrease
		FY 2023 1H	FY 2024 1H	(compared
				with FY 2023
				1H)
Net sales	131	133	+1
	Pharmaceutical/	119	118	(1)
	medical

	Biomedical	12	15	+2

(Depreciation and	(4)	(5)	(+0)
amortization)



Operating income	7	3	(4)
Operating income ratio	5.5％	2.3％	(3.2％)

		(100 million yen)

	FY 2024	Change
FY 2023	(compared
forecast
	with FY 2023)


260	280	+19
234	249	+15

26	30	+3


(10)	(13)	(+2)


8	8	-
3.2%	2.9%	(0.3%)

FY 2024 1H	Compared with FY 2023 1H: Decrease of ¥400 million

・Pharmaceutical and medical related product sales at subsidiaries in Indonesia and Thailand were robust but were sluggish at the parent company, which suppressed net sales.

・Increased demand for antibody drugs drove up sales of single-use bags for biopharmaceutical products.

・The company continued to invest in upfront fixed costs and human resources to further develop its biomedical business.

FY 2024 Forecast	Compared with FY 2023: Essentially unchanged

・ Pharmaceutical and medical related product sales are strong domestically and abroad, and release films for pharmaceuticals are also
expected to perform well.
・ Biomedical-related single-use bags are performing strongly.
・ZACROS'domestic manufacturing bases were affected production halt by ransomware, but recovery is expected within the fiscal year.
・ Biomedical-related fixed costs are rising because of joint development costs in regenerative medicine and the cost of developing medical
device successor models.


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Environmental Solutions

				Increase/
				decrease
		FY 2023 1H	FY 2024 1H	(compared
				with FY 2023
				1H)
Net sales	171	169	(2)
	Daily and industrial	125	117	(7)
	packaging

	Liquid containers	46	51	+5


(Depreciation and	(8)	(8)	(+0)
amortization)



Operating income	8	8	(0)
Operating income ratio	5.0%	4.9%	(0.0%)

		(100 million yen)

	FY 2024	Change
FY 2023	(compared
forecast
	with FY 2023)


334	330	(4)
242	229	(13)

91	100	+8


(17)	(19)	(+1.5)


14	13	(1)
4.3%	3.9%	(0.4%)

FY 2024 1H	Compared with FY 2023 1H: Decrease of ¥0

・ Daily and industrial packaging saw overall revenue decline, despite growth in OA equipment-related packaging. This decrease resulted from two factors: the second-quarter transfer of part of the food packaging business, and reduced production at ZACROS'domestic manufacturing bases by ransomware. ・ Sales of liquid containers grew in blood testing-related applications.

・ Despite the positive effect of increased revenue from liquid containers, the decline in revenue from daily and industrial packaging resulted in a decrease in profits.

FY 2024 Forecast	Compared with FY 2023: Decrease of ¥100 million

・Daily and industrial packaging revenue is expected to decrease due to the transfer of a portion of the food packaging business in the second quarter.

・For refill packaging, cosmetic packaging, and OA equipment-related packaging, production efficiency temporarily declined at ZACROS'domestic manufacturing bases by ransomware, resulting in decreased production volume. However, recovery is expected for daily and industrial packaging from the fourth quarter onward.

・Liquid containers are experiencing increased global demand, particularly in Asian markets. Orders continue to be strong, with revenue expected to increase.

6	Copyright (C) ZACROS Corporation All Rights Reserved.

Electronic Materials

								(100 million yen)

				Increase/
				decrease			FY 2024	Change
		FY 2023 1H	FY 2024 1H	(compared		FY 2023	(compared
			forecast
				with FY 2023			with FY 2023)

				1H)
Net sales	201	263	+61		449	530	+80

	Displays	158	204	+46		350	404	+53

	Electronic	43	59	+15		98	125	+27
	components


(Depreciation and	(12)	(10)	(1)		(25)	(22)	(2)
amortization)



Operating income	7	21	+14		30	44	+13

Operating income ratio	3.6%	8.1%	+4.5%		6.7%	8.3%	+1.6%

FY 2024 1H Compared with FY 2023 1H: Increase of ¥1,400 million

・Sales of display-related protective film rose notably on the strength as industry restructuring bolstered our orders.

・Sales of information recording materials for electronic components increased as the impact of the cooling semiconductor market eased. ・Profit increased in display-related and electronic materials and other products owing to higher sales and enhanced production efficiency.

FY 2024 Forecast	Compared with FY 2023: Increase of ¥1,300 million

・Although ZACROS'domestic manufacturing bases were affected production halt by ransomware, display-related protective film orders are anticipated to remain strong and a recovery is evident for electronic components-related information-recording material orders, such that sales are expected to rise.

・Higher sales are expected to lead to improved profitability.

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Industrial Infrastructure

				Increase/
				decrease
		FY 2023 1H	FY 2024 1H	(compared
				with FY 2023
				1H)
Net sales	153	188	+34
	Building materials	79	97	+17
	Civil engineering	24	31	+6
	materials

	Chemicals	49	59	+10

(Depreciation and	(2)	(2)	(+0)
amortization)



Operating income	15	23	+7
Operating income ratio	10.1%	12.4%	+2.4%

		(100 million yen)

	FY 2024	Change
FY 2023	(compared
forecast
	with FY 2023)


316	360	+43
158	188	+30

51	58	+6

106	113	+6


(4)	(5)	(+0)


30	40	+9
9.6%	11.1%	+1.5%

FY 2024 1H	Compared with FY 2023 1H: Increase of ¥700 million

・Building materials sales were strong in pipes for air-conditioning systems, void slabs for housing complexes, and industrial chimney construction, resulting in higher sales.

・Civil engineering materials sales increased for tunneling materials.

・Sales of chemical products rose, bolstered by robust sales of adhesive products for semiconductor and automotive film applications.

FY 2024 Forecast	Compared with FY 2023: Increase of ¥900 million

・Building materials, air-conditioning pipe orders will remain strong and industrial chimney construction sales are anticipated to recover. ・Civil engineering materials orders for tunnel materials are forecast to be strong.

・Chemicals sales are forecast to rise at Japanese and Chinese subsidiaries.

8	Copyright (C) ZACROS Corporation All Rights Reserved.

FY 2024 1H: Operating Income Year-on-Year

Increase/Decrease Forecast Analysis

¥0.5

¥0.4

¥0.3

¥3.1

billion

¥1.1

billion

•

Price pass-

• Impact of

•

Raw material

through

production

•

Streamlining

stoppage due to

•

prices

ransomware

Energy costs,

etc.

•

R&D

expenses

•

Strategic

expenses

•

Other fixed

costs, etc.

Effect of

¥3.8	increased sales	¥5.6
billion		billion

FY 2023 1H	FY 2024 1H
Operating Income	Operating Income

9	Copyright (C) ZACROS Corporation All Rights Reserved.

FY 2024: Operating Income Year-on-Year

Increase/Decrease Forecast Analysis

¥0.9

billion

¥4.7

¥0.5

billion

¥1.1

¥1.8

billion

•

Price pass-

billion

•

through

• Impact of

Streamlining

production

stoppage due to •

Raw material

ransomware

prices

•

Energy costs,

•

R&D

etc.

expenses

•

Strategic

expenses

• Effect of

•

Other fixed

increased sales

costs, etc.

¥8.3	¥10.5
billion	billion

FY 2023 1H	FY 2024 1H
Operating Income	Operating Income

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