Cosmo Energy Holdings (5021): FY2025 Results Summary — Net Profit Up on Positive Time-Lag Effect

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

Cosmo Energy Holdings reported FY2025 results (year ended March 31, 2026) with net sales of ¥2,677.6 billion, operating profit of ¥144.8 billion and ordinary profit of ¥149.2 billion. Profit attributable to owners of parent rose ¥16.3 billion year on year to ¥74.0 billion. Excluding the impact of inventory valuation, which was a negative ¥16.5 billion, ordinary profit was ¥165.7 billion and profit attributable to owners of parent was ¥85.5 billion. The company states that a positive time-lag effect from rising crude prices outweighed cost increases driven by inflation and by import procurement to ensure stable supply.

Consolidated Results (Full-Year Actual)

Net sales declined ¥122.3 billion year on year while operating profit rose ¥16.6 billion. Ordinary profit was down ¥1.6 billion, but profit attributable to owners of parent increased as extraordinary losses narrowed to ¥3.7 billion from ¥25.8 billion a year earlier. The Dubai crude oil price averaged 72 USD/B (Apr.-Mar.) against 79 USD/B in FY2024, and the JPY/USD exchange rate averaged 151 yen/USD against 153 yen/USD.

Item (billion yen)	FY2025 Results	FY2024 Results	YoY Change
Net sales	2,677.6	2,799.9	(122.3)
Operating profit	144.8	128.2	16.6
Non-operating income/expenses, net	4.4	22.5	(18.1)
Ordinary profit	149.2	150.8	(1.6)
Extraordinary income/losses, net	(3.7)	(25.8)	22.1
Income taxes	63.3	66.0	(2.7)
Profit attributable to non-controlling interests	8.2	1.3	6.9
Profit attributable to owners of parent	74.0	57.7	16.3
Impact of inventory valuation	(16.5)	(30.8)	14.3
Ordinary profit excluding the impact of inventory valuation	165.7	181.6	(15.9)
Profit attributable to owners of parent excluding the impact of inventory valuation	85.5	79.2	6.3

Key indicators for FY2025 were ROE of 14.4% (13.4% in FY2024), ROIC of 8.2% (6.9%), EBITDA of ¥219.6 billion (¥216.3 billion) and EPS of 523 yen (462 yen), all excluding the impact of inventory valuation. Following the effective date of the 2-for-1 stock split of common shares on October 1, 2025, per-share figures have been calculated on the assumption that the stock split had been implemented at the beginning of the previous fiscal year. Net worth was ¥606.2 billion with a net worth ratio of 27.6%, and the net debt to equity ratio improved to 0.71 times from 0.84 times.

Cash flows / Balance sheet (billion yen)	FY2025 Results	FY2024 Results
Cash flows from operating activities	213.7	137.1
Cash flows from investing activities	(84.7)	(145.7)
Free cash flow	129.0	(8.6)
Cash flows from financing activities	(81.9)	(69.0)
Cash and cash equivalents at end of the period	81.8	34.9
Total assets	2,196.6	2,156.6
Net assets	735.8	707.5
Net interest-bearing debt	430.9	493.0

Segment Results

In the Petroleum Business, ordinary profit excluding the impact of inventory valuation was ¥92.8 billion, up ¥0.2 billion year on year, as profits increased on a positive time-lag effect from rising crude prices. The Oil E&P Business posted ordinary profit of ¥65.3 billion, down ¥17.1 billion, with profit declining due to crude oil prices while production volumes increased as production ramped up at the Hail Oil Field. The Petrochemical Business remained in the red at negative ¥3.1 billion but improved ¥1.9 billion on business restructuring and higher sales of specialty chemicals, and the Renewable Energy Business earned ¥2.8 billion, up ¥1.5 billion following the commencement of operations at new sites.

Segment (billion yen)	Net sales	Operating profit	Ordinary profit	Ordinary profit excl. inventory valuation
Petroleum business	2,385.6	71.9	76.3	92.8
Petrochemical business	332.8	(2.9)	(3.1)	(3.1)
Oil E&P business	130.4	63.1	65.3	65.3
Renewable energy business	16.5	2.6	2.8	2.8
Other, adjustment	(187.7)	10.1	7.9	7.9
Total	2,677.6	144.8	149.2	165.7

Operationally, the CDU operating ratio at the company’s three refineries was 91.2% on a calendar day basis, up 2.8 points, while the streaming day basis ratio was 94.1%, down 2.2 points. Total sales volume was 25,015 thousand KL against 25,018 thousand KL in FY2024, and the four main products totalled 16,166 thousand KL versus 16,511 thousand KL. Crude oil production volume rose to 43,330 B/D from 39,474 B/D, and total proved and probable reserves stood at 137.3 million barrels as of December 31, 2025. Capital expenditures totalled ¥97.5 billion against depreciation of ¥58.3 billion.

FY2026 Forecast

For FY2026 the company forecasts ordinary profit of ¥115.0 billion and ordinary profit excluding the impact of inventory valuation of ¥110.0 billion, reflecting a positive inventory valuation impact of ¥5.0 billion. Profit attributable to owners of parent is expected to be ¥44.0 billion. The forecast assumes a Dubai crude oil price of 89 USD/B and an exchange rate of 155 yen/USD (Apr.-Mar.). The company notes that the forecast reflects a conservative estimate of potential earnings impacts given uncertainties surrounding the Middle East situation and market conditions, and that it will be updated as appropriate if these assumptions change materially.

Item (billion yen)	FY2026 Forecast	FY2025 Results
Net sales	2,870.0	2,677.6
Operating profit	102.0	144.8
Ordinary profit	115.0	149.2
Profit attributable to owners of parent	44.0	74.0
Impact of inventory valuation	5.0	(16.5)
Ordinary profit excluding the impact of inventory valuation	110.0	165.7
Profit attributable to owners of parent excluding the impact of inventory valuation	40.0	85.5
Dubai crude oil price (USD/B) (Apr.-Mar.)	89	72
JPY/USD exchange rate (yen/USD) (Apr.-Mar.)	155	151

Segment forecast (billion yen)	Net sales	Operating profit	Ordinary profit	Ordinary profit excl. inventory valuation
Petroleum business	2,483.0	52.0	61.0	56.0
Petrochemical business	387.0	1.0	1.0	1.0
Oil E&P business	110.0	35.0	38.0	38.0
Renewable energy business	18.0	3.0	3.0	3.0
Other, adjustment	(128.0)	11.0	12.0	12.0
Total	2,870.0	102.0	115.0	110.0

By segment, the Petroleum Business is expected to see profits decline mainly due to a negative time-lag effect, with domestic market conditions assumed conservatively. In the Oil E&P Business, although high crude oil prices are expected to support profits, sales volumes are projected to decrease as a result of production constraints attributable to the closure of the Strait of Hormuz. The Petrochemical Business is expected to improve due to lower export volumes, although overseas market conditions are expected to remain weak, and the Renewable Energy Business is expected to deliver stable profits driven primarily by onshore wind power. Capital expenditures are planned at ¥194.0 billion against depreciation of ¥58.4 billion.

Shareholder Returns

For FY2025 the company states a planned year-end dividend of ¥90 per share. For FY2026 an annual dividend of ¥165 per share is planned, consisting of an interim dividend of ¥75 per share and a year-end dividend of ¥90 per share. The materials note that a two-for-one share split was implemented for Wednesday, October 1, 2025, and that the total dividend per share forecast is not stated as a simple calculation is not possible due to the share split; on a post-share split basis the figure is ¥165, with no change (±¥0) year on year, and there will be no substantial change to the year-end and annual dividend projections.

Medium-Term Plan / Topics

The company presented the results of its 7th Medium-Term Management Plan. In existing (Oil) fields it implemented initiatives including strengthening DX to maximize refinery uptime, starting to increase production at the Hail Oil Field, and restructuring the basic chemicals business, where Maruzen Petrochemical made the decision to optimize ethylene production and HD Hyundai Cosmo Petrochemical shares were sold off. In new fields it commenced Japan’s first large-scale domestic SAF production, built a green power supply chain, and expanded earnings from specialty chemicals, while strategically refraining from participating in offshore wind tenders in response to changes in the business environment. Investment securities are included in the net investment amount of ¥420.0 billion in the 7th Consolidated Medium-Term Management Plan (from FY2023 to FY2025).

The company also detailed its capital and business alliance with Iwatani Corporation. Iwatani joined efforts to establish a domestic SAF supply chain, including participation in the used cooking oil collection program, and a commercial viability assessment was initiated toward establishing a green LPG supply chain, with SAF and green LPG produced with partners on the premises of the Sakai Refinery. On hydrogen, the two companies plan to realize a hydrogen business leveraging refinery assets at the Chiba Refinery, scheduled to commence operations around 2029, alongside the steady operation and expansion of hydrogen stations for commercial vehicles (Heiwajima opened in 2024, Ariake opened in 2025, and Shinsuna scheduled to open in 2027).

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.