Nisshinbo Holdings (3105): FY2025 Results Summary — Operating Income Up 59.2% on Wireless and Communications Growth

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Nisshinbo Holdings Inc. (TSE: 3105) reported results for FY2025, the fiscal year ended December 2025, in its Financial Results Presentation Materials dated February 10, 2026. Net sales rose 1.5% year on year to 502,339 million yen, while operating income jumped 59.2% to 26,401 million yen, driven by significant profit growth in the Wireless and Communications Business. Ordinary income increased 20.2% to 29,327 million yen and net income attributable to owners of parent rose 35.4% to 13,920 million yen. For FY2026 the company guides for higher sales but lower profits, mainly reflecting a reduced scale of real estate sales, and plans approximately 6 billion yen of extraordinary losses for restructuring of the Micro Devices business and other factors.

Consolidated Results (Full-Year Actual)

Sales increased due to higher revenue in the Wireless and Communications Business, among other factors. Operating profit, ordinary profit, and net income attributable to owners of parent all increased, likewise due to significant profit growth in the Wireless and Communications Business. Operating income of 26,401 million yen came in well above the initial forecast of 19,700 million yen, and ordinary income of 29,327 million yen also exceeded the initial forecast of 21,600 million yen, while net income of 13,920 million yen fell short of the 18,300 million yen initially forecast.

Item (millions of yen)	FY2024	FY2025	Change	Rate	FY2025 Initial Forecast
Net Sales	494,746	502,339	+7,593	+1.5%	506,000
Operating income	16,581	26,401	+9,820	+59.2%	19,700
Ordinary income	24,403	29,327	+4,924	+20.2%	21,600
Net income attributable to Owners of Parent	10,277	13,920	+3,642	+35.4%	18,300

Segment Results

The Wireless and Communications Business was the main growth driver, with sales up from 234,515 million yen to 251,837 million yen and operating income more than doubling from 7,577 million yen to 17,668 million yen. Within it, Solutions & Defense (JRC and KDE) posted increased revenue and profits driven by higher orders for municipal disaster prevention systems due to renewal demand, plus increased orders for Ministry of Defense equipment and maintenance materials. Marine Systems also grew on strong orders for equipment for new merchant ships, retrofitting, and aftermarket services such as maintenance. In contrast, Mobility and others saw revenue decline and profitability deteriorate due to a fall in orders for repeaters (mobile phone relay equipment) caused by specification changes and project delays, coupled with weak performance in commercial wireless equipment for overseas markets.

The Micro Devices Business narrowed its operating loss to -5,505 million yen from -7,093 million yen, with automotive revenue reduced by the sluggish EV market and inventory adjustments by sensor-related customers, and the microwave business hit by difficulties in obtaining components due to rare earth restrictions. In the Materials Business, Brakes increased profit on higher revenue and profit in Japan and the US, and Precision Instruments grew on molded products for automotive and medical applications, while Chemicals posted a loss on stagnation in the overall hydrogen market and Textiles saw profitability worsen on reduced orders in the shirt business. Real estate sales and operating income declined due to shrinkage in condominium sales projects compared to the previous period.

Segment (millions of yen)	FY2024 Sales	FY2024 Op. income	FY2025 Sales	FY2025 Op. income
Wireless and Communications — Solutions & Defense (JRC)	63,814	233	76,272	6,535
Wireless and Communications — Solutions & Defense (KDE)	71,061	3,742	78,149	6,934
Wireless and Communications — Solutions & Defense Total	134,875	3,975	154,421	13,469
Wireless and Communications — Marine Systems	51,413	4,537	56,027	6,018
Wireless and Communications — Mobility and others	51,599	-862	44,430	-1,676
Wireless and Communications — Eliminations, etc.	-3,372	-73	-3,041	-143
Wireless and Communications — Total	234,515	7,577	251,837	17,668
Micro Devices	64,225	-7,093	62,400	-5,505
Materials — Brakes	58,188	2,333	57,795	3,385
Materials — Precision Instruments	54,161	1,641	55,442	2,976
Materials — Chemicals	11,040	655	9,736	-56
Materials — Textiles	36,842	193	33,345	98
Real estate	23,539	17,694	17,939	12,667
Other Businesses, Corporate costs	12,232	-6,421	13,841	-4,834
Consolidated Total	494,746	16,581	502,339	26,401

FY2026 Forecast

For FY2026 the company forecasts net sales of 511,000 million yen, up 1.7%, on expected higher orders in Wireless and Communications and Micro Devices. Operating income is expected to decrease 20.5% to 21,000 million yen, mainly due to the reduced scale of real estate sales. An extraordinary loss of approximately 6 billion yen is expected due to restructuring costs for the Micro Devices business and other factors. The forecast assumes an exchange rate of 145 JPY/USD (versus 149.78 in FY2025), with a sensitivity such that a 1-yen depreciation of the yen results in +200 million yen.

Item (millions of yen)	FY2025	FY2026 Forecast	Change	Rate
Net Sales	502,339	511,000	+8,661	+1.7%
Operating income	26,401	21,000	-5,401	-20.5%
Ordinary income	29,327	21,500	-7,827	-26.7%
Net income attributable to Owners of Parent	13,920	10,000	-3,920	-28.2%

By segment, the Wireless and Communications Business is expected to grow to 265,700 million yen in sales with 17,100 million yen of operating income, supported by continued strength in disaster prevention networks for government agencies, robust new shipbuilding and aftermarket demand in Marine Systems, and an anticipated recovery in customer demand for smart meters in the Connected (formerly Mobility) sub-segment. The Micro Devices Business is expected to shrink its operating loss to -500 million yen, helped by market recovery, new orders, and fixed-cost reductions from structural reforms, with the effect of the early retirement incentive program announced in December 2025 contributing from the second half of the fiscal year. Real estate sales are planned to fall to 9,900 million yen with operating income of 6,400 million yen, due to the reduction in the scale of condominium projects.

Segment (millions of yen)	FY2026 Forecast Sales	FY2026 Forecast Op. income
Wireless and Communications — Solutions & Defense (JRC)	82,600	6,100
Wireless and Communications — Solutions & Defense (KDE)	80,000	7,200
Wireless and Communications — Solutions & Defense Total	162,600	13,300
Wireless and Communications — Marine Systems	57,100	4,800
Wireless and Communications — Connected (formerly Mobility) and others	47,300	-900
Wireless and Communications — Eliminations, etc.	-1,300	-100
Wireless and Communications — Total	265,700	17,100
Micro Devices	67,900	-500
Materials — Brakes	57,800	3,000
Materials — Precision Instruments	51,500	1,700
Materials — Chemicals	10,200	0
Materials — Textiles	34,600	200
Real estate	9,900	6,400
Other Businesses, Corporate costs	13,400	-6,900
Consolidated Total	511,000	21,000

Shareholder Returns

Under its cash flow allocation and financial strategy, the company states that cash is being prioritized for structural reforms and, after their completion, will be redirected toward growth investments. However, dividends will maintain a minimum annual payout of 36 yen per share and a payout ratio of 40%.

Medium-Term Plan and “Blueprint for Management”

FY2025 was Year 2 of the Medium-Term Management Plan 2026, which the company describes as a phase of laying the foundation to achieve its vision. Progress includes initiating structural reforms in the Wireless and Communications business, including an early retirement incentive program (with Micro Devices business reforms scheduled for FY2026), and considering a strategy to achieve 300 billion yen in sales and 30 billion yen in operating profit in the Wireless and Communications business by fiscal 2030. A new FI (Future Innovation) Division has been established to accelerate new business creation in the Wireless and Communications field.

Alongside the results, the company presented a “Blueprint for Management” titled “Foundation Building for Realization of Our Vision — Blueprint for Transformation and Growth.” It identifies weak earning power as the company’s primary challenge and sets a consolidated operating profit margin of 10% or more as the criterion for redesigning each business, with ROIC of 7% or more as the efficiency benchmark (WACC is approximately 6% as of 2025 and is expected to rise to approximately 7%). Structural reform of Japan Radio Co., Ltd. (JRC) includes consolidating operating companies from four to two, consolidating production companies from six to one, and an early retirement incentive program, with a JRC organizational restructuring from April 2026. In the Micro Devices business, fixed-cost reduction through an early retirement incentive program is being implemented through June 2026, followed by a fundamental review of business content and structure. In the Materials Business, the company is shifting toward chemical materials for the electronics field under the “Nisshinbo Materials” concept, with decisions on spin-offs for businesses not aligned with the new materials business policy; the withdrawal from the NIST nonwoven business (Oikos) was completed in October 2025.

By domain, the company shows operating profit (in units of 100 million yen) for the Wireless and Communications business of 75 in FY2024, 176 in FY2025, and 171 planned for FY2026; Micro Devices of ▲70, ▲55, and ▲5; Materials of 48, 64, and 49; and Real Estate of 176, 126, and 64. Excluding real estate and other, operating profit rose from 53 to 185 and is planned at 215, in line with the goal of generating operating profits independent of the real estate business and completing structural reforms by 2026. For 2030, the company targets an Electronics business (Wireless & Communications plus Micro Devices plus new businesses) with sales revenue of more than 300 billion yen through organic growth and operating profit of 30 billion yen, aiming to become a “Wireless Communications Total Engineering Company.”

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.