Kaneka Corporation (4118): FY2025 Results Summary — Record Net Sales and Net Income, Operating Income Declines

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Kaneka Corporation (4118) announced its consolidated financial results for the fiscal year ended March 31, 2026 (FY2025) on May 14, 2026. Net sales rose 0.5% year on year to ¥811.6 billion and net income attributable to owners of the parent increased 22.4% to ¥31.0 billion, both record highs, while operating income declined 17.9% to ¥32.9 billion. The company cited sales expansion of new products and market expansion in Medical and globally expanded sales in Supplement as factors for increase, against a sluggish Asian market in Vinyls, prolonged slow housing and construction demand in the U.S. for MOD/MS, and impacts of soaring raw material costs in E&I/Fiber as factors for decrease. Quarterly operating income recovered to exceed ¥10.0 billion in the fourth quarter (January 1 to March 31, 2026).

Consolidated Results (Full-Year Actual)

Net sales and net income attributable to owners of the parent reached record highs, while operating income and ordinary income decreased year on year. The operating income margin was 4.1% (5.0% in FY2024) and ROE was 6.4% (5.5% in FY2024). Against the previous forecast announced on February 10, 2026, the rate of achievement was 101.5% for net sales (forecast: ¥800.0 billion), 96.7% for operating income (¥34.0 billion), 102.0% for ordinary income (¥28.3 billion), and 98.3% for net income (¥31.5 billion). Assumed exchange rates for FY2025 were ¥150.7 to the U.S. dollar and ¥174.6 to the euro, with a domestic naphtha price of ¥65,025 per kl.

Item (Billions of yen)	FY2024	FY2025	Difference (YoY)	%
Net sales	807.2	811.6	4.4	0.5%
Operating income	40.1	32.9	(7.2)	(17.9%)
Ordinary income	32.9	28.9	(4.0)	(12.1%)
Net income attributable to owners of the parent	25.3	31.0	5.7	22.4%
Operating income margin	5.0%	4.1%	–	–
Net income per share	¥400.91	¥501.26	–	–
Dividend per share	¥130.00	¥160.00	–	–
ROE	5.5%	6.4%	–	–

Segment Results

By Solutions Unit (SU): Material SU saw decreased sales and profits on sluggishness in the Asian market for Vinyls and prolonged slow housing and construction demand in the U.S. for MOD and MS. Quality of Life SU posted increased sales and decreased profits, with solid performance in Foam and PV while E&I and Fiber experienced soaring raw material costs. Health Care SU achieved increased sales and profits on dramatic growth of Medical, where both blood purification devices and catheters expanded substantially, making it the largest earning-generating business. Nutrition SU recorded higher sales and profits on strong performance for Supplemental Nutrition — with sales of the active form of coenzyme Q10 expanding in the global market, particularly in the U.S. — and improved profitability of Foods.

Segment	Net sales FY2024	Net sales FY2025	Operating income FY2024	Operating income FY2025
Material SU	342.9	327.2	31.0	24.9
Quality of Life SU	191.0	194.3	20.0	18.0
Health Care SU	77.3	83.0	13.4	14.8
Nutrition SU	195.0	206.0	13.1	13.7
Others	1.1	1.1	0.5	0.6
Adjustment	–	–	(37.9)	(39.1)
Total	807.2	811.6	40.1	32.9

FY2026 Forecast

For FY2026, Kaneka forecasts net sales of ¥820.0 billion (up 1.0% year on year), operating income of ¥36.0 billion (up 9.4%), ordinary income of ¥32.0 billion (up 10.8%), and net income attributable to owners of parent of ¥31.5 billion (up 1.7%). The company will actively invest management resources in Life Science and Leading-edge businesses to accelerate business expansion and improvement in profitability. Regarding impacts of the situation in the Middle East, it anticipates temporary adjustments in demand and fluctuation in profit margins, primarily for certain Solutions Vehicles of Material and QoL SU, and states it will closely monitor future developments and promptly revise the plan as necessary. Forecast assumptions are ¥150.0 to the U.S. dollar, ¥170.0 to the euro, and a domestic naphtha price of ¥120,000 per kl.

Item (Billions of yen)	FY2025 Result	FY2026 Forecast	Difference	%
Net sales	811.6	820.0	8.4	1.0%
Operating income	32.9	36.0	3.1	9.4%
Ordinary income	28.9	32.0	3.1	10.8%
Net income attributable to owners of parent	31.0	31.5	0.5	1.7%
Operating income margin	4.1%	4.4%	–	–
Net income per share	¥501.26	¥523.04	–	–
Dividend per share	¥160.00	¥210.00	–	–
ROE	6.4%	6.2%	–	–

Shareholder Returns

The FY2025 annual dividend was ¥160 per share (up ¥30 per share year on year), with repurchase of treasury shares of ¥12.0 billion and a dividend payout ratio of 31.9%. For FY2026, the company plans an annual dividend of ¥210 per share (up ¥50 per share year on year), repurchase of treasury shares of ¥7.0 billion (upper limit 1,400,000 shares), and a dividend payout ratio of 40.2%. Kaneka will implement a progressive dividend policy for the period FY2025 to FY2027, with a dividend payout ratio of 40% as target.

Item	FY2025 Result	FY2026 Plan
Annual dividend	¥160 per share (YoY +¥30 per share)	¥210 per share (YoY +¥50 per share)
Repurchase of treasury shares	¥12.0 billion	¥7.0 billion
Dividend payout ratio	31.9%	40.2%

Topics: Portfolio Transformation and Cross-Shareholdings

The operating income contribution ratio of Leading-edge businesses (MS, E&I, PV, Medical, Pharma, Supplement) increased to 53% in FY2025, from 46% in FY2023 and 48% in FY2024. Key drivers were Medical (expanded sales of new products and broadened sales areas in Asia and the U.S.), Supplement (global sales expansion, primarily in the U.S.), and E&I (sales expansion of high-value-added grades such as polyimide films and optical acrylic resins). Kaneka also made further reductions of cross-shareholdings: the total amount disposed in FY2025 was ¥22.7 billion, and the ratio of cross-shareholdings to consolidated net assets was reduced to 8.1%, below 10%. On the balance sheet, total assets stood at ¥959.2 billion as of March 31, 2026, with an equity ratio of 52.0%. Cash flows from operating activities were ¥50.1 billion and free cash flow was ¥24.0 billion, with cash and cash equivalents of ¥48.9 billion at period-end.

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.