Sinko Industries (6458): FY2025 Results Summary — Higher Sales but Lower Profit; Profit Growth Planned for FY3/2027

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

Note: On this site, the company’s most recently completed fiscal year (ended March 31, 2026) is classified as FY2025; fiscal-year labels in the text and tables below follow the source materials (e.g. FY3/2026 = the fiscal year ended March 31, 2026). Sinko Industries publishes its English-language results materials as AI/machine translations only; this article is an English translation of the Japanese-language article on our sister site Investalk, which is based on the company’s Japanese-language IR materials, with figures transcribed as reported.

Sinko Industries’ consolidated results for the fiscal year ended March 31, 2026 (April 2025 to March 2026) were net sales of ¥59.3 billion (up 4.1% year on year), operating profit of ¥9.44 billion (down 5.4%), and profit attributable to owners of parent of ¥6.826 billion (down 12.8%). The business environment was generally favorable, with orders received by plumbing and equipment installation contractors remaining at high levels, while in the Japan segment lower sales of air-conditioning units and higher SG&A expenses weighed on profit. For the fiscal year ending March 31, 2027, the company plans net sales of ¥63.0 billion (up 6.2%) and operating profit of ¥10.0 billion (up 5.9%).

Consolidated Results (Full Year)

Consolidated net sales for FY3/2026 came in at ¥59.3 billion (up 4.1% year on year) and operating profit at ¥9.44 billion (down 5.4%). The gross profit margin was 38.1%, roughly flat versus 38.2% in the prior year. Although higher sales lifted profit by ¥0.89 billion, this was outweighed by a ¥1.36 billion profit decline from higher SG&A expenses, and operating profit fell ¥0.54 billion from the prior year. Ordinary profit was ¥10.061 billion (down 5.2%), profit attributable to owners of parent was ¥6.826 billion (down 12.8%), and earnings per share were ¥99.59 (prior year: ¥107.68).

Item	FY3/2026 (Actual)	FY3/2025 (Actual)	Change
Net sales	59,339 million yen	57,005 million yen	+4.1%
Gross profit	22,622 million yen	21,797 million yen	+3.8%
Operating profit	9,444 million yen	9,986 million yen	△5.4%
Ordinary profit	10,061 million yen	10,615 million yen	△5.2%
Profit attributable to owners of parent	6,826 million yen	7,829 million yen	△12.8%
Earnings per share	99.59 yen	107.68 yen	―

Segment Results

In the Japan segment, sales of air-conditioning units declined on lower unit shipments across the central air-conditioning market as a whole, while air-conditioning installation work and maintenance stayed strong, and segment net sales rose to ¥51.332 billion (up 3.1% year on year). Although the company aimed to improve margins through price revisions on equipment sales, lower profit from reduced unit shipments and higher costs weighed on results, and segment operating profit declined to ¥9.535 billion (down 6.8%). In the Asia segment, with the stagnation of China’s real estate market continuing, net sales rose to ¥8.092 billion (up 10.9%) on increased air-conditioning equipment sales and installation projects. Despite progress in booking profit on installation projects, price competition in equipment sales remained severe, resulting in an operating loss of ¥116 million (prior-year operating loss: ¥283 million; the loss narrowed by ¥160 million year on year).

Segment	Metric	FY3/2026	FY3/2025
Japan	Net sales	51,332 million yen	49,768 million yen
Japan	Operating profit	9,535 million yen	10,228 million yen
Asia	Net sales	8,092 million yen	7,298 million yen
Asia	Operating profit	△116 million yen	△283 million yen

Reflecting work-style reform in the construction industry and soaring construction costs, early ordering has been accelerating, mainly for large domestic projects. Total orders received in FY3/2026 were ¥38,470 million (Japan segment ¥36,662 million, Asia segment ¥1,808 million), and within the Japan segment’s order growth, gains in large buildings (up ¥4.1 billion year on year) and data centers (up ¥3.7 billion year on year) were notable. Although this includes orders for some large projects with long construction periods, the order backlog at the end of the fiscal year had accumulated to a record-high level.

Full-Year Forecast

For FY3/2027, the company plans consolidated net sales of ¥63.0 billion (up 6.2% year on year) and operating profit of ¥10.0 billion (up 5.9%). In addition to higher sales from increased sales volumes of central air-conditioning units and price pass-through, the company expects growth in the target markets of its medium-term management plan, such as air-conditioning installation work and maintenance. It will press ahead with initiatives toward achieving the final targets of the medium-term management plan “move.2027” — net sales of ¥60.0 billion and operating profit of ¥10.0 billion. Ordinary profit is planned at ¥10.600 billion (up 5.3%) and profit attributable to owners of parent at ¥7.200 billion (up 5.5%). The escalating situation in the Middle East has caused deteriorating availability and rising prices for some raw materials used in manufacturing air-conditioning equipment, but at this point the impact on the earnings outlook is expected to remain minor.

Item	FY3/2027 (Forecast)	FY3/2026 (Actual)	Change
Net sales	63,000 million yen	59,339 million yen	+6.2%
Japan	56,000 million yen	51,332 million yen	+9.1%
Asia	7,000 million yen	8,092 million yen	△13.5%
Operating profit	10,000 million yen	9,444 million yen	+5.9%
Ordinary profit	10,600 million yen	10,061 million yen	+5.3%
Profit attributable to owners of parent	7,200 million yen	6,826 million yen	+5.5%

Shareholder Returns

The annual dividend for FY3/2026 was ¥50.00 per share (interim ¥20.00, year-end ¥30.00), maintained at the same level as the prior year’s annual dividend of ¥50.00 after adjusting for the stock split. Although profit declined year on year, the year-end dividend was kept as previously forecast in line with the shareholder-return policy of the medium-term management plan. Share buybacks totaled ¥4,584 million (prior year: ¥4,715 million). As a result of paying dividends and conducting buybacks at the same level as the prior year against lower earnings per share, the payout ratio rose to 50.2% (prior year: 46.4%) and the total return ratio to 117.4% (prior year: 106.3%). Of the share buybacks of up to ¥10.0 billion set out in the medium-term management plan, ¥9.3 billion (excluding shares acquired through the officer-compensation BIP trust) had been completed by the end of March 2026, and the company intends to continue balancing shareholder returns and growth investment in FY3/2027.

Item	FY3/2026 (Actual)	FY3/2025 (Actual)	Change
Annual dividend (total)	50.00 yen	50.00 yen	±0.00 yen
Year-end dividend	30.00 yen	32.00 yen	△2.00 yen
Interim dividend	20.00 yen	18.00 yen	+2.00 yen
Payout ratio	50.2%	46.4%	+3.8pt
Total return ratio	117.4%	106.3%	+11.1pt
Total dividends	3,429 million yen	3,608 million yen	△179 million yen
Share buybacks	4,584 million yen	4,715 million yen	△131 million yen

Medium-Term Plan / Topics

Through the capital-cost-focused management advocated in the medium-term management plan “move.2027”, ROE for FY3/2026 was 11.0% (down 1.8 points year on year), and PBR stood at 1.3x as of the end of March 2026. As a topic, at the end of March 2026 the company opened the “SINKO System Development Center Nagasaki Base” (Nagasaki City, Nagasaki Prefecture), its fourth domestic system development site, strengthening its structure for promoting the DX strategy “SIMA Project”.

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.