F.C.C. (7296): FY2025 Results Summary — Record Revenue and Operating Profit, Annual Dividend Raised to 194 Yen

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

Note: F.C.C. Co., Ltd. labels the fiscal year covered by this presentation as “FY26” (April 1, 2025 through March 31, 2026), and the following fiscal year as “FY27”; the labels used in the text, tables and charts below follow the presentation. For FY26 the company reported record-high revenue and operating profit. Revenue rose 1.6% year on year to 260,836 million yen and operating profit rose 9.2% to 18,927 million yen, as increased sales of motorcycles in India and automobiles in North America more than offset the effect of US tariffs and restructuring costs in China. Profit attributable to owners of parent increased 18.3% to 18,760 million yen, mainly due to recognition of deferred tax assets, and ROE was 9.6% (+1.0 point year on year). Alongside the results the company published its 13th Medium-term Management Plan covering FY2027 to FY2031.

Consolidated Results (Full-Year Actual)

Revenue increased 4,217 million yen (1.6%) year on year and operating profit increased 1,598 million yen (9.2%). In the analysis of changes in operating profit, the positive factors were reductions in other sales, general, and administrative expenses (+1,563 million yen), a reduced depreciation expense burden (+1,097 million yen), sales fluctuations and changes in model mix (+801 million yen), reduced R&D expenses (+244 million yen) and other (+720 million yen); the negative factors were the effect of US tariffs (-2,158 million yen) and the amount of exchange rate effect (-669 million yen). The company notes that the tariff figure is calculated taking into consideration the potential effect of tariffs on the Group and the current status of price transfer negotiations with each customer. Basic earnings per share rose from 323.77 yen to 387.36 yen. The average USD rate during the period was 150.78 yen, against 152.58 yen in FY25.

Item (million yen)	FY25 Results	FY26 Results	Change (amount)	Change
Revenue	256,619	260,836	4,217	1.6%
Operating profit	17,329	18,927	1,598	9.2%
Profit before income taxes	20,052	21,567	1,515	7.6%
Profit	15,903	18,806	2,903	18.3%
Profit attributable to owners of parent	15,859	18,760	2,901	18.3%
Basic earnings per share (Yen)	323.77	387.36	63.59	19.6%
Average rate during the period: USD (Yen)	152.58	150.78	-1.80	—

Segment Results

In the motorcycle business, revenue was 124,691 million yen and operating profit 12,230 million yen, both up year on year, with the operating profit margin at 9.8% against 10.0% in FY25. In the automobile business, revenue was 135,975 million yen and operating profit 9,156 million yen, with the operating profit margin rising to 6.7% from 6.0%. The environmental energy business posted revenue of 169 million yen and an operating loss of 2,459 million yen.

Business segment (million yen, %)	Metric	FY25	FY26
Motorcycles	Revenue	120,408	124,691
Motorcycles	Operating profit	12,083	12,230
Motorcycles	Operating profit margin	10.0	9.8
Automobiles	Revenue	136,115	135,975
Automobiles	Operating profit	8,101	9,156
Automobiles	Operating profit margin	6.0	6.7
Environmental energy	Revenue	94	169
Environmental energy	Operating profit	-2,855	-2,459

By geographical segment, Asia was the largest revenue contributor at 118,479 million yen, followed by North America at 110,487 million yen. North America recorded the largest operating profit at 10,736 million yen with a 9.7% margin, while Asia’s operating profit declined to 8,790 million yen and its margin narrowed to 7.4% from 8.1%. Japan remained in operating loss, but the loss narrowed from 4,121 million yen to 1,197 million yen and the margin improved from -15.9% to -4.7%.

Geographical segment (million yen, %)	Metric	FY25	FY26
Japan	Revenue	25,975	25,371
Japan	Operating profit	-4,121	-1,197
Japan	Operating profit margin	-15.9	-4.7
North America	Revenue	109,649	110,487
North America	Operating profit	10,706	10,736
North America	Operating profit margin	9.8	9.7
Asia	Revenue	115,409	118,479
Asia	Operating profit	9,388	8,790
Asia	Operating profit margin	8.1	7.4
Others	Revenue	5,586	6,498
Others	Operating profit	577	807
Others	Operating profit margin	10.3	12.4

On a customer basis, the HONDA Group remained the largest customer with revenue of 92,678 million yen (35.5% of the total, down 2.4% year on year), followed by FORD at 52,574 million yen (20.2%, up 1.8%) and GM at 24,090 million yen (9.2%, up 1.4%). Within the motorcycle business, TVS grew 23.4% to 9,270 million yen and Bajaj grew 16.3% to 3,848 million yen. The exchange rate effect on total revenue was -4,427 million yen.

FY27 Forecast

For FY27 the company forecasts revenue of 260,000 million yen (-0.3%) and operating profit of 20,000 million yen (+5.7%), while profit attributable to owners of parent is forecast to decrease 20.0% to 15,000 million yen. The presentation states that the motorcycle business is forecast to have increased revenue due to higher sales in India and the Philippines, while the automobile business is forecast to have increased profits despite lower sales in North America, due to reduced depreciation costs, and that the revenue and operating profit forecasts partially reflect the effect of the tensions in the Middle East. The assumed average USD rate is 150.00 yen.

Item (million yen)	FY26 Results	FY27 (Forecast)	Change (amount)	Change	(Reference) Exchange rate effect
Revenue	260,836	260,000	-836	-0.3%	(-2,900)
Operating profit	18,927	20,000	1,073	5.7%	(-500)
Profit before income taxes	21,567	22,000	433	2.0%	—
Profit	18,806	15,100	-3,706	-19.7%	—
Profit attributable to owners of parent	18,760	15,000	-3,760	-20.0%	—
Basic earnings per share (Yen)	387.36	315.05	-72.31	-18.7%	—
Average rate during the period: USD (Yen)	150.78	150.00	-0.78	—	—

Business segment (million yen, %)	Metric	FY26	FY27 (Forecast)
Motorcycles	Revenue	124,691	124,900
Motorcycles	Operating profit	12,230	11,900
Motorcycles	Operating profit margin	9.8	9.5
Automobiles	Revenue	135,975	134,900
Automobiles	Operating profit	9,156	11,000
Automobiles	Operating profit margin	6.7	8.2
Environmental energy	Revenue	169	200
Environmental energy	Operating profit	-2,459	-2,900

By region, the FY27 forecast has Japan returning to an operating profit of 300 million yen (margin 1.2%) on revenue of 25,000 million yen, North America at 10,500 million yen of operating profit on revenue of 110,000 million yen, Asia at 9,000 million yen on revenue of 119,000 million yen, and Others at 500 million yen on revenue of 6,000 million yen. Capital expenditures are planned to rise to 21,500 million yen from 16,451 million yen in FY26 and research and development expense to 9,800 million yen from 8,513 million yen, while depreciation and amortization is planned at 9,630 million yen against 9,692 million yen.

Shareholder Returns

For FY26 the dividend payout ratio was set at 50%, resulting in an annual ordinary dividend of 194 yen per share, an increase of 118 yen year on year, and the maximum amount of share buybacks was set at 3.39 billion yen. The dividend payout ratio for FY26 was 50.1% and the total shareholders return ratio 68.7%, which includes the planned acquisition amount through the tender offer bid for treasury stock announced on May 13, 2026; DOE was 3.8%. In FY25 the company paid an ordinary dividend of 76 yen plus a special dividend of 126 yen, for a payout ratio of 62.4%, a total shareholders return ratio of 78.2% and DOE of 5.4%. Under the 13th Medium-term Management Plan, the company will pay dividends at whichever is higher of a dividend payout ratio of 50% or a DOE of 3.5%, and share buybacks are considered part of profit distribution and will be decided flexibly, with a flexible share buyback program set at 25 billion yen over five years. The FY27 annual ordinary dividend is estimated at 160 yen per share.

13th Medium-term Management Plan (FY2027 to FY2031)

The 13th Medium-term Management Plan has been formulated as a five-year plan looking ahead to 2030, under the basic policy “Creating New Value for the Future” and four key strategies: business strategy, strengthening the management foundation, financial and capital strategy, and sustainability strategy. For FY2031, the final year of the plan, the company targets sales of 3,000 (unit: 100 million yen), an operating profit margin of 8.3% and ROE of 9.0% or more, against 2,608, 7.3% and 9.6% respectively in FY2026. The FY2031 sales target breaks down into motorcycles (core) 1,450, motorcycles (EV/CASE) 150, automobiles (core) 1,150, automobiles (EV/CASE) 150 and environmental energy 100, on an assumed exchange rate of 150.00 yen per USD. Business-level 2031 targets are sales of 160 billion yen and operating profit of 17 billion yen (margin 10.6%) for the motorcycle business, sales of 130 billion yen and operating profit of 10 billion yen (margin 7.7%) for the automobile business, and sales of 10 billion yen and operating profit of 500 million yen (margin 5.0%) for the environmental energy business.

On cash allocation, the plan assumes five-year cumulative cash in of 190 billion yen of operating CF (before deducting R&D expenses), 80 billion yen of cash on hand and 20 billion yen of loans, etc. Cash out is allocated to growth investments of 80 billion yen, core business investments of 60 billion yen, strategic investments of 40 billion yen and shareholder returns of 70 billion yen, with the remainder held as cash on hand for working capital and risk management costs. The shareholders’ equity ratio is estimated to move from 78% in FY2026 to 69% by FY2031.

Reviewing the 12th Medium-term Management Plan, the company states that its share in the Indian motorcycle clutch market rose from 69% in FY2024 to 73% in FY2026, and that it secures approximately 30% of the North American automobile clutch market share in FY2026 according to in-house research. PBR improved from 0.48 in FY2023 to 0.79 in FY2026.

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.