Earnings release
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Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail. Consolidated Financial Results for the First Nine Months of the Fiscal Year Ending March 31, 2025 (Under Japanese GAAP) February 6, 2025 Company name: Bunka Shutter Co., Ltd. Listing: Tokyo Stock Exchange Securities code: 5930 URL: https://www.bunka-s.co.jp/ Representative: Hiroyuki Ogura, Repr esentative Director and President Inquiries: Koichi Nishimura, Operating Officer and Manager of Accounting Department TEL: +81-3-5844-7200 Scheduled date to commence dividend payments: – Preparation of supplementary material on financial results: None Holding of financial results briefing: None (Yen amounts are rounded down to millions, unless otherwise noted.) 1. Consolidated financial results for the first nine months of the fiscal year ending March 31, 2025 (from April 1, 2024 to December 31, 2024) (1) Consolidated operating results (cumulative) (Percentages indicate year-on-year changes.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Nine months ended Millions of yen % Millions of yen % Millions of yen % Millions of yen % December 31, 2024 159,943 3.7 8,174 (1.8) 8,484 (6.4) 5,967 6.6 December 31, 2023 154,164 12.4 8,326 57.3 9,063 80.5 5,599 35.9 Note: Comprehensive income For the nine months ended December 31, 2024:¥5,605 million [(25.8)%] For the nine months ended December 31, 2023:¥7,557 million [38.7%] Basic earnings per share Diluted earnings per share Nine months ended Yen Yen December 31, 2024 83.88 – December 31, 2023 84.71 – Note: At the end of the previous fiscal year, the provisiona l accounting treatment for business combination was settled. As a result, each figure for the nine months ended December 31, 2023 reflects the settlement of the provisional accounting treatment. (2) Consolidated financial position Total assets Net assets Equity-to-asset ratio As of Millions of yen Millions of yen % December 31, 2024 206,820 104,837 50.6 March 31, 2024 206,879 103,924 50.2 Reference: Equity As of December 31, 2024: ¥104,676 million As of March 31, 2024: ¥103,769 million
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2. Cash dividends Annual dividends First quarter-end Second quarter-end Third quarter-end Fiscal year-end Total Yen Yen Yen Yen Yen Fiscal year ended March 31, 2024 – 21.00 – 34.00 55.00 Fiscal year ending March 31, 2025 – 32.00 – Fiscal year ending March 31, 2025 (Forecast) 32.00 64.00 Note: Revisions to the cash dividends forecasts most recently a nnounced: None 3. Consolidated earnings forecasts for the fiscal year ending March 31, 2025 (from April 1, 2024 to March 31, 2025) (Percentages indicate year-on-year changes.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen Fiscal year ending March 31, 2025 230,000 4.0 15,000 3.6 15,400 (3.4) 13,200 24.7 185.51 Note: Revisions to the earnings forecasts most recently a nnounced: Yes Concerning the revisions to the consolidated earnings forecasts, please refer to the “Notice Concerning Revisions to Earnings Forecasts” announced today (February 6, 2025).
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* Notes (1) Significant changes in the scope of consolidation during the period: None (2) Application of specific accounting treatment for preparing quarterly consolidated financial statements: Yes Note: For more details, please refer to “2. Quarterly cons olidated financial statements, (3) Notes to quarterly consolidated financial statements, (Notes to specific accounting treatment for preparing quarterly consolidated financial statements)” on page 8 of the attached material. (3) Changes in accounting policies, changes in accounting estimates, and restatement (i) Changes in accounting policies due to revisions to accounting standards and other regulations: Yes (ii) Changes in accounting policies due to other reasons: None (iii) Changes in accounting estimates: None (iv) Restatement: None Note: For more details, please refer to “2. Quarterly cons olidated financial statements, (3) Notes to quarterly consolidated financial statements, (Notes on changes in accounting policies)” on page 8 of the attached material. (4) Number of issued shares (common shares) (i) Total number of issued shares at the end of the period (including treasury shares) As of December 31, 2024 72,196,487 shares As of March 31, 2024 72,196,487 shares (ii) Number of treasury shares at the end of the period As of December 31, 2024 1,041,314 shares As of March 31, 2024 1,065,082 shares (iii) Average number of shares outstanding during the period Nine months ended December 31, 2024 71,143,860 shares Nine months ended December 31, 2023 66,110,631 shares Note: The number of treasury shares at the end of the period includes the number of shares of Bunka Shutter Co., Ltd. (the “Company”) held by the Board Incentive Plan trust. The Company’s shares held by the trust are included in the treasury shares deducted in calculating the average number of shares outstanding during the period. * Review of the Japanese-language originals of the attached quarterly consolidated financial statements by certified public accountants or an audit corporation: None * Proper use of earnings forecasts, and other special matters (Caution regarding forward-looking statements and others) The forward-looking statements, including earnings forecasts, contained in these materials are based on information currently available to the Company and on certain assumptions deemed to be reasonable. Consequently, any statements herein do not constitute assurances regarding actual results by the Company. Actual business and other results may differ substantially due to various factors. Regarding earnings forecasts, please refer to “1. Overview of operating results, etc., (3) Explanation of consolidated earnings forecasts and other forward-looking statements” on page 3 of the attached material.
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- 1 - ○ Table of Contents of Attached Materials Index 1. Overview of operating results, etc. ........................................................................................................... 2 (1) Overview of operating results for the first nine months of the current fiscal year ............................. 2 (2) Overview of financial position for the first nine months of the current fiscal year ............................ 3 (3) Explanation of consolidated earnings forecasts and other forward-looking statements ..................... 3 2. Quarterly consolidated financial statements ............................................................................................. 4 (1) Quarterly consolidated balance sheet ................................................................................................. 4 (2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income ................................................................................................................................................ 6 Quarterly consolidated statement of income ...................................................................................... 6 Quarterly consolidated statement of comprehensive income ............................................................. 7 (3) Notes to quarterly consolidated financial statements ......................................................................... 8 (Notes on changes in accounting policies) ......................................................................................... 8 (Notes to specific accounting treatment for preparing quarterly consolidated financial statements) . 8 (Notes to segment information, etc.) .................................................................................................. 9 (Notes on significant changes in the amount of shareholders’ equity) ............................................. 10 (Notes on premise of going concern) ............................................................................................... 10 (Notes to quarterly consolidated statement of cash flows) ............................................................... 11 (Significant subsequent events) ........................................................................................................ 11
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- 2 - 1. Overview of operating results, etc. (1) Overview of operating results for the first nine months of the current fiscal year In the first nine months of the fiscal year ending March 31, 2025, the Japanese economy maintained a moderate recovery trend, mainly owing to improvements in employment and income conditions buoyed by wage hikes and the like and expanded capital investment against a backdrop of improved corporate earnings. On the other hand, the future outlook remains uncertain due to factors such as heightening geopolitical risks, including the situations in the Middle East and Ukraine, as well as skyrocketing energy and raw material prices due to the continued depreciation of the yen. In the construction and housing industries too, in which the Bunka Shutter Group operates, private capital expenditure remains steady and construction demand remains firm, but the situation remains unclear mainly because of continued weak figures for new housing starts due to skyrocketing construction costs and other factors. Under these circumstances, the Group posted consolidated net sales of 159,943 million yen (up 3.7% year on year) in the first nine months of the fiscal year ending March 31, 2025. With regard to profits, despite all Group segments exerting the utmost effort to secure profits, operating profit came to 8,174 million yen (down 1.8% year on year) and ordinary profit was 8,484 million yen (down 6.4% year on year), but profit attributable to owners of parent totaled 5,967 million yen (up 6.6% year on year) due mainly to recording of gain on sale of investment securities. Operating results by segment are as follows: 1. Shutter Business The inclusion in the scope of consolidation of Windsor Doors Limited and three other companies, and SPRINT ROLLER SHUTTERS PTY LTD led to net sales of 67,001 million yen (up 2.8% year on year) for the first nine months of the fiscal year ending March 31, 2025, and operating profit of 6,274 million yen (up 6.8% year on year). 2. Construction-Related Materials Business Due to weakness in steel doors, etc., net sales for the first nine months of the fiscal year ending March 31, 2025 came to 61,132 million yen (up 2.6% year on year), but operating profit was 1,163 million yen (down 43.6% year on year). 3. Service Business Due to strong results mainly from emergency repairs and periodic maintenance services, centering on the firm performance of consolidated subsidiary Bunka Shutter Service Co., Ltd., net sales for the first nine months of the fiscal year ending March 31, 2025 amounted to 22,346 million yen (up 8.2% year on year), and operating profit was 4,101 million yen (up 15.4% year on year). 4. Refurbishment Business This segment focuses on the renewal business, which mainly engages in renovation of buildings, and the housing remodeling business. Due to weakness in the housing remodeling business, with BX Y utori Form Co., Ltd. as the main driver, net sales for the first nine months of the fiscal year ending March 31, 2025 amounted to 4,776 million yen (up 5.2% year on year), but operating loss was 16 million yen (compared to an operating loss of 1 million yen in the same period of the previous fiscal year). 5. Other The other businesses, including the water-sealing business which handles water-sealing equipment for dealing with the social problems of torrential rain, etc., performed strongly. Accordingly, net sales for the first nine months of the fiscal year ending March 31, 2025 amounted to 4,686 million yen (up 10.9% year on year) and operating profit was 620 million yen (up 13.4% year on year).
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- 3 - (2) Overview of financial position for the first nine months of the current fiscal year Total assets as of December 31, 2024 amounted to 206,820 million yen, a decrease of 59 million yen from the end of the previous fiscal year. Current assets amounted to 120,133 million yen, an increase of 84 million yen from the end of the previous fiscal year. This is attributed mainly to increases in merchandise and finished goods (6,125 million yen), “other” in current assets (2,072 million yen) and cash and deposits (1,330 million yen), which more than offset a decrease in notes and accounts receivable - trade, and contract assets (8,987 million yen). Non-current assets amounted to 86,686 million yen, a decrease of 143 million yen. This is attributed mainly to decreases in investment securities (1,280 million yen) and goodwill (635 million yen), which more than offset increases in buildings and structures (868 million yen) and “other” in property, plant and equipment (831 million yen). Total liabilities as of December 31, 2024 amounted to 101,982 million yen, a decrease of 972 million yen from the end of the previous fiscal year. Current liabilities amounted to 64,655 million yen, a decrease of 904 million yen. This is attributed mainly to decreases in income taxes payable (2,963 million yen), provision for bonuses (2,267 million yen) and notes and accounts payable - trade (760 million yen), which more than offset increases in “other” in current liabilities (2,889 million yen), short-term borrowings (1,050 million yen) and electronically recorded obligations - operating (917 million yen). Non-current liabilities amounted to 37,327 million yen, a decrease of 67 million yen. This is attributed mainly to a decrease in long-term borrowings (554 million yen), which more than offset an increase in “other” in non-current liabilities (520 million yen). Total net assets as of December 31, 2024 amounted to 104,837 million yen, an increase of 913 million yen from the end of the previous fiscal year. This is attributed mainly to an increase in profit attributable to owners of parent (5,967 million yen), which more than offset a decrease caused by dividends paid (4,716 million yen). (3) Explanation of consolidated earnings forecasts and other forward-looking statements The Company has revised the consolidated earnings forecasts for the fiscal year ending March 31, 2025 announced on May 14, 2024, as a result of taking into account the progress of operating results and future outlook in the first nine months of the fiscal year ending March 31, 2025. For more details, please refer to the “Notice Concerning Revisions to Earnings Forecasts” announced today (February 6, 2025).
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- 4 - 2. Quarterly consolidated financial statements (1) Quarterly consolidated balance sheet (Millions of yen) As of March 31, 2024 As of December 31, 2024 Assets Current assets Cash and deposits 40,151 41,481 Notes and accounts receivable - trade, and contract assets 46,935 37,948 Electronically recorded monetary claims - operating 10,631 10,316 Merchandise and finished goods 9,818 15,944 Work in process 1,406 1,543 Raw materials and supplies 8,654 8,438 Other 2,752 4,825 Allowance for doubtful accounts (302) (365) Total current assets 120,049 120,133 Non-current assets Property, plant and equipment Buildings and structures, net 12,320 13,189 Land 13,121 13,489 Other, net 13,265 14,097 Total property, plant and equipment 38,707 40,775 Intangible assets Goodwill 11,318 10,682 Other 8,156 7,550 Total intangible assets 19,474 18,233 Investments and other assets Investment securities 19,940 18,659 Retirement benefit asset 1,397 1,397 Other 7,564 7,908 Allowance for doubtful accounts (254) (288) Total investments and other assets 28,648 27,677 Total non-current assets 86,830 86,686 Total assets 206,879 206,820
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- 5 - (Millions of yen) As of March 31, 2024 As of December 31, 2024 Liabilities Current liabilities Notes and accounts payable – trade 15,604 14,844 Electronically recorded obligations - operating 21,552 22,470 Short-term borrowings 1,352 2,402 Current portion of long-term borrowings 817 873 Income taxes payable 4,334 1,371 Provision for bonuses 4,809 2,541 Provision for bonuses for directors (and other officers) 182 123 Provision for loss on construction contracts 373 606 Other 16,531 19,420 Total current liabilities 65,559 64,655 Non-current liabilities Bonds payable 10,000 10,000 Long-term borrowings 3,209 2,655 Provision for retirement benefits for directors (and other officers) 247 247 Provision for share awards for directors (and other officers) 69 63 Retirement benefit liability 16,433 16,405 Asset retirement obligations 53 54 Other 7,381 7,901 Total non-current liabilities 37,395 37,327 Total liabilities 102,954 101,982 Net assets Shareholders’ equity Share capital 15,051 15,051 Capital surplus 11,292 11,292 Retained earnings 70,476 71,728 Treasury shares (1,103) (1,079) Total shareholders’ equity 95,716 96,992 Accumulated other comprehensive income Valuation difference on available-for-sale securities 5,026 4,481 Deferred gains or losses on hedges – 11 Revaluation reserve for land (46) (46) Foreign currency translation adjustment 908 1,201 Remeasurements of defined benefit plans 2,163 2,035 Total accumulated other comprehensive income 8,052 7,684 Non-controlling interests 155 161 Total net assets 103,924 104,837 Total liabilities and net assets 206,879 206,820
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- 6 - (2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income Quarterly consolidated statement of income (Millions of yen) Nine months ended December 31, 2023 Nine months ended December 31, 2024 Net sales 154,164 159,943 Cost of sales 112,908 116,302 Gross profit 41,255 43,641 Selling, general and administrative expenses 32,929 35,466 Operating profit 8,326 8,174 Non-operating income Interest income 26 60 Dividend income 265 346 Rental income 57 60 Foreign exchange gains 579 – Other 341 360 Total non-operating income 1,269 827 Non-operating expenses Interest expenses 224 369 Share of loss of entities accounted for using equity method 170 35 Other 138 113 Total non-operating expenses 532 517 Ordinary profit 9,063 8,484 Extraordinary income Gain on sale of non-current assets 2 13 Gain on sale of investment securities 15 1,196 Total extraordinary income 18 1,210 Extraordinary losses Loss on sale of non-current assets – 16 Loss on retirement of non-current assets 41 74 Total extraordinary losses 41 91 Profit before income taxes 9,041 9,603 Income taxes 3,429 3,629 Profit 5,611 5,974 Profit attributable to non-controlling interests 11 6 Profit attributable to owners of parent 5,599 5,967
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- 7 - Quarterly consolidated statement of comprehensive income (Millions of yen) Nine months ended December 31, 2023 Nine months ended December 31, 2024 Profit 5,611 5,974 Other comprehensive income Valuation difference on available-for-sale securities 1,268 (554) Foreign currency translation adjustment 306 330 Remeasurements of defined benefit plans, net of tax (101) (148) Share of other comprehensive income of entities accounted for using equity method 472 3 Total other comprehensive income 1,945 (368) Comprehensive income 7,557 5,605 Comprehensive income attributable to Comprehensive income attributable to owners of parent 7,545 5,599 Comprehensive income attributable to non-controlling interests 11 6
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- 8 - (3) Notes to quarterly conso lidated financial statements (Notes on changes in accounting policies) (Application of “Accounting Standard for Current Income Taxes” and other standards) The “Accounting Standard for Current Income Taxes” (ASBJ Statement No. 27, October 28, 2022; hereinafter the “Revised 2022 Accounting Standard”) and relevant regulations have been applied from the beginning of the first quarter of the fiscal year. Revisions to the category in which income tax, etc. is recorded (in cases where other comprehensive income is subject to tax) are subject to the transitional treatment stipulated in the provisos to paragraph 20-3 of the Revised 2022 Accounting Standard, and paragraph 65-2 (2) of the “Guidance on Accounting Standard for Tax Effect Accounting” (ASBJ Guidance No. 28, October 28, 2022; hereinafter the “Revised 2022 Guidance”). These changes in accounting policies have no impact on the quarterly consolidated financial statements. With regard to revisions related to changes in the treatment in the consolidated financial statement of cases involving the deferral of taxes associated with gains or losses arising from the sale of shares, etc. of subsidiaries between consolidated companies, the Revised 2022 Guidance has been applied from the beginning of the first quarter of the fiscal year. These changes to accounting policies have been applied retrospectively, and quarterly consolidated financial statements and consolidated financial statements for the quarters of the previous fiscal year and for the previous fiscal year, respectively, reflect this retrospective application. These changes to accounting policies have no impact on quarterly consolidated financial statements for the quarters of the previous fiscal year or consolidated financial statements for the previous fiscal year. (Notes to specific accounting treatment for preparing quarterly consolidated financial statements) (Calculation of tax expenses) The Company calculates tax expenses by estimating a reasonable effective tax rate after the application of tax-effect accounting to profit before income taxes for the consolidated fiscal year ending March 31, 2025, including the third quarter under review, and multiplying profit before income taxes by this estimated effective tax rate.
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- 9 - (Notes to segment information, etc.) I For the nine months ended December 31, 2023 1. Explanation of net sales, profit (loss), and other items, and information on disaggregation of revenue for each reportable segment (Millions of yen) Reportable segments Other (Note 1) Total Adjust- ments (Note 2) Amount recorded in quarterly consolidated statement of income (Note 3) Shutter Business Construction -Related Materials Business Service Business Refurbish- ment Business Total Net sales Revenue from contracts with customers 65,157 59,589 20,651 4,541 149,940 4,224 154,164 – 154,164 Other revenue – – – – – – – – – Net sales to external customers 65,157 59,589 20,651 4,541 149,940 4,224 154,164 – 154,164 Inter-segment sales and transfers 3,869 95 361 5 4,331 665 4,997 (4,997) – Total 69,027 59,684 21,013 4,546 154,272 4,889 159,162 (4,997) 154,164 Segment profit (loss) 5,876 2,063 3,553 (1) 11,491 546 12,037 (3,711) 8,326 Notes: 1. The category “Other” is an operating segment which is not included in the reportable segments, and it includes water-sealing business, solar power system business, real estate leasing business, insurance agency business and architecture design business. 2. The adjustment to segment profit (loss) of (3,711) million yen consists of (3,710) million yen for corporate expenses not allocated to any reportable segment and (0) million yen for inventory adjustments. Corporate expenses consist primarily of general and administrative expenses that do not belong to any reportable segment. 3. Segment profit (loss) is adjusted with operating prof it in the quarterly consolidated statement of income. 4. At the end of the previous fiscal year, the provisional accounting treatment for business combination was settled. Segment profit (loss) is based on the amount after reflecting the significant revision of the initial allocation of acquisition costs due to the settlement of the provisional accounting treatment for business combination. 2. Information of impairment loss or goodwill, et c. on non-current assets by reportable segment (Significant changes in amount of goodwill) In the Shutter Business segment, BX BUNKA AUSTRALIA PTY LTD, a consolidated subsidiary, newly acquired shares of DOORWORKS AUSTRALIA PTY LTD, and included the company in the scope of consolidation. The increase in goodwill due to this was 746 million yen for the first nine months of the fiscal year ended March 31, 2024. The amount of goodwill reflects the settlement of the provisional accounting treatment. In the Shutter Business segment, BX BUNKA NEW ZEALAND LIMITED, a consolidated subsidiary, newly acquired shares of four companies: Windsor Doors Limited, Windsor Doors (South Island) Limited, Jones Door Company (2005) Limited, and Doors 2000 Limited (hereinafter the “Windsor Group”), and included the Windsor Group in the scope of consolidation. The increase in goodwill due to this was 4,655 million yen for the first nine months of the fiscal year ended March 31, 2024. The amount of goodwill reflects the settlement of the provisional accounting treatment.
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- 10 - In the Shutter Business segment, BX BUNKA AUSTRALIA PTY LTD, a consolidated subsidiary, newly acquired shares of SPRINT ROLLER SHUTTERS PTY LTD, and included the company in the scope of consolidation. The increase in goodwill due to this was 1,761 million yen for the first nine months of the fiscal year ended March 31, 2024. The amount of goodwill reflects the settlement of the provisional accounting treatment. II For the nine months ended December 31, 2024 1. Explanation of net sales, profit (loss), and other items, and information on disaggregation of revenue for each reportable segment (Millions of yen) Reportable segments Other (Note 1) Total Adjust- ments (Note 2) Amount recorded in quarterly consolidated statement of income (Note 3) Shutter Business Construction -Related Materials Business Service Business Refurbish- ment Business Total Net sales Revenue from contracts with customers 67,001 61,132 22,346 4,776 155,256 4,686 159,943 – 159,943 Other revenue – – – – – – – – – Net sales to external customers 67,001 61,132 22,346 4,776 155,256 4,686 159,943 – 159,943 Inter-segment sales and transfers 4,012 25 471 13 4,523 721 5,245 (5,245) – Total 71,014 61,158 22,818 4,789 159,780 5,408 165,188 (5,245) 159,943 Segment profit (loss) 6,274 1,163 4,101 (16) 11,522 620 12,142 (3,968) 8,174 Notes: 1. The category “Other” is an operating segment which is not included in the reportable segments, and it includes water-sealing business, solar power system business, real estate leasing business, insurance agency business and architecture design business. 2. The adjustment to segment profit (loss) of (3,968) million yen consists of (3,967) million yen for corporate expenses not allocated to any reportable segment and (0) million yen for inventory adjustments. Corporate expenses consist primarily of general and administrative expenses that do not belong to any reportable segment. 3. Segment profit (loss) is adjusted with operating prof it in the quarterly consolidated statement of income. 2. Information of impairment loss or goodwill, et c. on non-current assets by reportable segment Not applicable. (Notes on significant changes in the amount of shareholders’ equity) Not applicable. (Notes on premise of going concern) Not applicable.
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- 11 - (Notes to quarterly consolidated statement of cash flows) No quarterly consolidated statement of cash flows has been prepared for the first nine months of the fiscal year ending March 31, 2025. Amounts of depreciation (including amortization of intangible assets other than goodwill) and amortization of goodwill associated with the nine months ended December 31, 2023 and 2024 are as follows. (Millions of yen) Nine months ended December 31, 2023 Nine months ended December 31, 2024 Depreciation 3,404 3,937 Amortization of goodwill 478 814 (Significant subsequent events) (Conclusion of lawsuit) In relation to an appellate court judgment in the lawsuit in which the Company sued IBM Japan, Ltd. for damages related to the cancellation of a system development project, the Company and IBM Japan, Ltd., being dissatisfied with the verdict, filed an appeal and a petition for certiorari with the Supreme Court, which was dismissed by the Supreme Court on January 10, 2025, with a judgment to the effect that the appeal would not be accepted. This brought the lawsuit to a conclusion. As a result of these events, the Company will record extraordinary income of 2,782 million yen in relation to compensation for damages in the following quarter.