Sumitomo Chemical Co., Ltd. (TSE: 4005) reported consolidated full-year results for the fiscal year ended March 31, 2026 (FY3/2026) under IFRS. Revenue declined 10.7% year-on-year to ¥2,328,515 million from ¥2,606,281 million, as the group pruned low-margin commodity volumes and weaker product lines. The cleaner mix flowed straight through to profit: core operating income jumped 48.3% to ¥208,376 million from ¥140,519 million, lifting the core operating margin to 8.9% from 5.4%. Operating profit rose to ¥193,033 million from ¥151,744 million, while pre-tax profit nearly doubled to ¥116,068 million from ¥58,093 million — held back from the operating line by a ¥43,271 million swing into equity-method investment losses (versus a ¥20,639 million gain a year earlier).
Net profit attributable to owners of the parent rose 57.9% to ¥60,947 million from ¥38,591 million, and total net profit jumped 170.3% to ¥115,402 million. Basic EPS came in at ¥37.16 versus ¥23.59, with diluted EPS of ¥37.15. Return on equity attributable to owners of the parent improved to 6.4% from 4.1%, and total comprehensive income swung to a positive ¥187,881 million from a ¥54,622 million loss the prior year, aided by currency-translation gains.
A profitability rebuild across the portfolio
The result marks a clear inflection for a company that has spent the past two years restructuring. The headline story is margin recovery rather than top-line growth: revenue across the group's five reporting segments — Essential & Green Materials, Energy & Functional Materials, IT-related Chemicals, Health & Crop Sciences, and Pharmaceuticals — was deliberately rationalized, with the company exiting or scaling back unprofitable commodity positions. The 48% leap in core operating income against a 10.7% revenue decline shows the strategy working through the P&L, with stronger contributions from the higher-value materials and life-science franchises offsetting the deconsolidation of weaker units.
Balance sheet and cash flow
Total assets eased to ¥3,405,041 million from ¥3,439,784 million, while equity attributable to owners of the parent rose to ¥1,008,644 million from ¥900,790 million, lifting the parent equity ratio to 29.6% from 26.2% and book value per share to ¥610.78 from ¥550.37. Operating cash flow held broadly steady at ¥234,759 million (¥233,027 million a year earlier); investing activities used ¥74,821 million and financing activities used ¥199,068 million, the latter reflecting debt reduction and shareholder returns. Period-end cash and equivalents stood at ¥208,589 million.
Dividend lifted to ¥13.50
Reflecting the recovery in earnings, Sumitomo Chemical raised the annual dividend to ¥13.50 per share (¥6.00 interim + ¥7.50 year-end), up from ¥9.00 the prior year, with total dividends of ¥22,210 million. Management has guided to a further increase for FY3/2027, to ¥16.00 per share (¥8.00 interim + ¥8.00 year-end), signalling confidence that the profitability rebuild is durable.
FY27 guidance and portfolio changes
For FY3/2027, management guides to revenue of ¥2,360,000 million (+1.4%), core operating income of ¥215,000 million (+3.2%), operating profit of ¥177,000 million, and net profit attributable to owners of ¥70,000 million (+14.9%), implying basic EPS of ¥42.40. The company did not disclose first-half guidance, citing visibility constraints. During FY3/2026 the consolidation scope shifted materially: Sumitomo Chemical added Xuyou Electronic Materials Technology (Wuxi) Co., Ltd. as a new consolidated subsidiary and deconsolidated two companies, including Sumitomo Pharma UK Holdings Ltd., as part of the continuing portfolio realignment toward higher-value materials and life sciences.
| Metric | FY3/2026 | FY3/2025 | YoY |
|---|---|---|---|
| Revenue (¥ million) | 2,328,515 | 2,606,281 | −10.7% |
| Core operating income (¥ million) | 208,376 | 140,519 | +48.3% |
| Operating profit (¥ million) | 193,033 | 151,744 | +27.2% |
| Pre-tax profit (¥ million) | 116,068 | 58,093 | +99.8% |
| Net profit attrib. to owners (¥ million) | 60,947 | 38,591 | +57.9% |
| Basic EPS (¥) | 37.16 | 23.59 | +57.5% |
| Core operating margin | 8.9% | 5.4% | +3.5pp |
| ROE (attrib. to owners) | 6.4% | 4.1% | +2.3pp |
| Annual dividend (¥) | 13.50 | 9.00 | +50.0% |
| FY27 revenue guidance (¥ million) | 2,360,000 | — | +1.4% |
| FY27 core operating income guidance (¥ million) | 215,000 | — | +3.2% |
JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.