Hoden Seimitsu H1 Operating Profit Jumps 84% on Gas-Turbine and Aero-Engine Parts; Dividend Raised to ¥25

Energy and aerospace drive a margin jump

Hoden Seimitsu Kako Kenkyusho Co., Ltd. (TSE: 6469), the Yokohama-based specialist in electrical discharge machining, surface treatment and extrusion dies, reported consolidated first-half results for FY2/2027, the six months from March 1 to August 31, 2026, on October 6, 2026 under Japanese GAAP. Net sales rose 21.6% to ¥8,636 million. Housing and transport markets stayed sluggish, but rising electricity demand from the spread of AI lifted orders for gas-turbine parts, and air-travel and freight growth plus Japan's defence build-up kept aircraft-engine and defence work strong. Gross profit rose 32.4% to ¥2,470 million, the gross margin widening 2.3 points to 28.6% on scale benefits in aerospace and a richer mix of high-value energy parts, while selling, general and administrative expenses rose 7.0% to ¥1,337 million.

Operating profit jumped 83.7% to ¥1,132 million, a margin of 13.1% against 8.7% a year earlier, and ordinary profit rose 88.2% to ¥1,076 million. Profit attributable to owners of the parent rose 113.3% to ¥732 million, or ¥68.53 per share against ¥32.14. Orders received grew 30.3% to ¥9,677 million, running ahead of sales.

Every segment grows

The core electrical discharge machining and surface treatment segment, which processes aircraft-engine and gas-turbine components, grew external sales 27.2% to ¥6,173 million and segment profit 46.7% to ¥1,469 million; gas-turbine capacity added last year came on stream in stages, and its orders rose 38.5% to ¥7,308 million. The dies segment grew sales 9.0% to ¥1,793 million and profit 38.9% to ¥211 million: aluminium-extrusion dies for housing were flat, but demand rose for high-value dies used to extrude ceramic honeycomb. Machinery and other grew sales 11.1% to ¥669 million on price revisions for automotive press parts, and segment profit rose 163.4% to ¥152 million. The segment figures reflect a reorganisation that moved part of the environmental business from the machining segment into machinery, with the prior year restated.

Balance sheet and cash flow

Total assets rose 2.4% to ¥19,474 million from February 28 and net assets 4.1% to ¥10,086 million, lifting the equity ratio to 46.7% from 45.7%. Operating cash flow fell to ¥655 million from ¥1,551 million as receivables grew and payables fell, while capital expenditure on property, plant and equipment took ¥517 million.

Forecast revised, dividend raised

On the same day the company revised its FY2/2027 forecast, which now calls for net sales of ¥17,067 million (+19.2%), operating profit of ¥1,832 million (+63.2%), ordinary profit of ¥1,715 million (+65.2%) and net profit of ¥1,151 million (+39.9%), or ¥107.80 per share. The plan implies second-half operating profit of about ¥700 million, below the first half's ¥1,132 million. The year-end dividend forecast was raised to ¥25.00, against ¥18.00 for the previous year.

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.