Daiki Axis <4245> announced its consolidated financial results for the third quarter of the fiscal year ending December 2024 (January-September 24). Revenue increased by 7.3% year-on-year to 33.522 billion yen, operating profit increased by 88.0% to 0.677 billion yen, ordinary profit increased by 48.5% to 0.763 billion yen, and quarterly net profit attributable to parent company shareholders was 0.233 billion yen (compared to a profit of 0.017 billion yen in the same period last year).

Revenue from the environmental equipment-related business increased by 6.6% year-on-year to 16.535 billion yen, with segment profit (operating profit) increasing by 39.4% to 1.28 billion yen. Domestic construction and sales of purification tanks and drainage treatment systems saw increased revenue due to price increases and the status of large-scale construction projects. Profits in this segment significantly increased due to high-profit projects in price increases and large-scale construction, as well as expanding maintenance sales as part of the stock business. Overseas sales for the group as a whole increased, with maintenance also showing strong growth. New contracts related to stock business for groundwater drinking water conversion are increasing. Sales of groundwater drinking water conversion devices without ESCO contracts are also on the rise. Post-sale maintenance contracts are contributing to the expansion of the stock business.

Revenue from residential equipment-related business increased by 9.4% to 14.524 billion yen, with segment profit (operating profit) increasing by 67.9% to 0.342 billion yen. Wholesale of housing facilities and construction materials to construction-related businesses has increased year-on-year. Sales of retail products for home improvement stores are decreasing due to a decline in demand for renovation and DIY. The housing department's construction business has significantly increased due to including a subsidiary performing air conditioning equipment construction since the end of the previous quarter, and winning large projects in agricultural greenhouse construction driven by the recovery in equipment investment demand.

Revenue from renewable energy-related business increased by 0.9% to 1.999 billion yen, with segment profit (operating profit) decreasing by 30.1% to 0.176 billion yen. The solar power generation business saw an increase due to including a newly consolidated subsidiary since the end of the previous quarter, as well as an increase in sites selling electricity through FIT (189 sites, 2 more than the previous year) and PPA (32 sites, 21 more than before). Small wind power generation business saw a decrease in revenue due to recording sales revenue from participating in the Ministry of the Environment's 'CO2 Emission Reduction Inducement Type Technology Development and Demonstration Project' with 3 other companies in the previous year. The biodiesel fuel-related business continues to focus on strengthening sales of "B5 light oil", leading to a steady increase in contract numbers and revenue compared to the previous year.

Revenue from other businesses decreased by 0.5% to 0.463 billion yen, with segment loss of 0.006 billion yen (compared to a profit of 0.028 billion yen in the previous year). Despite a decrease in contract numbers for bottle-type water server in the household drinking water business, the number of subscribers for the fully automatic water server, which operates on a subscription model, has increased. Segment profit decreased due to the impact of initial costs related to introducing new products. In the venture capital business, following the establishment of Daiki Axis Venture Partners in the second quarter, a first fund (DAVP Venture 1 Investment Business Limited Liability Partnership) has been formed, with investments made in 12 companies as of the end of the third quarter.

Regarding the consolidated performance forecast for the full year ending December 2024, the revenue is expected to increase by 4.3% year-on-year to 44.5 billion yen, operating profit to increase by 10.5% to 0.73 billion yen, ordinary profit to decrease by 4.5% to 0.8 billion yen, and net income attributable to parent company shareholders to increase by 94.8% to 0.4 billion yen, maintaining the initial plan.