Sanyo Trading <3176> is an independent specialized trading company that focuses on exporting and importing raw materials such as rubbers and chemicals, automobile interior materials, renewable energy, bio-related equipment, and domestic sales, while also providing technical services related to each business. It expands its global business mainly in four markets: Fine Chemicals, Industrial Products, Sustainability, and Life Sciences. In terms of segment classification, it will transition from the conventional classification of chemicals, machinery materials, and overseas subsidiaries to the above four segment system from the first quarter of the fiscal year ending in September 2025 to disclose performance progress more clearly for capital markets. About half of the sales staff have a scientific background, and based on the technical knowledge cultivated since its establishment, Sanyo Trading provides total solutions from sales to after-sales services. With a solid management foundation and a unique business model, it has achieved high profitability and capital efficiency.

For the consolidated performance in the fiscal year ending in September 2024, the revenue increased by 7.2% from the previous year to 129,263 million yen, and the operating profit increased by 8.4% to 7,072 million yen, setting a new record for both revenue and profit. Revenue and profit increased in all segments - chemicals, machinery materials, and overseas subsidiaries, contributing to record-breaking performance. In particular, the profit was boosted by the strong performance of overseas subsidiaries, including favorable exchange rate gains, along with the sales growth of high value-added raw materials in the EV-related field and appropriate pricing reflecting rising procurement costs, resulting in the operating profit surpassing the topline growth. As a result, the operating margin has been maintained at a high level of 5.5%. Additionally, the successful acquisition of large projects in the wood biomass-related business and the increase in orders for offshore wind power-related equipment by group companies contributed to the revenue and profit growth.

For the consolidated performance in the fiscal year ending in September 2025, the revenue is expected to increase by 2.1% to 132,000 million yen, and the operating profit is expected to increase by 0.4% to 7,100 million yen compared to the previous year. Regarding revenue, it is expected to continue setting record highs in revenue, supported by the contribution of large projects in the wood biomass-related business and the favorable performance of overseas businesses, mainly in the USA. On the profit side, despite temporary cost increases due to the discontinuation of handling certain equipment and upfront investments in DX, the growth in the wood biomass-related business and marine resource development business is expected to offset these factors, aiming for profit levels similar to the previous period. Large projects such as wood biomass projects have revenue recognition based on progress in construction. Therefore, revenue recognition forecasts are easier to make, and in this sense, the company sees a relatively high likelihood of achieving performance expectations. As for dividends, a planned increase of 2.0 yen per share from the previous period to 57.0 yen (expected dividend yield of 3.81%) is planned. The company has publicly stated for the first time its policy of shareholder returns, aiming for a "cumulative dividend" with a target of "dividend payout ratio of 30% or more" during the long-term management plan "SANYO VISION 2028". By making this statement, the company has emphasized its shareholder-oriented stance once again. Our company believes that as profits expand in the future, shareholders can also expect sufficient dividend increases. Regarding the purchase of treasury stock, it seems that the company will continue to consider it while taking into account the need for funds for growth investments and overall liquidity and financial conditions.

Regarding the long-term management policy, SANYO has announced "SANYO VISION 2028". They aim to achieve an operating profit of 9,000 million yen by the fiscal year ending in September 2028 by actively investing in growth in three areas: business, DX-related areas, and human capital (with a total of 20 billion to 30 billion yen over 5 years), steadily advancing the three growth strategies known as the three arrows (realizing potential core businesses, promoting M&A, and initiatives of the business development office). The operating profit for the fiscal year ending in September 2024, the first year of this vision, set a new record, showing a good start towards achieving the numerical target for the fiscal year ending in September 2028. The company plans to continue executing growth investments that exceed the cost of capital, aiming to expand performance and enhance corporate value.