■Performance Trends of Mimaki Engineering (6638)

1. Cumulative performance trends for the 2nd quarter of the fiscal year ending March 31, 2025

The cumulative results for the 2nd quarter of the fiscal year ending 2025/3 were strong, with sales of 40942 million yen (up 15.5% from the same period last year), operating income of 4698 million yen (up 101.5% from the same period), ordinary profit of 4321 million yen (up 114.5% from the same period), and interim net income attributable to parent company shareholders of 3250 million yen (up 130.1% from the same period), and was revised upward twice during the fiscal year. Furthermore, the 10% operating profit margin for the fiscal year ending 2026/3, which was targeted by the medium- to long-term growth strategy “Mimaki V10,” was cleared as early as possible. Note that the main exchange rate (average rate from 2024/4 to 2024/9) was 1 US dollar 152.62 yen (141.00 yen in the same period last year) and 1 euro 165.93 yen (same 153.38 yen).

Although the global economy is on a gradual recovery trend, the core inflation rate is still high, and the state of economic recovery varies from region to region and country, and each country's central banks and governments continue to maintain prudent monetary policies. Furthermore, geopolitical risks remain a major cause of concern, and the situation is unpredictable. The Japanese economy is on a gradual recovery trend, corporate motivation for capital investment is solid, the economy is stabilizing as a whole, and a sustained economic recovery is expected, but private consumption is sluggish due to the effects of high prices, and the pace of growth is still moderate. Under such an environment, the company continuously promoted market introduction and sales expansion of new products, business development in anticipation of rapid changes in the market environment and customer needs, and infrastructure construction aimed at improving profitability based on the priority measures defined in the “Mimaki V10.”

Sales were strong in addition to DTF (Direct to Film) models and high-speed sublimation transfer models for the TA market, models equipped with UV ink with strengths for the SG market, and large FB (flatbed) models for the IP market, and the FA business also secured sales on par with the same period last year, although there were shades by product. By region, North, Central and South America, Japan, Asia, and Oceania grew drastically, and Europe, the Middle East, and Africa also performed well. The positive impact of the depreciation of the yen was added to this, and we were able to secure a 2-digit increase in sales as a whole. In terms of profit, although marine transportation costs have risen, sales of products using high-cost components have almost ended, and maintenance costs have also been reduced by analyzing big data from production processes and improving ink quality, cartridges, and cases, so the cost of sales ratio has improved drastically. Although labor costs, payment fees, research and development expenses, etc. increased in sales and administration expenses, the sales ratio improved due to sales increase effects and various cost reviews. The positive effects of exchange rates were added to these, and operating profit increased drastically by more than 2 times the same period last year, and the operating profit margin was 11.5%, which greatly cleared 10% on a half-year basis targeted with the “Mimaki V10.”

Compared to the initial forecast, the second quarter of the fiscal year ending 2025/3 was revised upward twice during the fiscal year, but as a result, it landed at 42 million yen in sales, 798 million yen in operating income, 721 million yen in ordinary income, and 700 million yen in interim net income attributable to parent company shareholders. The reason behind this upward correction is that, in addition to the positive effects of the depreciation of the yen, the development of ink and technology to properly use ink heads for diversifying printed matter progressed in terms of sales, and products that meet needs were introduced in rapid succession in the TA and SG markets, and sales of products using high-cost components were terminated in terms of profit.

As for new products, they are ambitious to strengthen the lineup against the backdrop of advances in technology that uses inkheads properly, etc., and it is planned that multiple new products will be announced for each market in 2024/9 and sold sequentially in the second half (sales contributions are scheduled to be in full swing for the 2026/3 fiscal year). Note, the profitability of new products has improved in the same way as overall profitability since price revisions have been made in the past 1 to 2 years. As a specific new product, the CJV200 series print and cut multifunction printer, which pursues high image quality and ease of use by anyone, was announced for the SG market. The 100 series has been renewed, and while the cost ratio has been greatly improved by using the 300 series head as one, speed and image quality have also been improved, and the time required for installation has been cut in half, so it seems to be very popular with dealers. For the IP market, we announced the JFX200-1213 EX, a new flatbed UV printer of “just the right size” with high production, high added value, and high image quality. Since it saves space and can be easily used for various purposes such as reinforced cardboard and novelty goods, it seems that it was well received at the exhibition. For the TA market, the DTF model TxF300-1600, which has about 4 times the productivity compared to conventional models, and the TS330-3200DS, a 3.2m wide super wide hybrid printer that enables direct sublimation and sublimation transfer printing with one unit, were announced. Since the width of the TxF300-1600 has been increased and the speed has been increased, productivity has improved, such as being able to print 2 T-shirts simultaneously, and applications have also expanded to a wide range of interior fabrics such as sofas and carpets. Since the TS330-3200DS can be printed on soft signs and interior fabrics, it is possible to easily create an entire space for small facilities such as exhibition booths, even though it is for Europe and the United States.

(Written by FISCO Visiting Analyst Miyata Hitomitsu)