Fujibo lifts FY2026 operating profit forecast to ¥10.5 billion

By Amara Osei

Fujibo Holdings (3104.T) reported on November 5 that fiscal 2026 first-half operating profit, covering April-September 2026, rose 29.0% year on year to a record ¥4.866 billion ($30.8 million). Revenue rose 21.4% to ¥27.354 billion ($173.2 million), while net profit attributable to owners of the parent rose 22.6% to ¥3.346 billion ($21.2 million).

Ordinary profit increased 32.6% to ¥5.176 billion ($32.8 million), and EBITDA rose 28.8% to ¥6.876 billion ($43.5 million).

President Masae Inoue said: “Abrasive materials performed strongly, supported by rising demand for advanced semiconductors accompanying the spread of generative AI and by a recovery in memory demand.”

Which segments produced the gain?

• Abrasives: Revenue reached ¥13.157 billion ($83.3 million), up 22.5%, while operating profit rose 25.2% to a record ¥3.655 billion ($23.1 million).
• Semiconductor applications: CMP revenue for semiconductor devices rose 31% on advanced logic-chip demand tied to generative AI; silicon-wafer applications rose 19% with the memory recovery; hard-disk applications rose 10% on data-center demand. LCD-glass applications fell 10% after Chinese government subsidy cuts reduced panel demand.
• Chemical products: Revenue rose 34.0% to ¥9.667 billion ($61.2 million), and operating profit increased 39.8% to ¥1.016 billion ($6.4 million).
• Production: Functional materials held firm as the electronic-materials market expanded, including for semiconductors. Agricultural chemical intermediates began a gradual recovery as inventory adjustments ended; Yanai and Takefu plants maintained high utilization; and Yanai’s No. 5 plant began operating in April.
• Lifestyle apparel: Revenue fell 11.3% to ¥2.79 billion ($17.7 million); operating profit dropped 52.0% to ¥107 million ($680,000).
• Other: Revenue rose 21.9% to ¥1.739 billion ($11.0 million); operating profit reached ¥87 million ($550,000), versus a ¥97 million loss a year earlier.

President Inoue said: “Results were sluggish due to shrinking sales floor space at mass retailers, unfavorable weather, and consumer reluctance to spend. In addition, overseas sales orders have declined because of deteriorating Japan-China relations.”

Fujibo plans to reset prices for flagship B.V.D. products, use AI-driven web marketing and e-commerce, and launch the Goodfar brand.

Abrasives and chemicals grew; apparel lagged.

How did profit drivers offset costs?

• Volume added ¥2.493 billion ($15.8 million) to operating profit, and selling prices added ¥555 million ($3.5 million).
• Cost changes offset ¥1.021 billion ($6.5 million); raw-material and fuel prices offset ¥564 million ($3.6 million); expenses offset ¥331 million ($2.1 million); and foreign exchange offset ¥37 million ($230,000).
• Second-quarter operating profit fell from the first quarter as raw-material and energy prices climbed amid Middle East tensions.
• Fujibo implemented price pass-through in chemicals and plans abrasives pass-through from the second half to limit a roughly ¥600 million ($3.8 million) full-year profit impact.

Price increases buffer input-cost inflation.

What does the raised FY2026 forecast show?

Fujibo made its third upward revision, two steps above its May 15 initial plan of ¥52.7 billion revenue and ¥9.2 billion operating profit.

• Revenue now stands at ¥55.4 billion ($350.8 million), up 20.6%; operating profit at ¥10.5 billion ($66.5 million), up 28.9%.
• Net profit is forecast at ¥7.2 billion ($45.6 million), up 28.3%; EBITDA at ¥14.708 billion ($93.1 million), up 28.9%. EPS is ¥213.49 ($1.4) on a post-stock-split basis.
• The annual dividend is ¥87 ($0.55), comprising ¥42 interim and ¥45 year-end payments, up ¥27 from ¥60 a year earlier.
• Abrasives: Revenue ¥27 billion ($171.0 million), up 19.7%; operating profit ¥8 billion ($50.7 million), up 25.3%.
• Chemical products: Revenue ¥18.5 billion ($117.1 million), up 31.1%; operating profit ¥1.9 billion ($12.0 million), up 34.1%.
• Lifestyle apparel: Revenue ¥6 billion ($38.0 million), down 5.1%; operating profit ¥300 million ($1.9 million), down 31.5%.
• Other: Revenue ¥3.9 billion ($24.7 million), up 33.1%; operating profit ¥250 million ($1.6 million), versus a ¥98 million loss.

Chemicals must offset apparel weakness.

Where is Fujibo deploying capital?

Under the “Evolution 26-30” medium-term plan, Fujibo plans ¥35 billion ($221.6 million) of capital investment from FY2026 through FY2028, with 81% allocated to abrasives, plus ¥5 billion ($31.7 million) for research and development.

Funding comes from ¥36 billion ($227.9 million) of net profit and depreciation, ¥2 billion ($12.7 million) of asset sales and other sources, and ¥10 billion ($63.3 million) in bank borrowings. Fujibo earmarks ¥8.5 billion ($53.8 million) for shareholder returns and raised its payout target to 40%, with possible increases after FY2028.

• A ¥8.7 billion ($55.1 million) soft-pad building and line at Fujibo Ehime’s Mibugawa Plant starts in the second half of FY2028 and raises capacity by more than 60%, mainly for CMP.
• A ¥5.3 billion ($33.6 million) post-processing building and line at the Oita Plant also starts in the second half of FY2028, lifting capacity by more than 50%, mainly for non-CMP work.
• A ¥6.5 billion ($41.2 million) R&D center near Hsinchu City at Taiwan Fujibo Precision Materials is under construction and scheduled to start in the first half of FY2027.

PBR exceeds 2x, while ROE of 11.3% and ROIC of 11.5% continue to improve. Inoue said investor recognition and market valuation still need improvement; management will focus on growth investment, disclosure, a broader investor base, stronger returns and ROIC-based management.

Capacity expansion targets semiconductor-related growth.

What did analysts ask?

At the briefing, analysts asked about semiconductor-demand durability, price pass-through and apparel reform. Management expects AI and data-center investment to expand for now, remains confident in CMP-led advanced-semiconductor demand, reiterated second-half abrasives pass-through, and plans a higher e-commerce ratio and new brands.

Pricing, capacity and apparel recovery set the execution test.