Top Message
Status of the Consolidated First Half of FY Ending March 2026
Looking at the global economy during our consolidated first six months of the Fiscal Year ending March 2026, the economy kept moderate recovery including firm uptrends in consumer spending and capital investments in the United States. On the other hand, the economy in Europe remained sluggish in general due to decreased export mainly impacted by the US Government's tariffing although the region saw a move of improvement in consumer spending. In China, the economy trended downward chiefly due to decreased export to the United States and slackening demand in the real estate market although the government policies boosted underlying domestic demands. In Japan, although the economy trended towards moderate recovery in general, corporate production activities remained weak centering on the automotive industry.
Looking at the market environment around the Nippon Chemi-Con Group, the ICT related market continued enjoying investments in data centers by leading US IT corporations, etc. and trended towards firm demand for generated AI servers and their peripheral equipment. On the other hand, however, recovery in demand slowed and remained sluggish in the automotive markets due chiefly to the US Government's tariff moves although demand grew in the areas of xEV and automated driving/Advanced Driving Assistant System (Ad/ADAS). Demand on industrial equipment markets, centering on manufacturing industry in Europe, remained sluggish. The economy in China hardly exhibited strength for recovery. In addition, the US Government's tariffing put burden on corporate capital investments. As a result, our market environment came to see no substantial recovery in demand.
Amid this operating environment, our Group steadily advanced its policy measures outlined in our 10th Medium-term Management Plan.
In sales, we focused promotion to meet growing demand for servers, including AI servers which are projected to enjoy stable growth in the future thanks to vigorous investments in data centers. We also worked on improvement in profitability by ending the manufacture of unprofitable products. In addition, we were building up sales footings in overseas markets that are expected to grow, for example, by making United Chemi-Con, Inc., our subsidiary in the United States, prepare for establishing new sales bases. In production, the Group reinforced its capacities of producing large-sized aluminum electrolytic capacitors and hybrid capacitors, leading to the buildup of a stable supply system. Furthermore, we have been transforming some of our production into an optimum-area production system where our production bases in the ASEAN region are adjusted to the US Government's tariffing.
In product development, we have succeeded in developing conductive polymer hybrid aluminum electrolytic capacitors, named the HXG Series, which are compatible with high capacity and high ripple current, compared with existing products, and offered the series products for higher-function devices such as in-vehicle devices. Moreover, we have succeeded in achieving a substantial improvement in permeability properties where our original processing is applied. The improved properties have been contributing to the proactive development of new products, such as common mode chalk coils, named FX Series, and camera modules, named ML Series. The former series products have led to the development of compact noise-filters for industrial equipment and in-vehicle devices, while the latter series products have led to the development of Automotive SerDes Alliance compatible with the next-generation high-speed interface.
As a result of these efforts, consolidated earnings for the cumulative first six months of the Fiscal Year Ending March 2026 were net sales of 642,46 million yen (up 7.2% YoY), operating income of 956 million yen (down 48.3% YoY), and ordinary income of 779 million yen (up 161.2% YoY). Profit attributable to owners of parent was 269 million yen (up 244.9% YoY).
Despite of the above performances, our current business environment has remained severe. Considering the market trends for the future, we have decided, with sincere regret, to forego issuing an interim dividend for the consolidated fiscal year ending March 2026. We offer our deepest apologies to our shareholders.
Status by Product Group
The consolidated first half status by product group is as follows:
- Capacitors (¥592,16 million, 92.2% of total sales)
Net sales of the product group increased by 7.9% YoY due to firm demands for data centers. - Mechanical Parts and Other Parts (¥15,75 million, 2.5% of total sales)
Net sales of the product group decreased by 8.0% YoY due to decreased demand for in-vehicle camera modules in the sluggish automotive market. - Capacitor Materials (¥2,657 million, 4.1% of total sales)
Net sales of the product group decreased by 3.4% YoY due to decreased demand for electrode foils used in aluminum electrolytic capacitors. - Other Products (¥797 million, 1.2% of total sales)
Net sales of the product group increased by 44.2% YoY due to increased demand for resale products.
Full-year Outlook
Looking ahead, the domestic economy is projected to trend towards a mild recovery in the trend of firm consumer spending along with slowed price rises. Looking at the global economy overall, however, the operating environment influencing the Group is still projected to remain uncertain owing to the factors including the US Government's tariff moves and geopolitical risks in the Middle East and Ukraine.
The Group is determined to improve its corporate value by continuously implementing key measures.
In sales, the Group will reinforce sales in the expected-to-grow ICT market, the expected-to-recover automotive electronics market, and the industrial equipment market. We will also promote sales of high-value-added products such as large-sized aluminum electrolytic capacitors and hybrid capacitors for data centers. In addition, the Group is going to establish Chemi-Con Electronics (India) Private Limited, our subsidiary distributor, in India and will build up a marketing system for overseas markets expected to grow. In production, we will continue promoting our smart factory framework to improve labor productivity by expanding automation in the production facilities. We will also continue working on minimizing manned labor in the production processes and dealing with work efficiency in the staffing sections.
Our consolidated full-year earnings forecast for the fiscal year ending March 2026 is net sales of 137,000 million yen (up 11.7% YoY), operating income of 4,000 million yen (up 6.9% YoY), ordinary income of 2,500 million yen (up 59.4% YoY), and profit of 1,500 million yen attributable to owners of parent (previous FY was 37 million yen in profit attributable to owners of parent). The assumed exchange rate is US $1 = JPY145.
December 5, 2025
Kenichi Konno
Representative Director and President