Asahi Intecc FY2026 Full Year: Operating Profit Jumps 50% to Record High

Revenue was 145,419 million yen (up 21.2% year on year), operating profit 45,218 million yen (up 50.3%), ordinary profit 45,185 million yen (up 52.8%), and net income attributable to owners of the parent 32,075 million yen (up 151.8%), marking record highs at every profit stage. Gross margin improved to 70.4% from 67.7% a year earlier, and the operating margin rose into the 31% range.

Growth was driven by overseas sales of medical PCI guidewires and penetration catheters, solid medical and industrial components in the device business, the consolidation of Nitta Mold, and the yen's depreciation to 154.45 per US dollar and 180.11 per euro. Higher US tariffs and increased selling and R&D expenses were absorbed by productivity improvements and the top-line expansion.

Net income jumped 151.8% largely because ordinary profit increased and an impairment loss fell sharply to 1,061 million yen from 9,244 million yen a year earlier.

Medical Business revenue was 126,798 million yen (up 17.6%), with segment profit of 46,190 million yen (up 38.1%). Domestic sales benefited from purchased peripheral vascular products in the non-circulatory field, while overseas sales expanded in all regions. China remained the largest regional market at 37,982 million yen, helped by case volume growth and share gains. In circulatory, PCI guidewires and penetration catheters led; in non-circulatory, abdominal/peripheral and cerebrovascular products grew.

Device Business revenue rose 52.1% to 18,620 million yen, with segment profit up 83.5% to 8,485 million yen. Medical components grew on demand from a US company for cardiovascular testing catheter parts and ultrasound catheter components for Asia, while industrial components benefited from strong overseas leisure-related transactions. The consolidation of Nitta Mold added to both revenue and profit.

Total assets rose by 25,098 million yen from the prior year end to 218,285 million yen, mainly due to increases in cash and deposits to 64,264 million yen and accounts receivable to 18,923 million yen. Net assets were 174,358 million yen, and the equity ratio improved to 79.4%, indicating an extremely strong financial position.

Operating cash flow remained high at 40,095 million yen. Investing cash flow was an outflow of 11,739 million yen from purchases of investment securities and property, plant and equipment. Financing cash flow was an outflow of 19,971 million yen, including 10,553 million yen for treasury stock and 6,534 million yen for dividends, leaving cash and cash equivalents at 64,264 million yen.

The annual dividend was 48.24 yen per share, consisting of an ordinary dividend of 42.21 yen and a 50th anniversary commemorative dividend of 6.03 yen, up 99.1% year on year, with a payout ratio of 40.0%. For FY2027, the company plans an annual dividend of 49.91 yen (payout ratio 35.0%), strengthening shareholder returns.

Key risks include: (1) higher costs from US tariffs and material prices, (2) exchange rate fluctuations, with a stronger yen above assumed rates reducing profit, (3) dependence on China, which accounted for about 26% of revenue, including 17,793 million yen in sales to major customer Beijing Jiashi Weizhong Medical Equipment Co., Ltd., (4) delays in new product development and approvals, and (5) market share losses from intensifying competition.

The company plans to absorb costs through productivity improvements and sales of high-value-added products, while pursuing balanced growth outside China. However, startup costs for the Nanning plant are expected to increase in FY2027 and may pressure near-term profits.

For FY2027, Asahi Intecc forecasts revenue of 161,794 million yen (up 11.3%), operating profit of 52,127 million yen (up 15.3%), and net income attributable to owners of the parent of 37,832 million yen (up 17.9%), maintaining double-digit growth. Gross margin is expected to improve to 70.9%, and operating margin to 32.2%. The company assumes exchange rates of 155 yen per US dollar and 179 yen per euro. Growth will be led by overseas share gains and increased OEM atherectomy catheters in the Medical Business, and by expanding component demand from major US medical device makers in the Device Business.

R&D spending will rise to 9.4% of revenue, and Nanning plant startup costs are expected to increase SG&A expenses.

Asahi Intecc has announced an upward revision to its medium-term management plan, 'Building the Future 2030.' The company consolidated Nitta Mold from this fiscal year, strengthening its device manufacturing base. It also conducted treasury stock acquisitions and retirements to improve earnings per share, and enhanced shareholder returns through the 50th anniversary dividend. Preparations for operations at Asahi Intecc Medical Instruments (Nanning) Co., Ltd., scheduled to start production in 2030, are now in full swing, laying the groundwork for future production capacity expansion.