Dear Shareholders and Investors
In the first half of fiscal 2024, the overall world economy showed gradual growth, with the U.S. economy remaining stable despite ongoing economic stagnation in Europe and China. However, the outlook was unclear due in part to the risks posed to global economic activity by geopolitical tensions attributable to conditions in the Middle East and the Russia-Ukraine situation.
Amid these circumstances, we saw our sales volume expand across many businesses and the yen depreciate, leading to consolidated operating results for the first half of fiscal 2024 as follows:net sales increased by \30.2 billion year on year to \411.2 billion, operating income increased by \4.5 billion to \45.5 billion, ordinary income increased by \5.5 billion to \44 billion, and net income attributable to owners of the parent increased by \8.6 billion to \30.4 billion. All of these results—net sales and each type of profit—set new record highs for the first half.
The full-year forecast for fiscal 2024 is revised upward from the previous forecast (announced on May 14, 2024) in light of the strong performance in the first half of the fiscal year. The forecasts are for net sales of ¥850 billion, operating income of ¥89 billion, ordinary income of ¥84 billion, and net income attributable to owners of parent of ¥55 billion.
Based on our Medium-Term Management Plan "PASSION 2026," the Group is working to enhance its business portfolio by evaluating businesses along two axes, "economic value" and "social and environmental value," and by considering "market growth potential." In the first half of this fiscal year, we decided to make investments for future growth, such as the construction of a new EVALTM plant in Singapore, where demand is expected to expand for food packaging applications as the shift to a circular economy continues, and the acquisition of an industrial reactivated carbon business in the United States. At the same time, in light of the market environment and the life cycle of our businesses, we decided to optimize the production capacity of our MMA plants, downsize our nonwoven fabric business, and transfer our diatomite and perlite businesses. We will continue to aim for sustained growth by shifting to a more sustainable business structure through well-balanced investment of management resources.
Regarding shareholder returns in fiscal 2024, we have decided to increase the interim dividend by \2 from the initial forecast to \27 per share, based on the shareholder return policy of "total return ratio of 35% or more and annual dividend per share of \40 or more" in the Medium-Term Management Plan "PASSION 2026," and taking into account the current performance trends. The year-end dividend forecast has also been revised up by \2 to \27 per share, and the annual dividend per share (forecast) is expected to be \54. In addition, based on the resolution of the Board of Directors on May 14, 2024, we are conducting a share buyback with a maximum of 15,000,000 shares and ¥20 billion, and the total return ratio for fiscal 2024 is expected to be approximately 68%.
On behalf of Kuraray, I would like to extend our gratitude for your continued understanding and generous support.
Hitoshi Kawahara, President and Representative Director
