Akebono Brake's 2024 Financial Overview

Akebono Brake Industry Co., Ltd., a key player in the automotive brake systems market, released its consolidated financial results for the fiscal year ended March 31, 2025, under Japanese GAAP. The company, listed on the Tokyo Stock Exchange, faced a challenging year with a slight decline in net sales but showed resilience in maintaining operating profit. Despite an ordinary loss, strategic financial moves, such as selling investment securities, bolstered overall profit. The company also forecasted growth for the upcoming fiscal year, signaling optimism for recovery.

Key Highlights:

Net sales decreased by 2.8% to 161,672 million yen from 166,301 million yen in 2024.
Operating profit remained stable at 3,124 million yen, a slight 0.9% decrease from 3,153 million yen.
Ordinary loss of 2,271 million yen was reported, compared to a profit of 3,780 million yen in 2024.
Profit attributable to owners dropped significantly to 168 million yen from 3,452 million yen.
Total assets reduced to 128,326 million yen, down from 150,475 million yen, reflecting a leaner balance sheet.
Capital adequacy ratio improved to 38.6% from 34.8%, indicating stronger financial health.
No dividends were paid on common or Class A shares, consistent with the previous year.
Forecast for 2026 projects net sales of 154,600 million yen and an operating profit increase of 28.1% to 4,000 million yen.

Financial Performance Details

Akebono’s net sales declined due to market challenges, but the company maintained a gross profit of 16,212 million yen, up from 15,779 million yen, driven by cost management. However, non-operating expenses, including foreign exchange losses of 1,873 million yen and financing expenses of 1,733 million yen, led to an ordinary loss. A significant gain on sale of investment securities (8,950 million yen) helped achieve a profit before taxes of 4,017 million yen. After accounting for taxes and non-controlling interests, profit attributable to owners was modest.

The balance sheet showed a reduction in total assets by 14.7%, primarily due to lower cash reserves and investment securities. Cash and deposits fell to 18,303 million yen from 26,949 million yen, reflecting significant debt repayments. Net assets decreased to 55,945 million yen, but the improved capital adequacy ratio suggests a more robust equity base. Cash flows from operating activities dropped to 1,446 million yen from 7,622 million yen, while investing activities generated 5,974 million yen, largely from asset sales. Financing activities saw a net outflow of 18,536 million yen, driven by 49,802 million yen in long-term borrowing repayments.

Strategic and Structural Changes

Akebono underwent structural changes, including the exclusion of Akebono Europe S.A.S. from its consolidation scope, impacting financials. The company also retired 6,300 Class A shares in January 2025, streamlining its capital structure. No dividends were declared, reflecting a cautious approach to capital preservation amid restructuring efforts. Non-consolidated results showed a net loss of 7,549 million yen, driven by a provision for doubtful accounts of 18,248 million yen, highlighting challenges in subsidiary performance.

Outlook for 2025

Akebono projects a 4.4% decline in net sales to 154,600 million yen for the fiscal year ending March 31, 2026, but anticipates a 28.1% rise in operating profit to 4,000 million yen. The company expects a profit attributable to owners of 4,790 million yen, signaling confidence in operational improvements and market recovery. These forecasts are based on current market conditions and internal strategies, though actual results may vary due to external factors.

Bottom Line

Akebono Brake Industry navigated a tough fiscal 2024 with stable operating profit despite a sales dip and an ordinary loss. Strategic asset sales and debt management strengthened its financial position, as evidenced by an improved capital adequacy ratio. With a positive outlook for 2025, Akebono aims to leverage operational efficiencies to drive profitability, maintaining its position in the competitive automotive sector.

Note: Financial forecasts are based on assumptions and may differ from actual outcomes due to market or operational changes.

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