Interim report
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DISCLAIMER: This translation may be used for reference purposes only. This English version is not an official translation of the original Japanese document. In cases where any differences occur between the English version and the original Japanese version, the Japanese version shall prevail. This translation is subject to change without notice. Consolidated Financial Results for the Six Months Ended September 30, 2025 <under Japanese GAAP> October 31, 2025 Company name: ORGANO CORPORATION Listing: Tokyo Stock Exchange Securities code: 6368 URL: https://www.organo.co.jp/english/ Representative: Masayuki Yamada, Representative Director and President Inquiries: Minoru Ando, General Manager of Accounting Dept., Corporate Management and Planning TEL: +81-3-5635-5111 Scheduled date to file semi-annual securities report: November 7, 2025 Scheduled date to commence dividend payments: D ecember 1, 2025 Preparation of supplementary material on financial results: Yes Holding of financial results briefing: Yes (for institutional investors and analysts) (Millions of yen with fractional amounts discarded, unless otherwise noted) 1. Consolidated financial results for the six months ended September 30, 2025 (from April 1, 2025 to September 30, 2025) (1) Consolidated operating results (cumulative) (Percentages indicate year-on-year changes.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Six months ended Millions of yen % Millions of yen % Millions of yen % Millions of yen % September 30, 2025 82,793 11.4 17,378 51.4 17,349 45.2 11,528 41.7 September 30, 2024 74,323 13.5 11,480 46.1 11,946 39.9 8,134 46.9 Note: Comprehensive income: Six months e nded September 30, 2025 ¥11,678 million [29.0%] Six months ended September 30, 2024 ¥9,050 million [36.8%] Basic earnings per share Diluted earnings per share Six months ended Yen Yen September 30, 2025 250.78 – September 30, 2024 176.97 – (2) Consolidated financial position Total assets Net assets E quity-to-asset ratio As of Millions of yen Millions of yen % September 30, 2025 194,947 128,638 66.0 March 31, 2025 194,396 121,194 62.2 (Reference) Equity: As of September 30, 2025 ¥128,638 million As of Ma rch 31, 2025 ¥120,947 million
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2. Cash dividends Annual dividends per share First quarte r-end Second quarte r-end Third quarte r-end Fiscal yea r-end Total Yen Yen Yen Yen Yen Fiscal year ended March 31, 2025 – 71.00 – 89.00 160.00 Fiscal year ending March 31, 2026 – 95.00 Fiscal year ending March 31, 2026 (Forecast) – 95.00 190.00 Note: Revisions to the forecast of cash dividends most recently announced: Yes 3. Consolidated earnings forecasts for the fiscal year ending March 31, 2026 (from April 1, 2025 to March 31, 2026) (Percentages indicate year-on-year changes.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen Fiscal year ending March 31, 2026 175,000 7.2 36,000 15.7 36,000 13.8 27,000 11.8 587.32 Note: Revisions to the earnings forecasts most recently announced: Yes
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* Notes (1) Significant changes in the scope of consolidation during the period: Yes Newly included: – Excluded: 1 company (PT Lautan Organo Water) Note: For more details, please refer to “Significant changes in the scope of consolidation during the period” on page 10 of the attached material. (2) Application of specific accounting for preparing the semi-annual consolidated financial statements: Yes Note: For more details, please refer to “Application of specific accounting for preparing the semi-annual consolidated financial statements” on page 10 of the attached material. (3) Changes in accounting policies, change s in accounting estimates, and restatement a. Changes in accounting policies due to revisions to accounting standards and other regulations: None b. Changes in accounting policies due to other reasons: None c. Changes in accounting estimates: None d. Restatement: None (4) Number of issued shares (common shares) a. Total number of issued shares at the end of the period (including treasury shares) As of September 30, 2025 46,359,700 shares As of March 31, 2025 46,359,700 shares b. Number of treasury shares at the end of the period As of September 30, 2025 377,149 shares As of March 31, 2025 393,638 shares c. Average number of shares outstanding during the period (cumulative from the beginning of the fiscal year) For the six months ended September 30, 2025 45,971,704 shares For the six months ended September 30, 2024 45,964,750 shares Note: The Company has introduced an Officer Share Delivery Trust, and shares of the Company held by the Trust have been included in treasury shares excluded from the calculation of the number of treasury shares at the end of the period and the average number of shares outstanding during the period (cumulative from the beginning of the fiscal year). * Semi-annual financial results reports are exempt from review conducted by certified public accountants or an audit firm * Proper use of earnings forecasts, and other special matters (Caution regarding forward-looking statements and others) The forward-looking statements, incl uding earnings forecasts, contained in these materials are based on information currently available to the Company and on certain assumptions deemed to be reasonable. Consequently, any statements herein do not constitute assurances regarding actual results by the Company. Actual business and other results may differ substantially due to various factors. Please refer to “(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements” in “1. Qualitative information regarding financial results for the semi-annual period” on page 4 of the attached material for the suppositions that form the assumptions for earnings forecasts and cautions concerning the use thereof.
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- 1 - Attached Material Index 1. Qualitative information regarding financial results for the semi-annual period ........................................ 2 (1) Explanation regarding operating results ............................................................................................... 2 (2) Explanation regarding financial position .............................................................................................. 3 (3) Explanation regarding consolidated earnings forecasts and other forward-looking statements ........... 4 2. Semi-annual consolidated financial statements and significant notes thereto ........................................... 5 (1) Semi-annual consolidated balance sheet .............................................................................................. 5 (2) Semi-annual consolidated statement of income and semi-annual consolidated statement of comprehensive income ......................................................................................................... ................ 7 Semi-annual consolidated statement of income ................................................................................... 7 Semi-annual consolidated statement of comprehensive income .......................................................... 8 (3) Semi-annual consolidated statement of cash flows .............................................................................. 9 (4) Notes to semi-annual consolidated financial statements .................................................................... 10 Notes on premise of going concern .................................................................................................... 10 Notes on substantial changes in the amount of shareholders’ equity .................................................. 10 Significant changes in the scope of consolidation during the period .................................................. 10 Application of specific accounting for preparing the semi-annual consolidated financial statements ........................................................................................................................................... 10 Segment information, etc. ................................................................................................................... 11
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- 2 - 1. Qualitative information regarding fina ncial results for the semi-annual period (1) Explanation regarding operating results During the six months ended September 30, 2025 (from April 1, 2025 to September 30, 2025), the global economy showed signs of a gradual recovery overall, despite the impact of U.S. tariff policies and economic stagnation in some regions. Looking ahead, it remains necessary to pay close attention to geopolitical risks and the impact of protectionist policy trends and other factors in various countries on the economy. In the electronics industry, the Organo Group’s main market, demand for cutting-edge semiconductors related to generative artificial intelligence (AI) has continued to expand, and AI-related capital investment remains robust. On the other hand, demand for semiconductors other than cutting-edge products, such as power semiconductors, has continued to be sluggish due to factors including the slowdown in the growth of EVs (electric vehicles). In the general industry, such as pharmaceuticals and food, as well as electronics peripherals, and in the social infrastructure field, such as electric power/water supply and sewage, steady growth has been seen mainly driven by demand for maintenance services. Under these conditions, while promoting order-taking and delivery activities for large-scale projects in Japan and overseas, the Organo Group has advanced various measures, including expanding production and delivery capacities through the recruitment and training of engineers worldwide, strengthening its engineering capabilities through digital-driven operational efficiency improvements, promoting technology development and intellectual property strategies aligned with its business strategy, and reorganizing its domestic and overseas bases and ne tworks to strengthen its customer relations. In addition, the Organo Group has also been working to strengthen its management foundation by reinforcing human capital, enhancing sustainability and governance, and renewing its core systems. As a result, for the six months ended September 30, 2025, orders received increased by 8.1% year on year to ¥100,281 million, net sales increased by 11.4% year on year to ¥82,793 million, operating profit increased by 51.4% to ¥17,378 million, ordinary profit increased by 45.2% to ¥17,349 million, profit attributable to owners of parent increased by 41.7% to ¥11,528 million, and the carry-over balance for order backlog as of September 30, 2025 was down 9.9% to ¥124,073 million. Results by segment are as follows. [Water Treatment Engineering Business Unit] ■Orders received Orders received increased 8.9% year on year to ¥87,294 million. In the electronics industry, orders received increased, reflecting large- scale projects ordered for semicond uctors in Taiwan, the U.S. and Europe as well as the robust performance of projects for solutions, such as facility-owned services and various maintenance services. Furthermore, in the general industry and the social infrastructure field, the demand for solutions projects such as various maintenance services remained strong, while orders received decreased due to a reaction ary decline from large orders received in the same period of the previous fiscal year. ■Net sales Net sales increased 14.0% year on year to ¥70,549 million. In the electronics industry, net sales increased, reflecting steady progress of construction work of semiconductor-related plant projects in Japan and Taiwan, as well as strong sales of solutions projects such as facility-owned services and various maintenance services. In the genera l industry, sales were strong for both plant and service solutions, which enabled us to maintain the same level of net sales as the same period of the previous fiscal year. In the social infrastructure field, net sales increased, mainly due to higher sales of solutions projects for nuclear power plants. ■Operating profit Operating profit increased 60.9% year on year to ¥15,771 million. This was attributable to factors such as expanded net sales, mainly in the electronics industry, and growth in sales of solution projects with relatively high margin. In addition, the steady recording of sales from highly profitable plant projects and efforts to improve profitability, along with profit margin improvements achieved through cost reductions also contributed to the increase in operating profit.
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- 3 - [Performance Products Business Unit] ■Orders received/Net sales Orders received increased 3.2% year on year to ¥12,987 million and net sales decreased 1.6% year on year to ¥12,243 million. Despite the impact of streamlining low-margin transactions in the Food Products Division, sales of small-scale pure and ultrapure wa ter production systems increased, and orders and sales of various divisions such as water treatment chemicals, filters, and functional materials also remained strong overall, which enabled us to maintain the same level of orders received and net sales as the same period of the previous fiscal year. ■Operating profit Operating profit decreased 4.2% year on year to ¥1,607 million. Despite the factors such as growth in sales of relatively high-margin products such as water treatment chemicals and functional materials for the electronics industry, and improved profitability resulting from the streamlining of low-margin transactions in the Food Products Division, operating profit decreased slightly year on year due to an increase in selling, general and administrative expenses, primarily composed of personnel expenses and R&D expenses. (2) Explanation regardin g financial position Assets, liabilities and net assets Assets Assets as of September 30, 2025 amounted to ¥194 ,947 million, an increase of ¥551 million from the previous fiscal year end. This was mainly due to an increase of ¥8,561 million in inventories and an increase of ¥1,920 million in other current assets, despite a decrease of ¥6,903 million in notes and accounts receivable - trade, and contract assets and a decrease of ¥2,444 million in investments in leases. Liabilities Liabilities as of September 30, 2025 amounted to ¥66,309 million, a decrease of ¥6,892 million from the previous fiscal year end. This was mainly due to a decrease of ¥5,711 million in short-term borrowings and a decrease of ¥4,087 million in notes and accounts payable – trade, despite an increase of ¥3,920 million in long-term borrowings. Net Assets Net assets as of September 30, 2025 amounted to ¥128,638 million, an increase of ¥7,444 million from the previous fiscal year en d. This was mainly due to an increase of ¥7,432 million in retained earnings resulting from the recording of profit attributable to owners of parent, despite being reduced due to dividends paid. Cash flows Cash and cash equivalents (hereinafter, “cash”) as of September 30, 2025 decreased by ¥220 million from the previous fiscal year end to ¥16,530 million. Cash flows from operating activities Net cash provided by operating activities for the six months ended September 30, 2025 was ¥7,155 million. This was mainly because there was an increase in cash from the recording of profit before income taxes, etc. while there were expenses related to purchase of inventories. (Net cash of ¥12,665 million was provided in the six months ended September 30, 2024.) Cash flows from investing activities Net cash used in investing activities for the six months ended September 30, 2025 was ¥1,434 million. This was mainly due to purchase of property, plant and equipment of ¥955 million. (Net cash of ¥621 million was used in the six months ended September 30, 2024.) Cash flows from financing activities Net cash used in financing activities for the six months ended September 30, 2025 was ¥5,820 million. This was mainly due to a net decrease in short-term borrowings of ¥6,916 million and dividends paid of ¥4,095 million, while there were proceeds from long-term borrowings of ¥6,900 million. (Net cash of ¥13,999 million was used in the six months ended September 30, 2024.)
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- 4 - (3) Explanation regarding consolid ated earnings forecasts and other forward-looking statements In light of recent performance trends and other factors, the Company has revised the consolidated earnings forecasts, which were announced on August 4, 2025. Orders received are expected to exceed the previous forecast and amount to ¥185,000 million (up 2.8% from the previous forecast), mainly due to the fact that orders fo r solutions projects are expected to remain strong. Net sales are expected to be in line with the initial forecast, but profits are expected to exceed the previously announced forecast, mainly due to efforts to improve profitability, along with profit margin improvements achieved through cost reductions. Revisions to the consolidated earnings forecasts for th e fiscal year ending March 31, 2026 (April 1, 2025 to March 31, 2026) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Millions of yen Millions of yen Millions of yen Millions of yen Yen Previous forecast (A) 175,000 34,000 34,500 26,100 567.81 Revised forecast (B) 175,000 36,000 36,000 27,000 587.32 Change (B-A) – 2,000 1,500 900 Change (%) – 5.9 4.3 3.4 Reference: Consolidated results for the fiscal year ended March 31, 2025 163,269 31,120 31,639 24,150 525.37
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- 5 - 2. Semi-annual consolidated financial stat ements and significant notes thereto (1) Semi-annual consol idated balance sheet (Millions of yen) As of March 31, 2025 As of September 30, 2025 Assets Current assets Cash and deposits 16,751 16,530 Notes and accounts receivable - trade, and contract assets 79,450 72,547 Electronically recorded monetary claims - operating 4,502 3,514 Investments in leases 35,512 33,067 Merchandise and finished goods 8,010 8,527 Work in process 11,169 17,916 Raw materials and supplies 3,345 4,643 Other 5,719 7,640 Allowance for doubtful accounts (94) (88) Total current assets 164,367 164,298 Non-current assets Property, plant and equipment Buildings and structures 19,937 20,015 Accumulated depreciation (13,992) (14,129) Buildings and structures, net 5,944 5,886 Machinery, equipment and vehicles 7,298 7,242 Accumulated depreciation (6,206) (6,242) Machinery, equipment and vehicles, net 1,091 999 Land 12,437 12,359 Construction in progress 690 930 Other 7,078 7,135 Accumulated depreciation (5,726) (5,808) Other, net 1,352 1,326 Total property, plant and equipment 21,516 21,502 Intangible assets 1,120 1,503 Investments and other assets Investment securities 2,373 2,494 Retirement benefit asset 2,260 2,331 Deferred tax assets 2,391 2,480 Other 505 474 Allowance for doubtful accounts (138) (139) Total investments and other assets 7,391 7,642 Total non-current assets 30,028 30,649 Total assets 194,396 194,947
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- 6 - (Millions of yen) As of March 31, 2025 As of September 30, 2025 Liabilities Current liabilities Notes and accounts payable - trade 23,438 19,350 Electronically recorded obligations - operating 4,648 4,098 Short-term borrowings 18,877 13,165 Income taxes payable 5,042 6,059 Contract liabilities 2,564 3,445 Provision for bonuses 2,161 2,533 Provision for product warranties 1,349 1,286 Provision for loss on construction contracts 34 33 Provision for share awards for directors (and other officers) 103 43 Other 6,180 3,553 Total current liabilities 64,401 53,571 Non-current liabilities Long-term borrowings 3,680 7,600 Deferred tax liabilities 25 55 Retirement benefit liability 4,984 4,967 Other 110 114 Total non-current liabilities 8,799 12,738 Total liabilities 73,201 66,309 Net assets Shareholders’ equity Share capital 8,225 8,225 Capital surplus 7,508 7,508 Retained earnings 100,982 108,415 Treasury shares (746) (639) Total shareholders’ equity 115,969 123,510 Accumulated other comprehensive income Valuation difference on available-for-sale securities 256 234 Foreign currency translation adjustment 3,397 3,632 Remeasurements of defined benefit plans 1,323 1,261 Total accumulated other comprehensive income 4,978 5,128 Non-controlling interests 246 – Total net assets 121,194 128,638 Total liabilities and net assets 194,396 194,947
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- 7 - (2) Semi-annual consolidated statement of inco me and semi-annual consolidated statement of comprehensive income Semi-annual consolidated statement of income (Millions of yen) Six months ended September 30, 2024 (From April 1, 2024 to September 30, 2024) Six months ended September 30, 2025 (From April 1, 2025 to September 30, 2025) Net sales 74,323 82,793 Cost of sales 51,179 52,667 Gross profit 23,143 30,125 Selling, general and administrative expenses 11,663 12,747 Operating profit 11,480 17,378 Non-operating income Interest income 60 103 Dividend income 22 8 Foreign exchange gains 418 10 Share of profit of entities accounted for using equity method 30 37 Other 68 43 Total non-operating income 601 204 Non-operating expenses Interest expenses 128 134 Loss on valuation of derivatives – 87 Other 7 11 Total non-operating expenses 135 233 Ordinary profit 11,946 17,349 Extraordinary income Gain on sale of non-current assets 4 2 Gain on sale of investment securities 724 88 Gain on sale of shares of subsidiaries and associates – 40 Total extraordinary income 728 131 Extraordinary losses Loss on sale of non-current assets – 0 Loss on abandonment of non-current assets 8 9 Total extraordinary losses 8 9 Profit before income taxes 12,665 17,471 Income taxes 4,519 5,942 Profit 8,146 11,528 Profit attributable to non-controlling interests 11 – Profit attributable to owners of parent 8,134 11,528
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- 8 - Semi-annual consolidated statement of comprehensive income (Millions of yen) Six months ended September 30, 2024 (From April 1, 2024 to September 30, 2024) Six months ended September 30, 2025 (From April 1, 2025 to September 30, 2025) Profit 8,146 11,528 Other comprehensive income Valuation difference on available-for-sale securities (585) (23) Foreign currency translation adjustment 1,537 246 Remeasurements of defined benefit plans, net of tax (48) (61) Share of other comprehensive income of entities accounted for using equity method (0) (11) Total other comprehensive income 904 150 Comprehensive income 9,050 11,678 Comprehensive income attributable to Comprehensive income attributable to owners of parent 9,024 11,678 Comprehensive income attributable to non- controlling interests 26 –
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- 9 - (3) Semi-annual consolidated statement of cash flows (Millions of yen) Six months ended September 30, 2024 (From April 1, 2024 to September 30, 2024) Six months ended September 30, 2025 (From April 1, 2025 to September 30, 2025) Cash flows from operating activities Profit before income taxes 12,665 17,471 Depreciation 871 926 Increase (decrease) in provisions 226 350 Increase (decrease) in retirement benefit liability 21 31 Decrease (increase) in retirement benefit asset (159) (129) Interest and dividend income (83) (112) Interest expenses 128 134 Foreign exchange losses (gains) (222) 258 Share of loss (profit) of entities accounted for using equity method (30) (37) Loss (gain) on valuation of derivatives (10) 87 Loss (gain) on sale of shares of subsidiaries and associates – (40) Loss on abandonment of non-current assets 8 9 Loss (gain) on sale of property, plant and equipment (4) (2) Loss (gain) on sale of investment securities (724) (88) Decrease (increase) in trade receivables and contract assets 6,892 7,040 Decrease (increase) in investments in leases (7,492) 2,444 Decrease (increase) in inventories 5,016 (8,571) Increase (decrease) in trade payables 134 (4,037) Other, net (866) (3,591) Subtotal 16,371 12,143 Interest and dividends received 95 124 Interest paid (132) (155) Proceeds from insurance income 6 1 Income taxes refund (paid) (3,676) (4,959) Other, net 0 0 Net cash provided by (used in) operating activities 12,665 7,155 Cash flows from investing activities Purchase of property, plant and equipment (1,017) (955) Proceeds from sale of property, plant and equipment 4 2 Purchase of intangible assets (163) (558) Purchase of investment securities (303) – Proceeds from sale of investment securities 858 96 Other, net (0) (20) Net cash provided by (used in) investing activities (621) (1,434) Cash flows from financing activities Net increase (decrease) in short-term borrowings (10,193) (6,916) Proceeds from long-term borrowings – 6,900 Repayments of long-term borrowings (895) (1,600) Dividends paid (2,807) (4,095) Other, net (103) (108) Net cash provided by (used in) financing activities (13,999) (5,820) Effect of exchange rate change on cash and cash equivalents 980 (120) Net increase (decrease) in cash and cash equivalents (975) (220) Cash and cash equivalents at beginning of period 17,642 16,751 Cash and cash equivalents at end of period 16,666 16,530
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- 10 - (4) Notes to semi-a nnual consolidated financial statements Notes on premise of going concern No items to report Notes on substantial changes in the amount of shareholders’ equity No items to report Significant changes in the scope of consolidation during the period The Company transferred part of its shareholding in the consolidated subsidiary PT Lautan Organo Water (hereinafter, “LOW”) to PT Lautan Air Indonesia, a subsidiary of PT Lautan Luas Tbk that is the Company’s partner in the joint venture LOW on April 11, 2025. With this transfer of shares, LOW ceased to be a consolidated subs idiary and has become an equity- method affiliate of the Company. Application of specific accounting for preparing the semi-annual consolidated financial statements Calculation of tax expenses The Company and some of its consolidated subsidiaries have reasonably estimated the effective tax rate after the application of tax effect accounting to the profit before income taxes for the fiscal year including the six months ended September 30, 2025, and tax expe nses are calculated by multiplying profit before income taxes by this estimated effective tax rate. However, in cases where the calculation of tax expenses using such estimated effective tax rate yields a result that is not reasonable to a significant extent, the amount of significant difference other than temporary differences, etc. is added to or deducted from the profit before income taxes, and the result is multiplied by the statutory income tax rate.
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- 11 - Segment information, etc. [Segment information] I Six months ended September 30, 2024 (From April 1, 2024 to September 30, 2024) 1. Information relating to net sales and profit by each reportable segment (Millions of yen) Reportable Segment Adjustment Amount recorded in the semi-annual consolidated statement of income (Note) Water Treatment Engineering Business Unit Performance Products Business Unit Total Net sales Sales to external customers 61,885 12,437 74,323 – 74,323 Intersegment sales or transfers 0 182 182 (182) – Total 61,885 12,620 74,505 (182) 74,323 Segment profit 9,802 1,677 11,480 – 11,480 Note: The figures for segment profit are based on operating prof it, and there are no discrepancies with the operating profit shown in the semi-annual consolidated statement of income. II Six months ended September 30, 2025 (From April 1, 2025 to September 30, 2025) 1. Information relating to net sales and profit by each reportable segment (Millions of yen) Reportable Segment Adjustment Amount recorded in the semi-annual consolidated statement of income (Note) Water Treatment Engineering Business Unit Performance Products Business Unit Total Net sales Sales to external customers 70,549 12,243 82,793 – 82,793 Intersegment sales or transfers 0 197 198 (198) – Total 70,549 12,441 82,991 (198) 82,793 Segment profit 15,771 1,607 17,378 – 17,378 Note: The figures for segment profit are based on operating prof it, and there are no discrepanc ies with the operating profit shown in the semi-annual consolidated statement of income.