LIXIL Corporation Q4 FY2026 earnings call

• CFO Fujita provided overview of financial results: Core earnings exceeded forecast, EBITDA 121.6 billion yen, Japan segments grew core earnings, international business improved. America's structural reform led to March profitability. • CEO Saito discussed fiscal year ending March 2027 outlook: Revenue forecast 1,600 billion yen, core earnings 45 billion yen, profit attributed to owners of parent 12 billion yen. Discussed business environments in Americas, Europe, India, Middle East, Japan, etc. • Mentioned initiatives like optimizing workforce allocation, restructuring supply chain, optimizing business portfolio in Americas, working on growth of growing brand in Europe, market recovery and sales network expansion in Asia-Pacific, etc.

Core earnings was 38.5 billion yen. EBITDA was 121.6 billion yen. In Japan market, all segments achieved year-on-year growth in core earnings. In international business, core earnings significantly improved. America's structural reform derived fruitful results, with core earnings becoming profitable in March. Revenue was 1 trillion 510.7 billion yen, up 6 billion yen year-on-year. Core earnings were 38.5 billion yen, up 7.2 billion yen year-on-year. EBITDA was up 7.1 billion yen year-on-year, and profit was up 6.1 billion yen year-on-year.

• Outlook for fiscal year ending March 2027: Revenue 1,600 billion yen, core earnings 45 billion yen, profit attributed to owners of parent 12 billion yen. Annual dividend forecasted at 90 yen per share. • Discussed that Middle East situation has many variables and not factored in current guidance, will be shared at next disclosure. • Americas business transition service agreement ended, major structural reforms led to last three months recovery and profit making, but U.S. economy affordability challenge remains. • Europe's economic situation recovery pace behind original expectation but market share increased and growers' average profit improved. • India and Middle East have various concerns but no negative impact currently, need to monitor Middle East situation.

• Biggest risk is Middle East situation with many variables hard to predict. • Supply chain concerns for raw materials like crude oil-derived products, aluminum, copper, solvents, etc. • European market recovery pace behind expectation, U.S. and China real estate/housing market deterioration, Trump administration's policies impact. • Japan's new housing starts significant and rapid decrease more than expected, heat insulation materials shortage causing sluggish housing starts. • Commodity price increases and their impact on cost and pricing, potential bottlenecks in supply and distribution.

Q: Related to Middle East and supply chain risk, including material procurement and cost issues, and Americas business profitability outlook.

A: Regarding raw materials, have visibility but some specific product supply issues being resolved. Americas business March turned profitable but market still challenging, transition service agreement cost reduced, but market further worsening unknown.

Q: How plans were created, cost and revenue plan, structural reform progress.

A: Cost issues like copper, aluminum price increases, working to revise prices quickly. Revenue current markets bottomed out, Middle East growth, Japan new housing starts decline but renovation business good. Structural reform no specific residual items, contingency for Middle East.

Q: Japan business raw material price increase impact on new housing starts.

A: Solvent-related raw material shortages initially, new housing starts decline but renovation demand offset, need to increase margin via AI/BI, new housing starts expected to improve next fiscal year.

Q: Middle East impact on guidance, revised downwards or not.

A: Middle East situation variables, difficult to factor in current guidance, visibility on Japan business orders but uncertain, price optimization and cost reduction key factors.