NOK downgrades financial forecast for FY23

TOKYO—NOK Corp. has revised down its consolidated financial forecasts for the first six months and full year of its current fiscal year (FY2023).

The downgrade, from previous guidance on May 10, was linked to "recent changes in business environment" as well as first-quarter results for its fiscal year to March 31, the Tokyo-based group said in an Aug. 2 update.

For the first three months of its current consolidated fiscal year, NOK reported net sales of about $1.1 billion, up 1.8 percent year-on-year, and operating loss of $8.4 million, compared to an operating loss of $10.6 million in the same period a year before, according to average 2022 exchange rates.

For the first-half, NOK maintains that automotive production is "steadily recovering" due to an easing of supply-shortages around semiconductors and other components. Sales growth for automotive applications, however, has been weaker than the forecast issued in May, the company said.

Meanwhile, sealing product sales for automotive and general industrial machinery applications "in the Chinese and ASEAN market are anticipated to be lower than our expectation."

In its electronic products business, NOK said that "although we expected demand recovery in hard disk drives, sales in the area were below our anticipation."

Overall, NOK now expects first half sales to be 3.6-percent lower than previously forecast—Yen $2.3 billion compared to $2.4 billion before.

At $16.4 million, operating income—from April 1 to Sept. 30—is meanwhile anticipated to come in 52.9-percent below NOK's May forecast, due principally to lower sales.

For the full-year, NOK expects net sales of $5.1 billion, 1.7-percent lower than previously forecast and operating earnings of $179.7 million, 10.3-percent below its May guidance.

For the group's last fiscal year (FY2022), NOK posted net sales of $5.4 billion, according to average 2022 exchange rates, and operating income of $117.1 million.

With around 38,000 employees, NOK, manufactures sealing products, industrial mechanical parts, hydraulic equipment, nuclear power equipment, synthetic chemical products and electronics parts, among other products.