Nippon Carbon Co.,Ltd.
5302・Prime Market・Glass & Ceramics Products
Business
Nippon Carbon is a pioneer in the carbon industry founded in 1915, listed on the Tokyo Stock Exchange Prime Market. With 9 consolidated subsidiaries and 2 affiliated companies, it operates three segments: Carbon Products (approximately 86% of net sales), Silicon Carbide Products, and Industrial Machinery, among others. In Carbon Products, the company manufactures and sells graphite electrodes, Fine Carbon Related Products, and anode materials for lithium-ion batteries, with major customers in the domestic and overseas steelmaking, semiconductor, and battery industries. In Silicon Carbide Products, its subsidiary NGS Advanced Fibers manufactures and sells Silicon Carbide Continuous Fiber (Nicalon, Hi-Nicalon) for the aviation industry, and as the group's only manufacturing base for this product, it holds a strong competitive advantage. The company has built a global sales network with sales subsidiaries in Europe, the United States, China, and Taiwan.
Business Model
The Group employs a vertically integrated model covering everything from raw material procurement to material manufacturing, processing, and sales. For Carbon Products, the Company and Nippon Techno-Carbon and others handle material manufacturing and processing, which are sold globally through sales subsidiaries in Europe, the US, and Asia. For Silicon Carbide Products, NGS Advanced Fibers handles integrated manufacturing and sales. While maintaining a stable production system through make-to-stock production for the majority of its core products, the Company invested ¥669 million in R&D expenses to continue developing new products and improving existing products, positioning technological superiority as a source of earnings.
Company Strengths
NGS Advanced Fibers is the group's only manufacturing base for Silicon Carbide Continuous Fiber, and as a result of capturing demand from the aerospace industry at maximum production capacity, achieved net sales of ¥4,128 million (up 52.9% year on year), operating income of ¥1,479 million (up 72.9% year on year), and an operating margin of 35.7% in FY2025.
The company has a track record of commercializing leading-edge materials of each era, including Japan's first domestically produced artificial graphite electrode in 1927, industrialization of carbon fiber in 1962, establishment of Silicon Carbide Continuous Fiber manufacturing technology in 1983, and the start of sales of negative electrode materials for lithium-ion batteries in 1994. It also has a track record of quality control, having received the Deming Application Prize (1985).
At the end of FY2025, total net assets stood at ¥63,607 million against total assets of ¥85,607 million and total liabilities of ¥22,000 million, indicating high financial soundness. Operating cash flow has been stably generated, reaching ¥6,319 million in FY2025, and the balance of cash and cash equivalents reached ¥15,035 million.
ENVALITH's Perspective
Performance Trend
Revenue expanded from ¥31,578 million in FY2021 to ¥37,867 million in FY2023, then remained flat in FY2024 and FY2025 (¥37,956 million and ¥37,735 million, respectively). For FY2026 (ending December 2026), full-year revenue is forecast at ¥41,000 million (up 8.7% year on year), suggesting accelerating growth, with Q1 also strong at ¥8,857 million (up 11.3% year on year). On the other hand, operating profit has continued to decline since peaking at ¥6,573 million in FY2023, falling to ¥4,809 million in FY2025, with the full-year FY2026 forecast of ¥4,300 million (down 10.6% year on year) indicating a further decline. The Q1 operating margin deteriorated to 11.9% (versus 16.2% in the same quarter of the prior year). The main causes are increased depreciation expenses and costs related to idled equipment associated with investment to expand semiconductor-related manufacturing equipment, while external factors such as uncertainty over raw material and energy prices stemming from U.S. trade policy and Middle East conditions are also weighing on profitability.
Growth Strategy
Under "GO BEYOND 2030," the company is pursuing three pillars: improving profitability, sustainability, and shareholder returns.
Investment to expand Fine Carbon Related Products manufacturing facilities is underway in anticipation of growing demand in semiconductor-related markets. In the short term, increased depreciation expenses and costs related to idled equipment are pressuring profits, but the company aims to improve profitability over the medium to long term through higher utilization rates. In Electrode Material Related Products, sales volume continues to increase through capturing demand both domestically and overseas.
In response to solid demand for Silicon Carbide Continuous Fiber, mainly for aircraft engine applications, the company continues to maintain high-level production. In the first quarter of FY2026 (ending March 2026), net sales of ¥1,113 million and an operating margin of 37.3% were maintained, reflecting high profitability, and efforts to strengthen a stable supply system through securing human resources and safe operations are being promoted.
The annual dividend forecast for FY2026 (ending December 2026) is ¥200 (¥100 at the second-quarter end and ¥100 at year-end), maintaining the same level as the actual results for FY2025 (ended December 2025). The company also conducted share buybacks (¥148 million, 318 hundred shares acquired in the first quarter), continuing its stance on shareholder returns.
This is positioned as one of the priority issues under the medium-term management policy "GO BEYOND 2030." Specific numerical targets and details of measures are not disclosed in the financial results summary. A performance-linked stock compensation plan (BBT) for directors has been introduced, establishing incentives for management to enhance corporate value over the medium to long term.
Last updated: July 17, 2026