Howa Machinery, Ltd.
6203・Standard Market・Machinery
Machine Tools
Loss-making business manufacturing and selling machining centers, pneumatic & hydraulic equipment, etc., top priority for structural reform
| Period | Current | Previous | Change |
|---|---|---|---|
| Segment sales | ¥5,421 million (FY2026, ending March 2026) | ¥6,962 million (FY2025, ending March 2025) | ↓ |
| Segment operating loss | -¥1,017 million (FY2026, ending March 2026) | -¥457 million (FY2025, ending March 2025) | ↓ |
| Segment assets | ¥6,901 million (end of FY2026, ending March 2026) | ¥8,772 million (end of FY2025, ending March 2025) | ↓ |
| Impairment loss | ¥38 million (FY2026, ending March 2026) | ¥174 million (FY2025, ending March 2025) | ↓ |
| Order backlog | ¥1,841 million (end of FY2026, ending March 2026) | ¥3,539 million (end of FY2025, ending March 2025) | ↓ |
| Orders received | ¥3,722 million (FY2026, ending March 2026) | ¥6,822 million (FY2025, ending March 2025) | ↓ |
| Production volume | ¥5,776 million (FY2026, ending March 2026) | ¥7,176 million (FY2025, ending March 2025) | ↓ |
Business Details
Howa Machinery's Machine Tools segment manufactures and sells machining centers, various special-purpose machines, pneumatic & hydraulic equipment, and electronic machinery. Its main customers are in the automotive-related industry, and in China, the consolidated subsidiary Howa (Tianjin) Machine Tool Co., Ltd. had handled local sales, but the company has resolved to dissolve and liquidate. In the new medium-term management plan (FY2026 (ending March 2026) to FY2028 (ending March 2028)), "transformation into a profit structure suited to market scale" is positioned as the top priority.
Recent Overview
Sales down 22%, operating loss widened to -¥1,017 million, resolution to dissolve Chinese subsidiary
In FY2026 (ending March 2026), overall Machine Tools sales were ¥5,421 million (down 22.1% year on year), and segment operating loss was -¥1,017 million (widening from -¥457 million in the prior period). In addition to declining capital expenditure demand in the automotive-related industry, the main cause of the widened loss was the recording of expenses such as inventory valuation losses on inventory for China as part of the structural reform under the medium-term management plan. In addition, the company resolved to dissolve and liquidate its Chinese local subsidiary Howa (Tianjin) Machine Tool Co., Ltd., recording liquidation-related expenses of ¥112 million as a loss on business restructuring within extraordinary losses. The order backlog also declined sharply from ¥3,539 million to ¥1,841 million, leaving the outlook for recovery unclear.
Key Products
Growth Drivers
- Improvement of cost structure through promotion of a profitability-focused product and sales strategy under the new medium-term management plan
- Acquisition of new demand through development of niche-top areas and strengthening of competitiveness
- Divestment of unprofitable business and reduction of fixed costs through liquidation of the Chinese subsidiary
- Capture of domestic demand such as increased orders for Special-Purpose Vehicles (synergy with the Building Materials and Special-Purpose Vehicles segment)
Risks
- Continued risk of declining sales due to sluggish capital expenditure demand in the automotive-related industry (EV shift and slowdown in the Chinese market)
- Risk of additional costs (severance payments, withdrawal costs, inventory disposal costs, etc.) arising from the dissolution and liquidation of the Chinese subsidiary
- Risk that the sharp decline in order backlog to ¥1,841 million makes it difficult to foresee a sales recovery from FY2027 (ending March 2027) onward
- Risk of delays in executing structural reforms (personnel reductions, plant downsizing) and associated risk of increased costs
- Adverse impact on export demand from US trade policy and geopolitical risk
Last updated: June 23, 2026