ENVALITH
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ULVAC, Inc.

6728・Prime Market・Electric Appliances

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株式会社アルバック logo
ULVAC, Inc.6728

Business

ULVAC, Inc. is a comprehensive vacuum manufacturer founded in 1952, operating two segments: the Vacuum Equipment Business, which provides vacuum equipment, instruments, and services, and the Vacuum Application Business, which provides materials and surface analysis instruments. Its main products span a wide range, from vacuum equipment such as sputtering equipment, CVD equipment, etching equipment, organic EL manufacturing equipment, and vacuum pumps, to Sputtering Target Materials, Mask Blanks, and Surface Analysis Instruments. The company supplies production equipment for semiconductors, FPDs, electronic components, and general industry, and operates domestically and internationally as a group including 37 subsidiaries and 8 affiliated companies. Its end products supply equipment and materials essential for manufacturing electronic components used in smartphones, PCs, tablets, automobiles, and other applications.

Business Model

The Vacuum Equipment Business (net sales of ¥199,050 million) accounts for approximately 79% of the total and is the core business, centered on made-to-order production of vacuum equipment for semiconductor, FPD, and industrial applications. The Vacuum Application Business (net sales of ¥52,134 million) provides materials, analytical instruments, and Mask Blanks, capturing stable consumables demand linked to the utilization rates of customers' factories. The synergy model of providing equipment, materials, film deposition processing, analysis, and customer support in an integrated manner is the source of competitive advantage, and the company continues to invest ¥13,991 million in R&D expenses (5.6% of net sales) to maintain its technological edge.

Company Strengths

The company has a business structure as a comprehensive vacuum equipment manufacturer capable of providing an integrated offering of equipment, materials, film deposition processing, analysis, and customer support. Through collaboration between the Vacuum Equipment Business and the Vacuum Application Business, it can provide solutions covering the customer's entire manufacturing process, forming a unique position that is difficult for competitors to imitate.

The company has a track record in metal hard mask processes in the leading-edge logic field, and is also developing equipment for DRAM and 3D NAND flash memory. It opened Technology Center PYEONGTAEK in Pyeongtaek, South Korea, strengthening its customer-focused development framework. A PLD oxide thin-film deposition system manufactured in the 1990s was registered as an "Essential Historical Materials for Science and Technology" by the National Museum of Nature and Science, demonstrating the depth of its technological accumulation.

As of the end of FY2025 (ended June 2025), the equity ratio stood at 59.6%, and cash and cash equivalents totaled ¥92,609 million. Operating cash flow was ¥34,811 million, and free cash flow was ¥24,011 million. The company has also established a framework for securing additional liquidity through the setup of a commitment line, giving it a financial foundation capable of responding to sudden changes in the business environment.

ENVALITH's Perspective

Cumulative order intake for the first three quarters of FY2026 (ending June 2026) showed robust growth, reaching ¥236,185 million, up 44.1% year on year, raising expectations for a future recovery in sales. On the other hand, operating profit for the same period declined 29.1% year on year to ¥14,719 million, with the operating margin deteriorating significantly to 7.7% (from 11.1% in the same period of the prior year). The rise in the cost of sales ratio (from 67.8% in the same period of the prior year to 69.7% in the current period) and the increase in SG&A expenses (from ¥39,764 million in the same period of the prior year to ¥43,311 million in the current period) are occurring simultaneously, and close attention should be paid to the time lag before order growth translates into profit improvement, as well as to the changing cost structure.

The full-year earnings forecast for FY2026 (ending June 2026) was revised to net sales of ¥260,000 million (up 3.5% year on year) and operating profit of ¥19,000 million (down 28.4% year on year). Given cumulative operating profit of ¥14,719 million through the third quarter, achieving the full-year forecast of ¥19,000 million would require operating profit of ¥4,281 million in Q4 alone. Compared with the actual Q4 result for the prior year (approximately ¥5,771 million), this level appears achievable, but the feasibility must be carefully assessed given the ongoing trend of rising expenses. Additionally, as a subsequent event, an extraordinary gain of approximately ¥7.8 billion from the transfer of equity in the China FPD target business has been incorporated into the full-year forecast, underpinning the achievement of the net income forecast of ¥18,500 million (up 10.9% year on year).

The full transfer of equity in the Chinese subsidiary (Ulvac Electronic Materials (Suzhou) Co., Ltd.), resolved on May 12, 2026, is a response to changes in the competitive environment in the Chinese market, shifting the FPD target business to a joint venture structure with KFMI. An extraordinary gain of approximately ¥7.8 billion from the sale of the equity investment in the affiliated company is expected to be recorded, providing a short-term boost to profit. Over the medium to long term, the strategic significance of withdrawing management resources from the increasingly competitive Chinese FPD market and concentrating on growth areas such as advanced semiconductors and rare-earth magnets can be positively evaluated, but the impact on sales scale resulting from the contraction of the China business warrants continued monitoring.

Growth Strategy

The company aims for FY2031 (ending June 2031) net sales of ¥360,000 million and an operating margin of 22% through concentrated investment in semiconductors/electronic components and restructuring of its business portfolio.

The company is capturing expanding capital investment in advanced logic, next-generation memory, and advanced packaging fields amid the spread of generative AI. Cumulative orders received in the Vacuum Equipment Business for the first three quarters of FY2026 (ending June 2026) rose sharply to ¥191,644 million, up 52.1% year on year, with the order backlog building up to ¥144,780 million.

The company is actively capturing investment in panel enlargement driven by the expanding adoption of OLED in IT products (tablets, PCs). In the cumulative first three quarters of FY2026 (ending June 2026), both orders received and net sales for Display and Energy-Related Manufacturing Equipment exceeded the same period of the previous year. However, the China FPD target business is scheduled to transition to a joint venture structure through an equity transfer.

The company is capturing new demand such as high-performance magnet manufacturing equipment aimed at supply chain diversification and leak test equipment for AI server cooling systems. In the cumulative first three quarters of FY2026 (ending June 2026), both orders received and net sales for General Industrial Equipment exceeded the same period of the previous year, emerging as a growth field.

The company plans to transition its increasingly competitive China FPD target business to a joint venture structure with KFMI (Beijing Fengke Jingsheng Electronic Materials Co., Ltd.), concentrating management resources on growth fields such as advanced semiconductors. The company expects to record a gain of approximately ¥7.8 billion on the sale of investments in affiliates as extraordinary income in FY2026 (ending June 2026), which has already been incorporated into the full-year earnings forecast.

Last updated: July 17, 2026