ENVALITH
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KIMOTO CO., LTD.

7908・Standard Market・Chemicals

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株式会社きもと logo
KIMOTO CO., LTD.7908

Business

Kimoto Co., Ltd. is a technology development-oriented company founded in 1961, operating two businesses: the High-Performance Materials Business, built around film surface processing technology, and the Digital Twin Business. In the High-Performance Materials Business, the company manufactures a diverse range of functional films—optical, light-shielding, adhesive, hard coat, diffusion, and others—supplying them to the communications equipment, electronic components, transportation equipment, and industrial equipment sectors. In the Digital Twin Business, the company provides DX solutions for the construction, infrastructure, and manufacturing industries, centered on its 3D spatial data creation service "SPLAT TWIN". The company operates a four-region structure spanning Japan, North America (US), East Asia (China), and Europe (Switzerland). Consolidated net sales for FY2026 (ending March 2026) were ¥10,546 million, with the Japan segment accounting for approximately 90% of net sales.

Business Model

In the High-Performance Materials business, industrial films developed using proprietary surface processing and coating technologies are manufactured at the Mie and Ibaraki plants in Japan and at a U.S. plant, and sold to domestic and overseas electronics, telecommunications, automotive, and industrial equipment manufacturers through direct sales and distributors. In the Digital Twin Business, 3D spatial data creation, editing, and utilization services are provided on a contract basis, securing large-scale projects in the construction and infrastructure fields. Annual R&D spending of ¥554 million is invested to maintain profitability through the continuous creation of high-value-added products.

Company Strengths

The company possesses functional coating and surface processing technologies accumulated over more than 70 years since its founding, and has established an advanced and consistent quality assurance system certified under ISO 9001:2015. It develops and manufactures in-house a diverse range of products including optical light-shielding, adhesive, hard coat, and diffusion products, and its adoption in new communication equipment models and continued revenue contribution from products used in electronic component manufacturing processes demonstrate its technological track record.

As of the end of FY2026 (ending March 2026), against total assets of ¥23,245 million, the company maintains net assets of ¥18,982 million and an equity ratio of 81.7%. It holds cash and cash equivalents of ¥10,967 million, achieving debt-free management in which capital expenditures and R&D are entirely funded by internal resources. This financial foundation enables business continuity and growth investment even during economic downturns.

In FY2026 (ending March 2026), the Japan segment maintained a high operating profit of ¥1,395 million (operating margin of approximately 14.6%). The order backlog at the end of the same period increased 29.6% year on year to ¥2,190 million, and is expected to contribute to sales in future periods. Steady demand for products used in electronic component manufacturing processes and solid sales of hard coat products for industrial equipment are underpinning earnings.

ENVALITH's Perspective

For FY2026 (ending March 2026), net sales came to ¥10,546 million (down 6.6% year on year), operating income was ¥1,064 million (down 20.5%), and profit attributable to owners of parent fell sharply to ¥565 million (down 42.9%). In addition to recording an impairment loss of ¥111 million as an extraordinary loss related to the former Technology Development Center (Saitama City), total income taxes increased to ¥535 million (from ¥414 million in the prior period), significantly weighing down net income. This represents a reversal from the V-shaped recovery seen in FY2025 (ended March 2025), raising questions about the sustainability of earnings.

The North America segment posted an operating loss of ¥262 million (versus a loss of ¥139 million in the prior period), while the Europe segment recorded an operating loss of ¥24 million (a reversal from operating income of ¥52 million in the prior period), as losses in both overseas segments widened. In North America, declining production volume due to deteriorating market conditions combined with the loss of new orders, while in Europe, the slump in the automotive industry and white goods sector had a direct impact. External factors such as the downturn in European manufacturing and uncertainty over U.S. trade policy continue, and it is expected to take time before overseas operations become profitable.

Citing the impact on crude oil and naphtha procurement conditions stemming from heightened tensions in the Middle East, developments in U.S. trade policy, and uncertainty over the timing of a recovery in the automotive industry, the company has left its consolidated earnings forecast for FY2027 (ending March 2027) undetermined. Because the High-Performance Materials business is directly affected by raw material costs, there is a risk that earnings could fluctuate significantly depending on external factors. Meanwhile, operating cash flow fell sharply to ¥579 million (from ¥1,838 million in the prior period), indicating weakened cash-generating capacity, and the situation continues to make it difficult for investors to gauge the earnings outlook.

Growth Strategy

Under the Sixth Medium-Term Management Plan, the company is advancing the higher value-added positioning of high-performance materials and the monetization of the Digital Twin Business

The company is increasing the sales ratio of high-profitability products, centered on light-shielding and adhesive products for communication devices, products for electronic component manufacturing processes, and hard coat products for industrial equipment. It is promoting optimization of the product mix to compensate for the slump in transportation equipment and battery manufacturing process applications. R&D expenses of ¥554 million are being continuously invested to maintain new product development capabilities.

Manufacturing transfer from the Mie No. 1 Plant to the Mie No. 4 Plant is underway. In connection with this, an accounting estimate change was made to shorten the useful life of the Mie No. 1 Plant building to its expected period of use. Improvement in production utilization rate and cost reduction effects are expected through manufacturing consolidation. Asset retirement obligations (asbestos removal costs of ¥164 million) have also been recorded.

Continued orders and acquisition of large-scale projects for the 3D spatial data creation service "SPLAT TWIN" in the construction field, as well as acquisition of large-scale projects in the infrastructure field, resulted in sales of ¥363 million (down 8.8% from ¥398 million in the previous period). Development of 3D model creation technology at the China base is also continuing. The revenue scale remains limited, and further order expansion is a challenge.

In North America (KIMOTO TECH, INC.), the company aims to improve profitability through reviewing the sales composition and developing new customers. In Europe (KIMOTO AG), it is promoting the launch of new projects and market development. Both segments saw expanded losses in FY2026 (ending March 2026), and structural improvements are continuing amid the impact of external factors (the slump in the automotive industry and U.S. trade policy).

Last updated: July 19, 2026