LIXIL Revenue Up While Profit Down in Q1 FYE2027

Full Year Forecast Unchanged as Increased Cost to Be Offset by Price Optimization and Expected Cost Reductions

• Japan Business core earnings declined due to rising raw material costs, but impact minimized through various initiatives

• LIXIL Water Technology's international revenue expanded through strong sales in Europe and the Middle East, agile operations across regions

Tokyo – LIXIL Corporation (“LIXIL”, TSE Code: 5938), maker of pioneering water and housing products, today announced its first quarter results for the fiscal year ending March 31, 2027.

CEO Comment:
“In the first quarter of FYE2027, the heightened tensions in the Middle East affected raw material supplies, particularly in April. However, our efforts to optimize our supply chain, including the diversification of procurement sources, enabled us to minimize the impact on production and sales operations globally. In our international business, we responded nimbly to regional challenges and expanded revenue through strong sales in Europe and the Middle East. In the Middle East in particular, despite constraints on supply and logistics, our localized production and robust inventory served as a key competitive advantage. In our Japan business, profitability was weighed down by rising raw material prices including aluminum. While cost increases will continue to affect our performance through the second quarter, we expect core earnings in the second half to improve as price optimization benefits take effect from the third quarter onward. Our full year forecast remains unchanged.

Based on the LIXIL Playbook, which outlines our management direction, LIXIL has been continuously strengthening its business foundation to maintain a strong competitive edge even in a volatile business environment. In circular materials, a key focus area for driving differentiation, we made steady progress. For our recycled aluminum material PremiAL, we established a unique circular business model with a new partner while we further expanded our residential product lineup with revia, a material derived primarily from waste plastics. Building on a resilient supply chain, we will accelerate the development and rollout of differentiated products and solutions driven by unique innovation. Through these efforts, we will keep driving long-term growth and create positive social and environmental impact.”  

- Kinya Seto

Financial Highlights:
Revenue
Consolidated revenue for the first quarter of FYE2027 increased 4% year-on-year to ¥379.2 billion. In the Japan market, new housing was prioritized amidst supply concerns, leading to a decline in our renovation sales ratio and resulting in Japan business revenue decreasing by 3% year-on-year to ¥244.6 billion. Revenue from the international business increased by 17% to ¥142.5 billion, supported by strong sales in Europe and the Middle East. On a local currency basis, revenue increased by 6%.

Core Earnings
Core earnings for the first quarter declined by ¥7.3 billion year-on-year to ¥1.7 billion. In the international business, strong sales in Europe and the Middle East offset sluggish performance in the U.S. and China. However, soaring raw material prices severely impacted LIXIL Housing Technology (LHT), leading to a significant profit decline for the business in Japan.

Net profit attributable to owners of the parent   
For the first quarter, LIXIL recorded a net loss of ¥3.5 billion, a decrease of ¥2.6 billion from the previous year. Although other expenses and finance costs decreased, the decline in core earnings negatively affected overall performance.

Performance by Business Segment and Region:
Revenue for LIXIL Water Technology's (LWT) Japan business decreased by 1.6% year-on-year to ¥76.3 billion. Core earnings remained flat year-on-year at ¥5.3 billion, as the benefits of price optimization were offset by soaring material prices. The ratio of revenue generated by renovation sales decreased by 0.9 pp to 56%.

LWT’s international business recorded revenues of ¥133.9 billion, a 15.8% increase year-on-year. Europe saw a 6% revenue increase, driven by strong sales in Germany and Eastern Europe. The India, Middle East, and Africa (IMEA) region saw a 16% revenue increase, supported by solid demand in countries such as India and Northwest Africa in addition to Middle Eastern nations. Asia Pacific recorded a 7% revenue increase due to growth in Vietnam and Indonesia. Americas saw a 1% revenue increase, as retail sales recovered alongside price optimization effects. In China, the continued downturn in the real estate market resulted in a 10% revenue decrease. Core earnings of LWT’s international business remained flat year-on-year at ¥5.4 billion.

Revenue from LIXIL Housing Technology decreased by 2.7% year-on-year to ¥124.7 billion. Renovation sales were sluggish. Core earnings decreased by ¥6.4 billion resulting in a core loss of ¥0.4 billion, impacted by soaring prices for aluminum and other materials.  

Revenue for the Living business increased by 1.7% year-on-year to ¥52.2 billion, while core earnings decreased by 38.8% to ¥1.3 billion. Renovation sales performed well, but profitability was weighed down by foreign exchange effects and higher material costs.

-  END

*Please see disclosures here.