H2O Retailing (8242) Q2 2025 earnings summary

Executive summary

• Department Store Business led consolidated growth in 2Q FY2025, with all major profit metrics reaching record highs for the first half, driven by robust domestic and inbound sales.

• Net sales for 2Q FY2025 rose 4.0% year-over-year to ¥331,254 million, with operating profit up 51.6% to ¥15,007 million and profit attributable to owners of parent surging 330% to ¥27,068 million.

• Comprehensive income for 2Q FY2025 reached ¥23,826 million, up 86.0% year-over-year.

• Supermarket Business saw sales growth from existing stores, though operating profit was flat year-over-year due to higher personnel costs.

• Shopping Center Business benefited from strong hotel occupancy, while food manufacturing and home delivery faced declines due to subsidiary closures.

Financial highlights

• 1H FY2025 gross sales rose 10.5% year-over-year to ¥558.5bn; net sales up 4.0% to ¥331.3bn.

• Operating profit increased 51.6% to ¥15.0bn; ordinary profit up 49.5% to ¥15.9bn; profit surged 330% to ¥27.1bn, partly due to a gain on sale of investment securities.

• Department Store gross sales up 17.7% year-over-year; operating profit doubled.

• Gross profit increased to ¥148,373 million from ¥137,047 million year-over-year.

• EPS for 2Q FY2025 was ¥236.28, up from ¥54.47 in 2Q FY2024.

Outlook and guidance

• FY2025 operating and ordinary profit forecasts revised upward to ¥31.0bn and ¥32.0bn, respectively.

• Full-year inbound sales forecast for Department Store Business raised from ¥100bn to ¥126bn.

• FY2025 gross sales forecast at ¥1,155bn, up 7.6% year-over-year.

• Full-year FY2025 net sales forecast is ¥682,000 million, up 3.7% year-over-year.

• EPS for the full year is forecast at ¥245.16; annual dividend forecast raised to ¥40.00 per share.