H2O Retailing (8242) Q2 2026 earnings summary

Executive summary

• Consolidated 1H FY2025/FYE2026 results were generally in line with forecasts, with net sales up 0.5% year-over-year, but operating profit and profit attributable to owners of parent declined sharply due to the absence of prior-year extraordinary income.

• Department Store Business saw declines in sales and operating profit, impacted by strong inbound sales in the previous year and remodeling closures, but 2Q showed improvement in inbound and domestic sales.

• Supermarket Business achieved increases in both sales and operating profit, driven by strong performance at existing and new/renovated stores.

• Comprehensive income rose to ¥18,137 million from ¥23,855 million year-over-year.

Financial highlights

• 1H FY2025 gross sales: 5,554 hundred million JPY (down 0.5% YoY); net sales: 3,330 hundred million JPY (up 0.5% YoY); gross profit: ¥148,570 million, nearly flat YoY.

• Operating profit: 119 hundred million JPY (down 21.0% YoY); ordinary profit: 124 hundred million JPY (down 22.1% YoY); profit attributable to owners of parent: 69 hundred million JPY (down 74.5% YoY).

• Earnings per share for the period were ¥57.70, down from ¥236.47 year-over-year.

• SG&A expenses increased by 2.5% YoY; depreciation rose 17.1% YoY.

• Total assets as of Sep. 30, 2025, were ¥731,153 million, with net assets at ¥318,862 million.

Outlook and guidance

• Full-year consolidated operating and ordinary profit forecasts remain unchanged; profit forecast revised upward due to expected gain on sale of investment securities from Toho shares.

• Full-year net sales forecast is ¥689,000 million, up 1.1% YoY; operating profit projected at ¥30,000 million, up 13.9% YoY; profit attributable to owners of parent forecast at ¥24,000 million, up 31.1% YoY.

• Annual dividend forecast at 44.0 JPY, up 2.0 JPY YoY.

• Full-year inbound sales forecast revised down to 105.0 billion JPY from 110.0 billion JPY.

• Full-year EPS is expected to be ¥204.63.