H2O Retailing (8242) Q4 2025 earnings summary

Executive summary

• Achieved record highs in gross sales, operating profit, and all profit categories for FY2025, driven by strong inbound and domestic sales in the Department Store Business and improved profitability in the Supermarket Business.

• Net sales increased by 3.7% year-over-year to ¥681,759 million for FY2025, with operating profit up 33.0% to ¥34,830 million and profit attributable to owners of parent rising 59.1% to ¥34,842 million.

• Comprehensive income grew 57.7% year-over-year to ¥41,555 million.

• Department Store Business saw significant growth from inbound sales, especially from Chinese customers, and robust domestic demand, though 4Q growth slowed due to remodeling and fewer business days.

• Supermarket Business increased sales and operating profit, aided by higher existing store sales and reduced SG&A expenses.

Financial highlights

• FY2025 gross sales: ¥1,159.6bn (+8% YoY); operating profit: ¥34.8bn (+33% YoY); net profit: ¥34.8bn (+59% YoY).

• Gross profit rose to ¥307,356 million from ¥287,608 million year-over-year, while selling, general, and administrative expenses increased to ¥272,526 million.

• Ordinary profit reached ¥35,909 million, up 28.8% year-over-year.

• Earnings per share increased to ¥295.51 from ¥189.82 year-over-year.

• Total assets grew to ¥730,499 million, and net assets to ¥313,420 million.

Outlook and guidance

• FY2026 consolidated gross sales forecast: ¥1,168.0bn (+0.7% YoY); operating profit: ¥30.0bn (−14% YoY); net profit: ¥18.0bn (−48% YoY), reflecting absence of prior year extraordinary gains.

• FY2026 full-year net sales are forecast at ¥690,000 million, up 1.2% year-over-year, with operating profit projected at ¥30,000 million and profit attributable to owners of parent at ¥18,000 million.

• Department Store sales and profit expected to decline due to remodeling closures and slower inbound sales; Supermarket Business to continue growth.

• Ongoing investments in store remodeling and digital initiatives to drive mid- to long-term growth.