Nippon Gas (8174) Q1 2027 earnings summary

Executive summary

• Gross profit for 1Q FYE 03/27 exceeded plan by ¥1.0B, driven by higher LP Gas margin and sales volumes, with SG&A expenses controlled as planned.

• Net sales rose 8.8% year-over-year to ¥49,910 million for the quarter ended 30th June 2026, with operating income up 5.0% to ¥3,836 million and ordinary income up 4.2% to ¥3,819 million.

• Operating income for 1Q was ¥9.0B above plan, and net income and EPS also surpassed expectations.

• Profit attributable to owners of parent declined 1.4% year-over-year to ¥2,593 million, while comprehensive income increased 16.4% to ¥2,928 million.

• Growth was driven by strong performance in equipment, construction sales, and the Platform business, offsetting margin pressures in the Electricity segment.

Financial highlights

• 1Q FYE 03/27 gross profit: ¥17.5B (+¥1.0B vs. plan, +¥0.5B YoY); operating income: ¥3.8B (+¥0.9B vs. plan, +¥1.2B YoY); net income: ¥2.6B; EPS: ¥24.4 (+¥5.5 vs. plan).

• Gross profit increased 2.6% year-over-year to ¥17,489 million, with cost efficiency measures offsetting inflationary pressures.

• Basic earnings per share for the quarter were ¥24.35, up from ¥24.12 a year earlier.

• Total assets decreased to ¥150.4 billion, down ¥13.1 billion from the previous fiscal year-end, mainly due to lower trade receivables and cash.

• Equity ratio improved to 42.7% from 40.9% at the previous year-end.

Outlook and guidance

• Full-year forecast remains unchanged: operating income ¥20,000 million (down 6.0% YoY), ordinary income ¥20,000 million (down 5.7% YoY), profit attributable to owners of parent ¥14,000 million (down 5.5% YoY).

• Six-month forecast for operating income and ordinary income revised upward by 20.6% to ¥4,100 million each, and profit attributable to owners of parent by 21.7% to ¥2,800 million.

• FY FYE 03/27 guidance maintained despite 1Q outperformance, incorporating current raw material price assumptions and temperature forecasts.

• Three-year plan targets operating income of ¥25.0B and ROE around 22% by FYE 03/29, emphasizing organic growth and capital efficiency.

• Dividend forecast for FY ending March 2027 is ¥110 per share, up from ¥103 in the prior year.