Hamakyorex Q2 FY2027: Profit rises 14% on logistics growth

Hamakyorex reported 11.0% growth in operating revenue, 14.0% growth in operating profit and a 5.2% increase in interim net income attributable to owners of the parent for the six months ended September 2026. Operating profit outpaced revenue growth, while ordinary profit rose 13.7% to ¥8.787 billion.

• Expansion of logistics center contracts: New contracts and projects won in the previous fiscal year contributed to results.
• Contribution from M&A: Acquired businesses added to results in both the logistics center and trucking operations.
• Improved trucking profitability: Higher revenue from dedicated truck services and better productivity at delivery terminals lifted profit.
• Net income growth lagged operating profit: The company recorded ¥182 million in settlement payments and other items as extraordinary losses, limiting net income growth to 5.2%.

Contract growth and more efficient trucking drove higher profit in the first half. Labor shortages and rising fuel prices continue to weigh on the logistics industry, but Hamakyorex expanded through new contracts and M&A while improving productivity in its transport operations. Operating profit growth ahead of revenue growth points to improved profitability as well as a larger business.

Logistics center operations generated operating revenue of ¥55.710 billion, up 14.1% year over year, and operating profit of ¥6.933 billion, up 7.4%. Expanded operations, new contracts and M&A supported growth in both revenue and profit. Profit increased despite acquisition-related expenses.

The segment secured logistics contracts with nine new companies during the first half, and all 10 companies, including those won in the previous fiscal year, were in operation. Hamakyorex had 218 logistics centers in total. Operating profit growth trailed revenue growth, making the maintenance of margins through day-to-day earnings management and operational improvements a key focus alongside further contract wins.

Motor trucking operations posted operating revenue of ¥28.041 billion, up 5.5% year over year, and operating profit of ¥1.196 billion, up 63.8%. Volumes in its less-than-truckload business were sluggish in the second quarter, but higher dedicated truck revenue, improved productivity and cost controls at delivery terminals, and M&A contributed to profit.

In trucking, Hamakyorex plans to expand dedicated services and intra-group business, with Kinbutsu Rex at the center of those efforts, while keeping transport costs in check. Logistics centers account for most of the company's profit, while trucking earnings will depend on whether efficiency gains and a better service mix can offset weak volumes.

Total assets at the end of the first half were ¥194.510 billion, up 12.8% from the end of the previous fiscal year. The equity ratio fell to 52.2% from 56.8%. Hamakyorex expects annual dividends of ¥46 per share, an increase of ¥4.25 from the previous fiscal year.

The increase in total assets mainly reflected higher fixed assets from capital investment and the addition of consolidated subsidiaries. Liabilities also rose by ¥18.092 billion from the previous fiscal year-end, partly because of the increase in subsidiaries, pulling down the equity ratio. Net assets increased, including from interim net income. The interim earnings release did not provide cash flow statement figures, and the company did not announce a share buyback. It raised the interim dividend and expects to increase the full-year payout as well.

Hamakyorex maintained its consolidated forecast for FY2027, projecting operating revenue of ¥165.5 billion, operating profit of ¥16.3 billion, ordinary profit of ¥17.2 billion and net income attributable to owners of the parent of ¥10.8 billion. The company forecasts year-over-year growth of 6.4% in operating revenue, 10.4% in operating profit, 7.0% in ordinary profit and 0.7% in net income.

The earnings release showed no revisions to the previous forecast, and the company kept its full-year plan unchanged. First-half operating profit exceeded the year-earlier level, but second-half results will depend on logistics center utilization, transport volumes and the business conditions of customer companies. Hamakyorex said a ¥1 change in the price of diesel per liter could affect annual earnings by about ¥40 million.

Hamakyorex said its logistics center and motor trucking operations are exposed to economic conditions and the performance of its customers. With labor shortages and fuel price increases continuing, the company's ability to turn new contracts into profit will be tested.

• Rising fuel prices: A ¥1-per-liter change in diesel prices could affect annual earnings by about ¥40 million. The company aims to reduce price volatility risk through measures such as fuel surcharge systems.
• Labor shortages and personnel costs: Difficult hiring conditions across the logistics industry could affect recruitment, labor costs and transport capacity. Productivity gains and transport cost management remain priorities.
• Economic conditions and customer performance: Changes in shippers' business environments or transport volumes could affect logistics center utilization and trucking revenue.
• Volume fluctuations: Volumes in the less-than-truckload business were weak at times during the first half. Investors will watch whether the company can broaden revenue sources by expanding dedicated truck services and intra-group business.
• Post-M&A integration and financial burden: Acquisitions support growth but also bring acquisition-related expenses and higher liabilities. Improving earnings after integration while maintaining capital efficiency will be important.

Managing fuel costs and labor shortages remains an ongoing challenge. Hamakyorex aims to limit the impact of external pressures through measures such as fuel surcharge systems, but its ability to pass on costs and improve productivity will shape the durability of profits. The earnings forecast is based on certain assumptions and may need to be revised as conditions change.