Kintetsu: Kintetsu Dept Store Raises Full-Year Profit Outlook, Hikes Dividend

Kintetsu (code: 8244) disclosed on October 9 that its consolidated results for the second quarter ending February 2027 significantly surpassed previous expectations. Revenue reached 57.362 billion yen, exceeding the forecast of 57 billion yen by 360 million yen. Profitability was notably stronger, with operating income at 3.014 billion yen, surpassing the 2.7 billion yen estimate by 314 million yen. This 11.6% increase also beat the prior year's figure of 2.62 billion yen. Net profit attributable to parent company shareholders came in at 2.22 billion yen, well above the 1.7 billion yen forecast. Strong domestic and duty-free sales, alongside reduced asset disposal costs related to renovations, supported this improvement. While individual revenue fell to 47.029 billion yen from 52.129 billion yen prior year, net profit remained solid.

Following the strong mid-term performance, Kintetsu revised its full-year 2027 forecasts. Consolidated revenue is now projected at 117 billion yen, an increase of 1 billion yen from the previous 116 billion yen. Operating income is set at 6.2 billion yen and net profit at 4 billion yen, both exceeding prior estimates despite being below last year's figures (6.718 billion yen and 6.613 billion yen respectively). The operating profit margin improved by 10.7% relative to revenue growth, highlighting enhanced cost awareness. Individual operating income is also raised to 5.4 billion yen, nearing the prior year's 6.01 billion yen. Although utility costs are expected to rise due to geopolitical tensions in the Middle East, these increases are projected to be lower than initially forecast, demonstrating improved management resilience.

Kintetsu announced a revision to its final dividend, raising the quarterly payout by 5 yen to 25 yen. The total annual dividend increases from 20 yen to 25 yen, surpassing the prior year's 20 yen by 5 yen. This decision reflects active return of profits to shareholders while maintaining financial health. With full-year net profit expected to exceed prior year levels, the company has room for this increase. The positive signal boosts investor confidence in Kintetsu Group HD and its subsidiary's profitability, though future results may vary.