Tohoku Electric: FY2027 sales at ¥3.47tn, dividend raised to ¥42

Tohoku Electric has released a consolidated earnings forecast for the year ending March 2027, after previously leaving it undecided. It expects sales, operating profit, ordinary profit and net profit all to exceed the previous year's results.

Tohoku Electric had left its earnings forecast undecided on April 30, 2026. The new forecast is based on certain assumptions, and the company cautioned that actual results could differ materially due to various factors.

Sales are forecast to rise to ¥3.47 trillion from ¥2.37242 trillion in the previous year. Tohoku Electric cited an increase in transactions outside its service area, including self-contracting associated with indirect auctions, as a main factor.

• Rate system: Tohoku Electric Network decided to revise electricity rates after approval of changes to its outlook for revenue from wheeling services under the revenue-cap system.
• Electricity sales volume: Retail sales are expected to be about 64 billion kWh and wholesale sales about 27.8 billion kWh. The combined total of about 91.8 billion kWh exceeds the previous year's 78.9 billion kWh.
• Market and fuel environment: The forecast also incorporates assumptions including fuel-price trends in light of the situation in the Middle East.

On profits, Tohoku Electric expects the time lag in the fuel-cost adjustment system and higher interest payments to weigh on results. These are expected to be offset by the reversal of mark-to-market effects at the end of the previous fiscal year and improved earnings from changes in market and sales conditions. Operating profit is forecast at ¥210 billion, up from ¥160.38 billion, while ordinary profit is expected to reach ¥170 billion, compared with ¥126.407 billion in the previous year.

Tohoku Electric provided assumptions for fuel prices, foreign exchange and nuclear plant utilization. Each differs from the previous year's result and is a key condition for assessing the forecast.

The earnings impacts represent the full-year effect of a change in each factor by the stated unit. Changes in fuel-price or exchange-rate assumptions could affect earnings, making future market conditions and actual results important indicators of how achievable the forecast is.

Tohoku Electric raised its year-end dividend forecast to ¥22 per share from ¥20, bringing the forecast annual payout to ¥42. This is also above the previous year's annual dividend of ¥40 per share.

Tohoku Electric's basic policy is to maintain stable dividends. From the year ending March 2025, it has determined dividends with a target DOE (dividend on equity) of 2%, while balancing this against the recovery of its financial base. The company raised its year-end dividend after releasing an earnings forecast that points to securing a certain level of profit, while also taking into account a 2% DOE based on shareholders' equity at the end of the previous fiscal year, excluding temporary accounting mark-to-market effects.