Okinawa Electric: FY2027 operating profit forecast cut to ¥5bn

Okinawa Electric expects sales to rise, while operating profit and net profit are forecast to fall below both the previous outlook and the prior-year results.

Against the previous forecast, sales are up 2.4%, while operating profit is down 32.4%, ordinary profit is down 36.0% and net profit is down 44.1%. The revised profit forecasts are also all below the prior-year results.

Okinawa Electric has factored in higher fuel and purchased-power costs, as well as increased repair and labor expenses related to typhoons.

• Sales driver: Electricity charges are expected to rise, partly because of the fuel-cost adjustment system.
• Pressure on profit: Higher fuel prices are expected to increase fuel expenses and the cost of power purchased from other companies.
• Additional costs: Typhoons are expected to lift repair and labor expenses.

The fuel-cost adjustment system contributes to higher sales, but rising fuel prices also push up expenses. Okinawa Electric said these cost increases, along with typhoon-related spending, make it difficult to translate the higher sales outlook into stronger profit.

Okinawa Electric has lowered its standalone profit forecasts but left its dividend outlook unchanged.

Compared with the previous forecast, standalone sales are set to rise 2.5%, while operating profit is projected to fall 55.3%, ordinary profit 66.7% and net profit 64.0%. For both consolidated and standalone results, the sales outlook and profit outlook are moving in opposite directions. The dividend forecast is unchanged.