East Japan Railway Company (9020) Q2 2026 earnings summary

Executive summary

• Consolidated operating revenues and operating income for the first half significantly exceeded initial plans, driven by strong railway usage and higher sales at station stores, with no major natural disasters impacting results.

• Full-year forecasts for operating revenues, EBITDA, operating income, and profit attributable to owners were all revised upward, with the annual dividend increased to JPY 70 per share and a payout ratio of 33.3%.

• Management strategy emphasizes safety, quality, and trust, with countermeasures for recent railway incidents and a focus on PRIDE & INTEGRITY growth strategy, tourism, and urban development.

• Interim and year-end dividends were raised to 35 yen each, reflecting a higher payout ratio in line with long-term shareholder return policy.

• Comprehensive income increased 32.1% year-over-year to ¥170,177 million.

Financial highlights

• Operating revenues increased for the fifth consecutive quarter, up 4.9% year-over-year to ¥1,463.0 billion.

• Operating income for the period was ¥231.4 billion, down 1.8% year-over-year due to timing shifts in real estate sales.

• Profit attributable to owners of parent rose by 5.3% year-over-year to ¥147.2 billion, mainly from gains on investment securities sales.

• Free cash flow is negative due to growth investments, with first-half free cash flow at -¥196.7 billion, but expected to turn positive from FY 2026.

• Extraordinary gains rose sharply due to increased sales of investments in securities.

Outlook and guidance

• Full-year operating revenues forecast revised to ¥3,058.0 billion (+¥35.0 billion from prior forecast), with operating income projected at ¥405.0 billion and profit attributable to owners at ¥237.0 billion.

• Dividend payout ratio target to gradually rise to 40% by FY2028.3 as investments stabilize.

• Targeting JPY 1 trillion in real estate fund assets and cumulative operating income of JPY 600 billion from real estate sales by FY 2031.

• Railway-focused mobility business aims to grow operating revenue by over JPY 200 billion by FY 2031.

• Basic earnings per share forecast at ¥209.98.