Kansai Electric Profit Rises Despite Lower Sales and Operating Income

Core Insights - Kansai Electric Power Company reported a slight increase in first-half profit for fiscal 2025, supported by improved cost management despite declines in revenue and operating profit [1] Financial Performance - For the six months ended September 30, 2025, consolidated net sales were ¥2.01 trillion, a decrease of 6.0% year-on-year, while operating profit fell by 7.0% to ¥276.6 billion [2] - Ordinary profit decreased by 1.3% to ¥315.0 billion, but net profit attributable to shareholders rose by 1.8% to ¥232.9 billion [2] - Basic earnings per share were ¥209.08, down from ¥256.44 in the previous year, attributed to a larger share base following a stock split [3] Asset and Equity Position - As of September 30, total assets were ¥9.6 trillion, slightly below the March 2025 level, while equity strengthened to ¥3.27 trillion, increasing the equity ratio to 34.0% from 31.8% at the fiscal year's start [4] Dividend Forecast - The company revised its full-year dividend forecast upward to ¥75 per share, comprising an interim dividend of ¥30 and a planned year-end payment of ¥45, up from ¥60 the previous year [4] Future Projections - For the full year ending March 31, 2026, Kansai Electric forecasts consolidated net sales of ¥4.05 trillion, a decrease of 6.6% from FY2024, with operating profit expected to decline by 4.0% to ¥450 billion [5] - Net profit is projected at ¥360 billion, a 14.4% decrease from the prior year, due to lower electricity prices and sluggish demand [5] Industry Context - Japan's power utilities, including Kansai Electric, are experiencing normalization after two years of exceptional earnings driven by fuel cost adjustments and high tariffs during the global energy price surge [6] - With LNG and coal prices stabilizing, utilities are focusing on operational efficiency, nuclear restarts, and long-term investments in decarbonization [6] Strategic Initiatives - Kansai Electric is accelerating investments in renewable and nuclear energy to support Japan's 2050 net-zero goal [7] - The company is also expanding its overseas and digital infrastructure businesses to diversify revenue sources amid a maturing domestic electricity market [7]