NIPPON RIETEC (1938): FY2025 Results Summary — Record Orders, Sales and Profits on Power Transmission Demand

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

Note: This article covers the fiscal year ended March 31, 2026, which the company labels “Fiscal year ended March 31, 2026” (FYE3/26); japan-equity.com classifies the most recent completed fiscal year as FY2025, and the labels used in the text, tables and segment data below follow the company’s materials. NIPPON RIETEC CO., LTD. posted higher sales and higher profits for the fiscal year ended March 31, 2026, with orders received, net sales and all profit levels reaching record highs. Orders received increased by 19.6 billion yen year on year to 82.3 billion yen, net sales increased by 5.3 billion yen to 74.0 billion yen, operating profit increased by 1.9 billion yen to 7.1 billion yen, and profit attributable to owners of parent increased by 0.8 billion yen to 5.5 billion yen.

Consolidated Results (Full-Year Actual)

Orders, especially those from major customers, remained robust and surpassed the previous fiscal year’s levels in all divisions. In particular, the power transmission line facility division recorded a significant increase compared to the previous fiscal year, supported not only by the receipt of orders for multiple large-scale projects related to the development of power transmission line networks, but also by orders for energy infrastructure projects, including grid-scale battery storage and data centers that contribute to the development of next-generation social infrastructure. Net sales were at a record high, thanks to the progress and completion of construction in each division on the back of robust orders received in the fiscal year under review, in addition to abundant construction contracts carried over from the previous fiscal year; the indoor/outdoor electric facility division drove the increase with the progress of electrical works for the Shinagawa Development Project. Operating profit was at a record high due not only to the significant increase in net sales but also to improvements in profitability at the order stage through ongoing negotiations to pass on price increases in response to rising construction costs, including material costs and labor costs, as well as enhanced on-site efficiency through further promotion of digitalization and flexible personnel allocation.

Item (Billions of yen)	Fiscal year ended March 31, 2026	Fiscal year ended March 31, 2025	YoY change
Orders received	82.3	62.7	+19.6
Net sales	74.0	68.6	+5.3
Operating profit	7.1	5.1	+1.9
Operating profit margin	9.6%	7.6%	—
Ordinary profit	7.8	5.9	+1.8
Ordinary profit margin	10.6%	8.7%	—
Profit attributable to owners of parent	5.5	4.7	+0.8
Profit margin (attributable to owners of parent)	7.5%	6.9%	—

The company notes that the numbers, including the YoY change, are rounded down to the figures shown, and the percentages are rounded to the figures shown. On the balance sheet, total assets rose to 101.3 billion yen from 94.6 billion yen (+6.7), total net assets rose to 69.2 billion yen from 63.7 billion yen (+5.5), and the capital adequacy ratio improved to 68.4% from 67.3% (+1.1pts). Non-current assets increased by 3.6 billion yen year on year, mainly due to an increase in the market valuation of investment securities held, while net assets increased primarily due to an increase in retained earnings.

Segment Results

The Electric Facility Work Business, which accounts for the bulk of consolidated net sales, grew net sales by 5.2 billion yen to 70.4 billion yen and segment profit by 1.9 billion yen to 10.1 billion yen. Net sales by segment are net sales to outside customers, and “Adjustment” includes corporate expenses, etc. not attributable to any reportable segment.

Segment (Billions of yen)	Fiscal year ended March 31, 2026	Fiscal year ended March 31, 2025	YoY change
Net sales	74.0	68.6	+5.3
Electric Facility Work Business	70.4	65.2	+5.2
Subsidiary Business	3.1	3.0	+0.1
Real Estate Leasing Business	0.3	0.3	+0.0
Segment profit	10.7	8.8	+1.9
Electric Facility Work Business	10.1	8.2	+1.9
Subsidiary Business	0.4	0.3	+0.0
Real Estate Leasing Business	0.2	0.1	+0.0
Adjustment	(3.6)	(3.6)	+0.0
Consolidated operating profit	7.1	5.1	+1.9

Within the Electric Facility Work Business, all four divisions grew both orders received and net sales. In the Railroad Electric Facility Division, the company secured orders from East Japan Railway Company for capital investment in safe and stable transportation and facility reinforcement, while net sales were lifted by utility pole replacement for Shinkansen bullet trains and the new installation of ground communication systems for onboard platform monitoring. The Road Facility Division was supported by traffic signal works for prefectural police, structure improvement works and tunnel lighting works on freeways, and large-scale projects including the extension of the Shin-Omiya Ageo route on the Metropolitan Expressway. The Indoor/Outdoor Electric Facility Division was supported by large-scale electrical facility renovation works for government agencies and financial institutions, the Shinagawa Development Project, and electrical facility renovation works at the Tokyo International Exhibition Center (East Exhibition Halls). The Power Transmission Line Facility Division saw the largest swing, driven by steel tower replacement works and overhead line replacement works for electric power companies, inter-regional connection line projects, and data center-related projects.

Electric Facility Work Business division (Billions of yen)	Orders received (FYE3/26)	YoY change	Net sales (FYE3/26)	YoY change
Railroad Electric Facility Division	39.9	+1.9	36.9	+1.3
Road Facility Division	12.7	+0.6	11.9	+0.2
Indoor/Outdoor Electric Facility Division	9.1	+3.4	8.8	+2.4
Power Transmission Line Facility Division	20.4	+13.6	12.6	+1.2

In the Subsidiary Business — manufacturing and sale of signs for transportation facilities and traffic safety goods, and maintenance and management of buildings and related facilities as well as machinery, equipment and temporary materials — net sales were 3.16 billion yen (+0.14) and operating profit was 0.41 billion yen (+0.03). In the Real Estate Leasing Business, which covers OSAKI BRIGHT TOWER (unit ownership) and the Hiroshima CD Building (tenant), net sales were 0.39 billion yen (+0.01) and operating profit was 0.20 billion yen (+0.00).

Next-Year Forecast

For the fiscal year ending March 31, 2027, the company expects net sales and profits to increase. Further economic growth is expected as corporate revenues, as well as employment and income conditions, improve on the back of a recovery trend. Net sales are expected to increase due to abundant construction contracts carried over from the previous fiscal year, as well as steady sales expected from construction works in each division on the back of a robust order environment. Operating profit is expected to increase thanks to the effect of the increase in net sales, as well as ongoing price negotiations with customers and cost reduction efforts, despite the anticipated impact of rising raw material prices, higher labor costs, and other factors. While the impact of the situation in the Middle East is currently expected to be minor, the Group will review its forecasts as appropriate if events arise that could have a significant impact on its business performance, such as supply shortages caused by disruptions in the supply chain.

Item (Billions of yen)	Fiscal year ending March 31, 2027 (Forecast)	Fiscal year ended March 31, 2026 (Results)	YoY change
Net sales	75.3	74.0	+1.2
Operating profit	7.3	7.1	+0.2
Operating profit margin	9.8%	9.6%	—
Ordinary profit	8.3	7.8	+0.5
Ordinary profit margin	11.1%	10.6%	—
Profit attributable to owners of parent	6.1	5.5	+0.5
Profit margin (attributable to owners of parent)	8.2%	7.5%	—

Shareholder Returns

The Company regards the return of profit to its shareholders as a key management priority, and aims at increasing return of profit to shareholders and improving capital efficiency through the continuation of stable dividends and opportune acquisition of treasury shares. The Company has introduced DOE for shareholder returns, aiming to pay out stable and progressive dividends regardless of short-term performance.

Fiscal year	Dividend per share	DOE
FYE3/25 (16th fiscal term)	¥77	3.2%
FYE3/26 (17th fiscal term)	¥82	3.2%
FYE3/27 (18th fiscal term, forecast)	¥97	3.6%

Medium-Term Management Plan 2027

Alongside the results, the company disclosed a revision of the numerical management targets of Medium-Term Management Plan 2027. Consolidated net sales are unchanged at ¥77,500 million, while consolidated operating profit was raised from ¥6,500 million to ¥7,750 million, ROE from 8.0% to 9.0%, and DOE from 3.2% to 3.6%. The company’s long-term chart of consolidated net sales and operating profit shows net sales of 74.0 billion yen and operating profit of 7.1 billion yen for FYE3/26, 75.3 billion yen and 7.3 billion yen for FYE3/27, and 77.5 billion yen and 7.7 billion yen for FYE3/28.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.