Axial Retailing (8255): FY2025 Results Summary — Record Net Sales and Ordinary Profit, Net Income Dips on Lower Tax Credits

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Axial Retailing Inc. (Tokyo Prime Market: 8255) operates supermarket chains through two operating groups, Harashin Narus and Fressay. For the fiscal year ended March 31, 2026, the company reported record net sales and ordinary profit: net sales rose 4.8% year on year to ¥295,536 million and ordinary profit increased 0.7% to ¥12,799 million, both all-time highs, while profit attributable to owners of parent declined 2.3% to ¥8,803 million, which the company attributes to a reduction in special corporate tax credits.

Consolidated Results (Full-Year Actual)

Axial Retailing achieved all-time highs in net sales and ordinary profit for the fiscal year ended March 31, 2026, pursuing a quality-focused policy amid inflationary pressure and intensifying price competition. Profit attributable to owners of parent decreased due to a reduction in special corporate tax credits.

Item	FY2025 (Year Ended Mar 2026)	FY2024 (Year Ended Mar 2025)	Change (%)
Net sales	295,536	281,870	4.8%
Gross profit	84,510 (28.6%)	82,056 (29.1%)	3.0%
Selling, General and Administrative Expenses	72,324 (24.8%)	69,995 (24.8%)	3.3%
Ordinary profit	12,799 (4.3%)	12,709 (4.5%)	0.7%
Profit attributable to owners of parent	8,803	9,006	△2.3%
ROE / ROA	9.5%/9.2%	10.4%/9.5%	―

Segment Results (Results by Corporate Group)

Axial Retailing’s two operating groups showed different trends in the fiscal year. Harashin Narus grew net sales 5.9% year on year to ¥211,665 million, with operating profit up 2.0% and ordinary profit up 1.5%, though net profit declined slightly. Fressay’s net sales grew 2.5% to ¥85,410 million, but its operating profit, ordinary profit and net profit all declined year on year.

Company	Metric	FY2025 (Year Ended Mar 2026)	Change (%)
Harashin Narus	Net sales	211,665	5.9%
Harashin Narus	Gross profit	59,233 (28.0%)	3.9%
Harashin Narus	SG&A expenses	49,760 (23.5%)	4.3%
Harashin Narus	Operating profit	9,473 (4.5%)	2.0%
Harashin Narus	Ordinary profit	9,758 (4.6%)	1.5%
Harashin Narus	Net profit	6,877	△0.7%
Fressay	Net sales	85,410	2.5%
Fressay	Gross profit	25,417 (29.8%)	0.8%
Fressay	SG&A expenses	22,715 (26.6%)	1.5%
Fressay	Operating profit	2,702 (3.2%)	△4.4%
Fressay	Ordinary profit	2,824 (3.3%)	△2.3%
Fressay	Net profit	1,860	△8.4%

FY2026 Forecast (Year Ending March 31, 2027)

For the year ending March 31, 2027, Axial Retailing forecasts consolidated net sales of ¥300,000 million (+1.5%), while operating profit, ordinary profit and profit attributable to owners of parent are all expected to decline, as the company positions the year as a preparation phase for growth ahead of accelerated new store openings from FY2027 onward. By group, Harashin Narus is forecast to post net sales of ¥214,500 million (+1.3%) and Fressay ¥85,500 million (+0.1%), with profit at both groups expected to decline.

Item	Consolidated Forecast	Change (%)	Harashin Narus Forecast	Change (%)	Fressay Forecast	Change (%)
Net sales	300,000	1.5%	214,500	1.3%	85,500	0.1%
Operating profit	11,700	△4.0%	9,300	△1.8%	2,400	△11.2%
Ordinary profit	12,000	△6.2%	9,500	△2.6%	2,500	△11.5%
Profit attributable to owners of parent	8,000	△9.1%	6,400	△6.9%	1,600	△14.0%

Medium-Term Management Plan

Axial Retailing’s medium-term management plan positions the fiscal year ending March 31, 2027 as a year to focus on strengthening SPA (specialty store retailer of private label apparel) functions and preparing for growth ahead of a planned expansion in new store openings. Under the plan, the company targets increasing its store count from 131 stores (as of the fiscal year ended March 31, 2026) to 144 stores by the fiscal year ending March 31, 2029, through a total of 16 store openings, with planned cumulative investment of ¥39.2 billion over the three years to FY2029. The plan targets an ordinary profit ratio of 4.0% and ROA/ROE of 9.0%/9.0% for the fiscal year ending March 31, 2029. In its narrative discussion of the plan, the company states it is targeting net sales of approximately ¥338 billion, with an ordinary profit ratio of 4.0%, by the fiscal year ending March 31, 2029. Key initiatives include expanding direct imports, stepping up in-house manufacturing (SPA) functions, establishing a new manufacturing base and distribution center, and strengthening recruitment and training to support accelerated store openings. The presentation notes that the figures in the medium-term plan are targets and differ from the company’s official forecasts.

Shareholder Returns

Axial Retailing paid an annual dividend of 29 yen per share for the fiscal year ended March 31, 2026, up from 27 yen the previous year, and plans to maintain a 29 yen dividend for the fiscal year ending March 31, 2027. During the fiscal year ended March 31, 2026, the company repurchased ¥1.2 billion of shares from the market, part of a ¥2.0 billion repurchase authorization launched in February 2025. Key shareholder-return initiatives over the past two years cited by the company include share repurchases totaling ¥1.5 billion + ¥2.0 billion + ¥2.0 billion, a 1:4 stock split effective April 1, 2024, introduction of a five-year progressive dividend policy, and a preferential shareholder-benefit program for long-term shareholders. The company’s long-standing capital policy targets a long-term ROA (ordinary profit / total assets) of 15%, with medium-term targets of ROA of 10% and ROE of 10%.

Item	FY2024 (Year Ended Mar 2025)	FY2025 (Year Ended Mar 2026)	FY2026 Forecast (Year Ending Mar 2027)
Dividend per share	27.0 yen	29.0 yen	29.0 yen
Consolidated payout ratio (%)	27.1	29.2	32.1

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.