Sompo Holdings (8630): FY2025 Results Summary — Record Profit on Improved P&C Profitability and Lower Catastrophe Losses

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Sompo Holdings reported record results for FY2025 (fiscal year ended March 2026). Adjusted consolidated profit rose ¥211.8 bn. year-on-year to a record ¥535.2 bn., outperforming the initial forecast by ¥172.2 bn., with earnings expanding across all businesses driven by improved profitability at SOMPO P&C. Consolidated net income also reached a record ¥640.0 bn., up ¥396.9 bn. YoY. For FY2026, the company forecasts adjusted consolidated profit of ¥500.0 bn. (up ¥62.4 bn. on a normalized basis), supported by further improvement in domestic P&C profitability and the consolidation of Aspen.

Consolidated Results (Full-Year Actual)

Adjusted consolidated profit for FY2025 reached a record ¥535.2 bn., up ¥211.8 bn. YoY, driven by improved profitability in the domestic P&C business and a decline in natural catastrophe losses both domestically and overseas. Consolidated net income also reached a record ¥640.0 bn., up ¥396.9 bn. YoY. Insurance revenue for FY2025 was ¥5,372.9 bn., up ¥307.4 bn. YoY.

Item (¥ bn.)	FY2025	FY2024	Change
Insurance revenue	5,372.9	5,065.5	+307.4
Adjusted consolidated profit	535.2	323.4	+211.8
Consolidated net income	640.0	243.1	+396.9

Segment Results

SOMPO P&C’s adjusted profit increased ¥201.5 bn. YoY to ¥484.7 bn. Domestic P&C profit rose ¥95.9 bn. to ¥219.4 bn., driven by improved profitability in fire and allied lines (+¥70 bn.) and a decrease in natural catastrophe losses (+¥26 bn.), partly offset by higher expenses from inflation (-¥8 bn.). Overseas insurance profit rose ¥105.5 bn. to ¥265.3 bn., driven by lower catastrophe losses (+¥58 bn.), improved underlying profitability excluding natural catastrophes (+¥35 bn.), and higher interest and dividend income from a larger asset base (+¥15 bn.). SOMPO Wellbeing’s adjusted profit increased ¥7.9 bn. to ¥74.1 bn., with Domestic Life up ¥4.2 bn. to ¥61.3 bn. on decreased claims payments, and Nursing Care, etc. up ¥3.6 bn. to ¥12.8 bn.

Segment	Metric	FY2025	FY2024
SOMPO P&C (Domestic P&C + Overseas)	Adjusted profit (¥ bn.)	484.7	283.2
– Domestic P&C	Adjusted profit (¥ bn.)	219.4	123.5
– Overseas	Adjusted profit (¥ bn.)	265.3	159.7
SOMPO Wellbeing (Domestic Life + Nursing Care)	Adjusted profit (¥ bn.)	74.1	66.2
– Domestic Life	Adjusted profit (¥ bn.)	61.3	57.0
– Nursing Care, etc.	Adjusted profit (¥ bn.)	12.8	9.2
Others	Adjusted profit (¥ bn.)	-23.6	-26.0
Group Total	Adjusted consolidated profit (¥ bn.)	535.2	323.4

At Sompo Japan, insurance revenue for FY2025 rose ¥96.8 bn. YoY to ¥2,187.7 bn. (excl. CALI and household earthquake), driven by product revisions in auto and fire insurance and sales expansion in allied lines. The combined ratio improved 5.1pt to 91.0%, reflecting a 4.6pt improvement in the loss ratio to 58.2% (lower fire and allied losses and reduced natural catastrophe impact) and a 0.5pt improvement in the expense ratio to 32.8%. Adjusted profit for Sompo Japan rose ¥94.4 bn. to ¥217.3 bn. For FY2026, insurance revenue is forecast to grow to ¥2,277.0 bn., the combined ratio is expected to normalize to 92.9% as natural catastrophe losses return to an average-year level, and adjusted profit is forecast at ¥178.6 bn.

Item	FY2024	FY2025	FY2026 Forecast
Loss ratio (excl. CALI, Household EQ)	62.8%	58.2%	60.6%
Expense ratio (excl. CALI, Household EQ)	33.3%	32.8%	32.3%
Combined ratio (excl. CALI, Household EQ)	96.1%	91.0%	92.9%
Insurance service result (¥ bn.)	81.2	195.8	162.7
Adjusted profit for Sompo Japan (¥ bn.)	122.9	217.3	178.6

At the overseas insurance/reinsurance business (Sompo International Holdings, SIH), insurance revenue grew 10.8% YoY to $16,089 mn., led by 9.2% growth in Commercial Insurance, 8.8% growth in Global Reinsurance, and 30.8% growth in Consumer Insurance (driven by strong growth in Turkey Motor and Property & Catastrophe). The combined ratio improved 8.6pt to 82.1% on an improved loss ratio and lower-than-normal catastrophe activity, with Commercial Insurance COR improving 4.3pt, Global Reinsurance 19.9pt, and Consumer Insurance 10.3pt. Adjusted profit for SIH rose $709 mn. YoY to $1,737 mn. For FY2026, insurance revenue is forecast to grow 31% (6% ex-Aspen) to $21,064 mn., the combined ratio is forecast at 89.0%, and adjusted profit for SIH is forecast flat at $1,737 mn., reflecting the full-year contribution from the Aspen acquisition, which closed in February 2026.

Item ($ mn.)	FY2024	FY2025	FY2026 Forecast
Insurance revenue	14,527	16,089	21,064
Combined ratio (discounted)	90.6%	82.1%	89.0%
Net income (SIH)	1,119	1,930	1,803
Adjusted profit (SIH)	1,028	1,737	1,737

FY2026 Forecast

For FY2026, Sompo Holdings forecasts adjusted consolidated profit of ¥500.0 bn. (up ¥62.4 bn. from the FY2025 normalized basis of ¥437.5 bn., a record high on a normalized basis) and consolidated net income of ¥490.0 bn. Domestic P&C business profit is forecast to increase ¥15.1 bn. YoY on a normalized basis to ¥180.0 bn., driven by improvement in the underlying profitability of automobile insurance (+¥15 bn.) and fire insurance (+¥12 bn.) and a decrease in expected large losses (+¥4 bn.), partly offset by expense increases from inflation (-¥11 bn.). Overseas insurance business profit is forecast to increase ¥57.7 bn. to ¥280.0 bn., primarily due to the full-year earnings contribution from the consolidation of Aspen (+¥45 bn.) and improvement in underlying profitability (+¥9 bn.).

Item	Forecast	FY2025 (Actual)
Insurance revenue (¥ bn.)	6,410.0	5,372.9
Adjusted consolidated profit (¥ bn.)	500.0	535.2
Consolidated net income (¥ bn.)	490.0	640.0
Domestic P&C adjusted profit (¥ bn.)	180.0	219.4
Overseas adjusted profit (¥ bn.)	280.0	265.3

Shareholder Returns

Total shareholder return for FY2025 was ¥281.6 bn., consisting of ¥135.6 bn. in dividends and ¥146.0 bn. in share buybacks (¥64.3 bn. as a basic return and ¥81.7 bn. funded by gains on sale of strategic holding stocks). The FY2025 dividend per share (DPS) was ¥150, including a second-half DPS of ¥75. For FY2026, the company anticipates a DPS of ¥200, an increase of 33% YoY, outpacing EPS growth and marking the 13th consecutive year of dividend growth; the company aims to progressively raise the dividend payout ratio over the medium term. The Group also resolved an additional share buyback of ¥69.0 bn., and, in line with its shareholder return policy, will continue to consider agile share buybacks while maintaining a certain level of capital for growth investments.

Item	FY2025	FY2026 (Forecast)
DPS (¥)	150	200
Total shareholder return (¥ bn.)	281.6	–
– Dividends (¥ bn.)	135.6	–
– Share buybacks (¥ bn.)	146.0	–

Medium-Term Plan / Topics

Sompo completed the acquisition of Aspen in February 2026, with post-merger integration (PMI) progressing on track and growth being accelerated through overseas synergies. The impact of Aspen consolidation for FY2026 is expected to contribute an additional ¥45.0 bn. to adjusted profit, a $4.6 bn. increase in gross written premium (GWP, FY2025 actual, USGAAP Jan.-Dec. basis), and $60 mn. in FY2026 synergies. The Group also continued to reduce strategic shareholdings, cutting ¥292.4 bn. in FY2025, exceeding the plan; for FY2026, it targets reductions of more than ¥250.0 bn., exceeding the initial plan of ¥200.0 bn. formulated at the start of the Mid-Term Management Plan. The Group’s Economic Solvency Ratio (ESR, 99.5% VaR) rose to 270% at the end of March 2026 from 256% a year earlier, above the newly established target capital level of 200% or above required to maintain financial soundness and credit ratings. Adjusted consolidated ROE was 13.4% in FY2025, up from 9.2% in FY2024, against a medium-term target of 13-15% (the FY2026 plan is 13.1%, adjusted to reflect the financial market assumptions used when formulating the Mid-Term Management Plan).

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.