Odakyu Electric Railway (9007): FY2025 Results Summary — Operating Profit Up 2.4% on Transportation, Dividend Raised to ¥55

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

Note: Odakyu Electric Railway labels the fiscal year covered by these results as FY3/2026; this site classifies the most recent completed fiscal year as FY2025, and all labels and figures below follow the company’s materials. Operating revenue was 418,732 million yen, down 3,968 million yen (-0.9%) year on year, while operating profit rose 1,228 million yen (+2.4%) to 52,659 million yen. Profit attributable to owners of parent fell 14,590 million yen (-28.1%) to 37,368 million yen. The company plans an annual dividend of ¥55 per share for FY3/2026, revised upward from ¥50.

Consolidated Results (Full-Year Actual)

Operating revenue decreased, mainly reflecting extraordinary factors in Life Services, while operating profit increased primarily due to revenue growth in Transportation. Profit attributable to owners of parent decreased, chiefly reflecting the absence of the extraordinary income (from transfer of UDS to an external party) posted in the previous fiscal year. Ordinary profit rose 3,553 million yen (+7.0%) to 54,028 million yen.

Against the forecast as of November, operating revenue was 6,267 million yen (-1.5%) lower, mainly due to a decrease in the number of units sold in Real Estate, and operating profit was 340 million yen (-0.6%) lower, primarily owing to increased expenses in Transportation. Profit attributable to owners of parent was 2,368 million yen (+6.8%) above the 35,000 million yen forecast, as non-operating income and extraordinary income were higher than expected.

The company identifies the following extraordinary factors in FY3/2025 (Life Services): the change of fiscal year and 13-month consolidation following application of the Group Tax Sharing system to Department Stores and Stores and Retail (operating revenue -¥8.4 bn, operating profit -¥0.4 bn), and the exclusion of UDS and Okinawa UDS from consolidation in Hotels at the end of the first quarter. Excluding these extraordinary factors, the company states that FY3/2026 consolidated operating revenue rose ¥8.8 bn and operating profit rose ¥2.3 bn year on year.

Millions of yen	FY3/2025 Results	FY3/2026 Results	Change
Operating revenue	422,700	418,732	-3,968 (-0.9%)
Operating profit	51,431	52,659	+1,228 (+2.4%)
Non-operating income	5,916	9,285	+3,368
Non-operating expenses	6,873	7,916	+1,042
Ordinary profit	50,474	54,028	+3,553 (+7.0%)
Extraordinary income	30,273	14,379	-15,893
Extraordinary losses	8,693	17,242	+8,548
Profit attributable to owners of parent	51,958	37,368	-14,590 (-28.1%)
Capital investments	65,388	81,385	+15,997
Depreciation	43,954	44,352	+397
Interest-bearing debt	652,789	699,754	+46,965
Interest-bearing debt/EBITDA ratio (times)	6.8	7.2	+0.4p
ROA	4.1%	2.8%	-1.3p
ROE	11.7%	8.0%	-3.7p

Total assets increased 93.5 billion yen from the end of the previous fiscal year to 1,393.5 billion yen, due mainly to an increase in land and buildings for sale in lots and a rise in investment securities with SPC investments. Liabilities increased 64.0 billion yen to 884.7 billion yen, mainly reflecting a rise in interest-bearing debt after borrowings and an increase in accounts payable – other related to the Shinjuku West Gate Development Project. Net assets increased 29.5 billion yen to 508.7 billion yen. The equity ratio was 36.4%, down 0.4 point from 36.8%.

Segment Results

In Transportation, operating revenue increased 6.3 billion yen and operating profit rose 3.0 billion yen, mainly due to fare revisions in Buses and the Hakone area in addition to the strong performance maintained in terms of the number of passengers carried at each company, especially in the Company’s railway business. In Real Estate, operating revenue increased 0.3 billion yen, mainly due to higher rental income in Leasing and increased orders received for construction work in Building Management and Maintenance despite the closure of Shinjuku MYLORD in Leasing; however, operating profit decreased 0.3 billion yen. In Life Services, operating revenue increased 2.7 billion yen with improved results at existing stores in Stores and Retail excluding extraordinary factors, while operating profit decreased 0.3 billion yen chiefly due to a drop in tax-free sales in Department Stores and a rise in expenses related to new businesses.

Millions of yen	Metric	FY3/2025 Results	FY3/2026 Results	Change
Operating revenue	Total	422,700	418,732	-3,968
Transportation	Operating revenue	174,927	181,261	+6,333
Real Estate	Operating revenue	95,897	96,226	+328
Life Services	Operating revenue	168,695	158,606	-10,089
Adjustments	Operating revenue	-16,821	-17,362	-541
Operating profit	Total	51,431	52,659	+1,228
Operating profit margin	Total	12.2%	12.6%	+0.4p
Transportation	Operating profit	26,495	29,517	+3,021
Transportation	Operating profit margin	15.1%	16.3%	+1.2p
Real Estate	Operating profit	15,852	15,473	-379
Real Estate	Operating profit margin	16.5%	16.1%	-0.4p
Life Services	Operating profit	9,062	7,658	-1,404
Life Services	Operating profit margin	5.4%	4.8%	-0.6p
Adjustments	Operating profit	20	10	-9

Within Transportation, Railways operating revenue was 132,621 million yen (+3,342) and Railways operating profit was 23,350 million yen (+1,966); Buses posted operating revenue of 38,363 million yen (+1,810) and operating profit of 3,060 million yen (+278); Others posted operating revenue of 10,277 million yen (+1,181) and operating profit of 3,106 million yen (+776). For Odakyu Electric Railway on a non-consolidated basis, the number of passengers carried and railway revenue both rose, as shown below.

Odakyu Electric Railway	FY3/2025 Results	FY3/2026 Results	Change
Number of passengers carried – Total (thousands of people)	698,871	712,628	+13,757 (+2.0%)
Number of passengers carried – Commuters	404,556	410,778	+6,222 (+1.5%)
Number of passengers carried – Non-commuters	294,315	301,850	+7,535 (+2.6%)
Revenue – Total (millions of yen)	118,508	121,039	+2,530 (+2.1%)
Operating expenses – Total (millions of yen)	97,635	98,591	+955 (+1.0%)
Tourism revenue including tax-free sales (millions of yen)	77,844	80,614	+2,770 (+3.6%)
Tourism revenue – inbound tourism only (millions of yen)	24,956	26,078	+1,122 (+4.5%)

Tourism revenue is included in the values for Transportation, Real Estate and Life Services. The company notes that the calculation method was changed, and accordingly the results for FY3/2025 and for FY3/2026 (inbound only) were modified. For the Hakone area only, tourism revenue was 29,758 million yen (+1,619, +5.8%), of which inbound tourism was 8,278 million yen (+929, +12.6%).

In Real Estate, the Sales sub-segment recorded operating revenue of 35,688 million yen (-864), Leasing 45,140 million yen (+38) and Others 15,397 million yen (+1,155). The number of units sold in Sales totalled 230 (+20), while Investment and development sold 2 properties (-1). In Life Services, Department Stores posted operating revenue of 22,922 million yen (-4,852), Stores and Retail 67,490 million yen (-2,915), Hotels 14,145 million yen (-3,039), Restaurants 17,092 million yen (-35) and Others 36,955 million yen (+754).

FY3/2027 Forecast

For FY3/2027, operating revenue is projected to increase 42,567 million yen (+10.2%) to 461,300 million yen, mainly due to a higher number of passengers carried and fare revisions in Transportation, and higher projected unit sales in the sale and purchase and resale sides of Real Estate. Operating profit is expected to rise 1,340 million yen (+2.5%) to 54,000 million yen. Ordinary profit is forecast to fall 6,128 million yen (-11.3%) to 47,900 million yen due to the absence of gain on settlement of construction contracts, among other factors, while profit attributable to owners of parent is expected to increase 931 million yen (+2.5%) to 38,300 million yen, chiefly owing to the posting of a gain on sale of investment securities (cross-shareholdings).

Millions of yen	FY3/2026 Results	FY3/2027 Forecasts	Change
Operating revenue	418,732	461,300	+42,567 (+10.2%)
Operating profit	52,659	54,000	+1,340 (+2.5%)
Ordinary profit	54,028	47,900	-6,128 (-11.3%)
Profit attributable to owners of parent	37,368	38,300	+931 (+2.5%)
Capital investments	81,385	132,800	+51,414
Depreciation	44,352	46,700	+2,347
Interest-bearing debt	699,754	790,500	+90,745
Interest-bearing debt/EBITDA ratio (times)	7.2	7.9	+0.7p
ROA	2.8%	2.7%	-0.1p
ROE	8.0%	8.0%	—

By segment, Transportation operating revenue is forecast to rise 5,838 million yen while operating profit falls 817 million yen, reflecting higher depreciation and personnel expenses in Railways. Real Estate operating revenue is projected to climb 31,873 million yen and operating profit 3,626 million yen on higher projected unit sales, with projected unit sales in Sales of 431 units (+201) and 5 properties (+3) in Investment and development. Life Services operating revenue is expected to grow 4,693 million yen while operating profit falls 1,458 million yen, mainly due to the suspension of accommodation operations at Hotel Century Southern Tower from October 1, 2026 (operating revenue -¥2.4 bn).

Millions of yen	Metric	FY3/2026 Results	FY3/2027 Forecasts	Change
Operating revenue	Total	418,732	461,300	+42,567
Transportation	Operating revenue	181,261	187,100	+5,838
Real Estate	Operating revenue	96,226	128,100	+31,873
Life Services	Operating revenue	158,606	163,300	+4,693
Adjustments	Operating revenue	-17,362	-17,200	+162
Operating profit	Total	52,659	54,000	+1,340
Operating profit margin	Total	12.6%	11.7%	-0.9p
Transportation	Operating profit	29,517	28,700	-817
Real Estate	Operating profit	15,473	19,100	+3,626
Life Services	Operating profit	7,658	6,200	-1,458
Adjustments	Operating profit	10	0	-10

Shareholder Returns

Under its basic policy for FY3/2024 through FY3/2027, and based on the assumption of a 30% shareholders’ equity ratio, the Company will implement stable dividends and flexible share buybacks, with a target total consolidated payout ratio of at least 40% on average for FY3/2024 through FY3/2027 (total amount of shareholder returns for the four years divided by total amount of profit attributable to owners of parent for the four years). For FY3/2026 the Company is planning to pay an annual dividend of ¥55 per share, revised upward from ¥50, and for FY3/2027 an annual dividend of ¥60 per share. The Company is aiming to implement share buybacks of ¥20.0 billion by the end of December 2026 as balance sheet control based on an awareness of the shareholders’ equity ratio, with the timing considered comprehensively in light of changes in the business environment, business performance and the balance between share supply and demand. Acquisitions that were made totalled ¥32.7 billion for FY3/2024 and FY3/2025 combined.

Dividend per share (yen)	FY3/2025	FY3/2026	FY3/2027 (Forecast)
Interim dividend	15.0	25.0	30.0
Year-end dividend	25.0	30.0	30.0
Annual dividend	40.0	55.0	60.0

As a long-term target through FY3/2031, the Company is aiming to reduce the shareholders’ equity ratio to 30% by FY3/2031 (36.4% at the end of FY3/2026), to deliver shareholder returns worth 180.0 billion yen in cumulative total during FY3/2027 to FY3/2031 (200.0 billion yen in cumulative total during FY3/2026 to FY3/2031), and to achieve progressive dividends through to FY3/2031.

Consolidated Financial Targets

For profitability, the Company targets operating profit of ¥54.0 billion in FY3/2027 and ¥80.0 billion or more in FY3/2031, stating that income will continue to increase moderately until FY3/2027 but will grow to 80.0 billion yen or more in FY3/2031, reflecting efforts to achieve growth in tourism and Real Estate and revise fares in the Company’s railway business. ROE is targeted at 8.0% in FY3/2027 and 10% or more in FY3/2031; the Company notes that ROE will be on a downward trend temporarily until FY3/2027 due to a decrease in extraordinary income but will grow to a level above 10% in FY3/2031 due to increases in ROA and financial leverage. For financial soundness, the interest-bearing debt/EBITDA ratio is to be controlled to maintain a 7-time level in FY3/2027 and FY3/2031.

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.