Kyushu Railway Company (9142): FY2025 Results Summary — Fare Revisions and Property Sales Lift Operating Income to ¥74.0 Billion

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

Note on year labels: the company labels the fiscal year covered by these results “FY26.3” and the forecast year “FY27.3”; this article follows our site convention of classifying the most recently completed fiscal year as FY2025, while all table, chart and segment labels are kept exactly as reported in the source materials.

Kyushu Railway Company (JR Kyushu) presented its FY26.3 results at its Annual Investors Meeting on May 12, 2026. Consolidated operating revenue, operating income, ordinary income and net income attributable to owners of the parent all increased year on year, driven primarily by higher railway passenger revenues following fares and charges revisions and by increased real estate sales. Operating revenue reached ¥500.3 billion (110.1% year on year) and operating income ¥74.0 billion (125.5%), while EBITDA rose to ¥112.6 billion (117.4%). Alongside the results, the company revised all numerical targets of its Medium-Term Business Plan 2025–2027 upward.

Consolidated Results (FY26.3 Full-Year Actual)

Net income attributable to owners of the parent rose to ¥45.4 billion (104.1%), a smaller increase than at the operating line because extraordinary gains and losses widened to (¥14.3 billion) from (¥3.3 billion) a year earlier. On a non-consolidated basis, operating revenue was ¥272.9 billion (113.3%) and operating income ¥49.4 billion (137.0%), while extraordinary gains and losses of (¥14.5 billion) were attributed to “The heavy rains beginning August 6, 2025” and the cancellation of the project utilizing the space above the tracks at Hakata Station; non-consolidated net income was ¥28.7 billion (92.6%). EBITDA is defined in the materials as operating income plus depreciation expense (excluding depreciation of leased assets held for subleasing purposes).

Item (¥ bil)	Results FY25.3	Results FY26.3	YoY
Operating revenue	454.3	500.3	110.1%
Operating income	58.9	74.0	125.5%
Ordinary income	59.5	74.0	124.3%
Extraordinary gains and losses	(3.3)	(14.3)	–
Net income attributable to owners of the parent	43.6	45.4	104.1%
EBITDA	95.9	112.6	117.4%

On the balance sheet, total assets grew to ¥1,222.4 billion (an increase of ¥81.9 billion), net assets to ¥494.8 billion and interest-bearing debt to ¥467.9 billion, with the equity ratio at 40.4% versus 40.0% a year earlier. Cash flows from operating activities were ¥72.8 billion (down ¥23.8 billion, reflecting increased expenditures due to an increase in inventory), cash flows from investing activities were (¥87.1 billion) and free cash flow was (¥14.2 billion).

Segment Results

All five segments except Business Services grew operating income. Transportation operating revenue rose to ¥190.6 billion (112.6%) and operating income nearly doubled to ¥23.9 billion (196.7%), reflecting the revision of rail fares and charges; within the Real Estate and Hotels segment, Real Estate Sales revenue rose to ¥39.6 billion (120.6%) on increased sales of properties and condominiums. Business Services was the only segment with lower operating income, at ¥5.0 billion (95.8%).

Segment (¥ bil)	Metric	Results FY25.3	Results FY26.3	YoY
Transportation	Operating revenue	169.3	190.6	112.6%
Transportation	Operating income	12.1	23.9	196.7%
Real Estate and Hotels	Operating revenue	143.4	156.6	109.3%
Real Estate and Hotels	Operating income	31.4	34.4	109.3%
Retail and Restaurant	Operating revenue	67.0	71.8	107.1%
Retail and Restaurant	Operating income	3.4	3.8	111.2%
Construction	Operating revenue	100.6	111.0	110.4%
Construction	Operating income	7.3	7.7	105.2%
Business Services	Operating revenue	82.5	84.1	101.9%
Business Services	Operating income	5.2	5.0	95.8%

Railway transportation revenues (non-consolidated) totaled ¥172.6 billion (114.1%), of which Shinkansen accounted for ¥69.1 billion (114.3%) and conventional lines ¥103.4 billion (114.0%). Passenger-kilometers, by contrast, declined to 8,493 million (98.8%), with conventional-line commuter pass passenger-kilometers at 3,661 million (97.2%) on a decrease in the number of passengers holding school commuter passes. Inbound revenue in Q4 FY26.3 remained at the same level as the previous year: JR-KYUSHU RAIL PASS tickets sold on a cumulative Q4 basis fell to 215,000 (77.3%) and sales to ¥3.59 billion (92.8%), while the reference average unit price rose to approximately ¥16,600 (120.0%).

In the real estate leasing business, station building tenant sales for FY26.3 exceeded the plan overall, supported by a recovery trend in duty-free sales at JR Hakata City after a Q1 decline; the materials note that at Amu Plaza, tenant sales grew at an annual average of around +6% and rents at around +4% from FY24.3 to FY26.3. In the hotel business, Q4 occupancy was 82% with ADR at approximately ¥25,000 and an inbound guest ratio of approximately 55%.

FY27.3 Forecast

For FY27.3, consolidated operating revenue and operating income are expected to increase, driven primarily by higher railway transportation revenues and an increase in property sales. Ordinary income is expected to decrease due to an increase in interest expense, while net income attributable to owners of the parent is expected to increase, reflecting the absence of the extraordinary losses recorded in the previous fiscal year. Railway transportation revenues are forecast at ¥175.1 billion (101.4%), with the transition to new commuter pass pricing adding ¥1.5 billion, marketing initiatives ¥1.1 billion and the upward trend ¥1.3 billion, against a ¥1.3 billion decrease from extraordinary factors in FY26.3.

Item (¥ bil)	Results FY26.3	Forecasts FY27.3	YoY	Medium-Term Business Plan targets
Operating revenue	500.3	520.5	104.0%	564.0
Operating income	74.0	75.0	101.3%	81.0
Ordinary income	74.0	70.9	95.8%	－
Net income attributable to owners of the parent	45.4	51.6	113.5%	－
EBITDA	112.6	116.2	103.1%	125.5
Transportation (operating revenue)	190.6	193.0	101.2%	196.0
Real Estate and Hotels (operating revenue)	156.6	168.1	107.3%	188.0
Retail and Restaurant (operating revenue)	71.8	76.0	105.8%	82.0
Construction (operating revenue)	111.0	114.0	102.6%	118.0
Business Services (operating revenue)	84.1	88.5	105.1%	96.0

By segment, Real Estate Sales revenue is forecast to rise to ¥48.2 billion (121.5%) on increased sales of properties, although its operating income is expected to fall to ¥7.4 billion (88.7%); the company plans to sell owned properties generating operating revenue of approximately ¥16.0 billion for the full year. Transportation operating income is forecast at ¥23.8 billion (99.3%) as personnel expenses, depreciation costs and other costs increase. Capital investment in FY27.3 includes the modification of conventional line rolling stock, Series 813 refurbishment, N700 series modifications, LOGI STATION Fukuoka Hakozaki, the JR Higo-Ozu Building and development of the former site of Kyushu University Hakozaki Campus.

Shareholder Returns

JR Kyushu states that it places importance on the stable provision of return to shareholders over the long term, and that over the period up to FY28.3 it will aim for a consolidated dividend payout ratio of 35% or higher and flexibly implement share repurchases. Based on this policy and taking into account the revised performance forecast, the company expects for FY27.3 to pay annual dividends of ¥121 per share and interim dividends of ¥60.5 per share. The dividend chart also notes the implementation of a share repurchase of ¥10 billion.

Dividends per share (Yen)	FY25.3	FY26.3 (Plan)	FY27.3 (Forecast)
Interim dividend	46.5	57.5	60.5
Year-end dividend	51.5	57.5	60.5
Annual dividend	98.0	115.0	121.0
Dividend payout ratio	35.1%	38.9%	36.1%

Medium-Term Business Plan 2025–2027 Update

The company left the basic policy and key strategies of the Medium-Term Business Plan 2025–2027 unchanged but revised all numerical targets upward, based on increases in railway transportation revenues and progress toward targets in each business. The FY2028.3 operating revenue target was raised from ¥530.0 billion to ¥564.0 billion, operating income from ¥71.0 billion to ¥81.0 billion and EBITDA from ¥115.0 billion to ¥125.5 billion, while the ROE target was changed from “maintain current level” to “around 10%.” The FY2028.3 target for railway transportation revenues was revised from ¥171.0 billion to ¥178.0 billion. The railway maintenance plan was reviewed in light of inflation and other factors, and although the project utilizing the space above the tracks at Hakata Station has been cancelled, the company will continue acquiring and exploring new development projects, including the Asahi Breweries Hakata Plant site. In the cash allocation plan, safety investment was raised from approximately ¥70.0 billion to approximately ¥80.0 billion, with maintenance and upgrade investment of ¥130.0 billion and growth investment of ¥230.0 billion unchanged.

Base pay increases were implemented to further improve employee compensation, at 7.1% overall including regular salary increases in FY2026.3 and 4.0% overall including regular salary increases in FY2027.3. Among other initiatives, a wireless train control system using public telecommunications networks is scheduled for introduction on the Nagasaki Main Line (Kikitsu–Urakami, via Nagayo) in FY29.3, and the company concluded a comprehensive partnership agreement with Kumamoto City aimed at “creating a community centered on rail-based transportation through co-creation,” with a joint press conference held on March 31, 2026.

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