Japan Elevator Service (6544) Q2 2025 earnings summary

Executive summary

• Net sales for the six months ended September 2024 rose 17% year-over-year to ¥23,264 million, with operating profit up 30.6% to ¥3,926 million and net income attributable to owners of parent up 30.6% to ¥2,522 million.

• Growth was driven by strong maintenance contract volume and expansion in modernization business, supported by improved sales structure and service quality.

• Maintenance contracts and modernization shipments both exceeded prior year levels, reflecting robust demand and successful sales efforts.

• Expansion of office network to 146 locations, with strategic focus on regional market share growth.

• The Japanese economy showed moderate recovery, but uncertainty persists due to global events and yen depreciation, increasing corporate cost-reduction needs.

Financial highlights

• Gross profit increased to ¥8,838 million from ¥7,374 million year-over-year, with gross margin and operating margin improving to 16.9%.

• EBITDA increased 26.2% year-over-year to ¥4,816 million.

• EPS for the interim period was ¥28.32, up 30.6% year-over-year.

• Comprehensive income for the period was ¥2,583 million, up 31.1% year-over-year.

• Free cash flow nearly doubled year-over-year, supported by slower capital expenditures.

Outlook and guidance

• Full-year forecast maintained: net sales ¥47,000 million (+11.3%), operating profit ¥8,000 million (+17.3%), net income attributable to owners of parent ¥5,100 million (+12.9%), EPS ¥57.27.

• Maintenance & repair and modernization services expected to continue growing, supported by strong contract increases and demand.

• Full-year dividend forecast set at ¥30 per share, up ¥5 year-over-year, with a payout ratio of 52.4%.