Japan Post Insurance (7181) Q4 2025 earnings summary

Executive summary

• Net income for the year ended March 2025 rose 41.8% year-over-year to ¥123.4 billion, driven by improved positive spread, higher investment returns, and a better market environment.

• Adjusted profit surged 49.3% year-over-year to ¥145.7 billion, reflecting higher investment income and adjustments for policy reserves and goodwill.

• Achieved a 27% year-on-year increase in new policies to 795,000, supported by new product launches and revitalized sales activities.

• Value of new business jumped 225.7% year-over-year to ¥67.9 billion, while embedded value (EV) slightly decreased by 0.6% to ¥3,940.8 billion.

• Enhanced employee engagement and achieved significant workload reduction through digitization, equivalent to 1,500 people.

Financial highlights

• Ordinary income was ¥6,165.3 billion, down 8.6% year-over-year, with insurance premiums up 27.0% to ¥3,154.9 billion and investment income down 1.3% to ¥1,195.6 billion.

• Adjusted profit for fiscal year ending March 2025 increased considerably, supporting record-high shareholder returns.

• Positive spread rose 55% year-on-year to ¥142.5 billion, with a forecast of ¥200 billion for fiscal year ending March 2026.

• Operating expenses decreased by ¥11.7 billion to ¥509.9 billion.

• Total dividend payout for fiscal 2025 forecast at ¥46.0 billion, with a payout ratio of about 55%.

Outlook and guidance

• FY2026 forecast: ordinary income ¥5,640.0 billion (−8.5% YoY), ordinary profit ¥240.0 billion (+40.9% YoY), net income ¥136.0 billion (+10.1% YoY), and net income per share ¥366.05.

• Dividend per share is projected to rise to ¥124, with a total payout ratio of about 55%.

• Targeting market capitalization of ¥2 trillion as an immediate goal.

• Aims to maintain adjusted ROE above 8% and improve stock price through continued growth strategies.

• Sensitivity analysis indicates a 50bp decrease in domestic interest rates could reduce positive spread by ¥3.0 billion.