Nagoya Railroad cuts FY2025 forecasts amid transport, real estate challenges

Nagoya Railroad Co. has revised its full-year operating results forecast for FY2025 downwards, with projected operating revenues now 15,000 million yen lower at 695,000 million yen, and operating income reduced by 10,000 million yen to 34,000 million yen compared to previous estimates. This adjustment is largely attributed to a decrease in expected revenues from the transport and real estate businesses. Despite these challenges, the company's traffic business saw increased revenue due to contributions from the Miyakoh Group and a rise in railroad passengers, while the leisure and services segment also experienced an uplift in revenues.

The transport business is notably underperforming, leading to a significant decrease in operating income, now projected at a loss of 7,300 million yen for FY2025. In response, Nagoya Railroad is implementing measures to improve profitability, including consolidating and closing five transport bases to enhance network efficiency, expecting annual integration benefits of approximately 1 billion yen from FY2026 onwards. The company also announced an entry into the REIT business to diversify its real estate portfolio and expand its asset base.

Shareholder returns remain a focus, with a dividend per share forecast of 40.0 yen for FY2026, marking a 1.5 yen increase from FY2025 and a new record high. This aligns with the company's policy to maintain stable dividends with a consolidated payout ratio of 30% or more. Additionally, various traffic businesses, including bus and taxi services, have implemented fare revisions to support revenue growth.