J.Front Retailing's results for March to August 2026 show a department store group with strong premium-customer and tax-free demand and weaker reported profit. Revenue fell 2.8% to ¥213.8bn. Business profit fell 5.6% to ¥26.6bn, operating profit fell 10.5% to ¥26.8bn and profit attributable to owners of the parent fell 5.3% to ¥17.4bn. Gross sales, which the company calculates by restating consignment and tenant sales on a gross basis, rose 2.5% to ¥638.2bn. Business profit is revenue less cost of sales and SG&A; operating profit adds other operating income and expenses.
Expo comparison and Umeda closures
The company attributes the revenue decline mainly to the reversal of last year's Osaka-Kansai Expo-related sales and floor closures during the major Daimaru Umeda renovation in the department store business, plus the drop-back of last year's large interior orders in the developer business. Gross profit slipped 0.2% while SG&A rose 1.7% to ¥80.7bn.
Department store revenue fell 1.0% to ¥128.4bn and business profit fell 2.6% to ¥15.6bn. The company says sales to wealthy customers, centred on external sales, and tax-free sales grew, but advertising costs and base-pay rises weighed on profit. Its presentation shows Daimaru Umeda store sales down 38.6%, and Daimaru Matsuzakaya store sales excluding Umeda up 7.0%. Tax-free sales at Daimaru Matsuzakaya rose 13.8% to ¥53.4bn: the company says customer numbers fell 16.7% and spending per customer rose 36.6%, with mainland Chinese visitor numbers sharply lower and the weak yen lifting spend.
Why operating profit fell further
Operating profit fell by more than business profit because other operating expenses rose 270.2% to ¥4.24bn, against a 51.7% rise in other operating income to ¥4.46bn. In the shopping centre business, business profit rose 1.3% but operating profit fell 19.8% to ¥7.65bn. The company says last year included a lease-termination gain tied to the sale of the former Matsumoto PARCO, while this year includes business-restructuring losses.
Guidance moves in different directions
The company raised full-year business profit guidance to ¥53.5bn from ¥52.0bn. It cut operating profit guidance to ¥46.0bn from ¥47.0bn and pre-tax profit guidance to ¥41.0bn from ¥42.0bn. Net profit guidance stays at ¥29.0bn.
| Measure | April | Revised | Change |
|---|---|---|---|
| Revenue | ¥469.0bn | ¥470.0bn | +¥1.0bn |
| Business profit | ¥52.0bn | ¥53.5bn | +¥1.5bn |
| Operating profit | ¥47.0bn | ¥46.0bn | -¥1.0bn |
| Pre-tax profit | ¥42.0bn | ¥41.0bn | -¥1.0bn |
| Net profit to owners | ¥29.0bn | ¥29.0bn | unchanged |
The tanshin (earnings summary) says the business profit raise reflects strong external sales and tax-free sales in the department store business, plus revised assumptions from the third quarter onward. The presentation says the operating profit cut stems from costs including the closure of the Daimaru Shimonoseki store.
The business profit raise is smaller than the interim beat. Interim business profit came in ¥4.59bn above April figures, yet the full-year guide rose only ¥1.5bn. The presentation implies a second-half business profit forecast of ¥26.9bn, ¥3.0bn below April. It says part of the interim beat came from SG&A timing shifts into the second half, and that the Prime Space developer unit's second-half plan was cut to allow for possible delays in external construction.
The interim dividend is ¥28, up ¥1, and the full-year forecast is unchanged at ¥56. The Umeda drag continues: the presentation guides second-half Daimaru Umeda sales down 30.0%. The tanshin is not subject to auditor review.