Earnings

Kojima operating profit rises 17.7% as appliance sales grow

The Tip Desk · November 13, 2026 · 3 min read

Air conditioners helped lift annual sales, and higher-value products improved gross margin. The retailer plans further investment in sales, training and inventory control.

Kojima Co.,Ltd. (TSE-7513) increased sales 5.2% to 297.632 billion yen in the fiscal year ended August 31, 2026, helped by strong air-conditioner demand. Operating profit rose 17.7% as gross margin improved and selling expenses fell as a proportion of sales.

Operating profit reached 8.622 billion yen. Net profit increased 17.4% to 5.529 billion yen, as the retailer completed the second year of its five-year business plan.

Air-conditioner sales benefited from expanded subsidies in Tokyo. Kojima also attributed growing demand outside the capital to the 2027 issue. Smartphones, personal computers and game consoles contributed to sales growth. Household-appliance sales, the company's largest product category, increased 4.0% to 125.377 billion yen.

Smartphones and game consoles carry relatively low gross margins, and their increased share of sales put pressure on the overall margin. Kojima said efforts to sell more high-value products lifted gross margin above the previous year's level. Higher revenue also increased gross profit.

Selling, general and administrative expenses rose 5.0% to 72.995 billion yen. Continued investment in employees raised personnel costs, and sales marking the company's 70th anniversary increased advertising and promotional spending. Efforts to cut electricity costs reduced utility expenses. Revenue growth lowered the ratio of selling expenses to sales.

Kojima completed the installation of electronic shelf labels across all stores by the end of August, part of its effort to give sales staff more time with customers. It also established a sales support department and expanded customer-service training. The retailer ended the year with 138 stores after opening two and closing three.

Operating cash flow increased to 11.851 billion yen from 3.981 billion yen a year earlier. Kojima attributed the inflow mainly to pretax profit, depreciation, lower receivables and an increase in other items, including other current liabilities. Cash and cash equivalents reached 35.361 billion yen at year-end.

Kojima spent 1.939 billion yen acquiring property, plant and equipment. It also paid 1.699 billion yen in dividends and spent 688 million yen buying back shares. In July, the company changed its dividend policy to target a 40% payout ratio; it also expanded shareholder benefits during the year.

Competition and weather remain risks to earnings. Kojima said more intense price competition and weaker consumption could hurt its results. Cool summers or warm winters could sharply reduce demand for seasonal products, and unexpected changes in demand could leave it with excess inventory.

For the fiscal year ending August 2027, Kojima plans to establish an inventory management office to improve stock turnover. It aims to secure popular products and strategic inventory and reduce slow-moving stock. The company also plans a third training center and greater use of digital tools and AI to reduce administrative work and give sales staff more time to serve customers.

Kojima is also investing in online sales, business customers and home equipment services. It opened three business-sales offices during fiscal 2026 and expanded the range of products available for same-day delivery through its online store. Its plans include supporting purchases through AI agents, opening more business-sales offices and strengthening home equipment sales to capture subsidy-related demand. The five-year plan covering fiscal 2025 through fiscal 2029 targets annual operating profit of 9 billion yen.