Tosei Corporation Revises Earnings and Dividend Forecasts for Fiscal Year Ending November 30, 2024

Key Facts in the Report:

• Date of the Report: October 7, 2024.
• Financial Year Covered: December 1, 2023, to November 30, 2024.

Notable Points for Investor Actions:

1. Earnings Revision:

   • Consolidated Revenue: Revised to ¥81,921 million, a decrease of ¥10,195 million (11.1%) from the initial forecast of ¥92,116 million.
   • Operating Profit: Revised upward to ¥18,187 million, an increase of ¥485 million (2.7%) from the previous forecast.
   • Profit Before Tax: Revised to ¥17,000 million, up by ¥500 million (3%).
   • Net Profit: Revised to ¥11,723 million, an increase of ¥514 million (4.6%).
   • Non-Consolidated Revenue: Revised downward to ¥45,654 million, a decrease of ¥5,389 million (10.6%).
   • Ordinary Income: Revised upward to ¥14,668 million, an increase of ¥1,463 million (11.1%).
   • Net Income: Revised to ¥11,585 million, up by ¥803 million (7.5%).

2. Dividends:

   • Annual Dividend per Share: The year-end dividend forecast has been revised upward to ¥77 per share, an increase of ¥4 from the previous forecast. This results in a total annual payout ratio of 31.8%.
   • Comparison to Previous Year: The dividend for the previous fiscal year ended November 30, 2023, was ¥66 per share.

Special Points for Investors to Note:

• Reason for Revisions:

  • The revision in revenue is mainly due to a strategic revision of the sales plan for properties in the Revitalization Business, shifting sales from the current period to the next fiscal year.
  • Despite the revenue decrease, profit forecasts have improved, primarily due to better-than-expected profit margins in the Revitalization Business and higher occupancy rates in their Hotel Business.
  • Lower property selling expenses also contributed to the increase in forecasted profits.

• Strategic Actions: The company is focusing on shifting property sales to the next fiscal year, which could indicate a strategic approach to maximize revenue potential over a longer term.

Recommendations for Investors:

• For Current Stockholders:
  • Recommendation: Hold the stock. The upward revision in profit forecasts and dividends suggests that the company is performing well despite a decrease in revenue. The strategic actions indicate management’s efforts to optimize profitability.
• For Potential Investors:
  • Recommendation: Consider buying. The company shows improved profitability and has revised its dividend forecasts upward, which could indicate potential growth and a reliable return on investment in the future.

Disclaimer:

This recommendation is based solely on the information provided in the company’s report and does not constitute financial advice. Investors should conduct further research and consider their risk tolerance before making investment decisions.