SAIBU GAS HOLDINGS CO., LTD.

Business Details

Centered on Saibu Gas Co., Ltd., this segment manufactures, supplies, and sells city gas in the Kyushu region (Fukuoka, Kumamoto, Nagasaki, Sasebo, Kurume, Omuta, etc.). It serves three demand categories—residential, commercial, and wholesale supply—and also provides related services such as Gas Appliance Sales & Piping Construction and Gas Appliance Inspection. It also conducts LNG Sales & International Energy Business utilizing the Hibiki LNG Terminal. From the current consolidated fiscal year, the Renovation Business was transferred from the Real Estate segment to the Gas segment. Net sales for FY2026 (ending March 2026) were ¥153,490 million.

Recent Overview

Despite lower sales volume, segment profit improved substantially, up 39.3% year on year, due to a decrease in depreciation expense

In the Gas segment for FY2026 (ending March 2026), net sales decreased 3.5% year on year to ¥153,490 million due to downward adjustment of gas unit prices through the raw material cost adjustment mechanism and declines in city gas sales volume across all use categories (total volume down 1.8% year on year). On the other hand, a significant decrease in depreciation expense at the Hibiki LNG Terminal led to a substantial improvement in segment profit, up 39.3% year on year to ¥7,914 million. The Renovation Business was transferred to the Gas segment from the current fiscal year.

Key Products

Growth Drivers

• Structural improvement in segment profit due to decreased depreciation expense at the Hibiki LNG Terminal (depreciation: ¥12,678 million in the prior year → ¥10,035 million in the current year)
• Room for global business expansion through capacity enhancement at the Hibiki LNG Terminal (addition of LNG tanks)
• Positioning the capture of natural gas transition demand as the most important priority under the medium-term management plan ACT2027
• Decarbonization initiatives such as expanded adoption of carbon-offset city gas and methanation demonstration projects
• Pursuit of business synergies from the transfer of the Renovation Business to the Gas segment
• Maintenance and expansion of the customer base through a slight increase in the number of meters installed (up 0.5% year on year to 1,147 thousand units)

Risks

• Downward adjustment of gas unit prices through the raw material cost adjustment mechanism is pressuring net sales (net sales down 3.5% year on year in the current period)
• Exchange rate and crude oil price fluctuation risk affecting LNG import costs (time lag arises due to the raw material cost adjustment mechanism)
• Demand fluctuation risk due to changes in temperature and water temperature, etc. (residential gas sales volume decreased 2.7% due to higher average temperatures than the prior year)
• Decrease in commercial gas sales volume due to reduced operations among existing customers, etc. (down 1.4% year on year to 592,840 thousand m³)
• Decrease in wholesale gas sales volume due to reduced demand from wholesale supply customers (down 2.6% year on year to 119,608 thousand m³)
• Maintenance of a high level of interest-bearing debt and interest rate fluctuation risk associated with substantial capital investment in the city gas business
• Long-term demand decline risk due to fuel switching to electricity and renewable energy

Business Details

This segment engages in the sale of LPG and LPG-related gas appliances, along with associated construction work. It also supplies LPG for city gas feedstock to Saibu Gas Co., Ltd. Although small in scale, accounting for approximately 10.0% of Group net sales (FY2026, ending March 2026), the segment returned to profitability from a segment loss in the prior year, driven by a decline in LPG purchase unit prices, among other factors.

Recent Overview

Returned to profitability from a prior-year loss due to a decline in LPG purchase unit prices, though net sales decreased slightly

In FY2026 (ending March 2026), net sales in the LPG segment decreased 2.9% year on year to ¥26,098 million due to a decline in the LPG sales unit price, among other factors. On the other hand, the decline in the LPG purchase unit price contributed to cost reduction, and segment profit returned to positive territory at ¥1 million (compared to a segment loss of ¥217 million in the prior year). No impairment losses were recorded, and segment assets were ¥21,874 million, a slight decrease from the prior year.

Key Products

Growth Drivers

• Cost reduction effect from the decline in the LPG purchase unit price (the main factor behind the return to profitability)
• Securing stable intra-group demand through the supply of LPG for city gas feedstock within the Group
• Maintenance of the business foundation through continued acquisition of fixed assets (capital expenditure of ¥1,158 million)

Risks

• Risk of deteriorating profitability when crude oil and LPG prices rise, since LPG sales unit prices are linked to international market conditions and exchange rates
• Structural risk of shrinking LPG demand due to fuel switching to city gas and progress in electrification
• Profitability pressure from fixed costs such as sales promotion expenses (profit levels remain extremely thin)
• Continued amortization burden on goodwill balance (amortization of ¥52 million in FY2026, ending March 2026)
• Seasonal fluctuations causing volatility in quarterly profit and loss

Business Details

This segment conducts electricity sales (Retail Electricity Business), heat supply business, power generation business using solar and other renewable energy sources, and international energy business (LNG reshipping, etc., utilizing the Hibiki LNG Terminal). Major subsidiaries include Saibu Gas Techno Solution Co., Ltd. (heat supply and equipment design/construction) and Ene-Seed Co., Ltd. / Ene-Seed Hibiki Co., Ltd. (renewable energy power generation). Equity-method affiliates include TSH Birdsboro LLC (gas-fired power generation in the United States), among others. In FY2026 (ending March 2026), this segment accounted for approximately 12.0% of Group net sales (based on net sales to external customers of ¥30,621 million).

Recent Overview

Net sales up 35.0% and segment profit up 441.8% on a sharp recovery driven by increased electricity and international energy sales volume

In the Electricity & Other Energy segment for FY2026 (ending March 2026), net sales increased 35.0% year on year to ¥31,419 million, mainly due to increased sales volume in the electricity sales business and international energy business. Segment profit increased 441.8% from ¥228 million in the prior year to ¥1,235 million, showing a substantial improvement over the prior year. The increase in property, plant and equipment and intangible assets also expanded from ¥914 million to ¥2,599 million, indicating accelerated investment in the business foundation. Meanwhile, equity in earnings of affiliates on a consolidated basis shifted from a profit of ¥228 million in the prior year to a loss of ¥26 million.

Key Products

Growth Drivers

• Continued increase in sales volume in the electricity sales business (net sales up 35.0% year on year in the current period)
• Expansion of sales volume in the international energy business (LNG reshipping, etc.)
• Room for global business expansion by leveraging the capacity of the Hibiki LNG Terminal
• Policy of promoting the PPA business and expanding the volume of renewable energy sources handled under the medium-term management plan ACT2027
• Strengthening of the business foundation through expansion of segment assets (¥49,256 million) and accelerated fixed asset investment

Risks

• Intensifying competition in the electricity market and risk of fluctuations in electricity procurement costs
• Impact of exchange rate and crude oil price fluctuations on international energy business costs (current period assumptions: crude oil at $80/barrel, exchange rate at ¥155/dollar)
• Risk of fluctuations in weather and sunlight conditions affecting the renewable energy power generation business
• Risk of deteriorating performance at equity-method affiliates (gas-fired power generation) (equity in earnings of affiliates on a consolidated basis was a loss of ¥26 million in the current period)
• Risk of impairment associated with expanded fixed asset investment (an impairment loss of ¥239 million was recorded in this segment in the current period)

Business Details

This segment conducts real estate sales, leasing and management, housing construction, residential land development, and other activities. Major subsidiaries include Estrust Co., Ltd. (condominium sales and leasing), Saibu Gas Urban Development Co., Ltd. (leasing), Kyushu Yaesu Co., Ltd. (housing construction and residential land development), and SG Enrich Co., Ltd. (housing and residential land development in Thailand). Note that the Renovation Business was transferred to the Gas segment from the current consolidated fiscal year. The segment emphasizes synergy with the gas energy business, proposing solutions to developers and homebuilders from the planning stage of urban development, redevelopment, and building construction. The segment is also focused on strengthening the leasing business to expand its stable revenue base.

Recent Overview

Net sales increased 15.4% year on year due to rising condominium sales prices, but segment profit decreased 20.1% due to increased costs in the overseas business

In FY2025 (fiscal year ending March 2026), net sales in the Real Estate segment increased substantially to ¥47,700 million (up 15.4% year on year) due to rising condominium sales prices, among other factors. On the other hand, segment profit decreased to ¥3,329 million (down 20.1% year on year) due to increased cost of sales in the overseas business (Thai subsidiary SG Enrich Co., Ltd.), among other factors. In addition, the Renovation Business was transferred to the Gas segment from the current consolidated fiscal year, and the year-on-year comparison is based on the categories after this change. Segment assets decreased to ¥136,944 million from ¥144,836 million in the prior year.

Key Products

Growth Drivers

• Upward trend in condominium sales prices (net sales up 15.4% year on year in FY2025)
• Strengthening of the stable revenue base through the acquisition and expansion of leasing properties
• Policy of securing stable revenue in the real estate business under the medium-term management plan "ACT2027"
• Synergy effects with the gas energy business (integrated proposals for urban development and redevelopment)
• Overseas real estate business expansion through the Thai subsidiary SG Enrich Co., Ltd.

Risks

• Pressure on segment profit due to increased cost of sales in the overseas business (Thai subsidiary), among other factors (segment profit decreased 20.1% year on year in FY2025)
• Seasonal and periodic volatility in earnings due to concentration of condominium completion and delivery timing
• Impact on sales prices and unit sales volume from deterioration in real estate market conditions (rising interest rates, economic downturn)
• Risk of declining asset efficiency due to increased inventory of real estate for sale (segment assets remain at the highest level among all segments)
• Change in business scale and comparability due to segment reorganization (transfer of the Renovation Business to the Gas segment)

Business Details

This segment consolidates businesses that do not belong to the Group's four main segments (Gas, LPG, Electricity, and Real Estate), including food sales, restaurant business, and information processing business. Net sales to external customers in the current consolidated fiscal year were ¥16,369 million, and the amount including intersegment internal net sales was ¥23,603 million. The segment accounts for approximately 9.0% of consolidated net sales (against consolidated net sales of ¥261,823 million). While the increase in net sales from the information processing business drove growth, segment profit decreased substantially.

Recent Overview

Net sales increased due to growth in the information processing business, but segment profit decreased 79.1% due to increased SG&A expenses

In FY2026 (ending March 2026, the current consolidated fiscal year), segment net sales (including internal transactions) increased 6.1% year on year to ¥23,603 million, mainly due to increased net sales in the information processing business. On the other hand, segment profit deteriorated substantially, down 79.1% year on year to ¥60 million, due to increased selling, general and administrative expenses, among other factors. Net sales to external customers decreased to ¥16,369 million from ¥16,979 million in the prior year, indicating that the increase in internal net sales supported the overall figures.

Key Products

Growth Drivers

• Stable intra-group demand for the information processing business is expected to continue in line with the Group's overall business expansion, maintaining a growth trend in net sales
• Promotion of diversification and strengthening of the business structure, including the establishment of new venture capital funds, under the medium-term management plan "ACT2027"
• Demand for Group-oriented BPO services (accounting and human resources) is expected to increase in line with the expansion of the Group's overall business scale

Risks

• Increased selling, general and administrative expenses have significantly pressured segment profit, which fell 79.1% year on year to a low level of ¥60 million in the current consolidated fiscal year
• The continued downward trend in net sales in the food sales business is a factor depressing net sales to external customers
• The continued downward trend in net sales in the carbon materials and chemical products business (SG Chemical Co., Ltd.)
• Group-oriented services (information processing and BPO) have limited room for expansion into the external market and depend on the performance trends of the Group as a whole
• As a segment consolidating diverse businesses, fluctuations in the performance of individual businesses are difficult to manage, resulting in low earnings stability