HOKURIKU GAS CO.,LTD.
9537・Standard Market・Electric Power & Gas
Business
Hokuriku Gas Co., Ltd., founded in 1913, is a city gas utility whose primary supply area is Niigata Prefecture. The group comprises Hokuriku Gas Co., Ltd. as the core company along with 5 consolidated subsidiaries and 5 affiliated companies, and operates six business segments centered on City Gas manufacturing, supply and sales: LPG Sales, Gas Facility Maintenance, Design & Construction, Residential Equipment Sales & Installation, Civil Engineering & Piping Construction, and Solar Power Generation. The company boasts a household penetration rate of 94.1% within its supply areas across the three districts of Niigata, Nagaoka, and Kashiwazaki, with the number of City Gas customers reaching 436,752 (as of the end of March 2026). Its supply area was further expanded through the transfer of the Ojiya City gas business in April 2025.
Business Model
The manufacture, supply, and sale of City Gas account for approximately 94% of net sales, with gas rate revenue forming a stable earnings base. Within the group, Hokuriku Gas Engineering Co., Ltd. handles safety inspections, Hokuei Construction Co., Ltd. handles Gas Construction, and Hokuriku Gas Living Service Co., Ltd. handles residential equipment sales and Meter Reading Services, together forming a vertically integrated value chain. The raw material cost adjustment system, which allows part of LNG price fluctuations to be passed through to rates, also contributes to earnings stability.
Company Strengths
As of the end of March 2026, the household penetration rate within the supply area stood at 94.1%, with 436,752 City Gas customers. The Niigata area boasts an extremely high penetration rate of 96.2%, and the customer base built through years of community-focused sales activities forms an entry barrier that is difficult for competitors to replicate in a short period.
Since 2009, the company has continuously acquired gas businesses from municipalities, including the Koshiji, Mishima, Yoita, Tochio, and Kawaguchi districts of Nagaoka City, as well as Kashiwazaki City, Mitsuke City, and Ojiya City. The acquisition of the Ojiya City gas business in April 2025 (acquisition consideration of ¥3,209 million) expanded the customer base and sales volume, with City Gas sales volume increasing 2.7% year on year to 416,639 thousand m³.
As of the end of March 2026, the balance of interest-bearing debt stood at an extremely low level of ¥69 million, while the equity ratio remained high at 74.9%. Net assets reached approximately ¥569,230 million, giving the company a financial foundation capable of funding capital expenditures and business acquisitions with internal funds. Operating cash flow was ¥9,007 million (up 16.1% year on year), demonstrating stable cash generation capability.
ENVALITH's Perspective
Performance Trend
Net sales came to ¥64,436 million (up 4.3% year on year), operating profit was ¥3,798 million (up 169.4%), and profit attributable to owners of parent was ¥3,180 million (up 62.9%), achieving the highest profit level in the past five fiscal years. As external factors, LNG prices fell year on year, reducing cost of sales by ¥343 million, while the effect of the October 2024 gas tariff revision and a 2.7% increase in gas sales volume resulting from the transfer of the Ojiya City gas business (April 2025) drove the increase in sales. On the other hand, for the next fiscal year (FY2027, ending March 2027), the company forecasts a substantial decline in profit, with operating profit of ¥1,920 million (down 49.5% year on year), mainly due to rising LNG prices and increased capital expenditure. The high profitability of the current fiscal year should therefore be regarded not as a structural improvement but as the result of multiple favorable conditions coinciding. Operating cash flow was solid at ¥9,008 million, but cash outflow from investing activities expanded to ¥10,003 million, and cash and cash equivalents stood at ¥5,249 million (down ¥1,397 million from the end of the previous fiscal year).
Growth Strategy
Aiming for sustainable growth centered on four pillars: rate optimization, service area expansion, infrastructure resilience enhancement, and carbon neutrality initiatives
In October 2024, the company implemented its first gas rate revision in 14 years, optimizing its revenue structure by reflecting increases in raw material costs in rates. In FY2026 (ending March 2026), the full-year contribution of the revision effect significantly contributed to improvements in sales and profit. In the next fiscal year, further increases in the rate unit price are also expected due to raw material cost adjustments.
In April 2025, the company acquired the city gas business of Ojiya City for ¥3,481 million, recording goodwill of ¥1,577 million and customer-related assets of ¥440 million. This contributed to a 2.7% year-on-year increase in gas sales volume, and the company will continue its policy of capturing demand for business transfers from municipalities going forward.
The company continues to work on replacing aging gas pipes and maintaining and enhancing the functionality of supply facilities. Capital expenditures for property, plant and equipment in FY2026 (ending March 2026) increased 44.6% year on year to ¥5,962 million, and the company plans to continue a high level of capital investment in the next fiscal year as well. This is expected to be a factor increasing operating expenses in the next fiscal year.
The company operates a Solar Power Generation business (Mega Solar), achieving sales of ¥70 million and segment profit of ¥56 million in FY2026 (ending March 2026), up 11.3% and 23.5% year on year, respectively. This is positioned as a renewable energy business within the group's decarbonization strategy, to be promoted in parallel with the utilization of natural gas as a transitional energy source.
Last updated: July 19, 2026