KITAKEI CO., LTD.
9872・Standard Market・Wholesale Trade
Building materials sales business (single segment)
A single-segment company centered on wholesale and construction-inclusive sales of housing materials
| Period | Current | Previous | Change |
|---|---|---|---|
| Net sales (2Q cumulative) | ¥29,741 million | ¥30,416 million | ↓ |
| Operating income (2Q cumulative) | ¥390 million | ¥433 million | ↓ |
| Ordinary income (2Q cumulative) | ¥475 million | ¥525 million | ↓ |
| Interim net income (2Q cumulative) | ¥291 million | ¥325 million | ↓ |
| Gross profit (2Q cumulative) | ¥3,243 million | ¥3,333 million | ↓ |
| Gross profit margin (2Q cumulative) | 10.9% | 11.0% | ↓ |
| Operating margin (2Q cumulative) | 1.3% | 1.4% | ↓ |
| Equity ratio | 53.1% | 50.5% (end of FY2025 (ended November 2025)) | ↑ |
| Interim net income per share | ¥31.45 | ¥35.08 | ↓ |
| Cash and cash equivalents (interim period-end) | ¥10,868 million | ¥11,103 million (end of FY2025 (ended November 2025)) | ↓ |
| Full-year net sales forecast | ¥59,300 million (+0.5% YoY) | ¥58,990 million (FY2025 (ended November 2025) actual) | ↑ |
| Full-year operating income forecast | ¥720 million (+0.9% YoY) | ¥714 million (FY2025 (ended November 2025) actual) | ↑ |
Business Details
Hokkei Co., Ltd. is a single-segment company whose main customers are lumber stores, building materials retailers, construction companies, and homebuilders, engaged in the sale of new building materials and housing equipment, as well as sales with construction work included (including completed construction revenue). It has no disclosed reportable segments. Its principal market is the new housing market for owner-occupied and detached-house developments, and it is also promoting expansion into the non-residential and renovation markets, expanding sales of environmentally friendly products such as solar power generation systems and storage batteries, and expanding its construction business by enhancing construction capabilities.
Recent Overview
Amid the continued decline in housing starts, net sales and all income items decreased year on year
For the second quarter (interim period) of FY2026 (ending November 2026), net sales were ¥29,741 million (down 2.2% year on year), operating income was ¥390 million (down 9.8%), ordinary income was ¥475 million (down 9.6%), and interim net income was ¥291 million (down 10.3%). The main causes were the continued decline in new housing starts for owner-occupied and detached-house developments and persistently high building material and labor costs. Selling, general and administrative expenses were reduced to ¥2,852 million from ¥2,899 million in the same period of the previous year, but this was not enough to offset the decline in gross profit. The full-year earnings forecast (net sales of ¥59,300 million, operating income of ¥720 million) remains unchanged, with a recovery expected in the second half. Operating cash flow turned positive at ¥113 million (versus negative ¥233 million in the same period of the previous year). The amortization period for actuarial differences related to retirement benefits was changed from 10 years to 9 years (impact is minor).
Key Products
Growth Drivers
- Expanding sales of environmentally friendly products such as solar power generation systems and storage batteries (amid rising demand for energy-efficient and environmentally friendly housing)
- Expanding sales channels into the non-residential market, such as commercial facilities, and the renovation market by leveraging its track record in construction-inclusive sales
- Expanding construction revenue and construction business areas by enhancing construction capabilities
- Strengthening relationships with existing customers and developing new business partners
- Differentiation through the development and sales expansion of original products (private brand)
Risks
- Continued decline in new housing starts for owner-occupied and detached-house developments (structural decline in demand due to falling birthrate, aging population, and population decline)
- Elevated housing prices and weakening housing purchase sentiment due to persistently high building material prices, transportation costs, and labor costs
- Prolonged building confirmation application processing times due to revisions to the Building Standards Act and energy conservation standards
- Increased mortgage burden and suppressed demand due to a rising trend in fixed interest rates
- Macro risks including persistently high resource and raw material prices, foreign exchange and interest rate fluctuations, and prolonged geopolitical risks including in the Middle East
- ROE and PBR remaining at low levels, with improving capital efficiency and market valuation remaining a challenge
Last updated: February 18, 2026