Sundrug FY26 Net Profit Rises 2% to ¥31.4 Billion as Sales Top ¥842 Billion; Dividend Lifted to ¥131

Sundrug Co., Ltd. (TSE: 9989), one of Japan's largest drugstore and pharmacy retail chains, reported consolidated full-year results for the fiscal year ended March 31, 2026 (FY3/2026) under Japanese GAAP. Net sales rose 5.1% year-on-year to ¥842,512 million, while operating profit increased 5.2% to ¥46,831 million and ordinary profit gained 5.4% to ¥46,220 million. Net profit attributable to owners of the parent edged up 2.1% to ¥31,392 million from ¥30,750 million, and basic EPS reached ¥268.36 versus ¥262.91. EBITDA grew 6.2% to ¥65,707 million, and the operating margin held at 5.6%.

Steady top-line growth across the store network

Sundrug operates a dual-format model spanning a nationwide network of drugstores — combining dispensing pharmacies, health-and-beauty and over-the-counter medicine ranges with food and daily necessities — and a discount-store business that anchors its high-frequency, everyday-low-price positioning. Both pillars contributed to the year's mid-single-digit sales gain, supported by continued new-store openings, resilient demand for cosmetics and household staples, and ongoing inbound and domestic foot traffic. Comprehensive income was broadly stable at ¥31,424 million versus ¥30,831 million the prior year.

Profitability and returns

Return on equity came in at 11.3% (versus 11.8% a year earlier), the ordinary-profit-to-total-assets ratio held at 10.1%, and the sales operating-profit margin was 5.6%. The slower pace of net-profit growth relative to operating profit reflects the normalization of the prior year's equity-method and non-operating items; the equity-method investment loss narrowed to ¥1,258 million from ¥1,567 million.

Balance sheet and cash flow

Total assets expanded to ¥475,505 million from ¥444,007 million, while net assets grew to ¥286,001 million from ¥269,713 million, keeping the equity ratio at a robust 60.1%. Book value per share rose to ¥2,444.81 from ¥2,305.89. Operating cash flow strengthened to ¥43,297 million from ¥41,164 million; investing activities used ¥32,076 million (versus ¥35,373 million) as the group continued to invest in store rollouts and infrastructure, and financing activities used ¥5,653 million. Period-end cash and equivalents climbed to ¥70,523 million from ¥64,956 million.

Dividend raised to ¥131; FY27 guidance for further growth

Sundrug lifted its FY3/2026 annual dividend to ¥131.00 per share (¥65 interim + ¥66 year-end) from ¥130.00, equivalent to a consolidated payout ratio of 48.0% and a net-asset dividend rate (DOE) of 5.5%. For FY3/2027, management plans a further increase to ¥132.00 per share (¥66 interim + ¥66 year-end). Full-year FY3/2027 guidance points to net sales of ¥876,000 million (+4.0%), EBITDA of ¥69,150 million (+5.2%), operating profit of ¥48,800 million (+4.2%), ordinary profit of ¥48,100 million (+4.1%), and net profit attributable to owners of ¥32,150 million (+2.4%), with EPS of ¥274.87. The plan implies continued steady expansion in both the drugstore and discount-store businesses. There were no material subsequent events disclosed.

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