Astmax Swings to ¥819 Million Operating Loss Despite 39% Revenue Jump as Power-Hedge Timing Bites

Revenue up 39%, costs up 58%

Astmax Co., Ltd. (TSE: 7162), a group that applies know-how built in financial and market trading to a business centred on energy, published consolidated first-quarter results for FY3/2027 on July 31, 2026, covering April 1 to June 30, 2026 under Japanese GAAP. Operating revenue rose 39.2% to ¥6,108 million. The company attributes the increase to soaring electricity prices after crude oil and natural gas jumped on the escalating situation in Iran; by business, Power Trading added ¥1,161 million, Electricity Retail ¥446 million, Dealing ¥62 million and Renewable Energy ¥55 million.

Operating expenses, however, climbed 57.9% to ¥6,927 million, driven by a ¥2,478 million increase in power purchases and ¥62 million more in outsourcing fees. The result was an operating loss of ¥819 million, against a profit of ¥2 million a year earlier.

A hedge-timing loss in Power Trading

The company's explanation centres on accounting timing. Astmax hedges the price risk of physical forward power contracts with electricity futures. The forwards are booked only when delivery is completed, while the futures are derivatives marked to market, so gains and losses on the two legs land in different periods. For this quarter, futures results booked in the prior fiscal year against deliveries made in the quarter, net of futures results booked in the quarter against deliveries falling after June 30, came to minus ¥729 million. A year earlier the same effect had lifted results by ¥58 million.

Put simply, the hedge gains were recognised first, in FY3/2026, and the matching physical deliveries only now. On the company's own adjusted basis, Power Trading's operating revenue and segment result would each be ¥729 million better, cutting the segment's ¥743 million loss to ¥13 million. The figures in the table are the reported, unadjusted ones.

Below the operating line

Non-operating income fell to ¥3 million from ¥12 million, largely because the prior year's ¥10 million of dividends received did not recur, while non-operating expenses rose to ¥29 million, including ¥21 million of interest. The ordinary loss widened to ¥845 million from ¥10 million. There were no extraordinary items. Income taxes of ¥32 million, almost all of it a deferred-tax charge, and a ¥4 million loss attributable to non-controlling interests left a net loss attributable to owners of the parent of ¥873 million, against ¥17 million a year earlier. The loss per share was ¥66.44, compared with ¥1.36.

Every segment ends in the red

Power Trading, the largest business, lifted revenue 38.2% to ¥4,221 million but swung from a ¥109 million segment profit to a ¥743 million loss, the hedge-timing effect described above. Wholesale orders were subdued: higher prices made market participants more cautious, and although some generators increased fixed-price sell orders, generators and consumers alike were largely waiting on the sidelines. Enquiries for its outsourced operations services, which include AI-based supply-demand management, increased.

Electricity Retail grew revenue 37.4% to ¥1,642 million, helped by supply to a large customer that began in March 2026, higher power prices and a higher capacity-contribution unit price, but price competition compressed margins and the segment swung from a ¥16 million profit to a ¥12 million loss. Extra-high- and high-voltage customers, counted by billing unit, fell by 18 from the fiscal year-end to 465.

Renewable Energy revenue rose 29.9% to ¥257 million on a temporary increase in contracted-service income, but the segment moved from a ¥1 million profit to a ¥19 million loss: solar power sales fell on economic output curtailment and an unusually large number of poor-weather days nationwide, insurance premiums rose, and the geothermal project in Ebino, Miyazaki Prefecture, continues to incur costs ahead of revenue. In June the company decided to move a solar plant in Kumamoto Prefecture from the FIT to the FIP scheme and add a battery, with FIP operation planned for June 2027.

Dealing, the proprietary arbitrage business in commodity and financial futures that is being scaled down ahead of its planned closure by the end of FY3/2027, posted revenue of ¥47 million against minus ¥14 million a year earlier, and a ¥15 million segment loss, narrower than the ¥100 million loss of a year ago. The market distortions in its arbitrage products at the prior year-end narrowed and all related positions were closed, but revenue did not cover operating costs.

Margin balances unwind, equity ratio rises

Total assets fell 27.6% to ¥15,473 million from March 31, 2026. Current assets dropped 38.5% to ¥9,318 million, chiefly because guarantee deposits fell by ¥6,052 million and the asset-side balance on the company's own futures positions by ¥1,071 million; cash and deposits rose to ¥4,840 million from ¥3,432 million. On the other side, the liability-side futures balance shrank by ¥5,386 million while short-term borrowings rose by ¥1,023 million, taking total liabilities down 36.6% to ¥8,525 million. Net assets fell 12.4% to ¥6,948 million as retained earnings dropped ¥978 million, reflecting the quarterly loss and the ¥8 per share year-end dividend paid in June. With the balance sheet smaller, the equity ratio rose to 42.6% from 35.4%.

A battery-project gain ahead, but no guidance

After the quarter closed, on July 17, 2026, the board approved, and Astmax signed, agreements to transfer the rights to its grid-scale battery storage project in Komoro, Nagano Prefecture, together with 5,286 square metres of land, to Hulic Co., Ltd., the parent of its major shareholder Hulic Property Solutions. The transfer was executed on July 24. Astmax does not disclose the price, but expects to book operating profit of about ¥650 million in the second quarter of FY3/2027. The planned 42 MW / 171 MWh lithium-ion facility is scheduled to start operating in December 2027, after which Astmax intends to act as its aggregator.

Astmax again published no full-year forecast, saying the mismatch between mark-to-market futures and forward contracts makes results hard to predict; instead it explains the timing-adjusted picture in quarterly supplementary materials and publishes monthly generation data for its plants. The FY3/2027 dividend is undecided. The company's policy is a payout ratio of at least 30%, taking power-hedge effects into account, with a floor of ¥7 per share through FY3/2028 under its Mid-term Vision 2028; it paid ¥8.00 per share for FY3/2026.

JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.