Japan Tobacco (JAPAF) Q2 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good afternoon. I am Hiromasa Furukawa, CFO of the JT Group. Thank you very much for joining us today for JT Group's second quarter 2026 earnings briefing. Before we begin, we would like to express our deepest sympathies to all those affected by the 2026 Kumamoto earthquake in Japan. We sincerely hope that those in the affected communities remain safe and that the region recovers as quickly as possible. I will begin by explaining our six months consolidated results for the fiscal year 2026. Revenue in ALP increased significantly, reflecting the strong business momentum in both the tobacco and processed food businesses. AOP at constant FX, our key performance indicator, increased by 19.4% year-on-year, contributing to growth all the way to net income. The FX impact was positive, driven by the appreciation of several currencies, including the Russian ruble, against the Japanese yen. Operating profit increased by 29% year-on-year driven by the increase in AOP as well as a reduction in amortizing costs of intangible assets arising from past acquisitions included in the adjustment items. Profit increased by 28.9% year-on-year driven by operating profit growth and lower financial costs. Next, I will detail the performance of each business segment, starting with the tobacco business and its volume performance. Please turn to slide 5. Total volume, combining both combustibles and RRP, increased by 1% year-on-year. Excluding favorable inventory movements, total volume increased by 0.4% year-on-year. and combustibles. Although industry volume declined across several markets, including Japan, Russia and the UK, solid share and GFB volume momentum continued across our global footprint. As a result, our combustibles volume remained in line with the previous year. RRP volume incre...