Brighter economy put rail companies on track in fiscal 2013
TOKYO -- Fourteen major railway companies not belonging to the Japan Railway group logged pretax profit growth in the year ended March 31, with nine posting record figures.
Rail, hotel and leisure operations fared well as the economy recovered. Results also got a boost from propped-up sales of unlimited train passes ahead of the April 1 consumption tax hike.
Tokyu Corp. said Thursday that pretax profit rose 11% to 62.6 billion yen ($608 million), beating the 4% drop projected at the start of fiscal 2013. Thanks in part to station redevelopment, ridership was up nearly 20% from fiscal 1999. The real estate leasing business generated a record operating profit.
The increase in visitors to Japan appears to have created a tailwind as well. Keikyu Corp., which provides direct service to Tokyo's Haneda Airport, enjoyed record ridership. So did Odakyu Electric Railway Co., which offers service covering the popular tourist destination of Hakone. The former's pretax profit jumped 50% to 20.3 billion yen, while the latter's climbed 16% to 42 billion yen. Hotel businesses of Keio Corp. and Sotetsu Holdings Inc. turned in brisk performances that helped push up overall pretax profit by 23% and 17%.
Nine of the 14 companies expect profit to decrease in fiscal 2014, mainly on a post-tax-hike drop in demand. But the actual results may turn out better, since railway operators generally make conservative projections at the start of a fiscal year.