KNT-CT Holdings Raises Net Profit Forecast 42.6% on Tax Benefit

KNT-CT Holdings Raises Net Profit Forecast 42.6% on Tax Benefit

KNT-CT Holdings Co., Ltd. (TSE:9726), Japan’s major travel agency, revised upward its earnings forecast for the fiscal year ending March 2026, driven by a substantial tax-related adjustment that more than offset operational headwinds from Middle East geopolitical tensions.

The company cited two offsetting factors in its revision. On the operational side, revenue and operating profit are expected to decline modestly as overseas tour cancellations related to Middle East instability weigh on the travel business, which had otherwise performed solidly. However, this operational softness was eclipsed by a JPY 2.5bn boost to net profit attributable to parent company shareholders, stemming from the additional recognition of deferred tax assets. The company recorded a JPY 2.5bn tax adjustment, which significantly improved the bottom line despite the operating profit decline.

For international investors, the revision underscores the importance of understanding Japan-specific accounting mechanics. While operating profit contracted 6.2%, net profit surged 42.6%—a divergence driven entirely by tax effects rather than business momentum. The ordinary income (keijo rieki), a Japan-specific metric capturing non-operating financial items, also rose 4.1%, suggesting improved financial income. The earnings per share guidance increased to JPY 321.22 from JPY 248.90. Investors should note that the tax benefit is largely non-recurring, and underlying operational performance remains pressured by geopolitical headwinds.

Source: Original filing (TDnet) | 日本語版

This article is for informational purposes only and does not constitute investment advice. Always verify against the original filing.