POLA ORBIS HOLDINGS (4927): 2Q results: Operating profit somewhat above expectations; watching sales acceleration measures from 3Q onward

Research evidence excerpt

J P M O R G A N

Asia Pacific Equity Research

07 August 2026

POLA ORBIS HOLDINGS (4927)

2Q results: Operating profit somewhat above

expectations; watching sales acceleration measures

from 3Q onward

Underweight

4927.T, 4927 JP

Price (06 Aug 26):¥1,336

Price Target (Dec-26):¥1,250

Somewhat positive: 2Q operating profit was ¥4.7 billion, ¥0.8 billion above our

estimate of ¥3.9 billion. Sales momentum of Pola and Orbis also improved in 2Q

from 1Q, giving us a somewhat positive impression. However, domestic sales of

Pola fell 3% YoY in 2Q, continuing their decline. Sales momentum of Orbis's direct

sales channel also slowed in 2Q. At the briefing on August 7, we look to confirm

progress in sales improvement measures for Pola's salon channel and measures to

gain senior users for Orbis.

1H FY2026 results above guidance: Management explained that 1H sales

were about ¥1.2 billion above guidance and operating profit was about ¥1.4

billion above. Of the overshoot in operating profit, around ¥0.7 billion

stemmed from delayed costs. By core brand, sales and operating profit of Pola

exceeded guidance by around ¥0.6 billion and around ¥0.7 billion,

respectively. At Orbis, they beat guidance by around ¥0.3 billion and around

¥0.4 billion, respectively. Management maintained full-year operating profit

guidance. It said this is because delayed costs will be recognized in 2H, and also

because it expects a negative impact of ¥0.4 billion on COGS from the

worsening Middle East conflict.

2Q Pola sales turn to 2.2% YoY growth: Overseas sales growth of 32%

boosted overall sales. The main reason for this was sales growth in China travel

retail and e-commerce. Management said the impact of an update to B.A

contributed. In contrast, domestic sales of Pola fell 3% YoY in 2Q. Sales

through the main salon channel fell 5% YoY. However, sales fell 0.2%

excluding the impact of tighter control on sales for secondary distribution,

improving from the 0.5% decline in 1Q.

Japan Equity Research

Cosmetics and Personal Care /

Paper and Packaging

Akiko Kuwahara AC

(81-3) 6736-8617

JPMorgan Securities Japan Co., Ltd.