AEON’score earnings remained on track in the first half of financial year 2026 (1HFY26), with stronger property management services (PMS) performance helping offset softer retail sales amid cautious consumer spending.
1HFY26 core net profit of RM97.9 mil came in at 63% of both Kenanga’s full-year forecast and the street’s estimate.
“We deem the results to be within expectations as 1H had always been seasonally stronger than 2H for the company in previous years,” said Kenanga.
As anticipated, AEON did not declare any dividend for the quarter. Revenue for 1HFY26 remained largely unchanged, with a 1% decline in retail sales as consumers continued to prioritise essential items and remain cautious on discretionary purchases.
This was offset by a 3% increase in its property management services (PMS) division, supported by successful rental renewals, strong occupancy levels and a more optimised tenant mix.
Core net profit climbed 22% year-on-year, driven by stronger PMS earnings, with segment profit up 25% and margins expanding 8.6 ppts to 50.1%, likely partly aided by lower utility costs under the revised electricity tariff structure during the period.
Retail margins, meanwhile, edged lower to 0.9%, broadly in line with management guidance of ~1%.
Quarter two financial year 2026 (2QFY26) turnover declined 20%, as retail (-23%) and PMS (-6%) divisions normalised from the double festive boost in the preceding quarter.
Its bottom line fell by a steeper 83%, likely due to lower revenue and weaker cost efficiency, with the retail segment slipping into the red during the seasonally weaker quarter, given that festive spending was largely frontloaded in 1Q.
“We expect consumer spending to remain selective, with the continued skew towards lower-margin essentials likely to keep retail margins tight, though its ongoing push toward private brands should provide some cushion,” said Kenanga.
Meanwhile, PMS should remain the key earnings anchor, although the earlier utility cost benefit should fade as AFA shifted from a rebate to surcharge starting May 2026.
The upcoming AEON Mall KL Midtown remains on track to open in 4QFY26 with an initial occupancy rate of 70-75%, while key tenants unveiled include Oriental Kopi, Dolly Dim Sum and Verrona Hills, alongside AEON supermarket and its own specialty concept outlets.
Store rejuvenation works are also progressing, with refurbishments at Permas Jaya, Seremban 2 and Kinta City, as well as Seremban 2’s expansion, targeted for completion by end-2026. Kinta City expansion is slated for end-2027.—Aug 24, 2026
Main image: 1 Utama
