Komori
Revision of earnings forecasts2175SMS CO.,LTD.Information and Communications, Services and Others

Notice Regarding the Recognition of an Impairment Loss, the Recognition of a Valuation Loss on Shares of Affiliated Companies in the Non-Consolidated Financial Statements, and the Difference Between the Full-Year Consolidated Earnings Forecast and Actual Results for the Fiscal Year Ending March 2026

For the fiscal year ending March 2026, consolidated net sales, operating income and ordinary income were below the initial forecasts. As a result of recognizing an impairment loss of ¥22,957 million on the overseas business, net income attributable to owners of the parent fell from the forecast of ¥7,029 million to a loss of ¥14,317 million. In the non-consolidated financial statements, the company recognized an impairment loss of ¥29,667 million on shares of affiliates, but left its dividend forecast unchanged at ¥29.5 per share.

Worth reading
70In focus
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Deterioration
Direction inferred from the company’s description.
Scale
-21347
Millions of yen
Wording
Conditional
How definitive the wording is.

Revised forecast

Fiscal year ending March 2026 · Full yearPrevious forecast published 28 April 2025
Net Sales67,544→64,735Millions of yen
-4.2%
Operating profit7,287→6,787Millions of yen
-6.9%
Ordinary income9,468→8,721Millions of yen
-7.9%
Profit attributable to owners of the parent7,029→-14,317Millions of yen
-303.7%
Net income per share82.39→-173.66yen
-310.8%

The bar length represents the relative magnitude of change, based on the item that changed the most in this document. The percentage change shown by the dotted line is calculated from the two reported figures because the company did not provide the rate.

Reason for the revision

The slower pace of recovery in net sales, particularly in the Career Business and overseas business; investments made to support medium- to long-term growth; and the recognition of an impairment loss of ¥22,957 million as an extraordinary loss.

Details and amount of extraordinary loss

Consolidated impairment loss of ¥22,957 million, comprising ¥13,041 million in trademarks, ¥8,649 million in goodwill, ¥677 million in software and ¥589 million in customer-related assets. The company also recognized an impairment loss of ¥29,667 million on shares of affiliates in the non-consolidated financial statements, but this had no impact on consolidated profit or loss.

Previous-period resultsNet sales: ¥60,952 million; operating income: ¥6,335 million; ordinary income: ¥8,357 million; net income attributable to owners of the parent: ¥6,054 million; basic earnings per share: ¥70.96 (fiscal year ended March 2025)
Dividend forecast revisionNo change. The dividend forecast for the fiscal year ending March 2026 remains ¥29.5 per share.
Consolidated / non-consolidatedConsolidated
Revised forecast
ItemDetails
Net Sales67,544 Millions of yen → 64,735 Millions of yen(-4.2%)
Operating profit7,287 Millions of yen → 6,787 Millions of yen(-6.9%)
Ordinary income9,468 Millions of yen → 8,721 Millions of yen(-7.9%)
Profit attributable to owners of the parent7,029 Millions of yen → -14,317 Millions of yen
Net income per share82.39 yen → -173.66 yen
Fiscal Period CoveredFiscal year ending March 2026
Period CoveredFull year
Publication date of previous forecast28 April 2025
Previous-period resultsNet sales: ¥60,952 million; operating income: ¥6,335 million; ordinary income: ¥8,357 million; net income attributable to owners of the parent: ¥6,054 million; basic earnings per share: ¥70.96 (fiscal year ended March 2025)
Reason for the revisionThe slower pace of recovery in net sales, particularly in the Career Business and overseas business; investments made to support medium- to long-term growth; and the recognition of an impairment loss of ¥22,957 million as an extraordinary loss.
Details and amount of extraordinary lossConsolidated impairment loss of ¥22,957 million, comprising ¥13,041 million in trademarks, ¥8,649 million in goodwill, ¥677 million in software and ¥589 million in customer-related assets. The company also recognized an impairment loss of ¥29,667 million on shares of affiliates in the non-consolidated financial statements, but this had no impact on consolidated profit or loss.
Dividend forecast revisionNo change. The dividend forecast for the fiscal year ending March 2026 remains ¥29.5 per share.
Consolidated / non-consolidatedConsolidated

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

In addition to the delayed recovery in net sales, particularly in the Career Business and overseas business, the company made investments aimed at medium- to long-term growth, causing net sales and profit at each stage to fall below the initial plan. The recognition of an impairment loss of ¥22,957 million on the overseas business as an extraordinary loss also resulted in a substantial decline in net income attributable to owners of the parent. The company also cited the prolonged budget restraints resulting from the expiration of patents on key drugs of major pharmaceutical companies and other factors, as well as a review of future plans in response to the worsening situation in the Middle East.

How to read this page

This is not the documentKomori reads the disclosure the company filed and writes this summary. Figures are as stated by the company and are not audited.
Weight is not a verdictIt measures how much this changes what the company had already told the market. It is not a view on the shares.
Corrections happenIf the company reissues this disclosure, the page is rebuilt from the corrected version and the revision number moves up.
Notice Regarding the Recognition of an Impairment Loss, the Recognition of a Valuation Loss on Shares of Affiliated Companies in the Non-Consolidated Financial Statements, and the Difference Between the Full-Year Consolidated Earnings Forecast and Actual Results for the Fiscal Year Ending March 2026 | SMS CO.,LTD. (2175) timely disclosure | Komori