Questions and Answers from the Full-Year Financial Results Briefing for the Fiscal Year Ending July 2026 | DIGITAL GRID Corporation (350A) timely disclosure

Worth reading

72In focus

Scored from 5 of 6 sections

Direction

Neutral

Direction inferred from the company’s description.

Scale

—

Displayed only when the document provides numerical figures.

Wording

Avoiding a definitive answer

How definitive the wording is.

Contents of this document

Summary of Q&AFull fiscal year ended July 20267 items taken from the company’s own explanation

Financial Results Figures (The key points of this material are explained below)

Full-year earnings forecast

AS business revenue

Over ¥2 billion

Power platform business revenue

48 Hundreds of millions of yen

What the company explained in this material

Self-assessment against the planThe company's self-assessment against its own plan.

All targets for the fiscal year ending July 2026 under the previous medium-term management plan were achieved or achieved ahead of schedule.

Key points of the Q&AKey questions raised by investors at the briefing and the company's answers

Issues Background to the growth of the renewable energy platform business / Answer Trading on RE Bridge became more active as the company captured demand for securing buyers and managing supply and demand arising from the transition away from the FIT scheme.
Issues Expansion into low-voltage grid-scale batteries / Answer Because operations can begin relatively quickly and multiple batteries can be aggregated to participate in the balancing market
Issues Reason for changing the KPI from total electricity handled to total contracted capacity / Answer Because kWh alone does not adequately capture growth in the battery business
Issues Revision of the operating profit margin target from more than 40% to more than 30% / Answer Because the increase in depreciation and amortization expense associated with investment in grid-scale batteries was factored in
Issues Bringing forward investment in grid-scale batteries / Answer Because investment decisions were brought forward, supported by the development team's experience and synergies with the existing platform business
Issues Direction of segment operating profit for the fiscal year ending July 2027 / Answer The AS business will be a source of profit growth, but conservative revenue assumptions for the power platform business and higher depreciation and amortization expense will be offsetting factors.
Issues Factors contributing to the deterioration in non-operating income and expenses / Answer The impact of higher borrowing-related costs and not recording a rebate of capacity contribution payments
Issues Impact of the situation in the Middle East / Answer Broadly offsetting in the power platform business, positive in renewable energy, and potentially an expanding source of revenue opportunities for the battery business over time
Issues Background to the decline in revenue in the power platform business / Answer Because settlement amounts with general transmission and distribution utilities were estimated conservatively
Issues Difference from the previous medium-term management plan / Answer The battery-related business is trending above plan, but settlement amounts and per-unit fees were estimated conservatively.
Issues Impact of balancing market prices / Answer The impact of the lower price caps was factored into the plan from the outset.
Issues Difference between operating capacity and capacity eligible for market participation / Answer Because there is a lead time of approximately 3 to 5 months to prepare for market participation
Issues Sustainability of new customer acquisition and the cancellation rate / Answer The company believes these can be maintained or improved through the full-scale launch of outbound sales, increased staffing, and improvements to systems and business processes.
Issues Main driver of the increase in AS business revenue / Answer Most of the contribution will come from external power sources, while operations are expected to commence at approximately 30 MW from the company's own investments.

Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.

Price caps for the various balancing market productsLowered from ¥15 to ¥10
Assumption for AS business revenueApproximately 4x the total for the fiscal year ended July 2026, exceeding ¥2 billion

New initiatives

Launch of an aggregation service that bundles low-voltage grid-scale batteries for market participation
Full-scale launch of outbound sales through the call center
Increased staffing for customer support
Improvements to systems and business processes
Expanded investment in grid-scale batteries

Key KPIsA metric the company considers important as a management benchmark.

Econohashi members and transaction volumeGrowth of more than 60% year on year
Year on year against the same period last yearIncreased by more than 60%
RE Bridge registered capacity2 GW
Renewable energy capacity actually operated and managed393 MW
Year on year against the same period last yearRecord high
Total contracted capacity1.4 GW
Year on year against the same period last yearIncreased by 38.3%
AS business operating capacity165 MW
Capacity eligible to participate in the balancing market100 MW
Monthly churn rate1.64 %
Year on year against the same period last yearCapacity cancellations were less than half the previous year's level

Medium-term management plan targets

ROE
TargetMore than 20%
Target fiscal yearFiscal year ending July 2026
Comparison with actual resultsAchieved or achieved ahead of schedule
Operating margin
Previous targetOver 40%
New targetMore than 30%
Adjusted EBITDA margin
Target40%
Investment in grid-scale batteries
Target¥10.0 billion over three years
Target fiscal year3 years
Comparison with actual resultsNearly all investment decisions completed in the first year

Financial targets

ROE of more than 20% (target for the fiscal year ending July 2026)

Contents of this document
Item	Details
Document type	Summary of Q&A
Fiscal Period Covered	Full fiscal year ended July 2026
Full-year earnings forecast	AS business revenue Over ¥2 billion / Power platform business revenue 48 Hundreds of millions of yen / Other Not disclosed
Self-assessment against the plan	All targets for the fiscal year ending July 2026 under the previous medium-term management plan were achieved or achieved ahead of schedule.
Key KPIs	Indicator name Econohashi members and transaction volume / Value Growth of more than 60% year on year / Year on year against the same period last year Increased by more than 60%, Indicator name RE Bridge registered capacity / Value 2 GW / Year on year against the same period last year Not disclosed, Indicator name Renewable energy capacity actually operated and managed / Value 393 MW / Year on year against the same period last year Record high, Indicator name Total contracted capacity / Value 1.4 GW / Year on year against the same period last year Increased by 38.3%, Indicator name AS business operating capacity / Value 165 MW / Year on year against the same period last year Not disclosed, Indicator name Capacity eligible to participate in the balancing market / Value 100 MW / Year on year against the same period last year Not disclosed, Indicator name Monthly churn rate / Value 1.64 % / Year on year against the same period last year Capacity cancellations were less than half the previous year's level
Assumptions Underlying the Business Outlook	Item Price caps for the various balancing market products / Value Lowered from ¥15 to ¥10, Item Assumption for AS business revenue / Value Approximately 4x the total for the fiscal year ended July 2026, exceeding ¥2 billion
Medium-term management plan targets	Item ROE / Target More than 20% / Target fiscal year Fiscal year ending July 2026 / Comparison with actual results Achieved or achieved ahead of schedule, Item Operating margin / Previous target Over 40% / New target More than 30% / Target fiscal year Not disclosed / Comparison with actual results Not disclosed, Item Adjusted EBITDA margin / Target 40% / Target fiscal year Not disclosed / Comparison with actual results Not disclosed, Item Investment in grid-scale batteries / Target ¥10.0 billion over three years / Target fiscal year 3 years / Comparison with actual results Nearly all investment decisions completed in the first year
Financial targets	ROE of more than 20% (target for the fiscal year ending July 2026)
Key points of the Q&A	Issues Background to the growth of the renewable energy platform business / Answer Trading on RE Bridge became more active as the company captured demand for securing buyers and managing supply and demand arising from the transition away from the FIT scheme., Issues Expansion into low-voltage grid-scale batteries / Answer Because operations can begin relatively quickly and multiple batteries can be aggregated to participate in the balancing market, Issues Reason for changing the KPI from total electricity handled to total contracted capacity / Answer Because kWh alone does not adequately capture growth in the battery business, Issues Revision of the operating profit margin target from more than 40% to more than 30% / Answer Because the increase in depreciation and amortization expense associated with investment in grid-scale batteries was factored in, Issues Bringing forward investment in grid-scale batteries / Answer Because investment decisions were brought forward, supported by the development team's experience and synergies with the existing platform business, Issues Direction of segment operating profit for the fiscal year ending July 2027 / Answer The AS business will be a source of profit growth, but conservative revenue assumptions for the power platform business and higher depreciation and amortization expense will be offsetting factors., Issues Factors contributing to the deterioration in non-operating income and expenses / Answer The impact of higher borrowing-related costs and not recording a rebate of capacity contribution payments, Issues Impact of the situation in the Middle East / Answer Broadly offsetting in the power platform business, positive in renewable energy, and potentially an expanding source of revenue opportunities for the battery business over time, Issues Background to the decline in revenue in the power platform business / Answer Because settlement amounts with general transmission and distribution utilities were estimated conservatively, Issues Difference from the previous medium-term management plan / Answer The battery-related business is trending above plan, but settlement amounts and per-unit fees were estimated conservatively., Issues Impact of balancing market prices / Answer The impact of the lower price caps was factored into the plan from the outset., Issues Difference between operating capacity and capacity eligible for market participation / Answer Because there is a lead time of approximately 3 to 5 months to prepare for market participation, Issues Sustainability of new customer acquisition and the cancellation rate / Answer The company believes these can be maintained or improved through the full-scale launch of outbound sales, increased staffing, and improvements to systems and business processes., Issues Main driver of the increase in AS business revenue / Answer Most of the contribution will come from external power sources, while operations are expected to commence at approximately 30 MW from the company's own investments.
New initiatives	Launch of an aggregation service that bundles low-voltage grid-scale batteries for market participation, Full-scale launch of outbound sales through the call center, Increased staffing for customer support, Improvements to systems and business processes, Expanded investment in grid-scale batteries

Items this document does not state (21)

Net SalesOperating profitOrdinary incomeNet incomeGross Profit MarginOperating profit marginSelling, general and administrative expensesResults for the three months of the current quarterProgress against full-year forecastSegment resultsBreakdown of Factors Affecting the ChangeUnit price and quantity metricsNumber of stores and locationsNumber of employeesRisk amount incorporated into the outlookAnnual DividendPayout ratioAcquisition of treasury sharesCapital expendituresOrders received and order backlogMarket Size / Share

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

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

To strengthen the provision of information to investors and achieve fair disclosure.

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.