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Presentation materials for financial results4324DENTSU GROUP INC.Information and Communications, Services and Others

Financial Results Briefing Materials for the First Quarter of Fiscal 2026

In the first quarter of fiscal 2026, gross profit increased 2.7% year on year and adjusted operating profit increased 11.5%, with margins also improving. Growth varied by region, however, and the substantial increase in profit for the period was also affected by non-recurring factors, including gains on the sale of fixed assets.

Worth reading
52Recurring
0–100. This measures how worthwhile something is to read, not how good or bad the company is.
Direction
Mixed performance
Direction inferred from the company’s description.
Scale
540.5
% (year-on-year change in profit for the period)
Wording
Conditional
How definitive the wording is.

Contents of this document

Presentation materials for financial resultsFY2026 First Quarter8 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales¥1,628.4 billion+9.8%
Operating profit¥65 billion+155.5%
Ordinary income¥62.5 billion+187.0%
Net income¥40.2 billion+540.5%
Operating profit margin12.8 %
Selling, general and administrative expenses
Value
Personnel Expenses200
Operating expenses48
Depreciation9.5
SG&A-to-sales ratio
Personnel Expenses67.8
Operating expenses16.3
Depreciation3.2
Results for the three months of the current quarterRevenue (Turnover) of ¥1,628.4 billion, revenue of ¥357.1 billion, gross profit of ¥295.1 billion, adjusted operating profit of ¥37.8 billion, operating profit of ¥65.0 billion, and profit for the period of ¥40.2 billion, all for January–March 2026
Full-year earnings forecast
Organic growth rate0~1%
Revenue¥1,491.5 billion, excluding EPS and margins
Gross profit¥1,230.2 billion, excluding EPS and margins
Adjusted operating profit¥166.3 billion, excluding EPS and margins
Adjusted net income¥85.2 billion, excluding EPS and margins
Operating profit¥152.6 billion, excluding EPS and margins
Profit for the period¥69.7 billion, excluding EPS and margins
Basic adjusted profit per share¥328.21
Operating margin13% range
What the company explained in this material
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
Operating profit adjustment items¥27.1 billion
Gains and losses on disposal and sale of non-current assets¥29.7 billion
Restructuring Costs¥-3.6 billion
Other (non-recurring items)¥7.2 billion
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
JPY/USD¥156.7 (January 2026 average)
JPY/GBP¥211.9 (January 2026 average)
New initiatives
  • Streamline EMEA regional headquarters functions and simplify clusters from 7 to 3 (effective 1 July 2026)
  • Restructure the ANZ CXM business and sell part of the business
  • Partnership with CreatorIQ
  • Rollout of AI agents and AI applications at dentsu Japan
  • Launch of Client IQ, an AI agent-based internal tool
Key KPIsA metric the company considers important as a management benchmark.
  • Organic growth rate0.8 %
  • Operating margin12.8 %
    Year on year against the same period last year+100bp
  • Adjusted EBITDA¥40.5 billion
    Year on year against the same period last year+10.1%
  • Basic adjusted profit per share¥75.43
    Year on year against the same period last year+18.4%
  • Net interest-bearing debt/adjusted EBITDA (LTM)1.05 times
Segment results
Japan
Gross profit128.9
Gross profit year-on-year-0.6
Adjusted operating profit39.8
Organic growth rate4.7
Americas
Gross profit76.4
Gross profit year-on-year0.2
Adjusted operating profit12.3
Organic growth rate-3
Europe, the Middle East and Africa
Gross profit65.5
Gross profit year-on-year15
Adjusted operating profit2.5
Organic growth rate0.8
Asia Pacific (excluding Japan)
Gross profit22.8
Gross profit year-on-year-1.3
Adjusted operating profit-3.2
Organic growth rate-7.5
Financial targets
Net interest-bearing debt/adjusted EBITDA (LTM): 1.05x (actual at 31 March 2026). Target: Not disclosed
Capital expenditures
¥27.7 billion net amount of acquisitions and sales of fixed assets
Acquisition of treasury shares
¥0.0 billion spent on share buybacks (January–March 2026). Buyback authorization and period: Not disclosed
Contents of this document
ItemDetails
Document typePresentation materials for financial results
Fiscal Period CoveredFY2026 First Quarter
Net Sales¥1,628.4 billion (YoY +9.8%)
Operating profit¥65 billion (YoY +155.5%)
Ordinary income¥62.5 billion (YoY +187.0%)
Net income¥40.2 billion (YoY +540.5%)
Operating profit margin12.8 %
Selling, general and administrative expensesvalue Personnel Expenses 200 / Operating expenses 48 / Depreciation 9.5 / SG&A-to-sales ratio Personnel Expenses 67.8 / Operating expenses 16.3 / Depreciation 3.2
Results for the three months of the current quarterRevenue (Turnover) of ¥1,628.4 billion, revenue of ¥357.1 billion, gross profit of ¥295.1 billion, adjusted operating profit of ¥37.8 billion, operating profit of ¥65.0 billion, and profit for the period of ¥40.2 billion, all for January–March 2026
Full-year earnings forecastOrganic growth rate 0~1% / Revenue ¥1,491.5 billion, excluding EPS and margins / Gross profit ¥1,230.2 billion, excluding EPS and margins / Adjusted operating profit ¥166.3 billion, excluding EPS and margins / Adjusted net income ¥85.2 billion, excluding EPS and margins / Operating profit ¥152.6 billion, excluding EPS and margins / Profit for the period ¥69.7 billion, excluding EPS and margins / Basic adjusted profit per share ¥328.21 / Operating margin 13% range
Segment resultsJapan Gross profit 128.9 / Gross profit year-on-year -0.6 / Adjusted operating profit 39.8 / Organic growth rate 4.7 / Americas Gross profit 76.4 / Gross profit year-on-year 0.2 / Adjusted operating profit 12.3 / Organic growth rate -3 / Europe, the Middle East and Africa Gross profit 65.5 / Gross profit year-on-year 15 / Adjusted operating profit 2.5 / Organic growth rate 0.8 / Asia Pacific (excluding Japan) Gross profit 22.8 / Gross profit year-on-year -1.3 / Adjusted operating profit -3.2 / Organic growth rate -7.5
Breakdown of Factors Affecting the ChangeOperating profit adjustment items ¥27.1 billion / Gains and losses on disposal and sale of non-current assets ¥29.7 billion / Restructuring Costs ¥-3.6 billion / Other (non-recurring items) ¥7.2 billion
Key KPIs0.8 %, 12.8 %, ¥40.5 billion, ¥75.43, 1.05 times
Assumptions Underlying the Business OutlookJPY/USD ¥156.7 (January 2026 average) / JPY/GBP ¥211.9 (January 2026 average)
Financial targetsNet interest-bearing debt/adjusted EBITDA (LTM): 1.05x (actual at 31 March 2026). Target: Not disclosed
Acquisition of treasury shares¥0.0 billion spent on share buybacks (January–March 2026). Buyback authorization and period: Not disclosed
Capital expenditures¥27.7 billion (net amount of acquisitions and sales of fixed assets)
New initiativesStreamline EMEA regional headquarters functions and simplify clusters from 7 to 3 (effective 1 July 2026), Restructure the ANZ CXM business and sell part of the business, Partnership with CreatorIQ, Rollout of AI agents and AI applications at dentsu Japan, Launch of Client IQ, an AI agent-based internal tool
Items this document does not state (13)
Gross Profit MarginProgress against full-year forecastSelf-assessment against the planUnit price and quantity metricsNumber of stores and locationsNumber of employeesRisk amount incorporated into the outlookMedium-term management plan targetsAnnual DividendPayout ratioOrders received and order backlogMarket Size / ShareKey points of the Q&A

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.

Adjusted operating profit increased due to higher revenue and control of selling, general and administrative expenses. EMEA benefited from higher revenue and control of selling, general and administrative expenses, while APAC benefited from control of selling, general and administrative expenses despite lower revenue. The increases in consolidated operating profit and profit for the period include non-recurring items such as ¥29.7 billion in gains and losses on the disposal and sale of fixed assets.

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Financial Results Briefing Materials for the First Quarter of Fiscal 2026 | DENTSU GROUP INC. (4324) timely disclosure | Komori