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Q1 Earnings Presentation for the Fiscal Year Ending June 2027

Results presentationFirst quarter, FY ending Jun 2027Published 2026-11-13 15:30

In the first quarter of the fiscal year ending June 2027, revenue, gross profit, operating profit, ordinary profit and net income were below the year-earlier levels, resulting in an operating loss, ordinary loss and net loss attributable to owners of the parent for the quarter. The full-year earnings forecast was left unchanged, with revenue recognition from battery storage projects expected to accelerate from the second quarter onward.

Contents of this document

Earnings presentation materialsFirst quarter of the fiscal year ending June 202713 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales¥11,876 million-6.6%
Operating profit¥-98 million
Ordinary income¥-552 million
Net income¥-565 million profit attributable to owners of the parent
Operating profit margin-0.8 %
Selling, general and administrative expenses¥1,326 million
Results for the three months of the current quarter
Net Sales¥11,876 million
Gross profit¥1,227 million
Operating profit¥-98 million
Ordinary income¥-552 million
Profit attributable to owners of parent for the quarter¥-565 million
Full-year earnings forecast
Net Sales
¥64,000 million
Gross profit
¥10,450 million
Operating profit
¥4,700 million
Ordinary income
¥2,900 million
Net income for the current fiscal year
¥1,800 million
ROE
3.7 %
ROIC
2.1 %
Dividend per share
¥9.6
Progress against full-year forecast　通期の予想に対して、いまどこまで進んだかの割合です。
Net Sales18.6%
Gross profit11.7%
What the company explained in this material
Self-assessment against the planThe company's self-assessment against its own plan.
On track versus the medium-term plan
Key points of the Q&AKey questions raised by investors at the briefing and the company's answers
  1. Battery storage EPC orders are expected to continue, with projects ranging from completion during the fiscal year ending June 2027 to scheduled completion in 2028.
  2. The target gross margin for battery storage EPC is approximately 15% for contract-based projects and at least 15% for development projects.
  3. The company is addressing rising costs by locking in purchase prices, using foreign exchange forwards and futures, and factoring expected price increases into its order decisions.
  4. The company is addressing grid connection delays through early consultations, schedule adjustments and exemption clauses, and explained that the impact on earnings would be limited.
  5. The company is responding with a view to both the risk of higher costs resulting from the situation in the Middle East and the potential for increased investment in energy conservation and renewable energy.
  6. Shareholder benefits will be provided to holders of 1,000 or more shares in the form of points based on the number of shares held.
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
  • Foreign-exchange impact¥-21 million
  • Decrease in gross profit (unprofitable biomass EPC projects and renewable energy contract-based projects)¥-887 million
  • Increase in personnel expenses¥-38 million
  • Increase in research and development expenses (EFB pellet manufacturing business)¥-18 million
  • Other¥18 million
New initiatives
  • Expansion of battery storage EPC orders
  • Opening of a PKS fuel stockpile in North Sumatra, Indonesia
  • Integration of the PKS fuel and EFB pellet supply chains
  • Resource-circulating fuel business leveraging an EFB pellet manufacturing demonstration plant and GGL certification
  • Expansion of growth investments, including increased staffing
  • Establishment of specialist-track and area generalist positions
  • Launch of Human Rights Due Diligence
  • Shareholder Benefit Program
Key KPIsA metric the company considers important as a management benchmark.
  • Orders received¥9,529 million
    Year on year against the same period last year54.6%
  • Order backlog¥44,362 million
    Year on year against the same period last year127.9%
  • On-site PPA supply volume70 MW
  • On-site PPA customers60 postings
  • Renewable power generation capacity412.7 MW
  • Cumulative large-scale battery storage EPC orders¥387 100 million
Segment results
Engineering Business
Net Sales
¥4,093 million
Gross profit
¥506 million
Operating profit
¥65 million
Energy Supply Business
Net Sales
¥7,783 million
Gross profit
¥720 million
Operating profit
¥301 million
Medium-term management plan targets
Fiscal year ending June 2027
Gross profit¥1.1 billion (¥1.32 billion)
Operating profit¥6.4 billion
ROE5.8%
ROIC3.0%
Renewable energy capacity transferred to the company's own FIP scheme75MW
Renewable energy generation capacity380MW
Fiscal year ending June 2030
Gross profit¥1.87 billion (¥2.15 billion)
Operating profit¥13.4 billion
ROE11.7%
ROIC5.7%
Renewable energy capacity transferred to the company's own FIP scheme113MW
Renewable energy generation capacity470MW
Financial targets
ROE
Fiscal year ending June 2027 plan5.8%
Plan for the fiscal year ending June 203011.7%
Actual results△1.1%
ROIC
Fiscal year ending June 2027 plan3.0%
Plan for the fiscal year ending June 20305.7%
Actual results△0.0%
Orders received and order backlog
Orders received
¥9,529 million
Order backlog
¥44,362 million
Number of employees
Headcount growth was noted, but the number of employees was Not disclosed
Annual Dividend
Annual¥9.60
End of period¥9.60
Payout ratio
Target consolidated payout ratio of 30%
Gross profit
¥1,227 million, profit margin 10.3%, year-on-year change -46.6%
Year-on-year change (points)-7.8
Contents of this document
ItemDetails
Document typeEarnings presentation materials
Fiscal Period CoveredFirst quarter of the fiscal year ending June 2027
Net Sales¥11,876 million (YoY -6.6%)
Operating profit¥-98 million
Ordinary income¥-552 million
Net income¥-565 million (profit attributable to owners of the parent)
Gross profit¥1,227 million, profit margin 10.3%, year-on-year change -46.6%
Operating profit margin-0.8 %
Selling, general and administrative expenses¥1,326 million
Results for the three months of the current quarterNet Sales ¥11,876 million / Gross profit ¥1,227 million / Operating profit ¥-98 million / Ordinary income ¥-552 million / Profit attributable to owners of parent for the quarter ¥-565 million
Full-year earnings forecastNet Sales ¥64,000 million / Gross profit ¥10,450 million / Operating profit ¥4,700 million / Ordinary income ¥2,900 million / Net income for the current fiscal year ¥1,800 million / ROE 3.7 % / ROIC 2.1 % / Dividend per share ¥9.6
Progress against full-year forecastNet Sales 18.6% / Gross profit 11.7% / Operating profit Not disclosed / Ordinary income Not disclosed / Profit attributable to owners of the parent Not disclosed
Self-assessment against the planOn track versus the medium-term plan
Segment resultsEngineering Business Net Sales ¥4,093 million / Gross profit ¥506 million / Operating profit ¥65 million / Year on year against the same period last year Not disclosed / Energy Supply Business Net Sales ¥7,783 million / Gross profit ¥720 million / Operating profit ¥301 million / Year on year against the same period last year Not disclosed
Breakdown of Factors Affecting the ChangeFactors Foreign-exchange impact / Amount ¥-21 million, Factors Decrease in gross profit (unprofitable biomass EPC projects and renewable energy contract-based projects) / Amount ¥-887 million, Factors Increase in personnel expenses / Amount ¥-38 million, Factors Increase in research and development expenses (EFB pellet manufacturing business) / Amount ¥-18 million, Factors Other / Amount ¥18 million
Key KPIsIndicator name Orders received / Value ¥9,529 million / Year on year against the same period last year 54.6%, Indicator name Order backlog / Value ¥44,362 million / Year on year against the same period last year 127.9%, Indicator name On-site PPA supply volume / Value 70 MW / Year on year against the same period last year Not disclosed, Indicator name On-site PPA customers / Value 60 postings / Year on year against the same period last year Not disclosed, Indicator name Renewable power generation capacity / Value 412.7 MW / Year on year against the same period last year Not disclosed, Indicator name Cumulative large-scale battery storage EPC orders / Value ¥387 100 million / Year on year against the same period last year Not disclosed
Number of employeesHeadcount growth was noted, but the number of employees was Not disclosed
Medium-term management plan targetsFiscal year ending June 2027 Gross profit ¥1.1 billion (¥1.32 billion) / Operating profit ¥6.4 billion / ROE 5.8% / ROIC 3.0% / Renewable energy capacity transferred to the company's own FIP scheme 75MW / Renewable energy generation capacity 380MW / Fiscal year ending June 2030 Gross profit ¥1.87 billion (¥2.15 billion) / Operating profit ¥13.4 billion / ROE 11.7% / ROIC 5.7% / Renewable energy capacity transferred to the company's own FIP scheme 113MW / Renewable energy generation capacity 470MW
Financial targetsROE Fiscal year ending June 2027 plan 5.8% / Plan for the fiscal year ending June 2030 11.7% / Actual results △1.1% / ROIC Fiscal year ending June 2027 plan 3.0% / Plan for the fiscal year ending June 2030 5.7% / Actual results △0.0%
Annual DividendAnnual ¥9.60 / Interim Not disclosed / End of period ¥9.60
Payout ratioTarget consolidated payout ratio of 30%
Orders received and order backlogOrders received ¥9,529 million / Order backlog ¥44,362 million
Key points of the Q&ABattery storage EPC orders are expected to continue, with projects ranging from completion during the fiscal year ending June 2027 to scheduled completion in 2028., The target gross margin for battery storage EPC is approximately 15% for contract-based projects and at least 15% for development projects., The company is addressing rising costs by locking in purchase prices, using foreign exchange forwards and futures, and factoring expected price increases into its order decisions., The company is addressing grid connection delays through early consultations, schedule adjustments and exemption clauses, and explained that the impact on earnings would be limited., The company is responding with a view to both the risk of higher costs resulting from the situation in the Middle East and the potential for increased investment in energy conservation and renewable energy., Shareholder benefits will be provided to holders of 1,000 or more shares in the form of points based on the number of shares held.
New initiativesExpansion of battery storage EPC orders, Opening of a PKS fuel stockpile in North Sumatra, Indonesia, Integration of the PKS fuel and EFB pellet supply chains, Resource-circulating fuel business leveraging an EFB pellet manufacturing demonstration plant and GGL certification, Expansion of growth investments, including increased staffing, Establishment of specialist-track and area generalist positions, Launch of Human Rights Due Diligence, Shareholder Benefit Program
Items this document does not state (7)
Unit price and quantity metricsNumber of stores and locationsAssumptions Underlying the Business OutlookRisk amount incorporated into the outlookAcquisition of treasury sharesCapital expendituresMarket 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.

Q1 Earnings Presentation for the Fiscal Year Ending June 2027 | TESS Holdings Co.,Ltd. (5074) timely disclosure | Komori