Will profit growth remain ahead of revenue in FY2027-H1 after leading in Q1?

Revenue for the first quarter of the fiscal year ending March 2027 was ¥4,042 million, up 19.6% year on year. Operating profit was ¥620 million, up 25.5%, ordinary profit was ¥624 million, up 25.1%, and net profit was ¥382 million, up 22.6%. Progress against the full-year forecast was 25.3% for revenue, calculated as ¥4,042 million ÷ ¥16,000 million, and 29.5% for operating profit, calculated as ¥620 million ÷ ¥2,100 million. Profit progress is therefore ahead of the 25% elapsed-period benchmark.

The company's full-year forecasts are revenue of ¥16,000 million, operating profit of ¥2,100 million, ordinary profit of ¥2,100 million and net profit of ¥1,400 million. Revenue is expected to increase 8.0% year on year, while operating profit, ordinary profit and net profit are forecast to decline 3.9%, 5.0% and 6.8%, respectively. The first quarter's higher revenue and profit alone are insufficient to determine whether the change is large enough to revise the full-year earnings decline assumption, making it important to confirm whether the improvement in profit margins is sustained in the first half.

The company had not changed its full-year earnings forecast as of the first quarter and left its full-year dividend forecast unchanged at ¥55. However, it has not disclosed half-year earnings forecasts, quarterly seasonality, or first-quarter order intake and order backlog results. Accordingly, revenue of ¥8,000 million, operating profit of ¥1,050 million and net profit of ¥700 million are monitoring benchmarks based on a simple half-year allocation of the full-year forecasts, not first-half targets explicitly stated by the company.

In FY2027-H1, we will check not only whether results exceed the simple allocated benchmarks, but also whether operating profit progress continues to outpace revenue progress and whether the full-year operating profit forecast of ¥2,100 million is maintained. In particular, if the full-year forecast remains unchanged, the key issue will be whether the company is building lower margins or growth investment into the second half, or is treating the strong first-quarter progress conservatively, and whether it provides additional explanation.