Even with strong first-half progress, FY2026-Q3 will focus on the likelihood of completing second-half sales

Revenue for FY2026 January-June was ¥19,946 million, operating profit was ¥3,276 million, ordinary profit was ¥2,978 million, and interim net profit attributable to owners of the parent was ¥1,966 million. Year on year, revenue increased 105.3%, operating profit 156.9%, ordinary profit 247.2%, and net profit 183.8%, representing very high growth rates when viewed on a first-half basis alone. The full-year plan calls for revenue of ¥55,400 million and operating profit of ¥7,600 million, putting first-half progress at approximately 36.0% and 43.1%, respectively.

First-half operating profit exceeded the internal plan by approximately ¥1.2 billion, or approximately 61%. The company cited approximately ¥400 million from shifts in revenue-recognition timing, including items brought forward; approximately ¥300 million from improved profitability on properties sold; approximately ¥50 million from Sankusu Okinawa exceeding plan; approximately ¥150 million from the real estate operations business exceeding plan; and approximately ¥300 million in unspent selling, general and administrative expenses as factors behind the increase. However, some of this upside reflects the timing of project sales, the property mix and the timing of expense utilization rather than recurring volume growth. In Q3, it will be necessary to determine whether the first-half upside was merely second-half projects brought forward or reflected underlying demand capable of generating additional sales profits.

A simple calculation based on the full-year plan indicates that the second half requires revenue of ¥35,454 million and operating profit of ¥4,324 million. The company maintained its full-year forecast, stating that deliveries are concentrated in the second half and that properties still under negotiation are included, requiring a cautious assessment of sales certainty. Accordingly, in Q3 it will be important to assess not only progress in cumulative revenue against the ¥55,400 million plan, but also whether projects scheduled for delivery during the remaining period are contracted, under active sales efforts or still at the negotiation stage, and whether the sale timing of individual projects has shifted from the original plan.

Of particular note, operating profit progress is approximately 7 percentage points ahead of revenue progress. This indicates strong project profitability and expense utilization in the first half, but does not necessarily mean the same margin can be reproduced in the second half. In the Q3 results, it will be important to assess how far cumulative operating profit has progressed against the full-year plan of ¥7,600 million from the 43% level, the likelihood of achieving the ¥4,324 million required in the second half, gross margins on properties sold, and whether the full-year forecast has been revised.