Full-year guidance maintained, but Q1 earnings progress lags revenue

Revenue for April-June 2026 was ¥4,430 million and operating profit was ¥148 million. Compared with the full-year forecasts of ¥20,925 million in revenue and ¥1,081 million in operating profit, progress as of Q1 was approximately 21.2% for revenue and 13.7% for operating profit. On a simple 25% comparison at the end of one-quarter of the year, revenue was approximately 3.8 percentage points below and operating profit approximately 11.3 percentage points below, indicating that earnings are lagging revenue by a wider margin.

To achieve the full-year plan after Q1, the company must generate ¥16,495 million in revenue and ¥933 million in operating profit over the remaining period. The remaining operating profit is approximately 6.3 times Q1's actual result, so based on simple progress alone, a meaningful improvement in earnings or the completion of highly profitable projects will be required in the second half. However, the company has not disclosed quarterly earnings plans or seasonality, so the comparison with 25% of the year elapsed cannot be interpreted directly as indicating that the company will miss its plan.

The full-year forecasts are revenue of ¥20,925 million, operating profit of ¥1,081 million, ordinary profit of ¥1,179 million, and net income attributable to owners of the parent of ¥823 million, and had not been revised as of Q1. Accordingly, at H1 it will be necessary to examine not only Q2 revenue and operating profit, but also the extent to which cumulative H1 results have progressed against the full-year forecasts and whether earnings progress has drawn closer to revenue progress.

Using a mechanical 50% benchmark that ignores seasonality, cumulative H1 revenue of ¥10,462.5 million and operating profit of ¥540.5 million would provide reference points. However, these are not half-year plans disclosed by the company. In the results, it will be important to see whether the company provides specific assumptions supporting its full-year forecasts, including H1 results by segment, such as completed construction revenue and gross profit margin on completed construction in the construction business, as well as profit from the transportation business.