Q1 saw lower revenue and profit, with the focus on the strength of the recovery in H1 while the full-year forecast remains unchanged

FY2027-Q1 consolidated revenue was ¥8,216 million, operating profit was ¥753 million, ordinary profit was ¥812 million and net profit attributable to owners of the parent was ¥551 million. In the same period of the previous year, revenue was ¥8,431 million and operating profit was ¥826 million, representing decreases of ¥214 million and ¥73 million, respectively. The decline rates were 8.9% for operating profit, 6.9% for ordinary profit and 2.8% for net profit. Although the company did not fall into the red, its operating margin declined from approximately 9.8% in the same period of the previous year to approximately 9.2%.

The company's FY2027 full-year forecasts are revenue of ¥41,126 million, operating profit of ¥3,694 million, ordinary profit of ¥3,947 million and net profit attributable to owners of the parent of ¥2,714 million. Progress at the end of Q1 was approximately 20.0% for revenue, 20.4% for operating profit and 20.3% for net profit. Although these figures are below the 25% implied by a simple quarterly allocation, the company has disclosed seasonality, with construction completions concentrated in the second and fourth quarters. The low Q1 progress rate alone therefore does not indicate that the full-year targets will be missed.

After Q1, the company needs to generate ¥32,910 million in revenue and ¥2,941 million in operating profit over the remaining 3 quarters to achieve its full-year forecasts. FY2026-H1 was strong, with revenue of ¥19,159 million and operating profit of ¥2,037 million. If FY2027-H1 falls below the previous year's level, the recovery required in H2 will be greater. In particular, we will monitor whether the company can absorb the decline from the record level reached in FY2026-H1 and whether progress on construction projects carried forward becomes visible in the second quarter.

The Q1 disclosure contained no revision to the full-year forecasts and did not disclose standalone H1 forecasts or numerical progress rates. At the next earnings announcement, it will be necessary to check year-on-year changes in revenue and operating profit, cumulative progress against the full-year forecasts, completed construction revenue and orders in the construction business, and the basis for maintaining the full-year forecasts.