Operating profit growth continues to outpace revenue growth, with earnings sustainability the focus for FY2027-H1

FY2026 revenue was ¥87,057 million, operating profit was ¥1,532 million and ordinary profit was ¥1,527 million, resulting in higher revenue and profit than the prior year, when revenue was ¥83,380 million and operating profit was ¥849 million. Revenue growth was limited to 4.4%, while operating profit increased 80.3%, raising the operating margin from approximately 1.0% to 1.8%. The fact that operating profit growth substantially outpaced revenue growth was the most significant change in these results.

FY2027-Q1 revenue was ¥22,789 million, operating profit was ¥739 million, ordinary profit was ¥716 million and net income attributable to owners of the parent was ¥402 million, representing year-on-year increases of 3.8%, 12.0%, 8.3% and 11.1%, respectively. The operating margin rose from approximately 3.01% in the prior-year period to approximately 3.24%, indicating that margin improvement continued into the first quarter. Operating profit reached approximately 44.3% of the full-year forecast of ¥1,670 million, well above the 25% implied by the elapsed period alone.

By contrast, FY2026-H1 recorded revenue of ¥43,372 million and operating profit of ¥1,324 million, making whether FY2027-H1 can exceed these figures the first point of verification. The strong first-quarter earnings progress is positive, but it has not yet been disclosed to what extent personnel expenses, logistics costs, cashless payment fees and sales promotion expenses will increase in the second quarter, when store openings and promotional activity are expected to rise. Rather than judging achievement of the full-year forecast solely on the strength of the first quarter, it will be necessary to see whether the operating margin can be maintained through the first half.

The full-year forecasts are revenue of ¥88,600 million, operating profit of ¥1,670 million, ordinary profit of ¥1,600 million and net income of ¥450 million, with operating profit planned to increase 9.0% year on year. Net income is expected to increase by only 0.8%, so the forecast does not assume that higher operating profit will translate directly into substantial growth in bottom-line profit. In FY2027-H1, it will also be necessary to check the extent of non-operating and extraordinary expense burdens, including impairment losses and losses on disposal of property, plant and equipment.