Third-quarter revenue increased, but profit declined; accelerating fourth-quarter profit is necessary to meet the full-year forecast

For the cumulative third quarter of FY2026, revenue was ¥25,279 million, operating profit was ¥1,800 million, ordinary profit was ¥1,745 million and net profit attributable to owners of the parent was ¥1,166 million. Revenue maintained growth, rising 2.2% year on year, but operating profit fell 2.9%, ordinary profit fell 6.6% and net profit fell 17.4%. The operating margin calculated from revenue and operating profit was approximately 7.12%, down approximately 0.37 percentage points from approximately 7.49% in the same period of the previous year, indicating that revenue growth has not translated directly into profit growth.

The full-year forecasts remain unchanged at revenue of ¥34,137 million, operating profit of ¥2,545 million, ordinary profit of ¥2,445 million and net profit of ¥1,545 million. Cumulative progress toward these forecasts was approximately 74.0% for revenue, 70.7% for operating profit, 71.4% for ordinary profit and 75.5% for net profit. On a simple difference basis, the fourth quarter will require revenue of ¥8,858 million, operating profit of ¥745 million, ordinary profit of ¥700 million and net profit of ¥379 million. Fourth-quarter revenue would only need to exceed the cumulative quarterly average of approximately ¥8,426 million by about 5%, whereas operating profit would need to be approximately 24% above the quarterly average of approximately ¥600 million.

There are significant differences among segments in terms of their expected full-year profit contribution. Cumulative third-quarter revenue was ¥14,798.512 million for the healthcare business, ¥1,887.097 million for the pharmaceuticals business, ¥3,504.893 million for the department-store business, ¥1,913.392 million for the food-service business, ¥1,607.650 million for the real estate and construction-contracting business, and ¥1,567.535 million for other businesses. Although the pharmaceuticals and food-service businesses increased revenue, a decline in the healthcare business’s margin, lower profit from the department-store business and losses in other businesses may have weighed on consolidated profit. However, the company has not fully broken down in monetary terms the reasons consolidated profit fell below the same period of the previous year.

At the next full-year results announcement, the focus will be not only on whether the full-year forecasts are met but also on the factors behind recording fourth-quarter operating profit of ¥745 million. Key points to verify include a recovery in the healthcare business’s margin, continued profit growth in the pharmaceuticals business, a reduction in losses from other businesses, and changes in promotional expenses, raw-material costs and personnel expenses. No supplementary presentation materials were prepared with the third-quarter summary report, so it will also be important to see whether a fourth-quarter profit bridge and segment-level expense breakdown are disclosed.