Initial assessment of the FY2027 plan, which anticipates a sales recovery but lower operating profit

FY2026 revenue was ¥7,745 million, down 5.4% year on year, while operating profit was ¥587 million, up 15.0%, and net income was ¥395 million, up 15.2%. The company's FY2027 plan calls for revenue of ¥8,000 million, operating profit of ¥570 million and net profit of ¥360 million. Revenue is planned to increase by ¥255 million, or 3.3%, from the previous year's result, but operating profit is expected to decline by ¥17 million, approximately 3.0%, and net profit by ¥35 million, approximately 8.9%. The fact that the plan does not translate higher revenue directly into higher profit will be the first point to assess in the next results announcement.

FY2026 Q1 results were revenue of ¥1,626 million, operating profit of ¥28 million and net profit of ¥17 million. In FY2025 Q1, revenue was ¥1,885 million and operating profit was ¥52 million. Accordingly, in FY2027 Q1 it will be necessary to assess not only whether revenue recovers from ¥1,626 million, but also whether operating profit exceeds ¥28 million. There is currently no quarterly forecast for FY2027 Q1, and there is no basis for treating figures obtained by simply dividing ¥8,000 million or ¥570 million by four as company guidance.

Accordingly, the next results announcement should be assessed based on the actual Q1 revenue, operating profit and net profit, as well as progress against the full-year forecasts and whether the forecasts have been revised. In particular, even if revenue recovers year on year, an exceptionally low level of operating profit relative to the full-year plan of ¥570 million could indicate that the improvement in the cost ratio achieved in FY2026 has not been maintained. Conversely, even if Q1 profit is low, it will be important to determine whether the full-year forecasts are maintained in light of historical seasonality.