FY2027 Q1: Profit growth is leading, with sustainability in H1 the key focus

Revenue for the first quarter of the fiscal year ending March 2027 was ¥13,541 million, up 25.0% from ¥10,831 million in the same quarter last year. Operating income was ¥1,245 million, ordinary income was ¥1,088 million, and net income attributable to owners of the parent was ¥639 million. All three profit levels turned positive, compared with an operating loss of ¥58 million, an ordinary loss of ¥296 million, and a net loss of ¥367 million in the same quarter last year. The operating margin was approximately 9.2%, an improvement of approximately 9.7 percentage points from approximately negative 0.5% a year earlier.

The full-year forecasts are revenue of ¥50,000 million, operating income of ¥2,400 million, ordinary income of ¥1,600 million, and net income of ¥1,000 million. As of Q1, progress rates were 27.1%, 51.9%, 68.0%, and 63.9%, respectively, with profit progress substantially ahead of revenue progress. Against the simple half-year benchmarks of ¥25,000 million in revenue and ¥1,200 million in operating income, the key issue is how much can be accumulated by FY2027-H1. The amounts remaining to reach the full-year forecasts after Q1 are ¥36,459 million in revenue, ¥1,155 million in operating income, ¥512 million in ordinary income, and ¥361 million in net income.

The factors behind the increase in revenue and profit were higher production of automotive parts for major customers in Japan, increased sales of molds and other equipment for new vehicle models, and manufacturing cost reductions; manufacturing and SG&A cost reductions in Thailand; and higher production of electrification parts for automotive battery manufacturers in China, together with the recovery of previously unrecovered mold investment costs. The company has not disclosed the profit contribution by factor, the breakdown between volume and unit price, or the contribution of electrification parts and mold cost recovery to Q1 operating income.

In FY2027-H1, the first points to confirm are whether revenue exceeds ¥25,000 million and operating income exceeds ¥1,200 million. In particular, the key issue is whether the approximately 9.2% operating margin achieved in Q1 can also be maintained in Q2 through production by major customers, mold and equipment sales, and cost reductions. The annual dividend forecast has been raised to ¥8 from the FY2026 actual dividend of ¥5, but the latest earnings disclosure does not provide numerical policies such as a payout ratio or DOE.