Even with revenue growth, the operating margin will not return to FY2025 levels

In FY2026, revenue was ¥7,059 million, up 5.3% year on year and a record high. Operating profit was ¥721 million, down 3.7%, ordinary profit was ¥754 million, down 0.9%, and net income attributable to owners of the parent was ¥491 million, down 1.9%. The operating margin declined 1.0 percentage point from 11.2% in the previous fiscal year to 10.2%, indicating that the expansion in revenue has not translated directly into profit growth.

The company’s FY2027 forecasts are revenue of ¥7,500 million, operating profit of ¥750 million, ordinary profit of ¥730 million and net income of ¥500 million. Revenue is planned to increase 6.2% from FY2026 actual results and operating profit 3.9%, but the operating margin is 10.0% on a calculated basis, based on ¥750 million ÷ ¥7,500 million. This is below the 10.2% achieved in FY2026 and does not reach the 11.2% achieved in FY2025. Ordinary profit is forecast to decline 3.2% year on year, so although operating profit is expected to rise modestly, the assumptions for growth in final profit, including non-operating income and expenses, remain cautious.

Cumulative results during the year also show both recovery and pressure on margins. In the first half of FY2026, revenue was ¥3,351 million and operating profit was ¥306 million, producing an operating margin of approximately 9.1%. For the nine months ended December, revenue was ¥5,177 million and operating profit was ¥494 million, implying a margin of approximately 9.5%. The full-year margin rose to 10.2%, but the earnings presentation materials do not provide specific standalone quarterly revenue or operating profit figures. As a result, it is not possible to determine in which quarters investment-related pressure increased or decreased, or whether margins improved after excluding seasonality.

In the next 1Q, it will be necessary to assess not only the rate of revenue growth but also progress toward the full-year operating profit forecast of ¥750 million and the margin relative to the full-year forecast operating margin of 10.0% on a calculated basis. R&D, technical verification, a review of salary levels and education investment are cited as factors behind the decline in FY2026 profit, but the amounts incorporated for each item in the FY2027 forecast have not been disclosed. Whether these expenses continue to weigh on results in 1Q or are absorbed by revenue growth will affect the reliability of the full-year forecast.