Will the return to operating profitability in FY2027-Q1 lead to a full-year recovery?

FY2026 revenue rose 8.0% year on year to ¥18,494 million, but operating profit fell 86.4%, from ¥432 million to ¥58 million, while ordinary profit turned from a ¥279 million profit into a ¥95 million loss. The recovery in revenue has not translated directly into a recovery in profit, making the extent to which revenue is being converted into operating profit more important than revenue growth itself in FY2027-H1.

Net profit attributable to owners of the parent was ¥753 million in FY2026, but this included the impact of extraordinary income, including subsidies related to construction of the new plant, making it difficult to regard the recovery as being of the same quality as the recovery in operating profit or ordinary profit. The FY2027 full-year forecasts are ¥20,600 million in revenue, ¥690 million in operating profit, ¥550 million in ordinary profit and ¥150 million in net profit attributable to owners of the parent. On the profit side, improvement at the operating level needs to be confirmed.

FY2027-Q1 revenue was ¥5,187 million, operating profit was ¥190 million, ordinary profit was ¥184 million and net profit attributable to owners of the parent was ¥99 million. Progress against the full-year forecasts was approximately 25.2% for revenue, 27.5% for operating profit, 33.5% for ordinary profit and 66.0% for net profit. However, it would be inappropriate to judge full-year achievement solely on the high progress rate for net profit. The presence or absence of extraordinary gains and losses and the accumulation of operating profit should be given priority.

If half of the full-year plan is treated simply as a milestone for FY2027-H1, revenue of ¥10,300 million and operating profit of ¥345 million would provide reference points. In practice, seasonality and the timing of costs related to the new plant mean that falling below these levels alone would not establish that the targets will be missed. However, if the first-half operating margin is materially below 3.35%, the burden from depreciation, raw materials, personnel and transportation costs that became apparent in FY2026 is likely to remain. At the next earnings announcement, the focus should be not only on whether the full-year forecasts are maintained or revised, but also on the factors behind changes in operating profit and the breakdown of extraordinary gains and losses.