Against the full-year plan for a 58.5% increase in operating profit, Q1 was ahead on sales but lagging on profit progress.

In the first quarter from April to June 2026, revenue was ¥12,264 million, operating profit was ¥621 million, ordinary profit was ¥668 million, and net profit attributable to owners of the parent was ¥393 million. Revenue increased 2.9% year on year, while operating profit fell 4.7%, meaning that higher revenue did not translate directly into higher operating profit. Revenue progress against the full-year forecast was 23.6%, broadly in line with the simple quarterly passage rate of 25%, whereas operating profit progress was only 17.3%, 7.7 percentage points below the elapsed-period rate.

The company’s FY2027 full-year forecast is revenue of ¥52,000 million, operating profit of ¥3,600 million, ordinary profit of ¥3,700 million, and net profit of ¥2,300 million, with no revision as of Q1. The operating profit forecast represents a strong 58.5% increase from FY2026 actual operating profit of ¥2,270 million, well above the 3.0% year-on-year increase expected for revenue. The operating margin implied by the full-year forecast is approximately 6.9%, assuming an improvement of approximately 2.4 percentage points from the 4.5% recorded in FY2026. How far the margin recovers in the first half will therefore be the central test of whether the plan can be achieved.

Revenue and operating profit in the first half of the previous year were ¥24,150 million and ¥1,025 million, respectively. Accordingly, first-half revenue above ¥24,150 million in FY2027 would represent year-on-year sales growth, while operating profit above ¥1,025 million would represent year-on-year profit growth. The figures of ¥26,000 million and ¥1,800 million are mechanical benchmarks set at 50% of the full-year forecast, not company targets adjusted for seasonality. However, whether results approach at least these levels should make it easier to determine whether the Q1 profit shortfall is temporary or structural.

The company attributed the Q1 decline in profit to higher raw material prices and an increase in selling, general and administrative expenses associated with promotional activities in the Medical business. In the first-half results, it will be necessary to confirm whether operating profit exceeds ¥1,025 million despite these burdens and whether the operating margin improves from approximately 5.1% in Q1. Since the company has not disclosed a breakdown of the full-year profit plan by segment or a budget breakdown directly showing first-half profit progress, both the accumulation of actual results and explanations by factor will need to be reviewed, rather than simply whether the full-year forecast is maintained.