Operating profit is ahead in Q1; focus is on whether this can be sustained through the first half

Revenue in Q1 of the fiscal year ending March 2027 was ¥999 million, and operating profit was ¥100 million. Against full-year forecasts of ¥3,600 million in revenue and ¥210 million in operating profit, progress was 27.8% and 47.8%, respectively, on a simple calculation. Operating profit progress was 20.0 points ahead of revenue progress, marking a strong start on the profit front.

Comparing the Q1 figures with 50% of the full-year forecasts gives monitoring benchmarks of ¥1,800 million in revenue and ¥105 million in operating profit for the first half. These are not company forecasts for the first half, but reference levels obtained by simply halving the full-year plan. As operating profit had already reached ¥100 million in Q1, the first-half results should be assessed not only for whether profit growth is maintained, but also for how much revenue builds from ¥999 million and whether the profit margin can remain at the Q1 level.

The company has stated that, in addition to uncertainty related to the situation in the Middle East, some orders appear to have been brought forward, and that it will carefully assess developments going forward. The impact of such front-loaded orders, order intake, order backlog, and the regional breakdown of orders have not been quantified. At the next earnings announcement, we will check not only whether the company leaves its full-year forecasts of ¥3,600 million in revenue and ¥210 million in operating profit unchanged or revises them based on first-half results, but also which businesses show the impact of the reversal of these front-loaded orders in revenue and profit.