First-half results are broadly on track for the full-year plan, but in FY2026-Q3 the focus will be on separating underlying profit progress from one-off losses

FY2026-H1 revenue was ¥11,343 million, up 11.6% year on year, operating profit was ¥1,148 million, up 7.0%, and ordinary profit was ¥1,171 million, up 9.0%. The full-year forecasts are revenue of ¥23,000 million, operating profit of ¥2,430 million, ordinary profit of ¥2,450 million, and net income attributable to owners of the parent of ¥1,330 million, with first-half progress of 49.3%, 47.3%, 47.8%, and 39.1%, respectively. Revenue and operating profit are broadly tracking the calendar-year halfway point, while net income is significantly behind, making this the first variance to monitor in FY2026-Q3.

Applying a simple 75% progress assumption to the full-year plan gives nine-month reference levels of ¥17,250 million for revenue, ¥1,823 million for operating profit, ¥1,838 million for ordinary profit, and ¥998 million for net income. To meet the full-year plan based on first-half results, the second half requires revenue of ¥11,656 million, operating profit of ¥1,282 million, ordinary profit of ¥1,278 million, and net income of ¥810 million. FY2026-Q2 standalone revenue was ¥5,905 million, operating profit was ¥548 million, and the operating margin was 9.3%. This makes it necessary to assess, alongside nine-month progress, whether large projects will continue to be recognized in Q3 or whether results will slow from the Q2 level.

The weakness in net income was primarily due not to an operating loss but to a ¥296.928 million loss related to trust-type stock options. This extraordinary loss was equivalent to approximately 25.9% of operating profit of ¥1,148 million, and first-half net income fell 31.7% to ¥520 million from ¥762 million in the first half of the previous year. The earnings presentation gives full-year adjusted net income of ¥1,684 million and progress of 48.5%, with the gap versus reported net income progress of 39.1% reflecting the impact of one-off items. In Q3, the key points will be whether no additional losses arise, whether the gap between reported and adjusted profit narrows, and whether bottom-line profit, including tax expense, recovers.

There has been no revision to the earnings forecast. Although the company assesses revenue and operating profit progress as slightly ahead of plan, it has not disclosed the risk amount incorporated into the full-year forecast or the numerical assumptions underlying its outlook. In FY2026-Q3, the focus will be not only on whether the full-year forecast is maintained, but also on which projects or services will generate the ¥11,656 million of revenue and ¥1,282 million of operating profit required in the second half, and which metrics will be used to explain underlying performance excluding one-off losses.