Operating profit is on plan as of Q3, but full-year achievement depends on Q4

For the cumulative nine months of FY2026 ending September, revenue was ¥11,493 million, operating profit was ¥672 million, ordinary profit was ¥746 million and net income attributable to owners of the parent was ¥489 million. The full-year forecasts are revenue of ¥17,000 million, operating profit of ¥1,000 million and EBITDA of ¥2,000 million, with progress rates of 67.6%, 67.3% and 72.7%, respectively, according to the earnings presentation. If nine months elapsed is simply treated as 75% of the year, revenue and operating profit were below that level by 7.4 and 7.7 percentage points, respectively, while EBITDA was 2.3 points ahead.

Working backward from the full-year forecasts, the company needs to generate ¥5,507 million in revenue, ¥328 million in operating profit and approximately ¥546 million in EBITDA in Q4. Stand-alone Q3 revenue was ¥4,131 million, operating profit was ¥286 million and EBITDA was ¥552 million. Accordingly, Q4 revenue needs to be approximately 1.33 times stand-alone Q3 revenue, while operating profit needs to exceed the Q3 figure by approximately ¥42 million. EBITDA alone was broadly sufficient in stand-alone Q3 to meet the required amount, but achieving the revenue and operating profit targets will require additional contributions, including the seasonality of the life events businesses such as housing consultation and weddings.

The improvement in profitability reflects the effects of structural reforms, including business consolidation and cost reductions implemented in the previous fiscal year, an increase in the number of subscription-based stores in the main business formats, and operational optimisation in the housing consultation business. Accordingly, the key point to assess in Q4 is not simply whether revenue is recognised, but whether the profit margin achieved after the structural reforms can be maintained. The cumulative operating margin for Q3 was approximately 5.8%, a significant improvement from approximately 2.1% in the same period of the previous year. Even if full-year operating profit reaches ¥1,000 million, it will be necessary to distinguish whether the improvement resulted from one-off cost reductions or was accompanied by revenue growth.

There was no revision to the full-year earnings forecast in the Q3 results, and the next FY2026 full-year results will be the first occasion on which the full-year results are finalised. The company did not prepare a quarterly consolidated cash flow statement in the Q3 earnings summary, and operating cash flow as of Q3 has not been disclosed. At the next results announcement, it will be necessary to assess not only whether revenue of ¥17,000 million, operating profit of ¥1,000 million and EBITDA of ¥2,000 million were achieved, but also whether the improvement in operating profit translated into cash generation, including Q4 changes in expenses and working capital.