First-half results are ahead of the full-year operating profit plan, but the focus is whether high profitability will continue in Q3

Revenue for the interim period of the fiscal year ending December 2026 was ¥2,050.569 million, up 27.8% year on year, while operating profit was ¥173.680 million, up 19.5%. Ordinary profit was ¥179.515 million and interim net profit attributable to owners of the parent was ¥177.763 million, up 21.6% and 4.3%, respectively. The full-year forecasts are revenue of ¥4,062 million, operating profit of ¥240 million, ordinary profit of ¥240 million and net profit attributable to owners of the parent of ¥295 million. Progress as of the interim period was approximately 50.5%, 72.4%, 74.8% and 60.3%, respectively.

Profit progress is substantially ahead of revenue progress. In the second quarter alone, revenue was ¥1,033 million, gross profit was ¥741 million, adjusted EBITDA was ¥192 million, operating profit was ¥80 million and net profit attributable to owners of the parent was ¥81 million, representing year-on-year increases of 32.3%, 23.1%, 65.7%, 61.9% and 18.8%, respectively. Meanwhile, the cumulative operating margin for the interim period was approximately 8.5%, down approximately 0.6 percentage points from approximately 9.1% in the same period of the previous year. Since revenue is growing faster than operating profit, a renewed increase in the margin, not just the absolute level of profit, will be important in Q3.

To achieve the full-year forecast from the interim period, the company needs to add ¥2,011.431 million in revenue and ¥66.320 million in operating profit in the second half. The benchmarks for reaching 75% of the full-year forecast by the cumulative third quarter are revenue of ¥3,046.5 million and operating profit of ¥180 million. For operating profit, this level would be reached with only ¥6.320 million of additional profit from the interim period. This is merely a simple progress calculation and does not indicate actual seasonality or the timing of project acceptance.

In the Q3 results, the focus will be whether large Akerun projects are continuing, whether revenue growth from Migakun and fixU is contributing to operating profit, and whether selling, general and administrative expense efficiencies are continuing. In particular, the key points are whether the company discloses not only higher revenue but also standalone Q3 revenue, gross profit and operating profit, contribution by service, and growth excluding large projects. The company's interim presentation qualitatively listed the factors behind revenue and profit growth, but did not provide a monetary breakdown by factor.