Full-year forecast unchanged; Q3 to reassess H1 revenue growth and earnings progress

Revenue for January-June 2026 was ¥4,561.402 million, up ¥545.164 million, or 13.6%, from ¥4,016.238 million in the same period of the previous year. Operating profit, however, was ¥268.359 million, down ¥154.590 million, or 36.6%, from ¥422.949 million. Ordinary profit was ¥282 million, and interim net profit attributable to owners of the parent was ¥124 million. Revenue growth and earnings declines occurred simultaneously, making whether revenue growth translates into earnings the key point to monitor in the next results announcement.

H1 progress against the full-year forecasts was 45.6% for revenue, 48.9% for EBITDA, 52.0% for operating profit, 57.6% for ordinary profit and 57.0% for net profit. The company says that both revenue and earnings are progressing in line with plan, but this is a self-assessment based on cumulative results through H1. The company still needs to generate ¥5,439 million of revenue, ¥248 million of operating profit, ¥208 million of ordinary profit and ¥93 million of net profit in H2. The Q3 cumulative results will need to show how much of these remaining amounts has been achieved.

Operating profit had reached 52.0% of the full-year forecast by H1, but was down 36.6% year on year. The assessment of progress will depend on how much the office relocation costs included in H1, as well as the impact of the high earnings level in the same period of the previous year, dissipate in H2. In Q3, we want to see disclosure not only of progress against the full-year forecast, but also of standalone Q3 revenue and operating profit, remaining relocation costs, and the earnings contribution from the M&A subsidiaries.

The company currently has a single reportable segment and does not disclose service-level earnings, order intake or order backlog. As a result, it is difficult to verify from the summarized figures in the earnings release which services, customers or projects generated the ¥4,561 million of revenue, or whether the ¥268 million decline in operating profit can be explained solely by one-off costs. In the next results announcement, it will be important to see whether the company discloses the amounts attributable to each earnings factor and service-level profitability, in addition to whether it revises the full-year forecast.