FY2027 year-end March: Secure profit growth exceeding revenue growth in Q1

Revenue in Q1 of the fiscal year ending March 2027 was ¥15,055 million, up 8.4% year on year. Operating profit was ¥1,221 million, up 45.8%; ordinary profit was ¥1,387 million, up 45.7%; and net profit attributable to owners of the parent was ¥813 million, up 53.8%. Operating profit growth exceeded revenue growth by 37.4 percentage points, indicating that profit improvement is leading. The operating margin rose to approximately 8.1% from approximately 6.0% in the same quarter of the previous year.

The company’s FY2027 full-year forecasts are revenue of ¥74,000 million, operating profit of ¥5,300 million, ordinary profit of ¥5,600 million, and net profit attributable to owners of the parent of ¥3,900 million. As of Q1, progress stood at 20.3% for revenue and 23.0% for operating profit. Compared with the 25% calendar-year benchmark, revenue was 4.7 percentage points behind, while operating profit was only 2.0 percentage points behind. Accordingly, at this stage, performance is being supported more by margin improvement than by progress in revenue scale.

In the previous fiscal year, the fiscal year ended March 2026, revenue was ¥69,245 million, operating profit was ¥4,758 million, and the operating margin was 6.9%. Revenue increased 7.5% year on year, while operating profit rose 13.5%. This trend strengthened further in Q1, with revenue growth of 8.4% versus operating profit growth of 45.8%. The company attributes the revenue increase to the acquisition of new properties, retention of existing contracts, and increased equipment and environmental diagnostics and solution proposals. However, it has not disclosed on a monetary basis whether price, project mix, contract type, or cost control was the primary driver of the increase in profit.

The Q1 earnings summary does not present segment profit because the company has a single reportable segment, and no statement of cash flows has been prepared. In FY2027-H1, it will be necessary to confirm not only whether revenue of ¥37,000 million and operating profit of ¥2,650 million, the simple half-year benchmarks, are achieved, but also whether the operating margin has declined from Q1’s 8.1%, whether a breakdown of the drivers of profit improvement is provided, and whether the full-year forecasts are maintained.