Revenue up, but operating profit down; the focus is on cost absorption in the first half

Consolidated revenue in FY2026-H1 was ¥1,077 million, up ¥76 million, or 7.6%, from ¥1,001 million in the same period of the previous year. However, operating profit fell ¥22 million to ¥65 million from ¥87 million, representing a 25.7% decline. The operating margin fell approximately 2.7 percentage points, from approximately 8.8% in the same period of the previous year to approximately 6.1%. Ordinary profit was also ¥73 million, down 17.2% year on year, indicating that revenue growth has not translated directly into operating profit growth.

Factors weighing on profit included higher administrative-function outsourcing costs between consolidated companies, start-up costs for new sales offices, and the upfront recognition of depreciation and amortization and opening costs. However, this disclosure did not provide the amounts by factor or distinguish between one-off and recurring costs. In FY2026-Q3, it will be necessary to determine whether these costs increased further or began to be absorbed by revenue growth.

By segment, the Human Resources Platform Business recorded revenue of ¥478 million, down 2.4% year on year, and segment profit of ¥110 million, down 15.6%. The Human Resources Outsourcing Business recorded revenue of ¥185 million, up 10.3%, but profit fell 37.2% to ¥7 million. The Working Environment Support Business recorded revenue of ¥347 million, up 10.1%, while profit fell 57.0% to ¥17 million. The Public-Private Partnership Business recorded revenue of ¥74 million, up 103.2%, but posted a ¥12 million loss. As no improvement in profit has been confirmed in any of the 4 businesses, recovery in the consolidated operating margin will require cost absorption across multiple segments.

Interim net profit attributable to owners of the parent was ¥55 million, up 5.7% year on year. However, the interim period included ¥2.5 million in litigation-related income recorded as extraordinary income, so this figure does not directly reflect the weakness in operating profit. In FY2026-Q3, the focus will be not only on revenue growth, but also on whether the operating margin remains at or above 6.1% and whether there is evidence of a return toward approximately 8.8%, the level recorded in the same period of the previous year.