After the full-year forecast was revised downward, the focus for Q3 is not a narrower loss but the likelihood of meeting the revised figures.

Following the earnings forecast revision on 15 September 2026, the full-year revenue forecast changed from ¥13,200 million to ¥10,500 million, while the operating profit forecast changed from a profit of ¥350 million to an operating loss of ¥415 million. The forecast net income attributable to owners of the parent also changed from a profit of ¥127 million to a net loss of ¥670 million, and the annual dividend forecast was revised from ¥2 to ¥0. In the Q3 results, the first point to confirm is whether these revised figures remain the company’s current plan.

Before the revision, first-half results were revenue of ¥4,837 million, an operating loss of ¥375 million, an ordinary loss of ¥407 million, and an interim net loss attributable to owners of the parent of ¥303 million. Although revenue increased 15.1% year on year, progress against the full-year revenue forecast of ¥13,200 million was only about 36.6%. Based on the revised revenue forecast of ¥10,500 million, the company would need to add ¥5,663 million in revenue after the first half on a simple calculation. In Q3, we will assess not only whether demand has recovered, but also whether the second-half sales plan is realistic.

On the earnings side, the revised full-year operating loss forecast of ¥415 million implies that the deterioration from the first-half operating loss of ¥375 million would be limited to ¥40 million in the second half on a simple calculation. By contrast, the plan calls for the net loss attributable to owners of the parent to widen from ¥303 million in the first half to ¥670 million for the full year, implying an additional loss of ¥367 million in the second half. Where this difference arises—from advertising and promotion expenses, M&A-related costs, impairment and one-off losses, or taxes and net income attributable to non-controlling interests—will be an important point to confirm in the Q3 results.

The dividend forecast was changed from ¥2 to ¥0 based on the post-split basis of 5-for-1 effective 1 January 2026. First-half materials had indicated a ¥2 forecast and a payout ratio of 47.4%, but the company moved to no dividend after revising its earnings forecast. In Q3, it will be necessary to determine whether the suspension reflects a response to a one-year loss or a capital policy decision based on financial covenants and liquidity, and whether a policy for resuming dividends in the future will be explained.

Reported downside factors included fewer extremely hot days and prolonged rain for functional apparel, and fewer stores carrying “Sayonara Dany” than expected for toiletries. In Q3, the nine-month cumulative revenue from functional apparel, the number of stores carrying the products, and the number of B2B customers should be reviewed alongside the number of stores carrying toiletries and improvements in sell-through, while tracking whether the ¥10,500 million revised forecast is revised again.