Latest forecasts for both revenue and operating profit are below the targets of the 20th Medium-Term Management Plan

FY2026 results were revenue of ¥5.1165 billion, operating profit of ¥448.9 million, ordinary profit of ¥567.1 million, and net income attributable to owners of the parent of ¥478.9 million. By contrast, the latest FY2027 forecast is revenue of ¥5.22 billion, operating profit of ¥405 million, ordinary profit of ¥515 million, and net income of ¥390 million. Revenue is expected to increase 2.0% year on year, while operating profit is expected to decline 9.8% and net income 18.6%, resulting in a plan that combines higher revenue with lower operating profit.

The FY2027 targets set out in the 20th Medium-Term Management Plan are revenue of ¥6.00 billion, operating profit of ¥500 million, ordinary profit of ¥610 million, net income attributable to owners of the parent of ¥430 million, and ROE of 10% or higher. Compared with the latest forecast, the shortfalls are ¥780 million in revenue, ¥95 million in operating profit, ¥100 million in ordinary profit, and ¥40 million in net income. As a percentage of the targets, the latest forecast stands at 87.0% for revenue, 81.0% for operating profit, 84.4% for ordinary profit, and 90.7% for net income. Because the exclusion of the Chinese joint venture from consolidation reduces comparability with the basis on which the targets were set, the figures should not be viewed simply as a shortfall. The underlying performance excluding the impact of the exclusion and the targets need to be redefined.

FY2026 ROE was 10.5%, above the previous medium-term plan target. However, the FY2027 ROE forecast is given as a range of 8.0–10.0%, reflecting a cautious outlook that incorporates lower profit and the capital structure after the change in the scope of consolidation. At present, only the full-year forecast has been disclosed. It has not been specified how much progress will have been made against the plan targets by FY2027-H1, or how the revenue and profit targets should be interpreted after the Chinese joint venture became an equity-method affiliate.

At the next earnings announcement, it will be important to confirm not only whether the full-year forecast is maintained or revised, but also whether the targets of the 20th Medium-Term Management Plan will be retained in their current form or replaced with new targets reflecting the change in the scope of consolidation. Key points will include whether ¥202.5 million can be secured in the first half against the ¥405 million operating profit forecast, which regions or initiatives will cover the ¥95 million gap to the ¥500 million full-year target, and whether the company will specify when ROE of 10% or higher can again be achieved consistently.