Will the sharp increase in operating profit in the first quarter be repeated in the first half?

In the first quarter, covering March to May 2026, revenue was ¥9,306 million and operating profit was ¥1,071 million, up 9.3% and 106.1%, respectively, from ¥8,516 million and ¥520 million in the same period of the previous year. The operating margin rose 5.4 percentage points, from approximately 6.1% in the same period of the previous year to approximately 11.5%, with profit growing faster than revenue. Ordinary profit was ¥1,117 million, while net income attributable to owners of the parent was ¥731 million, representing year-on-year increases of 153.2% and 208.3%, respectively, at the non-operating and bottom-line levels.

The full-year forecasts are revenue of ¥37,000 million and operating profit of ¥2,400 million, putting first-quarter progress at 25.2% for revenue and 44.6% for operating profit. Assuming a simple even quarterly run rate, the half-year benchmark for revenue would be ¥18,500 million, although the company has not provided a separate first-half forecast. For operating profit, subtracting first-quarter actual profit from the full-year forecast means that ¥1,329 million must be earned over the remaining 3 quarters. The full-year forecast implies an operating margin of approximately 6.5%, a substantial gap from the first-quarter margin of 11.5%. It will therefore be important to determine whether the plan assumes normalization of the margin or whether the effects of price adjustments and a higher-value product mix will continue.

As of the first quarter, the full-year earnings forecasts had not been revised. The full-year revenue forecast is only 6.1% above the previous year's actual result, while the operating profit forecast is up 1.4%. Accordingly, at the next results announcement, it will be necessary to check not only first-half cumulative progress in revenue and operating profit, but also whether the sharply expanded first-quarter margin was maintained or fell substantially in the second quarter. In particular, although the qualitative drivers of changes in operating profit have been explained, the contribution amounts from price adjustments, higher-value products and volume growth have not been disclosed. A key point to assess will therefore be whether the first-half results explain the change in margin by individual factor.