First-half results are broadly on track for the full-year plan, but the focus is whether the decline in operating margin will continue

First-half revenue was ¥42,261 million, up 18.3% from ¥35,732 million in the same period a year earlier, while operating profit was ¥5,205 million, up 5.9%. Ordinary profit also increased 27.4% year on year to ¥5,512 million, but interim net profit attributable to owners of the parent declined 4.1% to ¥2,894 million, so the results did not show uniform improvement from operating profit through to net profit.

Progress against the full-year forecasts was 54.2% for revenue, 56.0% for operating profit, 58.0% for ordinary profit and 51.7% for profit attributable to owners of the parent. For the first half, revenue and operating profit both exceeded the 50% mark based on the elapsed period, but progress in final profit was relatively low. On a simple 75% progress assumption for cumulative FY2026-Q3, revenue of ¥58,500 million, operating profit of ¥6,975 million and net profit of ¥4,200 million would provide reference checkpoints.

Margins require attention. The first-half operating margin was 12.32%, down approximately 1.44 percentage points from approximately 13.76% in the same period a year earlier. While revenue increased 18.3%, operating profit growth was limited to 5.9%, suggesting that higher procurement costs, fixed costs and tariffs may have absorbed part of the benefit from higher revenue. At the next results announcement, it will be necessary to check not only revenue growth but also whether the contribution margin and operating margin have improved.

Net profit also failed to grow as much as operating profit in the first half because extraordinary losses were recorded. In FY2026-Q3, the points to confirm are whether any additional extraordinary losses are recorded and whether the gap between ordinary profit and net profit narrows. Even if the full-year forecasts are maintained, how the company explains the profit required in the second half and first-half seasonality will provide a basis for assessing the likelihood of meeting the plan.