Whether the sharp decline in revenue and operating loss in FY2027-Q1 can be absorbed by the concentration of earnings in the second half of the full-year forecast

Revenue for the first quarter of the fiscal year ending March 2027 was ¥1,700 million, down 37.9% from ¥2,738 million in the same period of the previous year. Operating income moved from a profit of ¥23 million in the same period of the previous year to an operating loss of ¥358 million. The company also recorded an ordinary loss of ¥398 million and a quarterly net loss attributable to owners of the parent of ¥303 million. The operating margin on revenue fell sharply from approximately 0.8% to approximately negative 21.1%, highlighting that the issue was not simply a change in revenue scale; the cost burden exceeded the decline in revenue.

The company maintained its full-year forecasts at revenue of ¥30,000 million, operating profit of ¥4,300 million, ordinary profit of ¥4,300 million, and net income attributable to owners of the parent of ¥2,800 million. A simple calculation of the difference from first-quarter results indicates that revenue of ¥28,299 million and operating profit of ¥4,658 million will be required over the remaining 9 months. This equates to average revenue of approximately ¥9,433 million and operating profit of approximately ¥1,553 million in each of the remaining 3 quarters. FY2026 full-year revenue was ¥29,123 million and operating profit was ¥3,903 million, so the plan for the current fiscal year calls for operating profit to increase 10.2% for the full year while absorbing the first-quarter loss.

Factors cited for the first-quarter earnings decline include lower revenue from contract construction, higher expenses such as advertising and promotion costs, initial costs incurred upon property acquisition, and lower insurance agency revenue, but no monetary bridge by factor has been disclosed. YOSHICON has also continued to disclose the risk that results fluctuate depending on property handover and construction completion timing, making quarterly results susceptible to the timing of project recognition. In the next interim earnings release, we intend to confirm how far the loss narrowed on a cumulative first-half basis, whether major properties were handed over, and whether increases in advertising and promotion costs, initial costs and contract construction costs were one-off or recurring.