Will high-margin large domestic projects continue into H1?

In FY2026-H1, the domestic business generated revenue of ¥44,604 million and operating profit of ¥4,590 million, a substantial improvement from revenue of ¥37,839 million and operating profit of ¥1,723 million in the year-earlier period. For FY2026 as a whole, domestic revenue reached ¥94,902 million and operating profit ¥9,460 million, lifting the operating margin to approximately 10.0%. The key question is whether the shift toward large-diameter piles and large-scale construction projects, one-stop sales covering all pile types, and the leveling of production and construction schedules improved not only revenue scale but also profitability.

In FY2027-Q1, however, domestic revenue was ¥24,329 million and operating profit was ¥2,770 million, up only 6.1% and 8.1%, respectively, year on year. The quarterly operating margin was approximately 11.4%, improving from around 10.4% in the year-earlier period, but not substantially above the approximately 10.3% recorded in FY2026-H1. Q1 results alone do not clearly indicate whether the high-margin mix of large construction projects continued or whether the business simply recovered from the low level recorded in the year-earlier period.

Previous disclosures showed that the concentration on large-scale construction projects had, at one point, led to delays in starting some large projects and a 2.6% year-on-year decline in domestic concrete pile shipments. In FY2027-H1, the focus will be not only on whether domestic revenue exceeds the ¥44,604 million recorded in the year-earlier period, but also on whether operating profit of ¥4,590 million and an operating margin of around 10% can be maintained. Another issue is whether the company can provide additional disclosure, in monetary or volume terms, on the order backlog for large-diameter and large-scale projects, project start and completion dates, and the impact on shipments.