Can the Q1 lead in profit growth be maintained in Q2?

In Q1, from April to June 2026, revenue was ¥163.530 billion, up 14.9% year on year, and operating profit was ¥13.112 billion, up 51.4%. Profit before tax was ¥14.279 billion and profit attributable to owners of the parent was ¥9.061 billion, up 46.9% and 41.2%, respectively. Profit growth outpaced revenue growth, and the quarterly operating margin rose to approximately 8.0% from approximately 6.1% a year earlier.

Progress against the full-year forecasts was approximately 26.0% for revenue, calculated as ¥163.530 billion divided by ¥630.0 billion, and approximately 32.8% for operating profit, calculated as ¥13.112 billion divided by ¥40.0 billion. Profit before tax was approximately 34.0% of the ¥42.0 billion full-year forecast, while profit attributable to owners of the parent was approximately 33.0% of the ¥27.5 billion full-year forecast. Assuming mechanically that 50% of the full-year figures is earned in H1, the benchmarks would be ¥315.0 billion in revenue and ¥20.0 billion in operating profit. This implies that operating profit would need to increase by approximately ¥6.89 billion in Q2 alone after Q1.

However, as of Q1 the company had not disclosed segment plans for H1 or specific amounts of revenue and operating profit required during the remaining period to achieve the full-year forecasts. Accordingly, ¥20.0 billion is a mechanical benchmark that does not account for seasonality and cannot be regarded as the company’s plan itself. Next time, it will be necessary to assess whether orders for steel products, semiconductor-related products and industrial machinery-related products continued in Q2, together with the cumulative H1 margin.

In its Q1 presentation, the company explained that profit exceeded expectations because steel shipment volumes were higher than the figure announced on 15 May, while the quarterly financial results summary contained no revision to the full-year earnings forecasts. At the next results release, an important signal will be whether the company raises its full-year forecasts even if profit progress rises further from the low 30% range, or leaves them unchanged citing raw-material and fuel market conditions or higher fixed costs.