Will the strong first-quarter profit progress carry through to the first-half plan?

In the first quarter of the fiscal year ending March 2027, revenue was ¥10,888 million, operating profit was ¥715 million, ordinary profit was ¥760 million, and net income attributable to owners of the parent was ¥450 million. Year on year, revenue increased only 2.0%, while operating profit rose 65.9%, ordinary profit 46.4%, and net income 52.3%, meaning that profit growth significantly outpaced revenue growth.

As of the first quarter, the revised first-half forecasts were revenue of ¥22,200 million, operating profit of ¥1,480 million, ordinary profit of ¥1,580 million, and net income of ¥750 million. The corresponding progress rates were 49.0%, 48.3%, 48.1%, and 60.0%. Accordingly, achieving the first-half forecasts will require second-quarter revenue of ¥11,312 million, operating profit of ¥765 million, ordinary profit of ¥820 million, and net income of ¥300 million.

Operating profit is particularly notable: the required second-quarter amount of ¥765 million is approximately 7.0% above the first-quarter result of ¥715 million. Revenue would need to be roughly in line with the first-quarter result, but ordinary profit would need to be approximately 7.9% higher than in the first quarter. Net income is the exception, as 60.0% of the first-half target was already achieved in the first quarter, leaving only ¥300 million required in the second quarter to meet the first-half forecast.

The company attributed the first-quarter profit increase to product mix, company-wide cost controls, and cost-reduction initiatives, but did not disclose the contribution from each factor. At the next earnings release, we will review second-quarter operating profit of ¥765 million, the operating margin, the continuation of cost controls and cost reductions, and progress toward the first-half forecasts of ¥22,200 million in revenue and ¥1,480 million in operating profit, including whether contributions by factor are disclosed.