1Q operating profit is ahead, but progress in ordinary and net profit remains slow

Revenue in 1Q of the fiscal year ending March 2027 was ¥48.939 billion, up 38.1% year on year, while operating profit was ¥5.606 billion, up 181.6%. The full-year forecasts are ¥180.0 billion for revenue and ¥10.0 billion for operating profit, putting progress at 27.2% and 56.1%, respectively, as of 1Q. Compared with the simple elapsed-period ratio of 25.0% after three months, revenue is broadly on plan, while operating profit is running ahead.

However, profit progress weakens below the operating level. Ordinary profit was ¥2.628 billion, up 0.1% year on year, representing 26.3% of the ¥10.0 billion full-year forecast. Net profit attributable to owners of the parent was ¥1.551 billion, down 16.2%, or 23.9% of the ¥6.5 billion full-year forecast. Since the full-year forecasts call for ordinary profit and net profit to increase 77.4% and 81.2%, respectively, the first-half results will need to be assessed not only for the strength of operating profit but also for how much of that profit remains after non-operating gains and losses.

The 1Q operating margin, calculated from revenue of ¥48.939 billion and operating profit of ¥5.606 billion, was approximately 11.5%, up about 5.8 percentage points from approximately 5.6% in the same period of the previous year. However, against operating profit of ¥14.161 billion in the fiscal year ended March 2026, the forecast for the fiscal year ending March 2027 is ¥10.0 billion, a decrease of 29.4%. The company’s plan therefore does not assume that the high 1Q margin will continue throughout the year. At the next results announcement, the simple benchmark will be half of the full-year forecasts: ¥5.0 billion each for first-half operating and ordinary profit, and ¥3.25 billion for net profit. The results will be compared with the disclosures to determine whether the early profit progress is temporary or whether the plan assumes a slowdown in the second half.