Cumulative 2Q results are ahead of plan on earnings despite the full-year forecast having been raised

Cumulative 2Q revenue was ¥14,359 million, operating profit was ¥834 million, and net income attributable to owners of the parent was ¥527 million. The full-year forecast as of Q2 was revenue of ¥28,500 million, operating profit of ¥1,400 million, and net income attributable to owners of the parent of ¥800 million, putting progress at 50.4%, 59.6%, and 65.9%, respectively. Operating profit and net income are progressing ahead of revenue, with earnings running above the pace assumed in the plan.

The 3Q results will be assessed on a nine-month cumulative basis. Using 75% of the full-year forecast as a mechanical comparison benchmark without taking seasonality into account, the benchmarks are cumulative revenue of ¥21,375 million, operating profit of ¥1,050 million, and net income attributable to owners of the parent of ¥600 million. The additional amounts required from cumulative 2Q are ¥7,016 million in revenue, ¥216 million in operating profit, and ¥73 million in net income. However, these figures assume evenly distributed progress and do not reflect seasonality or the timing of project recognition. Reaching them alone therefore does not imply that the full-year forecast will be exceeded.

The forecast figures as of Q2 were raised from the figures as of Q1: revenue of ¥27,600 million, operating profit of ¥900 million, and net income attributable to owners of the parent of ¥450 million. The increases were 3.3% for revenue, 55.6% for operating profit, and 77.8% for net income, while the forecast operating margin rose from approximately 3.3% to approximately 4.9%. In Q3, it will be necessary to determine whether the higher earnings forecast reflects increased sales volumes or improved profitability, or whether it also includes cost factors such as lower retirement benefit expenses and depreciation.

As of Q1, the company had not disclosed order intake, order backlog, or quantitative KPIs other than financial statement figures, and the cumulative 2Q financial summary did not include a segment breakdown. Accordingly, the next results should be assessed not only on overall progress but also on which businesses generated the mechanical benchmarks, such as ¥21,375 million in revenue, whether the full-year forecast is maintained or revised again, and whether quantitative supplementary information on orders and demand is added.