Q1 is ahead of the full-year plan, but sustainability will be tested at the interim stage

First-quarter revenue was ¥5,726 million, up 17.1% year on year, while operating profit was ¥399 million, up 119.9%. Progress toward the full-year revenue forecast of ¥22,000 million was 26.0%, and progress toward the full-year operating profit forecast of ¥1,100 million was 36.3%, both exceeding the simple 25% ratio after three months. Ordinary profit was ¥511 million, and profit attributable to owners of the parent was ¥305 million, representing 46.5% and 33.9% of the respective full-year forecasts.

By comparison with the previous fiscal year, revenue increased from ¥20,947 million in the fiscal year ended March 2026 to a forecast ¥22,000 million for the fiscal year ending March 2027, while operating profit increased from ¥1,090 million to ¥1,100 million. In other words, the company plans for revenue growth of 5.0%, while operating profit growth is limited to 0.8%. The 119.9% increase in Q1 operating profit is well above the profit growth rate assumed in the full-year plan, suggesting that the plan may not assume that Q1's sales growth and improved operating rates will continue through the second half.

Q1 ordinary profit included ¥106 million in foreign exchange gains, with the reversal from ¥102 million in foreign exchange losses in the same quarter of the previous year also contributing. Accordingly, the 46.5% progress rate for ordinary profit, compared with 36.3% for operating profit, includes foreign exchange factors. Next time, it will be necessary to determine, alongside the interim segment figures, whether the increase in revenue was driven by sales volume and product mix, and whether the increase in operating profit resulted from improved operating rates.

As of the first quarter, orders received, order backlog, cash flows from operating activities and cash flows from investing activities had not been disclosed. At the next results announcement, it will be important to check not only the extent to which interim revenue exceeds ¥11,000 million and operating profit exceeds ¥550 million, the simple half-year equivalents of the full-year forecasts, but also whether the full-year forecasts are maintained or revised, interim regional profit and the amount of foreign exchange effects disclosed.