First-quarter progress is weak relative to the full-year plan, requiring an uplift in FY2027-H1

The first quarter from 1 April to 30 June 2026 generated revenue of ¥58,340 million and operating profit of ¥3,691 million. Against the FY2027 full-year forecasts of ¥284,500 million in revenue and ¥32,600 million in operating profit, progress was 20.5% for revenue and 11.3% for operating profit. Compared simply with the 25.0% elapsed-quarter benchmark, revenue was 4.5 percentage points behind and operating profit 13.7 percentage points behind, indicating particularly weak profit momentum.

Although this is a mechanical benchmark that ignores seasonality and the timing of project recognition, 50% of the full-year forecast for FY2027-H1 corresponds to revenue of ¥142,250 million and operating profit of ¥16,300 million. FY2026-H1 results were revenue of ¥123,926 million and operating profit of ¥13,942 million. Reaching this mechanical half-year benchmark therefore requires year-on-year increases of ¥18,324 million, or 14.8%, in revenue and ¥2,358 million, or 16.9%, in operating profit.

In FY2026-H1, progress toward the full-year forecast was 45.6% for revenue and 42.8% for operating profit. By comparison, FY2026 results were revenue of ¥268,701 million and operating profit of ¥30,917 million, meaning the current FY2027 full-year forecasts represent increases of 5.9% in revenue and 5.4% in operating profit over the previous year's results. Since the growth targeted for the year as a whole is modest, it will be important to determine whether the weak first-quarter profit progress can be absorbed from the second quarter onward.

At the next results announcement, we will want to see not only cumulative H1 revenue and operating profit, but also which of Japan, the Americas, and Asia and Other accelerated from the first quarter. For operating profit in particular, the key issues will be whether the company can reach the mechanical half-year benchmark of ¥16,300 million and, if it falls short, whether it can explain in monetary terms the projects carried forward to the second half, price revisions, and the impact of personnel costs and tariffs.