H1 earnings progress is strong, but the full-year forecast implies a slowdown in H2

FY2026-H1 consolidated revenue was ¥8,414 million, operating profit was ¥1,510 million, ordinary profit was ¥1,568 million, and interim net profit attributable to owners of the parent was ¥1,133 million. The full-year forecasts are revenue of ¥14,000 million, operating profit of ¥1,170 million, ordinary profit of ¥1,240 million, and net profit of ¥860 million, representing progress rates of 60.1% for revenue and 129.1% for operating profit. Operating profit in H1 alone exceeded the full-year forecast by ¥340 million, an unusually strong level of progress.

If the full-year forecasts are maintained, simple calculations imply FY2026-H2 revenue of ¥5,586 million and an operating loss of ¥340 million. FY2025-H2 results were revenue of ¥7,879 million and operating profit of ¥1,007 million, calculated by subtracting FY2025-H1 revenue of ¥10,359 million and operating profit of ¥2,044 million from full-year revenue of ¥18,238 million and operating profit of ¥3,051 million. Accordingly, the assumption for FY2026-H2 is that revenue will decline approximately 29.1% year on year and operating profit will move from a profit to a loss.

The company had not revised its full-year earnings forecast as of FY2026-H1. However, the earnings release disclosed only full-year aggregate forecasts, and does not provide a project-by-project breakdown of the H2 revenue and profit plan or a specific explanation of why operating profit would be negative ¥340 million. In FY2026-Q3, we will examine not only the extent to which cumulative operating profit exceeds the full-year forecast, but also the delivery timing of major projects planned for H2, additional costs, development expenses, and the cost-of-sales ratio, to assess whether maintaining the full-year forecast reflects conservative assumptions or simply an unrevised forecast.