Can the company deliver its upgraded FY2026 plan through results from large transactions?

For the nine months ended December, consolidated revenue was ¥16,003 million, operating income was ¥5,125 million, ordinary income was ¥5,110 million, and net income attributable to owners of the parent was ¥3,406 million. The original full-year forecasts were revenue of ¥22,523 million and operating income of ¥7,316 million, putting nine-month progress at 71.1% for revenue and 70.0% for operating income. At that stage, the company assessed both revenue and operating income as broadly on plan.

In a subsequent revision to its full-year forecasts, revenue was raised to ¥27,077 million, operating income to ¥10,401 million, net income to ¥7,139 million, and earnings per share to ¥123.93. The increases from the original forecasts were ¥4,554 million for revenue and ¥3,085 million for operating income, representing increases of 20.2% and 42.2%, respectively. Working back from the nine-month results, achieving the revised forecasts requires fourth-quarter revenue of ¥11,074 million and operating income of ¥5,276 million. This means generating quarterly operating income above the nine-month cumulative result in the fourth quarter alone.

FY2025 standalone results were revenue of ¥20,314 million and operating income of ¥6,332 million. On a simple calculation, the revised FY2026 forecasts therefore represent increases of 33.3% in revenue and 64.3% in operating income. However, FY2026 shifted to consolidated accounting from the third quarter and newly included 4 companies in the scope of consolidation. Directly comparing the prior-year standalone results with the current-year consolidated forecasts could conflate changes in the scope of consolidation resulting from the transition to a holding company structure and the addition of subsidiaries with growth in the existing business.

At the next earnings announcement, it will be necessary to review not only the results against the revised targets of ¥27,077 million and ¥10,401 million, but also the amount by which the consolidation of the 4 companies contributed to revenue and operating income, the revenue increase from the existing M&A advisory business, and any consolidation adjustments or transition-related costs. In particular, the assessment of profit levels from FY2027 onward will differ significantly depending on whether the fourth-quarter revenue of ¥11,074 million and operating income of ¥5,276 million resulted from the one-time recognition of large transactions or from sustained improvements in the number of completed transactions and average transaction fees.