Q1 profit is ahead of the revised full-year plan; sustainability to be assessed in the first half

Revenue in the first quarter of the fiscal year ending March 2027 was ¥18,304 million and operating profit was ¥4,963 million, up 35.6% and 83.4%, respectively, from the same period a year earlier. The full-year forecasts are revenue of ¥83,000 million and operating profit of ¥20,000 million, putting Q1 progress at 22.1% for revenue and 24.8% for operating profit. Operating profit progress was 2.7 percentage points ahead of revenue, indicating that profit is currently growing faster than revenue.

Margins have also improved. Q1 operating margin was approximately 27.1%, calculated as ¥4,963 million divided by ¥18,304 million, up approximately 7.1 percentage points from approximately 20.0% in the same period a year earlier. The operating margin was 20.4% for the fiscal year ended March 2026 and approximately 24.1% in the full-year forecast for the fiscal year ending March 2027, meaning that Q1 has already exceeded the profitability level assumed in the full-year plan. However, it is not yet clear whether the high Q1 margin was driven by temporary product mix or capacity-utilisation effects, or whether it will continue into the first half.

The current full-year forecast was revised because Q1 results exceeded the initial assumptions and in light of the current business environment. The company cited the recovery in the semiconductor market, strong domestic and overseas sales of Pilaflon products for semiconductor manufacturing equipment, and improved capacity utilisation accompanying higher revenue as factors driving the improvement. However, the company has not disclosed the increase in profit by factor or the contributions from volume, price and capacity utilisation, so the extent to which the ¥4,963 million of operating profit reflects demand recovery cannot be quantitatively verified.

At the first-half results announcement, mechanically calculated benchmarks corresponding to 50% of the full-year forecasts will be revenue of ¥41,500 million and operating profit of ¥10,000 million. These are not first-half forecasts provided by the company, but benchmarks obtained by simply halving the full-year forecasts. Because Q1 did not include individual first-half forecasts or the amounts of orders received and order backlog, the key points for the next update will be cumulative Q2 results, the basis for maintaining the full-year forecast, quantitative order information and the reproducibility of the margin level.