Can the first-quarter pace of profit growth be maintained through the interim plan?

In the first quarter of the fiscal year ending March 2027, revenue was ¥13,074 million, up 5.2% year on year; operating profit was ¥1,123 million, up 21.5%; ordinary profit was ¥1,285 million, up 29.2%; and net profit attributable to owners of the parent was ¥848 million, up 16.5%. Profit growth exceeded revenue growth, and the operating margin rose to approximately 8.6% from approximately 7.4% in the same period of the previous year.

The interim forecasts are revenue of ¥28,600 million, operating profit of ¥2,100 million, ordinary profit of ¥1,900 million, and net profit of ¥1,050 million. Calculated from the differences between these forecasts and first-quarter results, the second quarter alone needs to generate revenue of ¥15,526 million, operating profit of ¥977 million, ordinary profit of ¥615 million, and net profit of ¥202 million. First-quarter progress toward the interim forecasts was 45.7% for revenue, 53.5% for operating profit, 67.6% for ordinary profit, and 80.8% for net profit. Profit progress is strong, although net profit includes the impact of extraordinary income.

The full-year forecasts are revenue of ¥56,000 million, operating profit of ¥3,800 million, ordinary profit of ¥3,800 million, and net profit of ¥1,800 million. First-quarter progress toward the full-year forecasts was 23.3% for revenue, 29.5% for operating profit, 33.8% for ordinary profit, and 47.1% for net profit. The full-year operating profit forecast is 5.0% below the previous fiscal year's actual result, so first-quarter profit growth alone has not eliminated the outlook for a full-year decline. It will therefore be necessary to check whether improvements in North America, Japan, and marine components continue after the first half.

At the next results announcement, we will check whether the four interim-period indicators reach ¥28,600 million, ¥2,100 million, ¥1,900 million, and ¥1,050 million, respectively. The first-quarter materials did not disclose quantitative KPIs such as orders received, order backlog, sales volumes, or unit prices. It will also be important to see whether the second quarter provides a value-based explanation of whether revenue growth was driven by volume, price revisions, foreign exchange, or production efficiency.