Core 2 businesses lift Q1 revenue and earnings; H1 to test progress toward ¥10,000 million operating profit forecast

In Q1 of the fiscal year ending March 2027, consolidated revenue was ¥25,293 million, up 9.5% year on year, while operating profit was ¥2,130 million, up 44.5%. The full-year forecasts are revenue of ¥115,000 million and operating profit of ¥10,000 million, putting Q1 progress at 22.0% for revenue and 21.3% for operating profit. These figures are somewhat below the 25% benchmark that would result from simply dividing the year evenly by quarter. However, Q1 figures are cumulative, and the company has previously disclosed a tendency for Power Equipment revenue to be concentrated in the second half, particularly Q4. Q1 progress alone therefore does not indicate that the full-year forecasts will be missed.

By segment, the Power Equipment business posted revenue of ¥14,246 million and segment profit of ¥2,452 million, while the Metering business posted revenue of ¥9,739 million and segment profit of ¥1,627 million. The year-on-year change in operating profit included a positive ¥479 million contribution from Power Equipment and a positive ¥495 million contribution from Metering, for a combined ¥974 million uplift from the two businesses. By contrast, the GX Solutions business made a negative ¥63 million contribution and corporate expenses and other items made a negative ¥263 million contribution. The core 2 businesses therefore drove the improvement in company-wide results.

In the upcoming H1 results, it will be necessary to assess not only whether consolidated revenue and operating profit increased, but also whether the Power Equipment and Metering businesses can maintain their Q1 segment profit margins. Q1 segment margins were approximately 17.2% for Power Equipment and 16.7% for Metering. If these margins decline significantly in H1, the effects of product mix, raw material costs, research and development expenses, and corporate expenses will need to be examined separately. In particular, if the full-year forecasts remain unchanged, it will be important to see how the company explains the level of profit required for the remainder of the year at the H1 stage.