Revenue growth and a narrowing operating loss have progressed, but the quality of the return to profitability will be assessed in FY2027-H1.

Revenue in the first quarter of the fiscal year ending March 2027 was ¥1,748.436 million, an increase of ¥243.608 million, or 16.2%, from ¥1,504.828 million in the same quarter of the previous year. Operating income also improved, with the operating loss narrowing from ¥52.202 million in the same quarter of the previous year to ¥6.954 million, a reduction in the loss of ¥45.248 million. However, operating income remained negative relative to the rate of revenue growth, and the recovery remains at the stage of narrowing the loss rather than returning to profitability.

Calculated as operating income divided by revenue, the operating margin improved by approximately 3.07 percentage points, from approximately -3.47% in the same quarter of the previous year to approximately -0.40% in the current quarter. However, the company has not disclosed a breakdown by amount of gross profit, raw material costs, personnel expenses and other fixed costs, or a factor analysis of the ¥45.248 million improvement. In H1, it will be necessary to confirm not only whether revenue exceeds the year-earlier level, but also whether the operating margin turns positive after absorbing increases in raw material prices and fixed costs.

The FY2027 full-year forecasts recorded in the financial summary are revenue of ¥5,943 million and operating profit of ¥84 million. First-quarter revenue represents approximately 29.4% of the full-year forecast. To reach ¥2,971.5 million, the simple halfway point for the fiscal year, cumulative revenue will need to reach at least ¥1,223.064 million in the second quarter. In addition, assuming the first-quarter operating loss of ¥6.954 million, achieving full-year operating profit of ¥84 million will require total operating profit of ¥90.954 million from the second through fourth quarters.

At the next earnings release, the focus will be on separately reviewing revenue, operating profit, ordinary profit and net income for the second quarter alone and cumulatively for H1. In particular, the key points will be whether H1 operating income is at least ¥0 million, whether the operating margin turns positive, and, if the full-year forecasts are maintained, whether the company explains the assumption that ¥90.954 million will be earned in the second half alone.