FY2027-H1: the key question is whether the company can recover enough to meet its full-year forecast

FY2027-Q1 revenue was ¥1,036.6 million, down 3.1% from ¥1,069.8 million a year earlier. The operating loss was approximately ¥3.6 million and the ordinary loss was approximately ¥4.4 million. Net profit attributable to owners of the parent was approximately ¥1 million, putting the company in the black at the net income level, but it remained loss-making at the operating level. Progress against the full-year forecast was 21% for revenue and negative for operating profit, and the company itself considers progress as of Q1 to be behind schedule.

The FY2027 full-year forecasts are ¥4,850 million in revenue, ¥100 million in operating profit, ¥100 million in ordinary profit and ¥65 million in net profit attributable to owners of the parent. Working back from Q1 results, the company needs to generate ¥3,813.4 million in revenue and ¥103.6 million in operating profit over the remainder of the period. FY2026-H1 revenue was ¥2,203.9 million and operating profit was ¥13.5 million. If half of the full-year forecast is used as a simple benchmark, FY2027-H1 revenue of ¥2,425 million and operating profit of ¥50 million would be one reference point.

That said, quarterly results are affected by delivery timing and the progress of large projects, so it would be premature to conclude that the full-year forecast will be missed solely because results are below 50%. In FY2027-H1, we will assess whether delays in the Brand Business have been resolved, whether mid-sized projects in the Digital Marketing Business have progressed to revenue recognition, and whether the company provides specific grounds for maintaining its full-year forecast. Order intake, order backlog, scheduled project deliveries and the amount of profit required in the second half have not previously been disclosed in sufficient detail, making it important to see whether the company provides explanations supported by figures.