A return to profitability has been confirmed, but acceleration from Q2 onward is needed to achieve full-year operating profit of ¥610 million.

First-quarter revenue was ¥4,790 million, down ¥251 million, or 5.0%, from ¥5,041 million in the year-earlier quarter. Operating profit, meanwhile, changed from a ¥8 million loss in the year-earlier quarter to a profit of ¥79 million, while quarterly profit attributable to owners of the parent changed from a ¥84 million loss to a profit of ¥29 million. The first-quarter operating margin is approximately 1.65% based on calculation, although the company has not directly disclosed its operating margin. While this is above the 1.4% operating margin for the previous full year, the quarterly improvement cannot simply be extrapolated to the full-year margin.

The first-quarter earnings materials show progress toward the full-year forecast of 26% for revenue, 13% for operating profit, 10% for profit attributable to owners of the parent and 25% for stock profit, and the company describes progress across all metrics as being on track and above plan. However, it has not disclosed quarterly budget figures or seasonality quantitatively. Accordingly, whether revenue reaches ¥9,250 million, operating profit ¥305 million and net profit ¥150 million at the half-year point, equivalent to 50% of the full-year plan, should be treated not as the company’s own plan but as a simple six-month benchmark for assessing progress.

A simple calculation based on first-quarter results indicates that the second quarter alone would need to generate revenue of ¥4,460 million, operating profit of ¥226 million and net profit of ¥121 million to reach the 50% first-half benchmarks. To achieve the full-year forecast, the remaining three quarters after the first quarter would need to generate revenue of ¥13,710 million, operating profit of ¥531 million and net profit of ¥271 million. For operating profit, the plan requires building ¥531 million over the remaining period from the first-quarter level of ¥79 million, making the extent of profit acceleration in Q2 the factor that separates a simple return to profitability from the possibility of meeting the full-year target.

The company attributes the improvement in profit to growth in stock profit, cost improvements from organisational integration, the end of amortisation of intangible assets held by ZITTO, and a decrease in other SG&A expenses. Revenue, however, was below the year-earlier level because of the exclusion of アイ・ステーション from the consolidated group, so growth in revenue and improvement in profit on a like-for-like basis need to be assessed separately. In FY2027-H1, it will be necessary to confirm not only whether the full-year forecasts of ¥18,500 million in revenue, ¥610 million in operating profit and ¥300 million in net profit are maintained or revised, but also whether the factors behind the revenue decline and profit increase can be disclosed again on an amount basis.