FY2027-Q1 profit growth outpaced revenue growth, improving margins

Operating revenue in FY2027-Q1 was ¥3,123 million, up 21.8% from ¥2,564 million in the year-earlier quarter. Operating profit was ¥1,242 million, up 53.8% from ¥807 million, ordinary profit was ¥1,240 million, up 52.6%, and profit attributable to owners of the parent was ¥803 million, up 48.1%. Operating profit growth exceeded revenue growth by 31.9 percentage points, indicating that the recovery in profitability outpaced the expansion in revenue.

Operating margins calculated simply from operating revenue and operating profit were approximately 39.8% in FY2027-Q1 and 31.5% in the year-earlier quarter. The company does not disclose operating margin, however, so these are calculated figures based on reported amounts. In FY2027-H1, it will be necessary to assess the extent to which spread compression and campaign effects, contributions from trading tools and new products, and changes in advertising and system-related expenses affected results, and whether the margin improvement reflects temporary market conditions or improved cost efficiency.

As a factor supporting profit, the company recorded a ¥11.45 million special gain on the liquidation of an affiliate in FY2027-Q1, while no special loss was reported. Profit before income taxes was ¥1,252 million, meaning the gain on liquidation accounted for only approximately 0.9%. The increase in quarterly profit therefore appears to have been driven primarily by operating improvement. Since the gain is not included in operating profit, however, it will be important to determine whether similar one-off items arose in FY2027-H1.

The company identifies its financial instruments business as its main segment and omits segment information because its other business segments are not material. As a result, disclosure allowing the increase in profit to be directly verified by business, such as FX, CFD, BtoB and overseas subsidiaries, is limited. In FY2027-H1, it will be important to confirm at least the breakdown of transaction-related revenue comprising the ¥3,123 million in operating revenue, the contribution of SG&A expenses to operating profit of ¥1,242 million, and whether any special gains or losses other than the gain on liquidation of the affiliate were recorded.