Can FY2027's revenue and earnings growth reaccelerate in Q1?

FY2026 consolidated revenue was ¥10,964 million, up 16.3% year on year and reaching a record level. Operating income, however, was ¥703 million, down 5.2%; ordinary income was ¥711 million, down 5.5%; and net income attributable to owners of the parent was ¥392 million, down 9.8%. As the expansion in revenue has not translated directly into profit growth, the key in FY2027-Q1 will be the combination of revenue growth and operating-income growth, rather than revenue growth alone.

The company's full-year FY2027 plan calls for revenue of ¥12,556 million, operating income of ¥812 million, ordinary income of ¥814 million and net income attributable to owners of the parent of ¥444 million. The plan assumes year-on-year growth of 14.5%, 15.6%, 14.4% and 13.2%, respectively, with the deterioration in FY2026 profitability to be reversed through revenue growth and cost control. Dividing operating income of ¥812 million by revenue of ¥12,556 million gives an operating margin of approximately 6.5%, only a modest improvement from the approximately 6.4% recorded in FY2026. Meeting the plan will therefore depend less on a major improvement in profitability than on steadily building revenue across each business.

FY2026-Q1 revenue was ¥2,569 million and operating income was ¥114 million. In the next results announcement, FY2027-Q1 revenue, operating income and operating margin should therefore be assessed against these year-earlier levels. The key issues will be whether the store openings and business-transfer benefits in the Hoken Clinic business, the expansion of FA sales personnel, the recovery of large projects in the Solutions business and the increase in recurring revenue in the Systems business are progressing simultaneously. Disclosure of results by the four segments and progress against the full-year plan would allow a more specific assessment of the likelihood of meeting the plan in the second half and beyond.