1Q profit progress is outpacing revenue, but can high margins be maintained through the first half?

The next earnings announcement is scheduled for 12 November 2026. 1Q results were revenue of ¥6,365 million, operating profit of ¥1,266 million, ordinary profit of ¥1,300 million, and profit attributable to owners of the parent of ¥523 million, representing year-on-year increases of 8.1%, 23.8%, 21.7%, and 33.5%, respectively. The operating margin was approximately 19.9%, meaning profit grew faster than revenue.

The full-year plan calls for revenue of ¥25,800 million and operating profit of ¥4,300 million, putting 1Q progress at 24.7% for revenue and 29.4% for operating profit. After 1Q, the remaining revenue and operating profit required to meet the plan were ¥19,435 million and ¥3,034 million, respectively, implying a required operating margin of approximately 15.6% for the remainder of the year. This is below the 19.9% achieved in 1Q, so the high 1Q margin will not necessarily translate directly into the full-year result.

If the first half is viewed mechanically as half of the full-year plan, ¥12,900 million in revenue and ¥2,150 million in operating profit provide a reference point. However, the company has not disclosed quarterly earnings forecasts or seasonality, so this 50% benchmark cannot be regarded as the company’s formal first-half target. In the first-half results, it will be necessary to check cumulative revenue and operating profit, as well as whether the 1Q operating margin of 19.9% has been maintained.

There was no revision to the earnings forecast as of 1Q, and the full-year operating profit plan represents only a 0.6% increase from the previous year’s ¥4,272 million. The key issue next time will be whether the ¥4,300 million profit plan is maintained against the full-year revenue target of ¥25,800 million, based on 8.5% revenue growth, or revised due to cost factors such as raw materials, logistics, and labor.