Whether the upgrade to the ¥430 billion full-year profit forecast proves sustainable beyond temporary factors

In FY2027 Q1, revenue was ¥3,570,117 million, up 37.6% year on year; profit from operating activities was ¥184,379 million, up 45.6%; and profit for the quarter attributable to owners of the parent was ¥135,260 million, up 37.5%. The full-year forecast for profit attributable to owners of the parent was raised by ¥30,000 million, or 7.5%, from ¥400,000 million to ¥430,000 million. A simple calculation gives first-quarter progress of 31.5%, but it is too early to judge full-year achievement based on progress alone because the trading company business is affected by market conditions, foreign exchange, equity-method investment income, and seasonality.

The factors cited for the profit increase included stronger resource and memory-related market conditions, higher gross profit, and increased equity-method investment gains. However, the assessed disclosures in the earnings summary do not show how many hundreds of millions of yen each of resource markets, memory markets, foreign exchange, and equity-method investment gains contributed to the increase. An important point for the next results announcement will therefore be whether the upgrade to ¥430,000 million reflects revised market assumptions or increased sales volumes and transaction values or improved profitability.

Profit attributable to owners of the parent was ¥370,516 million in FY2026, meaning that the FY2027 forecast of ¥430,000 million is ¥59,484 million, or approximately 16.1%, above the previous fiscal year’s actual result. Even after the strong first quarter, approximately ¥294,740 million must be accumulated over the remaining 3 quarters. In H1, it will be necessary to assess not only the first-half profit level but also the company’s foreign exchange assumptions for the full-year forecast, its resource and memory market assumptions, and the recovery or decline in equity-method investment gains expected in the second half, in order to judge the repeatability of the increased forecast.

The annual dividend forecast is ¥125 per share, ¥5 above the FY2026 actual dividend of ¥120. Even if the profit forecast is revised again, the dividend policy and dividend level may not move at the same pace. H1 should therefore also be checked for whether the ¥125 annual dividend forecast is maintained, the payout ratio, and any additional explanation of the total shareholder return policy.