Secured 20% of the FY2027 operating profit plan in the first quarter

In the first quarter of the fiscal year ending March 2027, revenue was ¥156,281 million, up 8.0% year on year; operating profit was ¥3,149 million, up 29.7%; ordinary profit was ¥3,524 million, up 35.4%; and quarterly net profit attributable to owners of the parent was ¥1,814 million, up 55.6%. The operating margin, calculated from revenue and operating profit, was approximately 2.02%, up from approximately 1.68% in the same quarter of the previous year, indicating profit growth ahead of revenue growth.

Full-year forecasts are operating profit of ¥15,500 million, ordinary profit of ¥15,000 million and net profit attributable to owners of the parent of ¥8,000 million, representing targeted growth of 42.9%, 37.8% and 69.5%, respectively, from the previous year's results. Based on a mechanical calculation, first-quarter progress was 20.3% for operating profit, 23.5% for ordinary profit and 22.7% for net profit. However, quarterly profit allocation may vary depending on price revisions for paper and paperboard, seasonality at overseas operations and the timing of incorporating the results of M&A subsidiaries. It is therefore too early to assess full-year achievement solely by comparing progress with a simple 25% benchmark.

Meanwhile, the earnings release does not include a full-year revenue forecast, so progress toward the full-year revenue target cannot be calculated. FY2026 results were revenue of ¥606,779 million, operating profit of ¥10,848 million, ordinary profit of ¥10,887 million and net profit of ¥4,720 million. The current-year forecasts therefore assume a substantial recovery in earnings. At the next interim results, it will be important to confirm whether a revenue forecast is added or why only profit forecasts are being maintained.

There was no revision to full-year forecasts in the first quarter, and no supplementary results presentation or earnings briefing was held. Accordingly, the next results will need to be assessed using the quantitative disclosures in the earnings release, including whether cumulative operating profit approaches ¥7,750 million, or 50% of the full-year forecast, whether the overseas wholesale business remains profitable, and whether the benefit from paper and paperboard price revisions continues to exceed the decline in volumes. In particular, whether the margin can be maintained or improved from approximately 2.02% in the first quarter will be a practical indicator of the achievability of the ¥15,500 million operating profit forecast.