How much of the 1Q earnings decline can be recovered in FY2027-H1

FY2027 1Q revenue was ¥3,975.779 million and operating profit was ¥475.942 million. Revenue declined 2.9% and operating profit declined 33.9% year on year, with the decline in profit substantially greater than the decline in revenue. Meanwhile, the full-year forecasts included in the financial summary are revenue of ¥12,500 million, operating profit of ¥700 million and net income attributable to owners of the parent of ¥600 million. The company stated that, as of 1Q, there had been no change to its full-year earnings forecasts.

Cumulative results for FY2026-H1 were revenue of ¥7,011 million and operating profit of ¥791 million. Deducting FY2027 1Q results alone, FY2027 standalone 2Q would need to generate revenue of ¥3,035.221 million and operating profit of ¥315.058 million to match the year-earlier first-half level. These are mechanical benchmarks for comparison with the prior-year first half, not company forecasts, but they provide a useful checkpoint for assessing whether the 1Q decline was temporary or will persist into the autumn and winter selling season.

Progress against the full-year plan as of 1Q was approximately 31.8% for revenue and 68.0% for operating profit. However, the company sells seasonal products, so full-year achievement cannot be judged from the operating profit progress rate alone. The uneven quarterly distribution of profit is also evident from the fact that 1Q alone accounted for ¥475.942 million of the year-earlier first-half operating profit of ¥791 million. In H1, standalone 2Q revenue and operating profit should be assessed separately from cumulative progress against the full-year plan.

Although full-year targets have been provided, the materials do not include quarterly revenue or operating profit targets, or full-year targets for the Personal Effects business and Information Services business. Accordingly, the H1 results should be reviewed not only for whether the full-year forecast is retained, but also for whether the company explains how it will reach ¥700 million, including the second half, from 1Q operating profit of ¥475.942 million, and how much recovery is required by segment.