How much of the first-quarter decline in revenue and profit can be recovered in the first half?

In the first quarter from April to June 2026, revenue was ¥2,320 million, operating profit was ¥133 million, ordinary profit was ¥136 million, and net profit attributable to owners of the parent was ¥107 million. Year on year, revenue fell 9.6%, operating profit fell 31.7%, ordinary profit fell 30.7%, and net profit fell 29.6%, with profit declining more sharply than revenue. Progress toward the full-year forecasts was approximately 24.9% for revenue and 26.6% for operating profit, broadly in line with a simple one-quarter benchmark.

The company’s FY2027 full-year forecasts are revenue of ¥9,300 million, operating profit of ¥500 million, ordinary profit of ¥495 million, and net profit of ¥347 million. They were unchanged as of the first quarter. Compared with FY2026 actual revenue of ¥9,691 million and operating profit of ¥485 million, the plan assumes a 4.0% decline in revenue while targeting a 3.1% increase in operating profit. Accordingly, even if revenue continues to decline in the first half, the key issue will be whether the company can improve its margin in the second half and reach operating profit of ¥500 million.

FY2026-H1 actual revenue was ¥5,673 million and operating profit was ¥484 million, providing a basis for comparison with FY2027-H1. The company has not presented standalone numerical targets for the first half, so ¥4,650 million in revenue and ¥250 million in operating profit are merely benchmarks based on 50% of the full-year forecasts, not company targets adjusted for seasonality. Even so, if first-half operating profit falls below ¥250 million, a corresponding increase in second-half profit will be required to reach ¥500 million for the full year.

At the next earnings release, it will be necessary to check year-on-year changes in cumulative first-half revenue and operating profit, progress toward the full-year forecasts, and whether those forecasts are maintained or revised. In particular, the central issue in assessing the feasibility of the full-year forecasts will be whether the decline from the previous first half’s ¥484 million in operating profit remains as large as it was in the first quarter, or narrows through the hot-spring facility business and product initiatives.