Q1 delivered higher revenue and profit and was broadly in line with the full-year plan, but H1 will be the point at which earnings repeatability is assessed

In FY2027-Q1, revenue was ¥38.959 billion, operating profit was ¥7.174 billion, profit before tax was ¥7.519 billion, and profit for the quarter attributable to owners of the parent was ¥5.228 billion. Year on year, these increased by 9.0%, 11.8%, 17.1% and 18.4%, respectively, with operating profit growing faster than revenue. Operating margin was 18.4% on a simple calculation, improving from approximately 17.9% in the year-earlier period.

The full-year forecasts are revenue of ¥165.0 billion, operating profit of ¥34.0 billion, profit before tax of ¥33.6 billion and profit attributable to owners of the parent of ¥22.5 billion. The Q1 results did not prompt a revision to the forecasts. At Q1, progress against the full-year forecasts was 23.6% for revenue and 21.1% for operating profit. On a simple comparison that does not account for quarterly seasonality, ¥82.5 billion of revenue and ¥17.0 billion of operating profit in H1 provide one benchmark. However, because the company has not specifically disclosed the allocation of profit between H1 and H2 or seasonality, failure to reach 50% alone should not be treated as a failure to meet the plan. Year-on-year growth and maintenance of the full-year forecasts should also be considered.

The company cited growth in the recurring revenue base, including managed units in its leased employee housing management and rental management businesses, usage-related revenue from employee benefits outsourcing, the number of users of relocation support services, and property sales as factors behind the higher profit. In the tourism business, control of selling, general and administrative expenses through digital transformation, operational efficiency and cost control contributed, while ¥342 million of financial income from purchases of convertible bonds with share acquisition rights was also recorded. In H1, it will be important to distinguish whether revenue growth is recurring and driven by increases in managed units and the membership base, or includes temporary factors such as property sales and financial income.

In FY2026, revenue was ¥151.074 billion and operating profit was ¥30.815 billion, with operating profit reaching a record high. FY2027 targets operating profit of ¥34.0 billion, up 10.3% year on year. In H1, it will be necessary to assess not only progress toward this profit growth plan but also whether an operating margin in the 20% range can be maintained. Additional disclosures relevant to the quality of full-year profit include whether property sales recur, the impact of selling, general and administrative expense controls in the tourism business, and changes in revenue per unit and usage-related revenue in the recurring revenue businesses.