FY2027 plan calls for higher revenue but lower operating profit, with investment front-loaded

For FY2026, revenue was ¥8,881 million, operating profit was ¥816 million and the operating margin was 9.2%. Revenue rose 2.1% year on year and operating profit increased 9.9%. In contrast, the FY2027 full-year company plan calls for revenue of ¥9.8 billion, operating profit of ¥600 million, ordinary profit of ¥615 million and net income attributable to owners of the parent of ¥370 million. Revenue is expected to rise 10.3%, while operating profit is planned to decline 26.5%, ordinary profit 27.8% and net income 37.9%.

The operating margin calculated from revenue is approximately 6.1% under the FY2027 plan, down approximately 3.1 percentage points from the 9.2% recorded in FY2026. For FY2027, the company expects investment costs related to business succession, hiring associated with new orders, additional office space, digital investment and improved employee benefits. FY2026 included ¥87 million in capital expenditures and ¥9 million in R&D expenses, but the total planned investment for FY2027, the breakdown between expensed and capitalised amounts, and the timing of expenditures have not been specified.

In the next FY2027-Q1, the key issue is not simply whether revenue increases, but whether revenue is growing fast enough to absorb the investment burden. Revenue was ¥1,968 million and operating profit was ¥184 million in FY2026-Q1, but the company has not disclosed a quarterly target under the FY2027 plan or the quarterly allocation of investment costs. It will therefore be important to track year-on-year revenue growth, operating profit in absolute terms and the operating margin, together with actual personnel, rent and system-related costs included in the plan.

The increase in FY2027 revenue also includes the transfer of the company housing management agency services business, completed on 1 July 2026. FY2027-Q1 will be the first quarter after the transfer, so we will check whether revenue and profit from the transferred business are disclosed separately from the existing business, and how much new orders and additional orders from existing customers contributed. If only revenue growth is reported, without disclosure of investment amounts or the profitability of the transferred business, it will remain difficult to determine whether the decline in FY2027 profit is temporary front-loaded investment or a structural deterioration in profitability.