FY2027 guidance calls for higher revenue and profit, but the focus is on a reacceleration of the operating margin to 7.1%

FY2026 revenue was ¥150,556 million, operating profit was ¥10,311 million, and profit for the year attributable to owners of the parent was ¥7,212 million, representing year-on-year increases of 1.8%, 0.8% and 0.5%, respectively. The operating margin was 6.8%, and both revenue and profit reached record levels. However, profit growth lagged revenue growth, so the increase in revenue did not translate directly into a higher margin.

The company's FY2027 forecasts are revenue of ¥155,000 million, operating profit of ¥11,000 million, profit before tax of ¥11,000 million and profit for the year attributable to owners of the parent of ¥7,300 million. Revenue is planned to increase by 3.0%, operating profit by 6.7% and net profit by 1.2%, implying an operating margin of approximately 7.1%. In other words, the assumptions require operating profit to grow faster than revenue and the margin to improve by 0.3 percentage points from 6.8% in FY2026.

FY2026 actual results exceeded all of the targets in the medium-term management plan for fiscal 2026: revenue of at least ¥150 billion, operating profit of at least ¥10 billion, an operating margin of at least 6.5% and ROE of at least 14.0%. In FY2027-Q1, rather than simply checking whether the full-year forecasts remain unchanged, we want to see the quarterly progress toward the ¥155,000 million revenue and ¥11,000 million operating profit targets, the profit contributions from the domestic automotive-related and overseas-related businesses, and specific measures to improve margins disclosed.