First-half revenue and earnings declined, requiring a sharp recovery in the second half to meet the full-year forecast

First-half revenue for the fiscal year ending December 2026 was ¥3,003.435 million, down ¥8.597 million, or 0.3%, from ¥3,012.033 million in the same period of the previous year. Operating profit was ¥186.055 million, down ¥91.109 million, or 32.9%, from ¥277.164 million, while ordinary profit was ¥171.022 million, down ¥107.722 million, or 38.6%, from ¥278.745 million. Although the decline in revenue was limited, the fall in profit was substantial. The first-half operating margin was approximately 6.2%, down approximately 3.0 percentage points from approximately 9.2% in the same period of the previous year.

The full-year forecast presented by the company is revenue of ¥7,000 million, operating profit of ¥780 million, ordinary profit of ¥740 million and net profit attributable to owners of the parent of ¥500 million. It had not been revised as of the first-half results. Simple progress rates were 42.9% for revenue, 23.9% for operating profit, 23.1% for ordinary profit and 41.3% for net profit, showing that earnings progress was clearly behind revenue progress. A mechanical calculation of the gaps to the full-year forecasts indicates that the second half would need to generate revenue of ¥3,996.565 million, operating profit of ¥593.945 million, ordinary profit of ¥568.978 million and net profit of ¥293.575 million.

First-half segment revenue was ¥1,354.050 million for amusement parks, ¥540.388 million for golf, ¥840.467 million for hotels, ¥95.428 million for real estate, and ¥173.102 million for civil engineering and construction materials. While amusement parks and civil engineering and construction materials reported lower revenue, real estate revenue increased 16.8% year on year, indicating divergent trends across the businesses. In particular, lower visitor numbers at amusement parks and weak orders in civil engineering and construction materials were cited. The key issue will be not only whether revenue can be increased, but also whether the businesses can absorb their cost burdens.

In the next results release, cumulative revenue, operating profit and ordinary profit through the third quarter should be compared with the full-year forecasts to assess whether the second-half assumptions are realistic. For operating profit, the focus will be not only on the year-on-year change, but also on which quarter generated the increase from ¥186 million in the first half toward ¥780 million, and whether revenue gains from price revisions and events absorbed increases in personnel expenses, repair and maintenance costs, consumables and other costs.