Full-year forecast on track with profit ahead; FY2026 focus is building fourth-quarter revenue

Cumulative nine-month consolidated revenue was ¥67,551 million, up 13.0% year on year, while operating profit was ¥16,532 million, up 26.8%. The full-year forecasts are revenue of ¥86,800 million and operating profit of ¥17,600 million, implying progress of 77.8% for revenue and 93.9% for operating profit. Ordinary profit was ¥17,112 million and net income attributable to owners of the parent was ¥11,750 million, representing progress of 94.5% and 91.4%, respectively, against the full-year forecasts.

A simple calculation of the shortfall against the full-year forecasts shows that the fourth quarter needs to generate revenue of ¥19,249 million, operating profit of ¥1,068 million, ordinary profit of ¥988 million and net income of ¥1,100 million. Although the required operating profit is modest, the required revenue is equivalent to 22.2% of the full-year forecast. Accordingly, it will be important to assess the contribution not only from high-margin projects, but also from additional municipal government business and recurring revenue from accounting firms.

Company materials indicate an upward revision to the full-year forecasts, but do not disclose cumulative nine-month progress against those forecasts or the revenue and profit required for the remaining period. Results for the three months of the current quarter alone have also not been disclosed. As a result, the cumulative figures alone make it difficult to determine whether the strong profit progress through the third quarter reflects fourth-quarter seasonality or the early recognition of temporarily elevated profit associated with standardization-related demand.

At the next FY2026 full-year results announcement, it will be necessary to assess actual results against the latest forecasts of ¥86,800 million in revenue, ¥17,600 million in operating profit, ¥18,100 million in ordinary profit and ¥12,850 million in net income. In particular, alongside whether operating profit was achieved, it will be important to determine which segments made up the ¥19,249 million revenue shortfall and whether the fourth quarter still reflected a reversal of standardization-related demand or higher personnel expenses in the accounting firm business, based on revenue and operating profit by segment.