Revenue growth in H1 but still a loss; a sharp recovery in H2 is needed to achieve ¥1,000 million in full-year operating profit

FY2026-H1 revenue was ¥16,378 million, up 6.6% year on year. However, operating income was a loss of ¥49 million, ordinary income was a loss of ¥125 million, and interim net income was a loss of ¥91 million, meaning that revenue growth has not yet translated into profitability. The company maintained its forecasts for full-year revenue of ¥36,000 million, operating profit of ¥1,000 million, ordinary profit of ¥850 million, and net profit of ¥670 million.

H1 revenue reached only 45.5% of the full-year forecast, approximately 4.5 percentage points below the 50% share implied by the calendar year. To achieve the full-year forecast, revenue of ¥19,622 million will be needed in H2, exceeding FY2025-H2 revenue of approximately ¥17,843 million. As H1 operating income was a loss of ¥49 million, approximately ¥1,049 million in H2 operating profit will be needed to reach the full-year target of ¥1,000 million.

The company has a seasonal earnings bias toward H2. In FY2025, H1 operating income was a loss of ¥177 million, compared with H2 operating profit of approximately ¥978 million. Although the FY2026-H1 loss narrowed by ¥128 million from the year-earlier period, the H2 profit now required is approximately ¥71 million above the prior-year H2 result. The key issue to assess in FY2026-Q3 is whether the narrower H1 loss will lead to stronger H2 profit, or whether the plan depends solely on the company’s usual seasonality.

The earnings presentation stated that H1 revenue was in line with plan, while operating profit fell below the initial H1 forecast of ¥140 million. In FY2026-Q3, it will be necessary to review nine-month cumulative operating income, the profit still required in H2, and the timing of the resolution of postponed construction projects and upfront costs, then reassess the likelihood of achieving the full-year forecast of ¥1,000 million.