Financial Results for the Second Quarter (Interim Period) of the Fiscal Year Ending October 2026 [Japanese GAAP] (Consolidated)

Performance Overview

For the cumulative 2Q period, net sales were 5,578 million yen, down 17.2% YoY, and operating income was 61 million yen, a sharp decline. Decreased raw timber consumption, higher manufacturing costs, and increased selling, general and administrative expenses squeezed profit margins. In the Timber business, profitability declined due to factors related to chemical treatment, while the House & Eco business faced reduced large-scale orders in the heavy steel frame sector and higher SG&A, resulting in a profit decline. As for prospects, improvements are anticipated from the Timber business profitability and the continued high level of orders backlogs, and the full-year forecast remains unchanged.

Outlook and Drivers

From the third quarter onward, focus will be on securing large orders in the heavy steel frame sector and maintaining the backlog in House & Eco. The backlog stands at a record high of 3,823 million yen, and although full-year forecasts remain unchanged, continued impacts from higher raw material costs and personnel costs are possible. By strengthening young talent and expanding transactions, the goal is to achieve a backlog of over 4.0 billion yen by the end of October 2026.