Dentsu Group (4324) investor relations material

Executive summary

• H1 FY2026 net revenue rose 3.7% year-over-year to JPY 583.1 billion, with organic growth of 0.3%.

• Underlying operating profit increased 6.6% to JPY 72.0 billion, and statutory net profit turned positive at JPY 46.3 billion, reversing a prior year loss.

• Japan delivered strong organic growth of 5.0% in H1, achieving record underlying operating profit, while Americas and APAC saw organic declines and EMEA was broadly flat.

• The mid-term plan emphasizes profitability, cost reduction, and AI-driven transformation.

• Gains from asset sales, including the Dentsu Ginza Building, contributed to improved operating profit.

Financial highlights

• H1 FY2026 net revenue: JPY 583.1 billion (+3.7% YoY); underlying operating profit: JPY 72.0 billion (+6.6% YoY); underlying net profit: JPY 38.2 billion (+17.9% YoY).

• Operating margin improved to 12.3% (+30bps YoY).

• Statutory net profit: JPY 46.3 billion, including one-off gains from asset sales.

• Underlying basic EPS increased 17.8% year-on-year to JPY 147.29.

• Net debt reduced to JPY 83.8 billion at end-June 2026.

Outlook and guidance

• FY2026 organic growth guidance: 0–1% (Japan: +3%, Americas: ~-4%, EMEA/APAC: ~+1%).

• Net revenue forecast: JPY 1,230.2 billion; underlying operating profit: JPY 166.3 billion; operating margin target: 13%.

• Underlying net profit forecast: JPY 85.2 billion; underlying basic EPS: JPY 328.21.

• Midterm management plan targets operating margin of 16% by 2028 and organic growth of 2–3%.

• No dividend is forecast for the fiscal year ending December 31, 2026.