Nihon M&A Center (2127) Q1 2027 earnings summary

Executive summary

• Net sales for Q1 FY2026 were ¥9,104 million, up 0.9% year-over-year, with 188 transactions closed, down 11.3%.

• Ordinary profit fell 11.1% year-over-year to ¥2,252 million, mainly due to fewer closed deals and deal postponements, but higher M&A sales per transaction offset declines.

• Extraordinary gain of approximately ¥800 million from the sale of an investment in the fund business, which, if included in sales, would have resulted in a 9.7% sales increase.

• Profit attributable to owners of parent rose 33.8% year-over-year to ¥2,027 million, with comprehensive income up 71.2%.

• Leading indicators remain strong, with new sell-side mandates up 20.1% year-over-year and a record number of transactions under negotiation.

Financial highlights

• Sales: ¥9,104 million (+0.9% YoY); M&A sales per transaction: ¥46.3 million (+13.4% YoY).

• Ordinary profit: ¥2,252 million (-11.1% YoY); Pretax profit: ¥3,156 million (+24.6% YoY, boosted by extraordinary gain).

• Net profit: ¥2,206 million (+46.5% YoY); Profit attributable to parent: ¥2,027 million (+33.8% YoY).

• Basic earnings per share for the quarter were ¥6.39, up from ¥4.78 in the prior year.

• Gross profit margin: 60.3% (up 0.6pt YoY); Operating margin: 25.8% (down 2pt YoY).

Outlook and guidance

• Full-year net sales forecast for FY ending March 31, 2027, is ¥52,800 million, up 5.1% year-over-year; operating profit projected at ¥19,300 million (+2.9% YoY).

• Ordinary profit target for FY2032 set at ¥30 billion, with business domain expansion in fund, overseas, and PMI businesses.

• Strong leading indicators with new sell-side mandates up 20.1% YoY and mid-cap mandates up 31%.

• Transactions under negotiation up 17% YoY, supporting confidence in Q2 and Q3 results.

• Dividend per share forecast maintained at ¥29, with a payout ratio above 60%.