Toda (1860) Q2 2027 earnings summary

Executive summary

• H1 FY2027 net sales rose 16.5% YoY to ¥336.6B and operating profit rose 49.2% to ¥19.3B, led by higher construction revenue and gross profit.

• Profit attributable to owners of parent increased 89.1% to ¥24.2B, supported by ¥14.2B in gains on investment-security sales, primarily from cross-shareholding disposals.

• Medium-Term Management Plan 2027 targets medium- to long-term ROE of at least 10% and ROIC of at least 5%, alongside growth investments in SECC, environment and energy, and overseas businesses.

Financial highlights

• H1 net sales were ¥336.571B, up 16.5% YoY; gross profit was ¥44.434B, up 14.8%, while SG&A fell 2.4% to ¥25.140B.

• Operating profit increased 49.2% to ¥19.293B; ordinary profit rose 49.0% to ¥22.848B, including higher dividend income and other non-operating income.

• Profit attributable to owners of parent rose 89.1% to ¥24.152B; extraordinary gains included ¥14.163B from investment-security sales versus ¥5.313B a year earlier.

• Comprehensive income was ¥71.239B versus ¥21.102B, reflecting ¥46.231B in valuation gains on available-for-sale securities.

Outlook and guidance

• FY2027 consolidated forecast revised upward: net sales ¥763B, operating profit ¥44B, ordinary profit ¥45.5B, and parent-attributable profit ¥41.1B; respective increases over prior guidance were ¥10B, ¥5B, ¥5.5B, and ¥6.1B.

• Non-consolidated FY2027 forecast raised to net sales ¥624B, operating profit ¥37.9B, ordinary profit ¥42.4B, and net income ¥40.5B, mainly on domestic civil-engineering project progress and improved architectural project profitability.

• Consolidated forecast incorporates overseas subsidiaries’ customer investment-plan cancellations and order-timing changes, but domestic forecast revisions more than offset those effects.

• FY2027 annual dividend forecast remains ¥60 per share, including a ¥30 interim dividend; no change to the latest dividend forecast.