Advan Group Co., Ltd. (TSE: 7463) reported consolidated results for the first quarter (April 1–June 30, 2026) of the fiscal year ending March 31, 2027 under Japanese GAAP. Revenue rose 3.5% to ¥4,245 million from ¥4,103 million and operating profit climbed 70.8% to ¥870 million from ¥509 million, but the most striking figures came further down the income statement: ordinary profit swung to ¥2,871 million and net profit attributable to owners of the parent to ¥2,405 million (EPS ¥71.64), reversing prior-year losses of ¥1,213 million and ¥1,098 million (prior EPS −¥31.46). Advan supplies architectural and building materials — natural stone, tiles and interior/exterior finishing materials — under the Advan brand.
Catalog price revisions lift operating profit
The operating result improved on genuine business momentum. Revenue grew 3.5% to ¥4,245 million, and operating profit rose 70.8% to ¥870 million, helped by catalog price revisions that lifted margins on the group's stone, tile and finishing-material lines. Comprehensive income for the quarter was ¥2,783 million, against a comprehensive loss of ¥1,129 million a year earlier. The near-71% jump in operating profit reflects real pricing and mix gains — but it is a much smaller number than the swing seen below the operating line, which is driven by a non-operating item explained next.
Forex forward valuation gain drives the profit swing
The bulk of the year-on-year swing in ordinary and net profit is a non-operating, largely non-cash valuation effect, not a reflection of core trading strength. Advan carries large foreign-currency forward-exchange contracts, and as the yen weakened the mark-to-market ("refresh") valuation of those contracts rose from ¥21,032 million at end-March 2026 to ¥22,343 million at end-June 2026. The resulting ¥1,310 million increase was booked as non-operating income, which is the main reason ordinary profit reached ¥2,871 million and net profit ¥2,405 million after year-earlier losses. Investors should read this as a valuation gain that can reverse if the yen strengthens, rather than as recurring operating earnings.
Balance sheet remains well capitalised
The balance sheet stayed robust, with total assets of ¥86,384 million and net assets of ¥60,368 million. The equity ratio eased slightly to 69.9% from 71.5%, and book value per share stood at ¥1,797.72. The still-high equity ratio underscores that the group retains ample capital even as the forward-contract balance and its valuation move with currency markets.
Full-year guidance left unchanged
Because non-operating foreign-exchange gains and losses are difficult to forecast, Advan discloses guidance only for sales and operating profit, not for ordinary or net profit. For the first half it targets revenue of ¥8,600 million (+3.8%) and operating profit of ¥1,200 million (+11.8%). For the full year ending March 2027 it guides to revenue of ¥18,500 million (+8.6%) and operating profit of ¥2,800 million (+25.4%). Both the first-half and full-year targets were left unchanged from the company's earlier plan.
Dividend normalises after special payout
For FY2026/3 Advan paid a total dividend of ¥100.00 (¥20.00 interim plus ¥80.00 year-end, the year-end figure including a ¥60.00 special dividend on top of the ¥20.00 ordinary payout). For FY2027/3 the company plans ¥40.00 (¥20.00 interim plus ¥20.00 year-end) — lower than the prior year because the special dividend is not repeated, while the ordinary payout is maintained.
| Metric | Q1 FY2027/3 | Q1 FY2026/3 | YoY |
|---|---|---|---|
| Net sales (¥m) | 4,245 | 4,103 | +3.5% |
| Operating profit (¥m) | 870 | 509 | +70.8% |
| Ordinary profit (¥m) | 2,871 | -1,213 | — |
| Net profit (¥m) | 2,405 | -1,098 | — |
| Basic EPS (¥) | 71.64 | -31.46 | — |
| Comprehensive income (¥m) | 2,783 | -1,129 | — |
| Total assets (¥m) | 86,384 | 84,243 | — |
| Equity ratio | 69.9% | 71.5% | — |
| FY2027/3 revenue guidance (¥m) | 18,500 | — | +8.6% |
| FY2027/3 operating profit guidance (¥m) | 2,800 | — | +25.4% |
| Dividend per share (¥, forecast) | 40.00 | 100.00 | — |
JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.