NS Solutions Raises Full-Year Guidance as Q1 Revenue Climbs 13% to ¥93.7 Billion

NS Solutions Corporation (TSE: 2327), the systems-integration arm of Nippon Steel and one of Japan's larger enterprise IT houses, reported consolidated results for the first quarter of the fiscal year ending March 2027 — the three months from April 1 to June 30, 2026 — under IFRS. Revenue rose 13.3% to ¥93,660 million, operating profit rose 8.8% to ¥9,228 million, pre-tax profit rose 8.0% to ¥9,522 million, and profit attributable to owners of the parent rose 1.9% to ¥5,207 million. Basic earnings per share came to ¥28.46 against ¥27.93 a year earlier; no diluted figure was reported. Total comprehensive income rose 11.7% to ¥5,719 million. Alongside the results the company revised its full-year forecast upward, published supplementary explanatory material and held a briefing for analysts. Its shares are listed in Nagoya and Fukuoka as well as Tokyo.

Industrial and distribution customers drive a 13% top line

Management attributed the revenue gain — ¥10,976 million more than the ¥82,684 million booked a year earlier — chiefly to higher volumes in the industrial and distribution sectors. NS Solutions said corporate system investment remained broadly firm, with demand growing for business transformation, productivity gains and new value creation built on AI, including generative AI, although some customers have begun screening projects more selectively against an uncertain outlook. The quarter brought a run of product launches under the company's 2025–2027 medium-term plan: OHACO, a global-markets solution for financial institutions, went on sale; the long-established absonne managed-cloud service is being rebuilt on a next-generation platform using Oracle Alloy; and the NS Eclipa e-commerce platform launched as an agricultural-produce distribution platform, part of a push into industry-specific B2B marketplaces. On the AI side, the company folded AI-driven development learned from NS Devia — launched in July 2025 — into its NS DevCompass offering, and used its NS Craft AI Factory service to build a safety-management system for airport operations. In April 2026 it launched Corepeak, a corporate-transformation brand, and in May 2026 it brought B-Prost, a specialist in core systems for non-life insurers, into the group.

A wider gross margin, a narrower operating margin

Gross profit rose 18.1% to ¥24,779 million as the gross margin widened to 26.5% from 25.4% — the improvement management flagged as one of the two drivers of profit growth. The offset came one line lower: selling, general and administrative expenses jumped 24.7% to ¥15,550 million from ¥12,471 million as the company funded the medium-term plan's initiatives. That left the operating margin at 9.9%, down from 10.3%, and held operating-profit growth to 8.8% — well behind the 13.3% at the top line. Below the operating line, finance income of ¥420 million against finance costs of ¥127 million carried pre-tax profit to ¥9,522 million. The bottom line then diverged sharply: income tax expense rose to ¥3,969 million from ¥3,410 million, an effective rate of 41.7% versus 38.7%, and non-controlling interests took ¥345 million against ¥292 million. Quarterly profit of ¥5,552 million therefore left only ¥5,207 million for the parent's owners — a 1.9% gain on a pre-tax line that grew 8.0%.

Bonus payouts and dividends shrink both sides of the balance sheet

Total assets fell ¥3,755 million from the March year-end to ¥413,828 million. Within that, trade and other receivables dropped ¥21,598 million to ¥51,917 million as year-end billings were collected, while contract assets rose ¥7,785 million, inventories rose ¥7,399 million, other financial assets fell ¥3,708 million and cash and cash equivalents rose ¥6,156 million to ¥114,954 million. Goodwill edged up to ¥32,516 million from ¥31,823 million, consistent with the B-Prost purchase. Liabilities slipped ¥569 million to ¥128,206 million: accrued bonuses inside other current liabilities fell ¥8,019 million as year-end awards were paid out, largely offset by a ¥6,826 million increase in contract liabilities. Total equity fell ¥3,186 million to ¥285,622 million — quarterly profit of ¥5,552 million against ¥8,234 million of dividends paid — leaving retained earnings at ¥257,192 million and the ratio of equity attributable to owners of the parent at 66.8%, a shade below 66.9% at the year-end. Operating cash flow was a positive ¥14,595 million, a ¥33,846 million swing from the year-earlier quarter mainly on lower income-tax payments; investing activities contributed ¥2,090 million and financing activities used ¥10,497 million. Of the closing cash balance, ¥101,485 million sits on deposit inside parent Nippon Steel's cash-management system.

Guidance raised for both the half and the year; dividend plan unchanged at ¥87

Because the year has started ahead of plan, NS Solutions revised the forecast it published on April 27, 2026. First-half revenue guidance rises to ¥200,000 million from ¥198,000 million (+1.0%), operating profit to ¥21,500 million from ¥20,500 million (+4.9%), pre-tax profit to ¥21,900 million from ¥20,900 million, net profit to ¥13,300 million from ¥12,600 million (+5.6%) and EPS to ¥72.68 from ¥68.86 — implying year-on-year gains of 12.1% in revenue and 17.7% in operating profit against the ¥178,375 million and ¥18,272 million recorded a year earlier. For the full year, revenue guidance rises to ¥419,000 million from ¥417,000 million, operating profit to ¥48,500 million from ¥47,500 million (+2.1%), pre-tax profit to ¥49,300 million and net profit to ¥32,300 million from ¥31,600 million, with EPS of ¥176.52. Measured against FY3/2026 actuals of ¥381,340 million in revenue, ¥44,242 million in operating profit and ¥30,832 million in net profit, the new plan implies growth of 9.9%, 9.6% and 4.8% respectively. The first quarter accounts for roughly 22% of the revenue plan and 19% of the operating-profit plan, in line with the company's usual second-half weighting. The dividend forecast was left unchanged: an interim of ¥43.50 and a year-end of ¥43.50 for an annual ¥87.00, up from the ¥85.00 paid for the year ended March 2026, consistent with a stated consolidated payout target of about 50%. The quarterly financial statements were not subject to review by a certified public accountant or auditing firm.

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.