MITANI SANGYO CO.,LTD. Q2 FY2026 earnings call

Overall Financial Performance

• First half consolidated total revenue came in at 56.621 billion yen, up 16.2% YoY. Operating profit was 1.694 billion yen, up 124.2% YoY. Ordinary profit was 2.28 billion yen, up 96.1% YoY. Interim net profit attributable to parent company shareholders was 1.839 billion yen, up 44.6% YoY.
• All revenue and profit metrics hit record highs for an interim period since the company began consolidated reporting. Revenue has grown to a new record high for 4 consecutive years, and interim net profit attributable to parent shareholders has grown to a new record high for 3 consecutive years.

New Product & Business Expansion

• The company's Chalaza cloud integration service won the Kaonavi Partner Award 2025 for its contributions to streamlining HR operations and promoting human capital data utilization. Chalaza connects nearly 200 disparate cloud services (including Kaonavi HR software, HRBrain, and the Ouyo Cloud series) as a FaaS integrator, eliminating redundant duplicate data entry when adding new services and reducing customer friction. Management notes this integration also helps reduce churn for both connected services.
• Mitani Sangyo Constructions opened the renovated sosu select showroom in Nonoichi, Ishikawa, focused on high-end and premium residential housing equipment. The showroom displays rare high-priced imported products and high-end domestic goods (including a 2 million yen rain shower head) that usually require trips to Tokyo or European brand showrooms to view in person, plus the company's own competitive original products. The business targets high and mid-high end residential clients, with end-to-end service from proposal to after-sales support, and has already seen strong industry interest since opening.

Workplace & HR Initiatives

• The company raised starting salaries for national college of technology graduates, setting a pay scale higher than that for university graduates. This change is based on internal observations that college of technology graduates outperform university graduates on average, particularly in the air conditioning equipment segment, and management expects it to improve future hiring of this talent pool.
• Launched a new brain health self-check program for all executives and employees aged 40+, in partnership with Teoria Technologies, a subsidiary of Eisai. The program lets employees track age-related cognitive decline early, aligns with the company's eliminated mandatory retirement policy to support long tenures, and the company also offers the program to external clients and hosts public awareness seminars about dementia.
• Expanded parental leave support with a dedicated concierge service (ikuQ Concierge) to guide employees through available programs, and has achieved a 90% paternity leave take-up rate, with 50% of eligible male employees taking 1+ month of leave.

Brand & CSR Initiatives

• The company publishes the Carbon newsletter, distributed to ~5,000 clients nationwide, featuring open innovation and large enterprise-startup collaboration stories. The most recent issue focuses on innovative new activities in the recovering Noto region, to sustain national attention on the area. The company continues its own local support, including providing Nikko tableware to temporary housing residents and sponsoring local festival reconstruction.
• A full-page newspaper ad searching for an original vintage Mitani Sangyo indigo work coat (in-banten) from the company's early history generated widespread public engagement, went viral on social media, and recently won the Nikkei Advertising Award. After months of searching, an original authentic coat from a long-retired employee was finally recovered, and management credits the campaign as an effective way to build brand awareness ahead of the company's 100th anniversary in 3 years.

All 6 of Mitani Sangyo's business segments achieved year-over-year revenue growth. Only 5 segments grew operating profit, with the Housing Equipment Related segment the only one that did not. Full detailed performance for all segments is provided in the company's official financial attachments, with details shared for two high-performing segments:

1. Information System Related Business: Grew both revenue and profit year-over-year. Key contributors include delivery of the NEXTGIGA School project (the second phase of Japan's GIGA School educational ICT initiative) to Toyama Prefecture, plus follow-on security environment upgrade work from the project, and solid progress on multiple core system renewal projects in the Tokyo metropolitan area. Even excluding the NEXTGIGA School project, this segment posted a record high first half profit, and revenue has hit record highs for 2 consecutive first half periods. Revenue contribution percentage was not disclosed.
2. Chemicals Related Business: Grew both revenue and profit year-over-year. Growth drivers include increased customer operating activity in domestic chemical product sales, strong sales of the company's own active pharmaceutical ingredients, new project wins from existing clients for functional material contract manufacturing, and increased processing volume in the valuable metal recovery segment of the company's environmental business. Revenue has hit record highs for 2 consecutive first half periods. Revenue contribution percentage was not disclosed. Data on absolute performance and revenue contribution percentages for the remaining 4 segments (including the Housing Equipment Related segment) was not provided in the transcript.

• Management maintained the full-year consolidated earnings guidance originally announced in April, with no upward or downward revision: full-year revenue is projected at 110 billion yen (up 6.7% YoY), operating profit at 2.25 billion yen (up 8.5% YoY), ordinary profit at 2.95 billion yen (up 11% YoY), and net profit attributable to parent shareholders at 2.45 billion yen (up 0.4% YoY).
• The company projects 6 consecutive years of revenue growth and 3 consecutive years of profit growth, with revenue and net profit on track to hit all-time record highs (since the 1988 IPO) for the second consecutive year. First half progress against the full-year guidance was 51% for revenue, 75% for operating profit, 77% for ordinary profit, and 75% for net profit, which management calls very strong. Management expects the second half to continue solid performance.
• Management upwardly revised the full-year dividend forecast: interim dividend raised from 4.5 yen to 5 yen per share, year-end dividend raised from 5.5 yen to 7 yen per share, bringing full-year dividend from 10 yen to 12 yen per share. A 2 yen full-year increase is rare for the company, reflecting the strength of current performance. If second half performance exceeds expectations, management will consider a further dividend adjustment.

• While first half performance is very strong, a portion of full-year planned revenue was pulled forward into the first half from the second half, and the company's business has a natural historical skew toward stronger second half performance.
• Uncertainty from Japanese political conditions and US-China trade friction could impact performance, so management will continue to closely monitor market conditions. This uncertainty is the primary reason management maintained the original full-year earnings guidance despite strong first half results, as management does not see enough certainty to raise the guidance at this time.
• The company notes ongoing uncertainty around the best long-term approach to reconstruction support for the Noto region, with no clear consensus on whether continued monetary support is the optimal approach.

No Question and Answer section was included in the provided transcript.