Expanding Market Share Through Nationwide and Partner Farm Development

「In addition to including ピーエスピー株式会社 in the scope of consolidation from the interim consolidated accounting period, production capacity improved as Tsurusawa Farm of consolidated subsidiary ベルグ福島株式会社, which began operations in March 2025, moved to full-year operations. Increasing the in-house production ratio made it possible to establish a production system focused on quality and production balance in line with order conditions, contributing to higher revenue.」

「In this business segment, PSP株式会社 was included in the scope of consolidation from the current interim consolidated accounting period. In addition, as Tsurusawa Farm at ベルグ福島株式会社, which began operating in March 2025, moved to year-round operations, production capacity increased. By raising the in-house production ratio, the Company established a production system focused on quality and production balance in line with order conditions, leading to higher sales.」

「The newly established Tsurusawa Farm of Berg Fukushima was added to the production network, and we pursued sales efforts by strengthening production capabilities and leveraging the delivery system.」

「The newly established Tsurusawa Farm of Berg Fukushima was added to the production network, and we pursued sales efforts by strengthening production capabilities and leveraging the delivery system.」

「Net sales by delivery region were as follows: Hokkaido and Tohoku, ¥460.111 million (111.2% of the same quarter of the previous year); Kanto, ¥1,021.664 million (110.8%); Koshinetsu, ¥243.193 million (102.8%); Chubu and Hokuriku, ¥207.580 million (100.6%).」

「While demand for vegetable seedlings declined nationwide from November to January, sales efforts leveraging the production and delivery systems at company-operated and partner farms nationwide increased sales to Kanto. Sales to Kyushu also increased as a result of favorable assessments of product quality and production capabilities.」

「As the production facilities at the Iwate Hanamaki Farm, completed in March 2022, began operating year-round, the increase in in-house production capacity led to higher orders from Kanto and further north.」

「Our group has established a nationwide sales network and a division-of-labor system based on newly established company-operated farms and contract production. This has overcome agriculture's longstanding difficulty in ensuring stable supply and created a system capable of maintaining stable orders and production throughout the year.」

「After construction to expand production facilities at the Iwate Hanamaki Farm was completed in March 2022, the Company expanded its in-house production capacity and strengthened sales efforts to increase orders in the Tohoku and Hokkaido regions.」

「After construction to expand production facilities at the Iwate Hanamaki Farm was completed in March 2022, the Company expanded its in-house production capacity and strengthened sales efforts to increase orders in the Tohoku and Hokkaido regions.」

「The group conducts sales activities nationwide and has established a system capable of stable ordering and production throughout the year by opening company-operated farms and implementing a division of labor through contract production, thereby overcoming agriculture's longstanding difficulty in ensuring a stable supply. Going forward, the group plans to continue expanding company-operated farms and developing new contract production partners in parallel with increases in production volume.」

「To promote spring home gardening sales, we began using our dedicated website Housaku.net, which publishes online the seedling inventories of company-operated and partner farms nationwide as information on vegetables available for immediate delivery, and began operating Nae Bank, a new cloud-based order and procurement system.」

「Sales activities aimed at expanding orders during the November-January off-season increased sales of tomato seedlings to growers and large-scale gardens in Kyushu, Tohoku, and Hokkaido. Sales of cucumber seedlings also increased on the back of stronger demand in the Koshinetsu region during March-April. In addition, during June-July, expanded production facilities at Berg Fukushima increased the supply capacity for vaccine-treated cucumber seedlings, leading to higher orders in Fukushima Prefecture, while sales efforts and favorable quality assessments increased orders for tomato seedlings in Hokkaido and Kyushu. As a result, net sales were ¥3,318.740 million, an increase of ¥162.406 million, or 5.1%, from the same quarter of the previous year.」

「Sales promotion activities aimed at expanding orders during the November-to-January off-season increased orders for tomato seedlings for growers and large-scale vegetable gardens in Kyushu, Tohoku and Hokkaido, as well as cucumber seedlings in response to increased demand in the Koshinetsu region during March and April.」

「Various initiatives, including sales activities to expand orders during the November-January off-season, led to higher orders for tomato seedlings from growers and large-scale gardens in Kyushu, Tohoku, and Hokkaido.」

「We will designate Hokkaido, Chiba, the Chubu region, and Kyushu as areas for opening new farms as part of further business expansion, proceed with expanding company-operated farms and developing partner farms, and accelerate efforts to capture demand from commercial growers and home gardeners and to develop potential customers.」

「In this business segment, the company worked to expand orders during the off-season (November to January) by strengthening its production and supply structure through the expansion of production facilities at company-operated farms, improving delivery methods through the use of chartered transport and company-owned delivery services, and strengthening sales promotion. Sales progressed steadily, supported by increased orders for melon seedlings and other products for Ibaraki Prefecture, onion seedlings and flower seedlings for home improvement stores, and the growing demand among seedling producers for the company's original tomato and cucumber plug seedlings and cell seedlings.」

「To expand orders during the off-season from November to January, the Company had been working to increase sales of melon seedlings for customers in Ibaraki Prefecture. The expansion of production facilities at Ibaraki Farm established a production system capable of stably supplying more seedlings from locations closer to growers, and, together with the delivery advantages, this led to an increase in orders.」

「In addition to improved productivity from expanded production capacity at Ibaraki Farm, milder winter weather nationwide reduced the use of heavy oil and other fuels that drive up winter expenses. As a result of lower manufacturing expenses, segment loss (operating loss) was ¥133.933 million, compared with segment loss of ¥148.590 million in the same quarter of the previous year.」

「As priority areas, we will continue expanding our company-operated farms and developing partner farms in the Kanto and Kyushu regions, where demand remains strong, while accelerating efforts to capture demand from commercial growers and home gardeners and to develop potential customers.」

「Production capacity at the subsidiary ベルグ福島 and production facilities at the Ibaraki Farm were expanded, strengthening the production structure in East Japan. Orders for cucumber, pepper and tomato seedlings for Fukushima and Ibaraki prefectures have been progressing steadily.」

「Strengthening sales at production sites and expanding sales channels by leveraging company-owned and partner farms, and improving productivity through efficient operations」

「Reducing the capital investment burden by balancing the expansion of company-owned farms, farm development through collaboration with other companies, and the development of high-quality partner farms」

「The main capital investment for the consolidated fiscal year was ¥116.208 million, primarily for the construction of new production facilities at the Ibaraki Farm. Additional capacity after completion: 2 million seedlings.」

「As a measure to expand its share of the vegetable seedling market, we will actively develop company-owned and partner farms in demand centers across Japan.」