Lower profitability and margins due to higher equipment, materials, raw materials and fuel costs
First written in FY2020. 2 of 4 entries say "Worsened", first in FY2022. Latest entry: FY2026.
No other company in this theme has enough history to compare yet.
- FY2026MitigatedAnnual report
「We seek to mitigate risk through measures including monitoring and forecasting changes in the business environment and price trends, initiatives to improve forecast accuracy, early ordering, diversification of suppliers, passing costs through to product prices, the use of futures transactions, and establishing appropriate contractual terms to address higher equipment, materials, raw materials, fuel and transportation costs.」
Measures addressing the risk of higher equipment, materials, raw materials and fuel costs became more specific, combining monitoring, early ordering, supplier diversification, cost pass-through, futures transactions and contractual measures. - FY2024Emergence of tight supply and demand for equipment and materials and delivery delaysAnnual report
「The business environment affecting profitability in the current consolidated fiscal year included staffing conditions in recent design operations and delivery delays caused by tight supply and demand for equipment and materials in the Middle East.」
Regarding the risk of higher equipment, materials, raw materials and fuel costs, tight supply and demand in the Middle East and delivery delays materialized as factors contributing to lower profitability in the current fiscal year. - FY2022WorsenedAnnual report
「Procurement and transportation costs for equipment, materials, raw materials and fuel may rise sharply due to disruptions in international transportation and shortages of component supplies, while procurement and supply schedules for equipment, materials, raw materials and fuel may be delayed.」
The risks associated with equipment, materials, raw materials and fuel costs expanded to specifically include transportation disruptions, component shortages, higher costs and supply delays. - FY2020First statedAnnual report
「If equipment and materials costs rise sharply, project profitability may deteriorate due to higher procurement costs, while in the functional materials manufacturing business, profit margins may decline if raw material and fuel prices rise sharply.」
Higher equipment and materials costs in EPC and higher raw material and fuel prices in functional materials manufacturing were organized as separate profitability and margin risks.