Disruptions to Procurement Routes and Fluctuations in Raw Material and Product Prices

「During the interim consolidated accounting period, Japan's economy showed a gradual recovery alongside improvements in employment and income conditions, while economic activity continued to normalize. However, the economic outlook remains uncertain due to the impact of U.S. tariff policies, the slowdown in the Chinese economy, persistently high raw material prices, and rising logistics costs.」

「There are cases in which procurement becomes impossible because disruptions occur in the company's procurement channels, as well as products whose prices are affected by fluctuations in raw material prices and products whose procurement prices rise due to external factors such as foreign exchange fluctuations and overseas conditions.」

「During the interim accounting period, Japan's economy showed signs of recovery as economic activity normalized, accompanied by robust consumer spending and expanding inbound demand. However, concerns remain over the impact of higher prices resulting from rising raw material and logistics costs, the slowdown in the Chinese economy, and geopolitical risks related to the situations in Ukraine and the Middle East. The outlook therefore remains uncertain.」

「Meanwhile, the impact of rising prices resulting from the prolonged depreciation of the yen and soaring raw material and energy prices has also been substantial, and the economic environment remains uncertain.」

「Meanwhile, the economic environment surrounding the market remains challenging due to the prolonged depreciation of the yen and soaring raw material and energy prices, and the outlook remains uncertain.」

「As companies face rising cost burdens due to the resurgence of COVID-19 infections, higher raw material prices, and increased import costs resulting from yen depreciation, concerns are growing over sluggish demand.」

「The domestic economy has been significantly affected by higher prices resulting from shortages of raw materials and food caused by the prolonged situation in Ukraine, as well as rapid yen depreciation due in part to U.S. monetary policy. The outlook therefore remains uncertain.」

「Although selling prices rose substantially as imported timber prices soared, sales of major wood products, including plywood, increased as a result of efforts such as advance procurement and the maintenance of stable supply.」

「Although selling prices rose substantially as imported timber prices soared, sales of major wood products, including plywood, increased as a result of efforts such as advance procurement and the maintenance of stable supply.」

「In addition, sales of renovation-related products, including toilets and water heaters, declined due to delays in product supply resulting from the suspension of operations at overseas production sites amid the COVID-19 pandemic.」

「To address these risks, we are securing multiple business partners and suppliers to ensure that product procurement is not disrupted.」

「In the gasoline and kerosene business, the negative impact of lower gasoline unit prices was substantial and revenue remained weak. As a result, revenue decreased by ¥857 million from the same quarter of the previous year to ¥42,313 million, down 2.0% year on year.」

「During the quarter, revenue declined as gasoline sales volume decreased and selling prices were lowered in line with the decline in crude oil prices. As a result, revenue decreased by ¥250 million from the same quarter of the previous year to ¥2,623 million, down 8.7% year on year.」

「In addition, the rise in crude oil prices increased revenue in the gasoline and kerosene business.」

「During the quarter, sales volume for gasoline, including diesel fuel, was slightly lower year on year, but revenue increased substantially due to the rise in crude oil prices. As a result, revenue increased by ¥345 million from the same quarter of the previous year to ¥2,873 million, up 13.7% year on year.」

「Although kerosene sales volume declined, higher unit prices resulting from the rise in crude oil prices drove revenue higher. Gasoline unit prices also increased, but intense price competition with nearby competitors led to a decline in sales volume and weighed on sales.」

「Revenue for the six months ended in the second quarter decreased by ¥2,818 million from the same period of the previous year to ¥77,144 million, down 3.5% year on year. Factors included lower gasoline selling prices resulting from the decline in crude oil prices, a decrease in customer visits due to adverse weather, and two fewer operating days than in the same quarter of the previous year because the fiscal year-end inventory count date was changed to the beginning of the current fiscal year.」

「Sales for the six-month period ended the first quarter decreased by ¥1.560 billion from the same quarter of the previous year to ¥37.409 billion, down 4.0%, due to factors including lower gasoline selling prices following the decline in crude oil prices, a drop in customer traffic caused by adverse weather, and 2 fewer operating days than in the same quarter of the previous year because the fiscal year-end inventory count date was changed to the first day of the current fiscal year.」

「Some of the products handled by our group are affected by fluctuations in the prices of raw materials and other inputs, while the procurement prices of other products fluctuate due to external factors such as overseas conditions. These fluctuations in procurement prices may affect the business results and financial condition of our group.」