Risk of performance volatility due to long manufacturing lead times
First written in FY2018. 11 of 27 entries say "Materialised", first in FY2020-Q2. Latest entry: FY2026.
Jtec moved to the "Worse" side of this theme in 2020, 5 years before the typical company in this theme (2025).
The whole theme swung hardest in 2025: 2 of 6 companies on the "Worse" side.
2 other companies' latest entry also says "Materialised".
- FY2026MaterialisedAnnual report
「At several of these high-value products, customers requested design changes after contracts had been signed. With the customers' understanding, delivery dates had to be pushed back into a subsequent period. In addition, although monocrystalline silicon is used mainly as the substrate material for the mirrors, unexpected material-related defects occurred in some projects, extending manufacturing lead times for multiple products.」
Customer-requested design changes and defects originating from single-crystal silicon actually resulted in delivery dates being pushed back and manufacturing lead times being extended. - FY2026-H1MitigatedAnnual report
「In the Chinese market in particular, production for HALF, the synchrotron radiation facility under construction in Hefei, SHINE, the Shanghai X-ray free-electron laser facility requiring large quantities of high-precision mirrors with specifications that only our Company can achieve, and SSRF in Shanghai, one of our longstanding major customers, progressed as planned, and deliveries were completed without delay.」
The company states that manufacturing of major projects for China involving high-precision mirrors progressed as planned and that deliveries were completed without disruption. - FY2024MaterialisedAnnual report
「Synchrotron radiation facilities The company has already supplied many mirrors for the active construction of new facilities, upgrades and mirror replacements, primarily in Asian markets. However, changes to higher-precision specifications after orders were received and longer periods for value-added processing using the company's high-precision mirrors as substrates sometimes made production plans for certain products uncertain.」
Changes to higher-precision specifications and longer periods for value-added processing, such as coating and scribing, actually resulted in changes to and delays in production plans, as well as slippage into the following period. - FY2024-Q2MaterialisedAnnual report
「There were cases in which shipments were delayed because the number of labor hours required for manufacturing increased slightly during the cumulative second quarter of the current consolidated fiscal year.」
The increase in manufacturing labor hours actually resulted in shipment delays. The company explained that labor hours for high-precision products are trending higher because projects have a strong research and development component. - FY2024-Q1RestatedAnnual report
「Revenue is also expected to be weighted toward the second half of the current fiscal year, while progress in the first quarter of the current consolidated fiscal year was broadly in line with budget.」
We have reconfirmed that revenue is expected to be weighted toward the second half of the current consolidated fiscal year. - FY2023-Q3MitigatedAnnual report
「Most of the products for the US and Chinese markets that could not be recognized as revenue in the previous period were delivered in the third quarter.」
Most products for the US and Chinese markets that could not be recognized as revenue in the previous period were delivered in the third quarter, reducing the delay in revenue recognition. - FY2023-Q2MitigatedAnnual report
「All products for the US and Chinese markets that could not be recognized as revenue in the previous period are scheduled for delivery in the third quarter.」
Products for the US and Chinese markets that could not be recognized as revenue in the previous period have been scheduled for delivery in the third quarter, and the delay in revenue recognition is moving toward resolution. - FY2023-Q1RestatedAnnual report
「For the US market, many products will continue to be delivered in the second quarter, and production will proceed on a rolling basis.」
Many projects for the US market are scheduled for delivery in the second quarter, and the uneven timing of revenue recognition associated with long manufacturing and delivery lead times continues. - FY2022MaterialisedAnnual report
「The prolonged lockdown in Shanghai from April under China's zero-COVID policy caused disruption throughout China, and import procedures effectively came to a halt. Subsequently, import restrictions meant that many products destined for China could not be delivered. For the United States, some projects also failed to reach delivery because we responded to sudden requests for specification changes. In neither case was the order lost because the optical business is made-to-order; work is continuing, and sales are expected to be deferred to the following fiscal year.」
The suspension of import procedures and import restrictions in China, together with specification changes for the US market, actually resulted in deliveries and revenue recognition being pushed into the following period. - FY2022-Q3MitigatedAnnual report
「In manufacturing, several delays occurred in the production of mirrors scheduled for delivery in the second quarter, resulting in lower sales recognition than initially planned. Delivery acceptance for these mirrors took place in the third quarter, resolving the delay in sales recognition.」
The delays in mirror production and sales recognition that occurred in the second quarter were resolved when delivery and acceptance were completed in the third quarter. At the same time, a substantial amount of overseas sales is scheduled to be recognized in the fourth quarter. - FY2022-Q2MaterialisedAnnual report
「In manufacturing, several delays occurred in the production process for mirrors scheduled for delivery in the second quarter, resulting in lower sales recognition than initially planned. These mirrors are scheduled for delivery in the third quarter.」
Delays in the mirror manufacturing process caused second-quarter sales recognition to fall below the initial plan, with some deliveries pushed back to the third quarter. The risk of sales timing volatility associated with long manufacturing lead times has materialized. - FY2022-Q1RestatedAnnual report
「The first quarter is a period in which the focus is on manufacturing activities and relatively few shipments are expected, so the impact is limited. However, logistics delays remain, including a decline in cargo shipments by sea to and from Japan and an impact on air cargo transportation.」
The disclosure states that the first quarter is a period focused on manufacturing activities with few shipments, while logistics delays remain. - FY2021-Q3RestatedAnnual report
「On the other hand, a substantial amount of overseas sales is scheduled to be recognized in the fourth quarter, and the situation remains uncertain because the effects of the spread of COVID-19 continue in various countries.」
The previous factor driving financial results volatility, namely the concentration of overseas sales in the fourth quarter, has been reconfirmed, and the recognition of fourth-quarter sales is described as uncertain because the spread of COVID-19 continues. - FY2021-Q2MaterialisedAnnual report
「The spread of COVID-19 continued to have a significant impact. In particular, the effects of lockdown measures in Europe and the United States and logistics delays caused by the spread of the virus overlapped, and many projects could not be shipped even though manufacturing had been completed. As a result, performance fell substantially below the initial forecast.」
The risk associated with long manufacturing lead times and concentrated shipment timing materialized in the form of projects that could not be shipped after manufacturing was completed due to lockdowns in Europe and the United States and logistics delays. - FY2021-Q1RestatedAnnual report
「Sales, particularly from overseas projects, are expected to be concentrated in the fourth quarter of the current fiscal year.」
The factor driving financial results volatility, namely the concentration of sales from overseas projects in the fourth quarter, has been reconfirmed. - FY2020MaterialisedAnnual report
「In particular, during the current fiscal year, there were several cases in which specification discussions were suspended due to the spread of COVID-19, or shipments were delayed beyond schedule because subcontractors shut down.」
The risks of financial results volatility due to a long lead time of approximately 1 year and high unit prices materialized in the form of suspended specification discussions, subcontractor shutdowns and shipment delays associated with COVID-19. - FY2020-Q3MaterialisedAnnual report
「In the optical business, sales to China, the United States and Europe had been expected to be substantial in the fourth quarter. The expected timing of orders was delayed because of delays in the plans for the relevant facilities.」
Delays in facility plans in China, the United States and Europe delayed the expected timing of orders, and full-year optical business sales are now expected to decline. The impact of long lead times and delays in facility plans on sales timing has materialized. - FY2020-Q2MaterialisedAnnual report
「Actual sales in the cumulative second quarter fell below the sales forecast because many shipments were pushed from the second quarter into the second half of the fiscal year due to customer-requested changes in specifications and delivery schedules.」
Shipment timing was in fact pushed back due to changes in specifications and delivery schedules. In addition, delays in the timing of orders caused by delays in facility plans in China and the United States mean that the related sales are expected to be recognized in the following fiscal year. - FY2020-Q1RestatedAnnual report
「As in the previous fiscal year, sales are expected to be concentrated in the fourth quarter of the current fiscal year. The proportion of sales to the United States and China is expected to remain high, while the proportion of domestic sales is also expected to increase. Sales, particularly from overseas projects, are expected to be substantially concentrated in the fourth quarter because approximately 1 year, the average lead time for our products, will have elapsed from order receipt by that quarter.」
The factors driving financial results volatility have been reconfirmed: sales concentration in the fourth quarter, a high proportion of projects for the United States and China, and an average lead time of approximately 1 year. In the first quarter, sales were not expected to be substantial, and the focus was on manufacturing activities and other work ahead of delivery. - FY2019RestatedAnnual report
「It takes approximately 1 year from order receipt to shipment. Although rare, shipments may also take place after the scheduled shipping month when additional work is required to meet the specifications.」
The risk of quarterly volatility in financial results due to a manufacturing lead time of approximately 1 year, possible delivery delays and high unit prices continues to be disclosed. - FY2019-Q3RestatedAnnual report
「Sales are expected to be concentrated in the fourth quarter of the current fiscal year, with a particularly large proportion expected to come from the United States and China, where new synchrotron radiation and free-electron laser facilities are being built. The large projects are expected to generate sales in the fourth quarter because approximately 1 year, the average lead time for our products, will have elapsed from order receipt by that quarter.」
The previously identified factors driving financial results volatility have been reconfirmed: sales concentration in the fourth quarter, a high proportion of large projects for the United States and China, and an average lead time of approximately 1 year. - FY2019-Q2Sales concentration in the fourth quarter clarifiedAnnual report
「Sales are expected to be concentrated in the fourth quarter of the current fiscal year, with a particularly large proportion expected to come from the United States and China, where new synchrotron radiation and free-electron laser facilities are being built. The optical business is entirely made-to-order, and its long lead times from order receipt to delivery and high product unit prices mean that sales recognition is concentrated in certain periods.」
The previous explanation of sales concentration in the second half of the fiscal year has been refined to specify that sales are expected to be concentrated in the fourth quarter of the current fiscal year. A larger proportion of sales to the United States and China is also expected. - FY2019-Q1RestatedAnnual report
「The optical business is entirely made-to-order, and, as in the previous fiscal year, sales are expected to be concentrated in the second half of the current fiscal year. In the first quarter, sales were not expected to be substantial from the outset, and we focused mainly on manufacturing activities ahead of delivery.」
It has been reconfirmed that the optical business is entirely made-to-order and that sales are expected to be concentrated in the second half of the fiscal year. - FY2018First statedAnnual report
「The manufacturing process for X-ray nanofocusing mirrors differs from product to product because nano-processing using EEM and nano-measurements using RADSI and MSI must be repeated alternately several times until the specifications are met. Accordingly, it takes approximately 1 year from order receipt to shipment. Although rare, shipments may also take place after the scheduled shipping month when additional work is required to meet the specifications.」
The disclosure states that it takes approximately 1 year from order receipt to shipment, shipments may exceed the delivery schedule in order to meet specifications, and the average unit price of approximately ¥20-30 million could result in significant quarterly volatility in financial results.