Improving Domestic Profitability through Industrial Sewing Thread Price Revisions and Review of Unprofitable Products

「The first issue facing our group is to eliminate the ordinary loss. To this end, we will implement profitability-improvement measures that can be carried out promptly. Based on the business environment described above in “(3) The Company's Medium- to Long-Term Operating Environment,” our group is addressing the following issues.」

「The decline in factory utilization, changes in the product mix, and the decline in the gross profit margin on net sales caused by persistently high manufacturing costs, including raw material prices, weighed on results. The segment loss was ¥192 million, compared with a loss of ¥180 million in the previous fiscal year.」

「Despite the effects of price revisions for some products implemented since last summer, declining sales volumes reduced segment revenue to ¥2,263 million, down 7.8% from the previous interim consolidated accounting period. On the profit side, although the company's price revisions increased profit, the decline in revenue, lower utilization at the company's plants and elevated manufacturing costs due to higher raw-material prices and other factors weighed on results. The segment posted a loss of ¥79 million, compared with profit of ¥32 million in the previous interim consolidated accounting period.」

「Against this backdrop, sales-price revisions for sewing thread products implemented since the year before last contributed to higher revenue, but sluggish sales at the company limited segment revenue to ¥4,645 million, up 3.3% from the previous fiscal year. On the profit side, although the price revisions and changes in the product mix increased profit, elevated manufacturing costs, sluggish sales at the company and lower utilization at domestic plants weighed on results. The segment loss was ¥17 million, compared with a ¥155 million loss in the previous fiscal year.」

「Against this backdrop, sales-price revisions for sewing thread products implemented since the year before last contributed to higher revenue, but orders at the company declined, limiting segment revenue to ¥3,585 million, up 4.5% year on year. On the profit side, although the price revisions and changes in the product mix increased profit, elevated manufacturing costs, together with declines in the company's orders and production, resulted in segment profit of ¥26 million, compared with a ¥106 million loss in the previous corresponding period.」

「Against this backdrop, sales-price revisions for sewing thread products implemented since last autumn contributed to higher revenue, bringing segment revenue to ¥2,454 million, up 5.4% year on year. On the profit side, the price revisions and changes in the product mix increased profit, but elevated manufacturing costs, together with sluggish growth in the aforementioned revenue and domestic plant utilization, resulted in segment profit of ¥32 million, compared with an ¥87 million loss in the previous corresponding period.」

「On the profit side, although the trend of elevated overall manufacturing costs, including energy and raw-material prices, continued, factors increasing profit included domestic sales-price revisions implemented since last autumn and higher revenue in the segment. Changes in the company's product mix and higher plant utilization also contributed, resulting in segment profit of ¥27 million, compared with a ¥59 million loss in the previous corresponding period.」

「In addition to these factors, changes in revenue, including the effects of sales-price revisions from the third quarter onward, brought segment revenue to ¥3,430 million, up 6.9% year on year. On the profit side, although revenue had returned to growth, further increases in overall manufacturing costs, including raw-material and energy costs, and a lower gross profit margin due to changes in the product mix weighed on results. The segment loss was ¥106 million, compared with a ¥133 million loss in the previous corresponding period, indicating that the recovery is lagging.」

「Rush orders ahead of the sales-price revisions implemented from October this autumn helped lift segment revenue to ¥2,328 million, up 6.9% year on year. On the profit side, although selling, general and administrative expenses remained low, the decline in the gross profit margin due to changes in the product mix and higher overall manufacturing costs, including raw-material and energy costs, weighed on results. The segment loss was ¥87 million, unchanged from the previous corresponding period, representing an equally challenging result.」

「Although selling, general and administrative expenses remained low compared with before the COVID-19 pandemic, the decline in production of the company's household sewing thread increased manufacturing costs. Together with higher raw-material prices and changes in the product mix, this reduced the gross profit margin and resulted in a segment loss of ¥59 million, compared with a ¥43 million loss in the previous corresponding period.」

「The company aims to further improve the efficiency of its domestic business and restore profitability by strengthening coordination with its 3 domestic consolidated subsidiaries.」

「On the profit side, although selling, general and administrative expenses remained below the level of the previous corresponding period due to one-time expenses related to the company's new head office incurred in the previous fiscal year and lower orders and restrictions on sales activities in the current period, the decline in the company's revenue and production weighed on results. The segment posted a loss of ¥133 million, compared with profit of ¥91 million in the previous corresponding period.」

「On the profit side, although selling, general and administrative expenses remained below the level of the previous corresponding period due to restrictions on domestic sales activities, cancellation of related events and one-time expenses related to the company's new head office incurred last summer, the significant decline in the company's revenue and production weighed on results. The segment posted a loss of ¥87 million, compared with profit of ¥80 million in the previous corresponding period.」

「On the profit side, although one-time expenses and depreciation associated with the opening of the company's new head office last summer were incurred, margin improvement from sales-price revisions implemented the year before last, higher revenue from the company's household sewing thread and lower expenses such as rent and expenses resulting from sluggish external sales activities contributed to segment profit of ¥31 million, compared with a ¥39 million loss in the previous fiscal year.」

「On the profit side, although one-time expenses and depreciation associated with the opening of the company's new head office last summer were incurred, profit-improving factors continued in the third quarter of the current consolidated fiscal period, including margin improvement from sales-price revisions implemented the year before last, higher revenue from the company's household sewing thread and lower expenses such as rent and expenses resulting from sluggish external sales activities. Segment profit was ¥91 million, compared with a ¥11 million loss in the previous corresponding period.」

「On the profit side, although the opening of the company's new head office this summer resulted in one-time expenses, margin improvement from last year's sales-price revisions, higher revenue from the company's household sewing thread and lower expenses, including rent for the temporary head office and expenses resulting from sluggish external sales activities, contributed to segment profit of ¥80 million, up 851.0% year on year.」

「In addition to higher revenue, margin improvement from the aforementioned sales-price revisions and lower selling, general and administrative expenses due to sluggish sales activities and the cancellation of related events contributed to segment profit of ¥109 million, compared with a ¥0 million loss in the previous corresponding period.」

「On the profit side, although the decline in revenue reduced profit, margin improvement from the sales-price revisions, lower personnel expenses and lower expenses, including one-time costs associated with rebuilding the head office building in the previous fiscal year, improved the segment result. The segment loss narrowed to ¥39 million, compared with a ¥100 million loss in the previous fiscal year.」

「On the profit side, although the decline in the company's revenue reduced profit, margin improvement from the sales-price revisions and lower selling, general and administrative expenses led to a significant improvement from the previous corresponding period. The segment loss narrowed to ¥11 million, compared with a ¥107 million loss in the previous corresponding period.」

「On the profit side, although margins improved following the sales-price revisions, factors hindering growth in gross profit included declining sales volumes at the company and a trend toward higher manufacturing costs. Segment profit was ¥8 million, compared with a ¥73 million loss in the previous corresponding period.」

「On the profit side, the segment loss narrowed to ¥0 million, compared with a ¥35 million loss in the previous corresponding period, as sales-price revisions improved the gross profit margin.」

「The group had reached the limit of its efforts to absorb various cost increases, including higher personnel expenses, raw-material and dye prices and transportation costs. Accordingly, when it implemented sales-price revisions this spring, the company experienced rush demand centered on March this year. Segment revenue was ¥5,023 million, up 1.3% from the previous fiscal year. On the profit side, although personnel expenses and expenses associated with rebuilding the company's Tokyo branch and head office buildings increased as described above, higher revenue from rush demand, savings in sales-promotion expenses and lower repair expenses contributed to a modest improvement in the segment loss, which narrowed to ¥100 million from ¥128 million in the previous fiscal year.」

「On the profit side, in addition to factors reducing profit due to lower revenue, changes in the product mix and higher personnel expenses, expenses increased as described above in connection with rebuilding the company's Tokyo branch and head office buildings. As a result, the segment posted a loss of ¥107 million, compared with a ¥31 million loss in the previous corresponding period.」

「On the profit side, in addition to factors reducing profit due to lower revenue and changes in the product mix, expenses increased as described above, including the cost of temporary office rent associated with rebuilding the company's Tokyo branch and head office buildings. As a result, the segment posted a loss of ¥73 million, compared with a ¥22 million loss in the previous corresponding period.」

「The group companies in Japan and overseas addressed the issues facing each of them, but revenue for the first quarter of the current consolidated cumulative period was limited to ¥1,577 million, up 0.4% year on year. On the profit side, partly due to the effects of lower revenue and changes in the product mix, the segment posted a loss of ¥35 million, compared with profit of ¥2 million in the previous corresponding period.」

「In Japan's garment manufacturing market, which has been forced to contract in recent years, the company will strengthen coordination with its 3 domestic consolidated subsidiaries, further enhance synergies, support the garment industry by supplying highly distinctive and functional products for both apparel and non-apparel applications and providing high-quality services, and seek to expand its market share further.」

「In Japan's garment manufacturing market, which has been forced to contract in recent years, the company will strengthen coordination with its 3 domestic consolidated subsidiaries, further enhance synergies, support the garment industry by supplying highly distinctive and functional products for both apparel and non-apparel applications and providing high-quality services, and seek to expand its market share further.」

「Under these conditions, the domestic group companies steadily pursued various measures to restore profitability, but segment revenue was limited to ¥3,796 million, down 1.0% year on year. On the profit side, in addition to the decline in product revenue, lower utilization at domestic plants and a higher cost ratio due to rising raw-material prices also reduced profit. The segment posted a loss of ¥31 million, compared with profit of ¥34 million in the previous corresponding period.」

「Against this backdrop, the group companies in this segment worked to maintain and recover revenue by developing new customers, strengthening relationships with existing customers and launching new products. However, segment revenue was limited to ¥2,561 million, down 1.1% year on year. On the profit side, factors reducing profit included a higher cost ratio due to rising raw-material prices and changes in the product mix. As a result, the segment posted a loss of ¥22 million, compared with profit of ¥15 million in the previous corresponding period.」

「The companies in our group continue to steadily address the issues facing each of them in order to restore profitability.」

「On the profit side, although conditions varied among group companies in Japan and overseas, measures to improve profitability, including industrial sewing-thread price revisions and reductions in selling, general and administrative expenses, are beginning to produce results. Operating profit was ¥56 million, up 101.9% year on year, and ordinary profit was ¥112 million, up 51.1%. However, due to increases in income taxes and other taxes and profit attributable to non-controlling interests, net profit attributable to owners of the parent was ¥68 million, down 4.0% year on year. On the profit side, fluctuations in the exchange rates used for translation during the period significantly improved the profitability of export transactions. In addition, reductions in manufacturing costs and selling, general and administrative expenses to improve profitability in China contributed to segment profit of ¥29 million, compared with a ¥15 million loss in the previous corresponding period.」

「On the profit side, although revenue declined, the effects of measures to improve profitability in the domestic business, including the aforementioned industrial sewing-thread price revisions and a review of unprofitable products, are gradually beginning to emerge. Segment profit was ¥15 million, up 23.0% year on year.」

「Measures to improve profitability at the domestic companies, including price revisions for industrial sewing thread and a review of unprofitable products, are each beginning to produce results. As a result, although the segment's revenue was limited to ¥1,290 million, down 3.9% year on year, partly because the previous corresponding period benefited from rush orders ahead of the industrial sewing-thread price revisions, segment profit improved to ¥16 million, compared with a ¥2 million loss in the previous corresponding period.」