Expansion of the overseas Home & Personal Care business, centered on Asia

「Profitability in the overseas business improved as we advanced the structural reforms that are a key initiative. However, sales value fell below the previous fiscal year owing to the sale of the Turkish subsidiary as part of the structural reforms and lower sales resulting from a review of unprofitable baby diaper transactions in China.」

「In China, feminine care sales grew as the company used the Daio brand cultivated through GOO.N baby diapers to develop customer relationship initiatives and expand store coverage into untapped channels. Baby diaper volumes declined during the review of transactions with unprofitable customers and the switch from in-house production to OEM production as part of structural reform, but daily sales at outlets carrying the new SAP-sheet products were strong. In Brazil, sales have begun to recover following the normalization of distribution inventories, a review of sales-area policies, a reorganization of the channel and category mix, and a review of promotional spending.」

「In March 2025, the company decided to sell fixed assets related to baby diapers in China and withdraw from the Turkey business. It will improve cash flow by reducing fixed costs and reorganizing unprofitable businesses, and work toward an early turnaround of the overseas Home & Personal Care business.」

「In the overseas business, Brazil remained strong as sales of value-added products grew and price revisions were implemented across product lines. In China, feminine care sales grew, but baby care was still on the path to a full recovery. In Thailand, baby care and feminine care, centered on value-added products, drove sales growth. As a result, total overseas revenue exceeded that of the same period of the previous year.」

「In China, feminine care sales expanded, but sales value fell below that of the same period of the previous year as core baby care slowed due to worsening economic sentiment, a declining birth rate and the impact of ALPS-treated water, compounded by delays in responding to changes in consumer purchasing behavior and the market.」

「In the overseas business, sales value in China fell below that of the same period of the previous year due to the country's economic slowdown, declining birth rate and consumer restraint following the release of ALPS-treated water, as well as delays in responding to changes in consumer purchasing behavior and market structure. In contrast, sales value in Brazil and Turkey exceeded the previous year's level, supported in Brazil by the penetration of price revisions and growth in value-added tissue, baby-care and feminine care products, and in Turkey by the penetration of price revisions and an increase in sales volume. Overall overseas sales value nevertheless fell below that of the same period of the previous year.」

「On 19 July 2023, the company established Elleair International Vietnam CO., LTD. and newly included it as a consolidated subsidiary from the end of the second-quarter consolidated accounting period.」

「In China, feminine care sales expanded, but sales value fell below that of the same period of the previous year because baby-care sales declined in the aftermath of the zero-COVID policy. In Southeast Asia, feminine care sales expanded, but sales value fell below the previous year's level because baby-care sales declined following price revisions. In Brazil, sales value exceeded that of the same period of the previous year as price revisions took hold and sales of value-added products in feminine care, baby care, paper products and other categories expanded. In Turkey, sales value also exceeded the previous year's level as price revisions took hold and sales of baby-care, wet and liquid products expanded.」

「As a result, sales value exceeded that of the same period of the previous year, partly due to growth in overseas sales.」

「For the overseas business as a whole, sales value exceeded that of the same period of the previous year, partly because the results of the Brazilian and Turkish subsidiaries, which had been included in the scope of consolidation since the end of the previous first quarter, contributed from the beginning of the current period.」

「In China, sales volumes and value both exceeded those of the same quarter of the previous year, supported by expanded sales outside major cities through stronger product lineups and promotional activities by region, channel and segment, as well as expanded sales of paper products and wet wipes produced at the second plant, which began operations last year.」

「At the second plant, which began operations last year, the company started local production of paper products and wet wipes. Sales volumes and value both exceeded those of the same quarter of the previous year, supported by promotions linked to baby diapers, stronger in-store sales activities and accelerated development of a multi-category business.」

「Sales in China increased, supported by expanded sales of the premium Hikariha Ryujin series of baby diapers, greater store coverage outside major cities, and steady growth in sales of paper products, particularly baby lotion tissues and toilet products.」

「During the consolidated first-quarter accounting period, Elleair International Turkey Kişisel Bakım Ürünleri Üretim, H&PC Brazil and Santel were added as consolidated subsidiaries. The company will promote business development encompassing the Middle East, all of South America and, ultimately, Africa.」

「In China, competition is intensifying as growth in the baby diaper market slows amid a decline in the birth rate, but sales remained firm as the company promoted a shift toward value-added products and a multi-category business through expanded tissue sales.」

「In Indonesia, sales progressed steadily and earnings improved significantly as the company worked with regional distributors established in the previous fiscal year to conduct sales promotions and marketing activities tailored to the characteristics of each area.」

「In the overseas business, China remained firm as the company promoted a multi-category business by increasing the sales mix of value-added baby diaper products and expanding tissue sales. In Indonesia, where distributor policies were reviewed last year, the launch of a new distribution system progressed smoothly.」

「Meanwhile, among categories other than baby diapers, sales expansion is progressing for feminine care products in Thailand, paper products in China, and feminine care products and adult diapers in Taiwan, and the multi-category business is beginning to gain traction. In Indonesia, where distributor policies were reviewed last year, some expenses related to establishing new distribution channels were carried over into the cumulative consolidated first-quarter period, but the new distribution system and sales policies are functioning, and efforts to establish a more profitable business structure are being accelerated.」

「To strengthen production capacity in line with the increase in sales, construction is under way on a second plant on land adjacent to EICN's existing plant.」

「The overseas business was affected by lower sales in South Korea, where demand for baby diapers is shrinking, and in Indonesia, where distributor policies were reviewed as the main local distributor scaled back its business. In China, however, sales of ultra-premium and pants-type baby diapers grew steadily, and initiatives to expand distribution of premium toilet products progressed. In Thailand and neighboring ASEAN countries, sales expanded through a multi-category business combining baby diapers with sanitary napkins, wet wipes and other products.」

「In the overseas business, sales in China progressed steadily for high-selling-price products, including ultra-premium products and pants-type baby diapers, while sales of premium toilet rolls also began. In Thailand and neighboring ASEAN countries, sales expanded through increased baby diaper sales, as well as higher sales of sanitary napkins, whose locally produced products began selling in August 2017, and wet wipes.」

「In the overseas business, volumes of core baby diapers grew steadily in China, mainly for high-selling-price and high-margin products such as the ultra-premium Tenshi series and pants-type diapers. In Thailand, volumes also increased not only domestically but in neighboring countries, particularly Vietnam, Myanmar and Laos. These gains more than offset lower sales in Indonesia, where competition intensified, and South Korea, where the market was sluggish due to the declining birth rate. Overseas sales volumes and value both exceeded those of the same quarter of the previous year.」

「For our core baby diapers, China expanded its lineup of the Hikari no Hane series, positioned above the ultra-premium Tenshi series, as well as distribution of pants-type diapers with high selling prices, and achieved strong sales growth in its Singles' Day campaign, the largest annual e-commerce event. In Thailand, distribution of pants-type diapers expanded not only in modern retail outlets within Thailand but also in neighboring countries. In Indonesia, in addition to strengthening in-store activities at existing outlets, we began e-commerce sales as a new channel, driving growth in sales of pants-type diapers in a growing market.」

「Baby diaper sales expanded steadily, supported by China, where sales of high-priced products grew further following the launch of the new Hikari no Hane series, positioned above the ultra-premium Tenshi series; Thailand, where sales expanded not only domestically but also in neighboring ASEAN countries; and Indonesia, where sales of pants-type diapers grew in a growing market.」

「In the overseas business, we continued in-store activities to expand store coverage and acquire new users in each country of operation. As a result, sales of our core baby diapers grew steadily in China, Thailand and Indonesia, where we have local bases. The higher sales mix of ultra-premium products with high selling prices in China, together with the expansion into multiple product categories in South Korea, Thailand and other countries, also contributed. Overall overseas sales volumes and value both exceeded those of the same quarter of the previous year.」

「Sales expansion progressed in Indonesia, where store coverage increased significantly in the mini-market channel, which accounts for more than 50% of the market, as well as in Thailand, Vietnam, Malaysia and other ASEAN countries, where in-store activities were strengthened alongside new store coverage. Expansion of categories other than baby diapers, including adult diapers in China and South Korea and wet wipes in Thailand, also contributed. As a result, overseas sales volumes and value both significantly exceeded those of the same quarter of the previous year.」

「In the overseas business, we added production lines in China for pants-type baby diapers, a segment whose market is growing rapidly, and began production and sales. Product categories are also expanding steadily toward a multi-category overseas business, including feminine care products in South Korea and wet products in Thailand, whose sales began during the fiscal year under review.」

「In China, in addition to tape-type baby diapers, we added production lines for pants-type diapers, a segment whose market is growing rapidly, and began production. Product categories are also expanding steadily toward a multi-category overseas business, including feminine care products in South Korea and wet products in Thailand, whose sales began during the fiscal year under review.」

「In overseas markets, our sales strategy is progressing steadily. In Indonesia, we have expanded store coverage as the GOO.N baby diaper brand has gained recognition and sales of single-pack products have begun. We have also begun selling feminine care products in South Korea and wet products in Thailand.」

「In overseas markets, PT. Elleair International Manufacturing Indonesia began producing baby diapers in December 2015. In April 2016, we opened a representative office in Taiwan, while in Thailand we began producing and selling wet products. From May, we also began selling feminine care products in South Korea, thereby expanding the sales channels for our overseas business.」

「For baby diapers, in addition to products in the premium price range, we will expand the sales areas for economy-range products in the mid- and low-price segments, which are already sold in Thailand, to Russia, Taiwan and South Korea, thereby developing a broader range of products by segment. We will also strengthen sales of products in categories other than baby diapers, including feminine care products and adult diapers, and pursue a multi-category rollout of paper products and converted paper products, as we have done in Japan. In addition, we will establish sales and representative offices in Vietnam, Malaysia and Taiwan, while developing and strengthening our sales systems in China, Thailand, Taiwan, Russia and other countries. By expanding store coverage and building systems that generate sales, we will accelerate the pace of sales growth.」