Rising Material Prices

「In the Package Solutions Business, mainly because the cost ratio rose as a result of the higher depreciation burden associated with the start-up of the new plant and higher material prices,」

「In terms of earnings, operating profit was ¥588 million, down 40.3% year on year, mainly because the cost ratio rose as a result of the higher depreciation burden associated with the start-up of the new plant and higher material prices.」

「In terms of earnings, operating profit was ¥208 million, down 48.2% year on year, mainly because the cost ratio rose as a result of higher depreciation expenses associated with the start-up of the new plant and higher material prices.」

「During the interim consolidated accounting period, Japan's economy generally remained firm due to increases in domestic consumption and exports and inbound demand. However, the outlook is uncertain due to concerns including persistently high material costs, rising prices and labor shortages.」

「Although material prices rose, the impact was offset by restraining subcontracting processing fees through greater in-house production and by reducing fixed costs,」

「Concerns have been raised about the impact of surging fuel and raw-material costs on future corporate activity and household finances.」

「During the cumulative second quarter of the fiscal year, Japan's economy generally remained on a recovery trend due to the normalisation of economic activity following the reclassification of COVID-19 to Category 5 and inbound demand. However, concerns have also been raised about the impact of surging fuel and raw-material costs on future corporate activity and household finances.」

「Meanwhile, the operating environment remained difficult due in part to surging energy and raw-material prices resulting from the prolonged turmoil surrounding the situation in Ukraine. / (Package Solutions business) Although raw-material prices surged,」

「(Package Solutions business) Although the recovery in demand was delayed by the COVID-19 pandemic, revenue was ¥12,091 million, up 5.7% year on year, due in part to spot projects from government demand. In terms of profit and loss, operating profit was ¥693 million, down 8.4% year on year, due to higher selling, general and administrative expenses resulting from surging raw-material prices and the amortisation of goodwill mentioned above.」

「During the cumulative second quarter of the fiscal year, Japan's economy showed signs of recovery as efforts to balance COVID-19 countermeasures and economic activity progressed. However, it remained in difficult conditions due in part to higher energy and raw-material prices resulting from the situation in Ukraine.」

「The operating environment remained difficult due in part to higher energy and raw-material prices resulting from the impact of the COVID-19 pandemic and the situation in Ukraine. / Decline in the gross profit margin due to increases in material costs, variable labor costs and other expenses」

「The Group purchases envelope paper, film materials and other items from multiple manufacturers to secure a stable supply of raw materials and maintain optimal procurement prices. However, if procurement of raw materials becomes extremely difficult or purchase prices rise substantially, this could affect the Group's financial position and operating results.」

「The Group implemented thorough cost reductions, including reductions in transportation expenses.」

「In addition to Osaka head-office relocation costs, higher material and transportation expenses, and the impact of implementing improvements to employee compensation,」

「In addition to head-office relocation costs, higher material and transportation expenses, and the impact of implementing improvements to employee compensation, the Group benefited from higher revenue, an improved gross profit margin and lower fixed costs, including retirement benefit expenses.」

「In terms of profit and loss, the impact of higher material prices and transportation expenses, together with head-office relocation costs, was offset by the effect of higher revenue and reductions in fixed costs, including labor costs. Operating profit was ¥718 million, up 80.3% year on year; ordinary profit was ¥759 million, up 65.6%; and profit attributable to owners of the parent for the quarter was ¥496 million, up 88.3%. The Group therefore recorded higher revenue and higher profits.」

「In terms of profit and loss, the impact of higher material prices and transportation expenses, as well as head-office relocation costs, was offset by the effect of higher revenue and reductions in fixed costs, including fixed labor costs. Operating profit was ¥250 million, up 46.8% year on year.」

「Costs remain a concern, including rising prices for corrugated cardboard and transportation expenses, and the situation is expected to remain difficult to predict.」

「However, if procurement of raw materials becomes extremely difficult or purchase prices rise substantially, this could affect the Group's financial position and operating results.」