Transformation toward stable profits and an earnings mix under the Fifth Medium-Term Management Plan

「The Group formulated the Seventh Medium-Term Management Plan (fiscal 2024–2026), setting medium- to long-term targets focused on scale and return on capital.」

「Against this backdrop, under the Seventh Medium-Term Management Plan (fiscal years ending March 2025 to March 2027), the Group worked to achieve an early recovery in its sluggish performance and enhance corporate value.」

「Against this backdrop, under the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to enhance corporate value by improving profitability through cost reductions, realizing its growth strategy and using management resources efficiently. Net sales for the nine months ended 31 December 2023 were ¥5,438 million, down 5.7% year on year, due to a decline in shipments of some products. In terms of income, the decline in net sales, lower production volume and persistently high prices for major raw materials and fuels resulted in an operating loss of ¥578 million, compared with operating income of ¥251 million in the same period of the previous year, an ordinary loss of ¥503 million, compared with ordinary income of ¥215 million, and a loss attributable to owners of the parent of ¥381 million, compared with profit attributable to owners of the parent of ¥168 million.」

「Against this backdrop, based on the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to enhance corporate value by improving profitability through cost reductions, pursuing its growth strategy, and improving the efficiency of its management resources. Sales for the six months ended September were ¥3,546 million, below the same period of the previous year and down 9.0% year on year, due mainly to a decline in shipments of some products.」

「Sales for the three months ended June were ¥1,931 million, below the same period of the previous year and down 13.8% year on year, due mainly to a decline in shipments of some products. In terms of earnings, operating loss was ¥39 million, compared with operating profit of ¥185 million in the same period of the previous year, owing to the decline in sales, lower production volume, and persistently high prices for key raw materials and fuels.」

「In fiscal 2022, the second year of the Sixth Medium-Term Management Plan formulated with a transition to the Prime Market in mind, sales, operating profit and ROS fell short of plan, partly due to an economic slowdown caused by global monetary tightening, the prolonged situation in Ukraine, and soaring raw material and fuel prices resulting from the weaker yen. In addition, the challenging business environment is expected to continue in fiscal 2023, the third year of the plan.」

「Against this backdrop, under the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to enhance corporate value by improving profitability through cost reductions, realizing its growth strategy and using management resources efficiently. Although sales prices were revised in response to soaring prices for major raw materials and fuels, net sales for the nine months ended 31 December 2022 declined 0.4% year on year to ¥5,770 million due to a decrease in shipments of some products. Operating income declined 16.8% to ¥251 million, ordinary income declined 6.4% to ¥215 million and profit attributable to owners of the parent declined 11.4% to ¥168 million, due to lower net sales and soaring prices for major raw materials and fuels.」

「Against this backdrop, based on the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to enhance corporate value by improving profitability through cost reductions, pursuing its growth strategy, and improving the efficiency of its management resources. Although shipments of some products declined, demand recovered as activity restrictions related to COVID-19 were eased, and sales prices were corrected in response to soaring prices for key raw materials and fuels. As a result, sales for the six months ended September 2022 rose above the same period of the previous year to ¥3,895 million, up 3.7% year on year.」

「Against this backdrop, under the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to enhance corporate value by improving profitability through cost reductions, realizing its growth strategy and using management resources efficiently. Net sales for the three months ended 30 June 2022 were ¥2,239 million, up 18.8% year on year, as demand for products recovered amid the easing of activity restrictions related to COVID-19 and sales prices were revised in response to soaring prices for major raw materials and fuels.」

「In the Tokyo Stock Exchange market restructuring in April 2022, the company moved to the Prime Market. However, its tradable share market capitalization does not meet one of the continued listing criteria. Accordingly, the company will present a growth vision extending from the Sixth Medium-Term Management Plan to achieve compliance with the criteria, with operating income of ¥1,300 million in fiscal 2025 identified as a particularly important target.」

「Against this backdrop, under the three-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), the Group worked to achieve an early recovery in earnings hit by the impact of COVID-19 and enhance corporate value by improving profitability through cost reductions, realizing its growth strategy and using management resources efficiently. Net sales for the nine months ended 31 December 2021 were ¥5,791 million, up 34.6% year on year, as shipments of some products remained strong and demand recovered amid signs of a recovery in economic activity that had contracted due to COVID-19. Although the increase in depreciation associated with the expansion of ultrafine titanium oxide production facilities and soaring prices for major raw materials and fuels had an impact, higher net sales and production volume resulted in operating income of ¥301 million, compared with an operating loss of ¥154 million in the same period of the previous year, ordinary income of ¥229 million, compared with an ordinary loss of ¥224 million, and profit attributable to owners of the parent of ¥190 million, compared with a loss attributable to owners of the parent of ¥255 million.」

「Under the three-year Sixth Medium-Term Management Plan for the fiscal years ending March 2022 through March 2024, the group worked to improve profitability through cost reductions, realize its growth strategy and use management resources more efficiently, while pursuing an early recovery in earnings affected by the COVID-19 pandemic and enhancing corporate value. For the cumulative second quarter of the current fiscal year, net sales were ¥3,757 million, operating income was ¥223 million, ordinary income was ¥156 million and quarterly net income attributable to owners of the parent was ¥118 million.」

「Against this backdrop, based on the 3-year Sixth Medium-Term Management Plan (fiscal years ending March 2022 to March 2024), our group worked to achieve an early recovery in earnings, which had been adversely affected by the COVID-19 pandemic, and enhance corporate value by improving profitability through cost reductions, implementing our growth strategy and improving the efficiency of management resources.」

「The group has formulated the Sixth Medium-Term Management Plan for fiscal 2021 through fiscal 2023. In the short term, it aims to reform its cost structure so that it can generate profits even if the recovery in sales is delayed, and over the three-year period, to build a strong corporate structure that is not affected by emergencies.」

「Against this backdrop, under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), the Group worked to strengthen its overall earnings power and build a new foundation, while giving top priority to addressing new management challenges arising from the global COVID-19 pandemic.」

「Against this backdrop, under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), the Group promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the Group-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, net sales for the three months ended 30 June 2020 were ¥1,410 million, operating income was ¥75 million, ordinary income was ¥74 million and profit attributable to owners of the parent was ¥53 million.」

「Under these circumstances, the group is formulating a new three-year medium-term management plan beginning in the final year of the Fifth Medium-Term Management Plan, which covers the fiscal years ending March 2019 through March 2021, to rebuild its business strategy and strengthen group management.」

「Under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), we promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the company-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, net sales for the nine months ended 31 December 2020 were ¥6,580 million, operating income was ¥325 million, ordinary income was ¥324 million and profit attributable to owners of the parent was ¥270 million.」

「Under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), we promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the company-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, net sales for the six months ended 30 September 2020 were ¥4,149 million, operating income was ¥298 million, ordinary income was ¥291 million and profit attributable to owners of the parent was ¥226 million.」

「Under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), we promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the company-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, although the discontinuation of sales of pigment-grade titanium oxide had an impact, increased production capacity for ultrafine titanium oxide contributed to net sales for the three months ended 30 June 2019 of ¥2,040 million, up 6.5% year on year.」

「As shipments of functional titanium dioxide products and iron oxide increased substantially, net sales for the current fiscal year reached ¥8,213 million, substantially exceeding the previous fiscal year and up 25.6% year on year.」

「Under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), we promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the company-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, shipments of functional titanium oxide products and iron oxide increased substantially, and net sales for the nine months ended 31 December 2019 were ¥5,943 million, substantially higher than in the same period of the previous year, up 26.7% year on year.」

「Under the three-year Fifth Medium-Term Management Plan (fiscal years ending March 2019 to March 2021), we promoted the concentration of management resources, including capital investment and research and development investment, in businesses where we can leverage our strengths and expect growth. At the same time, for businesses with low profitability, we assessed their future prospects and other factors and worked to strengthen the company-wide earnings power and build a new foundation by substantially reducing sales and undertaking fundamental reforms to their cost structures. As a result, shipments of functional titanium oxide products and iron oxide increased substantially, and net sales for the six months ended 30 September 2019 were ¥3,763 million, substantially higher than in the same period of the previous year, up 21.7% year on year.」

「Under the three-year Fifth Medium-Term Management Plan for the fiscal years ending March 2019 through March 2021, the company concentrated management resources, including capital investment and research and development investment, on businesses in which it could capitalize on its strengths and expected growth. For less profitable businesses, it reviewed their future prospects and pursued measures such as a substantial reduction in sales and fundamental reform of the cost structure, thereby strengthening the profitability of the company as a whole and building a new foundation. As a result, shipments of functional titanium dioxide products and iron oxide increased substantially, and net sales for the first quarter of the current fiscal year reached ¥1,915 million, substantially exceeding the same period of the previous fiscal year and up 22.5% year on year.」

「We formulated the Fifth Medium-Term Management Plan for fiscal 2018 through fiscal 2020, with the aim of transforming the company into one that generates stable profits.」