Accelerating the development of in-house-formulated, high-performance products through the establishment of a new research institute

「As a fabless company without factories, the Group plans and develops its own products. To rapidly develop high-performance, high-quality products focused on its strengths and concepts, it is actively developing proprietary formulations, mainly for hair-care products at the Tokyo Research Institute in Chuo-ku, Tokyo, and for hair-color and skin-care products at the Central Research Institute in Chuo-ku, Kobe.」

「Among the new products launched in the previous fiscal year, including renewed products, Ajuban Cosme Japan Co., Ltd. fully relaunched the daily-use Re:>>> (Re:) series in July 2022. In addition, 2C Co., Ltd., which handles the men's hair-growth-care brand NUOSS, launched the new supplement NUOSS Plus Hair Vital in March 2023 under the supervision of physician Akio Sato, a leading specialist in hair-loss treatment with a record of treating 15,000 AGA patients.」

「The Company is actively advancing the development of proprietary formulations, with hair-care products at the Tokyo Research Institute in Shinagawa-ku and skin-care products at the Central Research Institute in Kobe. The Central Research Institute is also conducting basic research, including evaluations using artificial skin models and genetic analysis, to create new value.」

「The Company announced at an academic conference hosted by JSCHR (the Japanese Society of Clinical Hair Research) in November 2020 that the functional peptide discovered by the joint research team of the Company and RIKEN has hair-growth-promoting effects. It has also filed a patent application.」

「With regard to preventing infection with and the spread of COVID-19, we complied with the guidelines established by the company concerning COVID-19 and promoted sales activities while taking every precaution to prevent the spread of infection, including using web conferencing systems such as Zoom instead of ordinary face-to-face sales. In October last year, we launched KASUI as a new haircare brand and Jalire as a system treatment.」

「In addition, through joint basic research with RIKEN, a National Research and Development Agency, we identified functional ingredients related to hair and the scalp. We subsequently formulated them in-house and worked on promotional activities ahead of the 1 October launch of KASUI, a new haircare brand, and Jalire, a system treatment designed to make hair more manageable by repairing it from within.」

「In March of that year, the Company established its Central Research Institute using the former site of Ajuban Cosmetic Co., Ltd.'s warehouse in Minatojima, Chuo-ku, Kobe. At the Central Research Institute, which serves as the Company's new development platform, it will continue basic research based on expertise obtained through joint research with RIKEN, as well as product development based on the results of that joint research.」

「The main changes were an ¥90 million increase in property, plant and equipment, mainly due to construction in progress recorded in connection with construction work at the research institute; a ¥61 million decrease in goodwill due to amortization of goodwill and the recognition of goodwill impairment losses; and a ¥53 million decrease in investment securities due to sales and other factors.」

「The Company currently develops products under a fabless model, outsourcing manufacturing based on its own product plans. At the research institute in Shinagawa-ku, Tokyo, opened in October 2015, it worked intensively on developing proprietary-formulation hair-care products, aiming to rapidly develop high-performance, high-quality products focused on the Company's strengths and concepts. As a result, it launched the first hair-care series in March of that year.」

「The Company currently develops products under a fabless model, outsourcing manufacturing based on its own product plans. At the research institute established in Shinagawa-ku, Tokyo, in October 2015, it is developing proprietary-formulation hair-care products with a view to commercialization from 2018 onward, aiming to rapidly develop high-performance, high-quality products focused on the Company's strengths and concepts.」

「Due to higher personnel expenses and increased R&D expenses following the research institute's full-scale operation, operating profit was ¥624 million, down 4.8% year on year.」

「Due to higher personnel expenses and increased R&D expenses following the research institute's full-scale operation, operating profit was ¥280 million, down 22.4% year on year.」

「Due to higher personnel expenses and increased R&D expenses following the research institute's full-scale operation, operating profit was ¥164 million, down 20.1% year on year. Ordinary profit was ¥163 million, down 35.3%, mainly reflecting the absence of the insurance surrender value and compensation income recorded in the same period of the previous year. Profit attributable to owners of the parent was ¥147 million, down 0.9%.」

「In October 2015, we established a research facility in Shinagawa Ward, Tokyo. We are currently developing haircare products using our own formulas and plan to commercialize them from 2017 onward.」