Inventory Increases and Production Suspension Costs Associated with Build-to-Forecast Production
First written in FY2018. 22 of 30 entries say "Materialised", first in FY2019-Q1. Latest entry: 2026-08-10.
Chemipro Kasei moved to the "Worse" side of this theme in 2018, 5 years before the typical company in this theme (2023).
The whole theme swung hardest in 2026: 23 of 41 companies on the "Worse" side.
14 other companies' latest entry also says "Mitigated".
- 2026-08-10MitigatedFinancial results
「Production suspension costs were limited to ¥8 million, a decrease of ¥48 million from the same quarter of the previous year, due partly to improved operating rates at some factories resulting from the introduction of contract manufacturing products.」
Improved operating rates at some factories reduced production suspension costs by ¥48 million year on year to ¥8 million. - FY2026Inventory Increases Continue; Production Suspension Costs DeclineAnnual report
「This was mainly due to increases of ¥407 million in merchandise and finished goods and ¥104 million in raw materials and supplies, respectively.」
Inventories of merchandise, finished goods, raw materials and other items increased, and ¥139.970 million in production shutdown costs was also recorded. Meanwhile, production shutdown costs decreased by ¥33 million from the previous fiscal year. - FY2026-H1MitigatedAnnual report
「Regarding ordinary profit and loss, improved plant operating conditions, partly due to the acquisition of new contract-manufacturing business, limited production suspension costs to ¥85 million, a decrease of ¥21 million from the same period of the previous year」
Factory operating conditions improved, and production shutdown costs fell by ¥21 million year on year to ¥85 million. Meanwhile, merchandise and finished goods increased by ¥311 million, and inventory risk remains. - FY2025MitigatedAnnual report
「Meanwhile, as plant operating conditions improved, production suspension costs recorded as a non-operating expense were reduced by ¥107 million from the same period of the previous year, resulting in ¥173 million being recognized」
Production suspension costs were reduced from ¥281 million in the previous year to ¥173 million, a reduction of ¥107 million. Inventories also decreased ¥288 million in cash flow from operating activities, indicating a reduction in the impact of the inventory and production adjustment risks, although they remain. - FY2025-H1MaterialisedAnnual report
「Ordinary income was ¥47 million, down 37.8%, after ¥107 million in production suspension costs was recognized as a non-operating expense」
¥107 million in production suspension costs was recognized, indicating that costs associated with make-to-stock production and inventory adjustments continued to materialize. Merchandise and finished goods decreased ¥260 million, while raw materials and supplies increased ¥209 million. - FY2024-Q3MaterialisedAnnual report
「To address stagnant demand, production adjustments were made at some plants, and part of the expenses was recorded as production suspension costs」
Production adjustments were made at some plants to address stagnant demand, and ¥232 million in production suspension costs was recognized. Production suspension costs associated with make-to-stock production and inventory adjustments continued to arise. - FY2024-Q2MaterialisedAnnual report
「Ordinary income was ¥76 million, down 63.6%, after ¥104 million in production suspension costs was recognized as a non-operating expense」
¥104 million in production suspension costs was recognized, indicating that costs associated with make-to-stock production and inventory adjustments continued to materialize. Merchandise and finished goods also increased ¥462 million from the end of the previous fiscal year. - FY2024-Q1MaterialisedAnnual report
「The main factors behind the increase in current assets were increases of ¥119 million in cash and deposits, ¥559 million in merchandise and finished goods and ¥103 million in raw materials and supplies, partly offset by decreases of ¥324 million in notes and accounts receivable and ¥92 million in other current assets,」
Merchandise and finished goods increased ¥559 million, and raw materials and supplies increased ¥103 million. In addition, ¥31 million in production suspension costs was recognized, indicating that inventory increases and costs associated with make-to-stock production and inventory adjustments materialized. - FY2023MaterialisedAnnual report
「This was mainly due to factors including the recognition of ¥121 million in profit before income taxes, ¥478 million in depreciation, a ¥1,113 million increase in inventories, a ¥236 million increase in trade payables and a ¥224 million increase in other receivables.」
Inventories increased ¥1,113 million, and ¥176 million in production suspension costs was also recognized. The impact of the production adjustment risks associated with make-to-stock production and increased inventories materialized throughout the full year. - FY2023-Q3MaterialisedAnnual report
「In terms of profit, despite the continued proactive capture of contract-manufactured products and other business, operating income was ¥356 million, down 29.2%, due to lower sales of ultraviolet absorbers and other products as well as a sharp increase in manufacturing costs. Ordinary income was ¥181 million, down 40.5%, after ¥135 million in production suspension costs was recognized as a non-operating expense.」
Merchandise and finished goods increased ¥812 million, and raw materials and supplies increased ¥369 million; ¥135 million in production suspension costs was also recognized. The impact of the risks associated with make-to-stock production and inventory adjustments continued to materialize. - FY2023-Q2MaterialisedAnnual report
「Although the company continued to increase sales of ultraviolet absorbers and other products and proactively acquire contract-manufactured products, operating profit fell 18.6% year on year to ¥340 million. Ordinary profit declined 23.8% to ¥210 million after ¥99 million in production suspension costs was recorded as a non-operating expense.」
¥99 million in production suspension costs was recognized. Raw materials and supplies increased ¥383 million from the end of the previous fiscal year, while total inventories increased ¥405 million, indicating that costs associated with make-to-stock production and inventory adjustments continued to arise. - FY2023-Q1MaterialisedAnnual report
「In addition to higher sales of ultraviolet absorbers and other products, the company continued its proactive acquisition of contract-manufactured products. Operating profit fell 13.0% year on year to ¥210 million, while ordinary profit declined 0.5% to ¥162 million after ¥32 million in production suspension costs was recorded as a non-operating expense.」
¥32 million in production suspension costs associated with production adjustments was recognized, and the costs associated with make-to-stock production and inventory adjustments continued to materialize. - FY2022MaterialisedAnnual report
「In addition to a recovery in sales of ultraviolet absorbers, the continued proactive acquisition of contract-manufactured products lifted operating profit 58.3% year on year to ¥552 million. Ordinary profit rose 138.8% to ¥264 million despite ¥217 million in production suspension costs recorded as a non-operating expense.」
¥217 million in production suspension costs associated with make-to-stock production and inventory adjustments was recognized for the full year. Raw materials and supplies also increased ¥151 million from the end of the previous fiscal year, indicating that the impact of the risks continued to materialize. - FY2022-Q3MaterialisedAnnual report
「In addition to a recovery in sales of ultraviolet absorbers, the continued proactive acquisition of contract-manufactured products lifted operating profit 60.2% year on year to ¥503 million. Ordinary profit rose 115.0% to ¥305 million despite ¥150 million in production suspension costs recorded as a non-operating expense.」
¥150 million in production suspension costs associated with production adjustments was recognized, and the impact of the inventory and production adjustment risks associated with make-to-stock production continued to materialize. - FY2022-Q2MaterialisedAnnual report
「In terms of profit, operating income was ¥418 million, up 105.5%, following a recovery in ultraviolet absorber sales and the continued proactive capture of contract-manufactured products and other business. Ordinary income was ¥276 million, up 179.5%, despite the recognition of ¥107 million in production suspension costs as a non-operating expense.」
¥107 million in production suspension costs associated with production adjustments was recognized, and the impact of the inventory and production adjustment risks associated with make-to-stock production continued to materialize. Raw materials and supplies also increased ¥278 million from the end of the previous fiscal year. - FY2022-Q1MaterialisedAnnual report
「In addition to a recovery in sales of ultraviolet absorbers, the continued proactive acquisition of contract-manufactured products lifted operating profit 159.2% year on year to ¥241 million. Ordinary profit rose 241.7% to ¥162 million despite ¥60 million in production suspension costs recorded as a non-operating expense.」
¥60 million in production suspension costs associated with production adjustments was recognized, and the impact of the inventory and production adjustment risks associated with make-to-stock production continued to materialize. Raw materials and supplies also increased ¥156 million from the end of the previous fiscal year. - FY2021MaterialisedAnnual report
「Inventories related to the company's continuing operations are primarily generated through make-to-stock production based on future demand and market trends. Depending on actual demand and unforeseen market developments associated with concerns in Japan such as the COVID-19 pandemic and a Nankai Trough earthquake, the company may therefore adjust production because of increased inventories, and the resulting production suspension costs may have a material impact on performance.」
Inventories decreased ¥319 million as a result of production adjustments aimed at reducing inventory, while ¥176 million in production suspension costs was recognized. The impact of the risks associated with make-to-stock production continued to materialize throughout the full year. - FY2021-Q3MaterialisedAnnual report
「Ordinary income was ¥141 million, up 0.7%, despite the recognition of ¥133 million in production suspension costs as a non-operating expense.」
During the cumulative third quarter, ¥133 million in production suspension costs associated with production adjustments was recognized. Merchandise and finished goods increased ¥439 million and raw materials and supplies increased ¥107 million from the end of the previous fiscal year, indicating that the impact of the inventory and production adjustment risks continued to materialize. - FY2021-Q2MaterialisedAnnual report
「Ordinary income was ¥98 million, down 12.3%, after ¥82 million in production suspension costs, up 7.7%, was recognized as a non-operating expense.」
¥82 million in production suspension costs associated with production adjustments was recognized, indicating that the impact of the inventory and production adjustment risks associated with make-to-stock production continued to materialize. Merchandise and finished goods, as well as raw materials and supplies, also increased from the end of the previous fiscal year. - FY2021-Q1Inventory Increases and Continuing Production Suspension CostsAnnual report
「The main factors behind the increase in current assets were increases of ¥462 million in cash and deposits, ¥479 million in inventories and ¥60 million in other current assets, partly offset by a ¥614 million decrease in notes and accounts receivable,」
Inventories at the end of the first quarter increased ¥479 million from the end of the previous fiscal year. In addition, ¥31 million in production suspension costs was recognized, indicating that inventory increases and costs associated with production adjustments continued. - FY2020MaterialisedAnnual report
「Decrease in inventories associated with production adjustments aimed at reducing inventory: ¥1,019,817 thousand」
Inventory reduction progressed, and inventories decreased ¥1,019 million in operating cash flow terms. Meanwhile, ¥169 million in production suspension costs was recognized, and the impact of the risks continued throughout the full year. - FY2020-Q3MaterialisedAnnual report
「In terms of profit, operating income was ¥295 million, up 47.9%, due in part to the effect of higher revenue. Ordinary income was ¥140 million, up 611.4%, after ¥120 million in production suspension costs was recognized as a non-operating expense due to continued production adjustments.」
Production adjustments continued, and ¥120 million in production suspension costs was recognized. The inventory and production adjustment risks associated with make-to-stock production continue to materialize as expenses. - FY2020-Q2MaterialisedAnnual report
「Operating income was ¥211 million, up 30.5%, due in part to the effect of higher revenue. Ordinary income was ¥112 million, up 289.5%, after ¥76 million in production suspension costs was recognized as a non-operating expense due to continued production adjustments.」
Production adjustments continued, and ¥76 million in production suspension costs was recognized. The inventory and production adjustment risks associated with make-to-stock production continue to materialize as expenses. - FY2020-Q1MaterialisedAnnual report
「Reducing inventories of ultraviolet absorbers, which had increased since the fiscal year before last, became an urgent priority. Manufacturing costs remained high due in part to continued production adjustments, and selling price competition also had an impact. Operating income was ¥73 million, down 19.9%, while ordinary income was recognized after ¥44 million in production suspension costs related to the suspension of a plant was recorded as a non-operating expense」
Production adjustments and plant suspensions aimed at reducing inventories continued, and ¥44 million in production suspension costs was recognized. Although inventories themselves decreased ¥188 million from the end of the previous fiscal year, the cost burden associated with inventory reduction actually materialized. - FY2019-Q3MaterialisedAnnual report
「In addition to lower sales, manufacturing costs rose due to production adjustments resulting from elevated raw material prices and higher inventories, while price competition also weighed on results. Operating profit fell 42.2% year on year to ¥200 million. Ordinary profit fell 92.7% to ¥19 million after ¥133 million in production suspension costs associated with the shutdown of a plant was recorded as a non-operating expense.」
Production adjustments and plant suspensions resulting from increased inventories continued, and production suspension costs reached ¥133 million. This was up from ¥101 million in the cumulative period of the previous quarter, indicating a greater impact from the risks. - FY2019-Q2MaterialisedAnnual report
「Manufacturing costs increased because of production adjustments resulting from persistently high raw material prices and higher inventories, while selling price competition also had an impact. Operating income was ¥162 million, down 42.8%, and ordinary income was ¥28 million, down 87.9%, following the recognition of ¥101 million in production suspension costs related to the suspension of a plant as a non-operating expense.」
Production adjustments and plant suspensions resulting from increased inventories occurred, and ¥101 million in production suspension costs was recognized. The impact of the risks associated with inventory increases and production suspension costs from make-to-stock production was more pronounced than in the previous quarter. - FY2019-Q1MaterialisedAnnual report
「Production suspension costs 39,235」
Inventories increased ¥99 million from the end of the previous fiscal year, and production suspension costs of ¥39 million were recognized. The risks of inventory increases and production suspension costs associated with make-to-stock production materialized. - FY2018First statedAnnual report
「In addition, inventories related to the company's continuing operations are primarily generated through make-to-stock production based on future demand and market trends. Depending on actual demand and unforeseen market developments, the company may therefore adjust production because of increased inventories, and the resulting production suspension costs may have a material impact on performance.」
The company identifies as a new risk the possibility that make-to-stock production will increase inventories, leading to production adjustments and production suspension costs depending on market trends.