Risk of Rising Steel, Cement and Crude Oil Prices

「中東情勢に起因する原油価格や資材価格の上昇等、物流・調達面においてその影響は非常に不透明な状況でありました。」

「Risks remain, including supply chain disruptions and higher energy and raw material prices resulting from heightened international tensions, as well as higher labor costs, delays in starting construction and extensions of construction periods, and logistics problems」

「In the business environment surrounding the Group, nationwide demand for concrete piles and nationwide shipments of concrete poles declined year on year, affected by the 2024 issues in construction and logistics, labor shortages, rising raw material prices and other factors, and difficult conditions continued.」

「Although factory utilization was below expectations, segment profit was ¥1,228 million, up 138.3% year on year, as the company worked to improve construction profitability and promote the adoption of appropriate prices.」

「Under these circumstances, because the Group recorded a net loss for the previous fiscal year and paid no dividend, it formulated a management improvement plan, announced on 19 May 2023, to achieve an early recovery in performance and resume dividend payments, and has steadily implemented various measures, including cost reductions, improvements in construction profitability and the establishment of appropriate prices.」

「Segment profit was ¥1,360 million, as in the foundation business, the establishment of appropriate prices proved effective, representing an increase of 158.7% year on year.」

「The Company is working to establish appropriate prices reflecting increases in raw material prices, expand sales and reduce costs.」

「In the business environment surrounding the Group, ... conditions were difficult as increases in raw material and energy prices for concrete secondary products continued.」

「The business is currently facing difficult conditions as it has been affected by continued increases in raw material and energy prices for concrete secondary products, and passing these increases through to selling prices has taken time.」

「Although conditions are extremely challenging at present due to increases in the prices of raw materials and energy for concrete secondary products such as piles, poles and precast products,」

「Regarding profit, although plant operating rates improved, construction profit margins declined during the period. In addition, affected by higher raw material prices, the segment posted a loss of ¥70 million, compared with a segment loss of ¥17 million in the same quarter of the previous year.」

「During the fiscal year, Japan's economy recovered moderately as strict restrictions were eased with the progress of COVID-19 vaccinations and other measures, despite stagnation in the procurement of components due to shortages of semiconductors and other factors, and surging crude oil and raw material prices. However, the outlook for the economy remains uncertain due to the recent course of the COVID-19 pandemic, the significant depreciation of the yen, increases in crude oil and raw material prices, and concerns over the situation in Ukraine.」

「In the business environment surrounding the Group, nationwide demand for concrete piles during the cumulative third quarter period was flat year on year. Nationwide shipments of concrete poles were also flat year on year, although demand for poles for mobile phone base stations remained strong, as in the previous fiscal year. Demand also remains high for concrete products, including PC-Wall, the Company's proprietary product, and slope reinforcement work that contribute to the expansion of mobile phone base stations for next-generation 5G communications, disaster prevention and mitigation, national resilience, and disaster recovery. In addition, attention is increasingly focused on the Company's environmental technologies for CO2 capture and utilization (CCUS) and low-carbon concrete products.」

「Recent resource prices have tended to fluctuate significantly in response to international supply conditions and international demand. In some areas, supply-side oligopolies are advancing globally, while the expansion of international demand, particularly in emerging economies, means that prices may fluctuate regardless of domestic economic conditions. Increases in the prices of steel and cement, which are key raw materials for poles, piles and other products, and in crude oil prices will drive up manufacturing and logistics costs for poles, piles and other products.」

「Increases in the prices of steel and cement, which are key raw materials for poles, piles and other products, and in crude oil prices will drive up manufacturing and logistics costs for poles, piles and other products. In response to these cost increases, the Company is undertaking group-wide cost reductions and requesting that customers and other parties appropriately revise product prices. However, delays in revising product prices and other factors may put pressure on the Group's earnings.」

「Increases in the prices of steel and cement and in crude oil prices will drive up manufacturing and logistics costs for poles, piles and other products. In response to these cost increases, the Company is undertaking group-wide cost reductions and requesting that customers and other parties appropriately revise product prices. However, delays in revising product prices and other factors may put pressure on the Group's earnings.」

「Increases in the prices of steel and cement, which are key raw materials for poles, piles and other products, and in crude oil prices will drive up manufacturing and logistics costs for poles, piles and other products. In response to these cost increases, the Company is undertaking group-wide cost reductions and requesting that customers and other parties appropriately revise product prices. However, delays in revising product prices and other factors may put pressure on the Group's earnings.」

「Increases in the prices of steel and cement, which are key raw materials for poles, piles and other products, and in crude oil prices will drive up manufacturing and logistics costs for poles, piles and other products. In response to these cost increases, the Company is undertaking group-wide cost reductions and requesting that customers and other parties appropriately revise product prices. However, delays in revising product prices and other factors may put pressure on the Group's earnings.」