Thorough Cost Reduction

「In terms of costs, initiatives to improve profitability resulted in a higher gross margin and lower expenses. However, sluggish sales meant that the Company was unable to achieve profitability.」

「We will pursue cost reductions for products, ensure and thoroughly manage stable quality and delivery times, and improve productivity.」

「Specifically, in the domestic business, where profitability has declined, we will seek to improve profitability by streamlining the business structure through measures such as scaling back unprofitable businesses and consolidating and reducing sales and production bases and head office functions.」

「Cost of sales for the current consolidated fiscal year was ¥1,270 million (¥1,717 million in the previous consolidated fiscal year), a decrease of ¥446 million. The ratio of cost of sales to net sales was 63.5% (70.8% in the previous consolidated fiscal year), a decrease of 7.3 percentage points. Selling, general and administrative expenses were ¥712 million (¥990 million in the previous consolidated fiscal year), a decrease of ¥277 million.」

「Meanwhile, revenue from the domestic business decreased from the same quarter of the previous year due to the contraction of unprofitable businesses and the narrowing of its product range and customer base. However, profit increased owing to lower manufacturing expenses resulting from the streamlining of the business structure and savings in personnel and other expenses.」

「The Domestic Business reported lower revenue than in the same quarter of the previous year due to the contraction of unprofitable businesses and the narrowing of its product range and customer base, but reported higher profit as reductions in manufacturing expenses and personnel and other costs from streamlining its operating structure took effect.」

「・ We will thoroughly simplify our product lineup and delivery formats and work to reduce loss costs.」

「On 30 August 2019, we announced the "Medium-Term Management Plan 2020–2022." We will work to improve performance based on the following basic policies set out in this medium-term management plan. 1. Return the domestic standalone business to profitability ・Thoroughly reduce fixed costs, including through workforce reductions」

「We have pursued measures including establishing a stable procurement system for products and reducing material costs through the reorganization of global procurement, improving productivity at the Kagawa facility, the main domestic assembly plant, and expanding production at the engineered marble plant in Vietnam to improve plant profitability and quality.」

「We have pursued measures including establishing a stable procurement system for products and reducing material costs through the reorganization of global procurement, improving productivity at the Kagawa facility, the main domestic assembly plant, and expanding production at the engineered marble plant in Vietnam to improve plant profitability and quality.」

「The company is making every effort to reduce procurement costs by strengthening its overseas purchasing structure centered on Asia and to eliminate waste and losses thoroughly by strengthening quality and inventory management, among other measures.」

「The company has pursued measures including the establishment of a stable procurement structure and cost reductions through the reorganization of its global procurement network, cost reductions through improved productivity at the Kagawa Plant, and cost reductions through stable operations and improved productivity at its engineered-stone plant in Vietnam.」

「②　Thorough cost reductions」

「In procurement and production, we have pursued measures including establishing a stable procurement structure and reducing costs through the reorganization of our global procurement network, reducing costs through improved productivity at the Kagawa facility, and reducing costs through stable operations and improved productivity at the engineered marble factory in Vietnam.」

「We will devote every effort to reducing procurement costs by rebuilding a predominantly overseas procurement structure and thoroughly eliminating waste and losses through stronger quality control, while working to maintain and improve the ordinary profit margin amid an expected challenging business environment.」

「In terms of profit, gross profit increased from the same quarter of the previous year in line with higher sales, and expenses were reduced. In addition, because the extraordinary losses associated with the relocation of the head office and consolidation of production and logistics functions at the Kagawa facility, which were incurred in the same quarter of the previous year, did not occur in the current period, the amounts of operating loss, ordinary loss and quarterly net loss attributable to owners of the parent all decreased from the same quarter of the previous year.」

「②　Thorough cost reduction The Company will continue to reduce production, logistics and administrative costs through the transfer and consolidation of its development and production divisions at the Kagawa facility, carried out in August 2016.」

「Against this backdrop, the Group is working across the organization to achieve further cost reductions and stringent expense cuts, with the aim of securing profits.」

「② Thorough cost reductions and stable quality」

「Thorough cost reduction and stable quality」