Higher revenue and earnings through secured orders in the housing equipment business

「Orders for wood-and-aluminum composite insulated fittings increased, particularly for large projects such as research facilities, large schools and resort hotels, against a backdrop of increased use of wood toward achieving a decarbonized society and growing demand for highly insulated building materials associated with the transition to net-zero energy buildings. However, because large projects were scheduled to be recognized as revenue from the third quarter onward due to extended construction periods and other factors, overall sales fell below the previous year's results.」

「However, construction declined as numerous large public-sector projects and large projects for private-sector companies were completed by the fourth quarter, resulting in overall performance below the previous fiscal year's results.」

「Gantry car-wash systems in the Mobility & Services business, low-temperature storage units in the Life & Support business, and rice-related products such as insulated rice containers and rice polishers performed steadily, resulting in net sales, operating income and ordinary income exceeding the previous forecasts.」

「However, construction declined as numerous large public-sector projects and large projects for private-sector companies that had contributed to the previous year's sales were completed by the end of the interim period, resulting in overall performance below the previous year's results.」

「Although construction plans have been revised or postponed due to persistently high construction material prices and labor shortages, wood-aluminum composite insulated doors and windows have remained strong, supported by the accelerated use of timber toward achieving a decarbonized society and rising demand for highly insulated building materials toward ZEBs. The use of timber in corporate buildings and facilities also progressed, broadening adoption of wood-aluminum composite insulated products and lifting revenue. Demand for soundproofing equipment also increased in urban redevelopment projects, data centers, hotels and schools, and performance remained strong. As a result, revenue increased 23.5% year on year to ¥1,597 million.」

「However, because revenue from large projects was scheduled to be recognized in the second half, overall revenue fell below the previous fiscal year's result. As a result, revenue declined 1.7% year on year to ¥641 million.」

「Demand for wood-and-aluminum composite insulated fittings remained firm as the use of wood increased toward achieving a decarbonized society, and orders for large public-sector projects, particularly in western Japan, remained strong. However, as of the end of the period, the number of large projects had declined from the end of the previous period, and net sales consequently fell below the previous period's results.」

「Momentum for timber use continued to grow against the backdrop of efforts to achieve a decarbonized society, and demand for our core wood-aluminum composite insulated doors and windows remained firm. In addition, schedules for large projects progressed smoothly, lifting revenue above the previous year's level, while soundproofing products performed steadily in hotels, data centers, schools and urban redevelopment projects. As a result, revenue increased 0.2% year on year to ¥1,967 million.」

「Although some orders were cancelled or postponed due to unsuccessful bids resulting from soaring construction material costs, projects ordered by the previous fiscal year progressed smoothly, and sales remained at about the previous year's level. As a result, net sales increased 1.7% year on year to ¥1.293 billion.」

「Wood-aluminum composite insulated fittings are one of the products that contribute to achieving a decarbonized society. Sales progressed smoothly as the product's low manufacturing CO2 emissions, greater use of timber and rising demand for highly insulated building materials toward ZEB (net-zero energy building) adoption bore fruit. However, some projects were deferred to the second quarter or later. As a result, revenue declined 2.9% year on year to ¥652 million.」

「Sales of large projects adopting wood-aluminum composite insulated fittings grew against a backdrop of carbon neutrality. Revenue recognition also increased as large projects whose construction had been delayed by shortages of building materials in the previous fiscal year contributed to sales, and the adoption of the revenue recognition accounting standard and related standards changed the method to recognizing revenue over a period of time as performance obligations are satisfied. As a result, revenue was ¥1.963 billion, compared with ¥1.207 billion in the same quarter of the previous year.」

「Although some projects were affected by postponed construction plans and delayed starts due to unsuccessful bids amid shortages and higher prices for building materials, orders in the second quarter progressed smoothly. For wood-aluminum composite insulated fittings, revenue exceeded the previous year's results as large projects whose construction had been delayed by shortages of building materials in the previous fiscal year contributed to sales. Revenue recognition also increased following the adoption of the revenue recognition accounting standard and related standards, which changed the method to recognizing revenue over a period of time as performance obligations are satisfied.」

「Construction periods have tended to lengthen because of shortages of construction materials caused by import restrictions following Russia's invasion of Ukraine and lockdowns in China. However, orders increased with the recovery in construction demand following the COVID-19 pandemic, and the application of the revenue recognition accounting standard and other requirements increased revenue recognition because we changed to recognizing revenue over a period of time as performance obligations are satisfied. As a result, revenue was ¥672 million, compared with ¥278 million in the same quarter of the previous year.」

「Use of timber in large buildings has become more active toward achieving a decarbonized society, and orders for wood-aluminum composite insulated fittings exceeded plan. Demand for rebuilding schools also increased for sound-attenuation equipment, and orders exceeded plan. However, construction was delayed and sales were weighed down by extended construction periods caused by delays in steel-frame deliveries.」

「Revenue declined due to timber price increases and supply shortages caused by the COVID-19 pandemic, the so-called "timber shock," as well as soaring prices for construction materials such as steel and extended construction periods caused by delivery delays. As a result, revenue declined 16.9% year on year to ¥1,207 million.」

「Following the government's declaration of carbon neutrality, momentum toward a green society through decarbonization accelerated, and interest in timber use and adoption of our products increased. However, revenue fell below the previous year's level due to timber shortages and price increases caused by the COVID-19 pandemic, the so-called "timber shock," as well as soaring prices for construction materials such as steel and extended construction periods caused by delivery delays. As a result, revenue declined 24.0% year on year to ¥721 million.」

「Amid growing momentum to promote timber use following the government's carbon-neutral declaration and policy to reduce CO2 emissions, wood-aluminum composite insulated fittings exceeded the previous year's results as the order backlog accumulated in the previous fiscal year contributed to revenue despite the impact of COVID-19.」

「Orders for wood-aluminum composite insulated fittings remained generally strong as public buildings began construction relatively smoothly and the government declared its aim of achieving carbon neutrality and a decarbonized society, prompting broader efforts to promote timber use. Meanwhile, general contractors and other construction companies experienced extended construction periods and schedule delays due to the impact of COVID-19, which weighed on sales. As a result, revenue from the housing equipment business was ¥2.304 billion, down 9.9% from the previous fiscal year.」

「The spread of COVID-19 continued to have a significant impact on the construction industry, including restrictions on face-to-face sales activities, delays in on-site work schedules and changes to delivery dates. We introduced remote sales activities, focused on deepening relationships with existing customers and developing new customers, and pursued earnings improvement through rigorous cost management for projects received. However, postponed construction plans and a decline in private-sector construction affected revenue. As a result, revenue declined 15.0% year on year to ¥1.453 billion.」

「The spread of COVID-19 has also had a significant impact on the construction industry, with concerns over delays in on-site work schedules, changes to delivery dates and disruptions in material procurement. We worked to secure and expand a stable order pipeline and pursued earnings improvement through rigorous cost management for projects received, in order to minimize the impact on our company. However, construction delays occurred and revenue recognition shifted into the second half.」

「The COVID-19 pandemic began to have a rapid impact on the construction industry. Material suppliers experienced delivery delays due to shortages of supplies and labor, while on-site construction schedules were substantially delayed. The company was no exception, and numerous projects experienced changes to planned construction delivery dates or postponement of sales recognition to the second half of the fiscal year. As a result, net sales fell 26.5% year on year to ¥235 million.」

「Wood-aluminum composite insulated joinery has become an established standard product as the use of local timber has taken hold and window insulation has been further enhanced.」

「Demand for the mainstay wood-aluminum composite insulated doors and windows for government office rebuilding remained strong. Although the construction industry was affected by construction delays due to labor shortages and typhoon damage, and the company tends to record sales mainly in the fourth quarter, net sales rose 3.7% year on year to ¥1,709 million.」

「Demand for the mainstay wood-aluminum composite insulated doors and windows remained strong, supported by government office rebuilding projects. Demand for sound-attenuation equipment is also expected to continue in major metropolitan areas. Demand for steel doors is trending higher due partly to revisions to fire-safety standards. As a result, net sales rose 26.3% year on year to ¥1,112 million.」

「The construction industry has experienced a substantial decline in its working-age population, and labor shortages have become more severe as the workforce ages, causing significant effects including construction delays and extended handover schedules. We were also affected by the deferral of revenue from large projects. As a result, revenue declined 7.6% year on year to ¥320 million.」

「Orders for the mainstay wood-aluminum composite insulated doors and windows grew strongly amid efforts to promote timber use against a backdrop of global warming and calls to reduce CO2 emissions. The newly expanded steel fire-door business also performed steadily. As a result, net sales in the residential equipment business were ¥2,319 million, up 22.4% from the previous fiscal year.」

「Although delays to construction schedules caused by labor shortages continued to affect the construction industry, sales rose 49.6% year on year to ¥1,648 million as the concentration of construction projects in the fourth quarter was dispersed.」

「As the construction industry as a whole was buoyant, demand for private-sector projects also increased substantially, and our business performed well. As a result, revenue increased 53.0% year on year to ¥881 million.」

「The construction industry remained active amid strong construction demand ahead of the 2020 Tokyo Olympic and Paralympic Games. Private-sector projects also performed well at the company. As a result, net sales rose 81.9% year on year to ¥346 million.」

「Adoption of wood-aluminum composite insulated fittings that meet these market requirements broadened, and orders for large properties increased, resulting in strong performance. As a result, total revenue from the housing equipment business was ¥1.894 billion, up 12.7% from the previous fiscal year.」

「As we actively expanded proposal-based sales promoting the use of locally sourced timber and mandatory energy-efficiency standards, a large project using timber from Nagano Prefecture was completed and made a significant contribution to revenue. As a result, revenue increased 23.5% year on year to ¥1.101 billion.」

「Sales remained strong, supported by efforts to promote the use of locally produced timber and mandatory energy-efficiency standards. Demand also grew for ball-stop grille doors and windows used in gymnasiums, which can serve as evacuation shelters during natural disasters, because they combine security and safety, provide ventilation and a blind effect, and withstand impact loads. As a result, net sales rose 7.2% year on year to ¥575 million.」

「The housing industry increasingly called for insulation and energy efficiency, and mandatory energy-efficiency standards for non-residential buildings also began in April. As the mainstay Altas Wood product, featuring wood and insulation, was expected to attract further attention, the order backlog accumulated from the previous fiscal year contributed to first-quarter sales. Net sales rose 18.7% year on year to ¥190 million.」

「The use of timber and insulation, the key themes of the products handled, has attracted attention in the construction industry. The order backlog continued to build from the previous year, and we will seek to increase revenue and improve earnings by securing new orders.」

「The Building Energy Conservation Act, which also applies to large buildings, came into force in April 2017, and demand was expected to increase alongside efforts to promote the use of locally produced timber. However, the shortage of construction workers caused projects overall to fall behind schedule, affecting the timing of sales. As a result, net sales fell 2.1% year on year to ¥892 million.」

「Inquiries for wood-aluminum composite insulated fittings increased as the use of locally sourced timber was promoted, while evaluations of insulation systems that contribute to reducing CO2 emissions also improved, raising expectations for higher orders going forward. However, competition for orders remained intense in the construction industry, a major customer base, and revenue declined 3.5% year on year to ¥537 million.」

「In the construction industry, completion dates have shifted away from the former fiscal year-end due to unsuccessful bids and a lack of bids by general contractors, significantly affecting the timing of our sales. As a result, revenue decreased 43.1% year on year to ¥160 million.」