Foreign Exchange Risk From Overseas Procurement in U.S. Dollars

「In terms of profit, although the yen weakened from the previous period and overseas sourcing costs increased, higher revenue resulted in operating profit rising 0.8% from the previous period to ¥2,212 million.」

「In terms of earnings, the exchange rate remained stronger for the yen than initially expected, and lower procurement costs also improved the profit margin. As a result, segment profit improved by ¥176 million year on year due to higher revenue, but remained a loss of ¥79 million.」

「However, ordinary profit decreased by ¥201 million from the previous period, or 7.0%, to ¥2,678 million, as foreign exchange gains decreased by ¥444 million year on year under the financial and foreign exchange environment,」

「Ordinary profit decreased by ¥629 million year on year, or 29.9%, to ¥1,474 million, as foreign exchange gains decreased by ¥473 million under the financial and foreign exchange environment.」

「In the housing equipment-related business, procurement costs rose as the yen weakened, despite declining revenue, and segment profit decreased by ¥60 million year on year to a loss of ¥118 million.」

「In the housing equipment-related business, segment profit was a loss of ¥462 million, affected by higher procurement costs resulting from the weaker yen and the decline in the hedging effect of forward exchange contracts compared with the previous period.」

「In terms of earnings, profitability improved through expanded sales of aluminum lifting equipment and the effect of price revisions for fitness-related products. However, due to higher procurement costs resulting from the weaker yen and the decline in the hedging effect of forward exchange contracts compared with the same period of the previous year, segment profit decreased by ¥105 million year on year to a loss of ¥193 million.」

「In terms of earnings, profitability improved through expanded sales of aluminum lifting equipment and the effect of price revisions for fitness-related products. However, due to higher procurement costs resulting from the weaker yen and the decline in the hedging effect of forward exchange contracts compared with the same period of the previous year, segment profit decreased by ¥40 million year on year to a loss of ¥196 million.」

「In terms of earnings, segment profit decreased by ¥130 million year on year to a loss of ¥156 million, as lower revenue and higher overseas procurement prices resulting from the rapid depreciation of the yen outweighed the effect of the price revisions.」

「Sales of products such as aluminum ladders and stepladders remained firm, including sales to mass retailers and sales of subsidiary products such as elevated work platforms and aluminum bridges. However, sales of fitness equipment failed to grow because the launch of new products was delayed by the impact of lockdowns and other measures in China. In terms of earnings, although the company raised selling prices, segment profit decreased by ¥68 million year on year to a loss of ¥53 million, as lower revenue and the rapid depreciation of the yen drove up overseas procurement prices.」

「The main factors behind the change in operating profit included higher prices for raw materials such as steel and aluminum (¥985 million decrease) and higher procurement costs due to the weaker yen (¥591 million decrease). In addition, foreign exchange gains increased by ¥197 million, mainly due to the hedging effect of forward exchange contracts.」

「Sales of products such as aluminum ladders and stepladders remained solid despite being affected by fewer people visiting mass retailers because of poor weather and the continued cancellation of trade shows. However, sales of fitness equipment, which recorded its highest-ever performance in the previous year partly because of stay-at-home demand, declined as a result of the backlash.」

「Our group hedges foreign exchange risk through forward foreign exchange contracts to stabilize procurement costs." "Foreign exchange gain: ¥154.161 million」

「Foreign exchange gain - 15,920」

「The reason the decline in ordinary profit was limited compared with the decline in operating profit was foreign exchange gains and other factors related to the translation of foreign currency-denominated assets.」

「The housing equipment-related business and other businesses of our group use outsourced overseas production, and US dollar-denominated product purchases accounted for 66.2% of the group's total product purchases in the fiscal year ended March 2020." "Although a foreign exchange loss arose from the valuation of foreign currency-denominated assets because of turmoil in financial markets, ordinary profit increased 4.7% from the previous fiscal year to ¥3,461 million.」

「In terms of profit and loss, segment profit fell 8.5% year on year to ¥389 million because foreign exchange gains declined.」

「Foreign exchange loss - 58,193」

「Non-operating expenses Foreign exchange loss - 82,473 In terms of profit and loss, segment profit fell 37.8% from the previous fiscal year to ¥63 million, mainly because foreign exchange gains declined from the previous year.」

「US dollar-denominated product purchases accounted for 67.1% of the group's total product purchases in the fiscal year ended March 2019.」

「The housing equipment-related business and other businesses of our group use outsourced overseas production, and US dollar-denominated product purchases accounted for 62.0% of the group's total product purchases in the fiscal year ended March 2018.」

「Ordinary profit increased 16.1% year on year to ¥2,778 million because of foreign exchange gains associated with hedging foreign exchange risk and other measures.」

「Although procurement costs rose because the yen remained weaker against the previous year, segment profit increased 96.4% year on year to ¥400 million because foreign exchange gains from hedging foreign exchange risk and other measures offset the impact.」

「Ordinary profit increased 158.6% year on year to ¥746 million, partly because of the hedging effect of forward foreign exchange contracts.」

「US dollar-denominated product purchases accounted for 61.5% of the group's total product purchases in the fiscal year ended March 2017." "Foreign exchange loss: ¥313.8 million」

「The decline in ordinary profit was due to the foreign exchange gain of ¥394 million recorded in the same period of the previous year as a result of the hedging effect of forward foreign exchange contracts becoming a foreign exchange loss of ¥257 million in the third quarter under review, following the rapid appreciation of the yen.」

「This was because the foreign exchange gain of ¥254 million recorded in the same period of the previous year as a result of the hedging effect of forward foreign exchange contracts became a foreign exchange loss of ¥550 million in the second quarter under review, following the rapid appreciation of the yen.」

「Ordinary profit fell 68.0% year on year to ¥288 million. This was because the foreign exchange gain of ¥192 million recorded in the same period of the previous year as a result of the hedging effect of forward foreign exchange contracts became a foreign exchange loss of ¥312 million in the first quarter under review, following the rapid appreciation of the yen.」

「The Group’s housing equipment-related business uses overseas contract manufacturing, and U.S.-dollar-denominated purchases of merchandise accounted for 58.5% of total merchandise purchases in the fiscal year ended March 2016. Although the Group intends to continue overseas contract manufacturing to maintain price competitiveness through cost reductions and expand its sales share, most transactions are denominated in U.S. dollars. Accordingly, fluctuations in foreign exchange rates may affect the Group’s results. The Company hedges foreign exchange risk through forward exchange contracts to stabilize procurement costs.」