Establishing a business portfolio focused on profitability and growth

「With regard to cost reductions, in addition to the benefits emerging from structural reforms pursued in overseas businesses, such as optimizing workforce allocation and sales strategies, and continued efforts to reduce selling, general and administrative expenses, including head-office costs, we also worked to rebuild the supply chain and optimize the business portfolio.」

「Other operating income and expenses for the interim consolidated accounting period included ¥4,722 million in structural reform costs. We pursued structural reforms, including optimizing workforce allocation, rebuilding the supply chain and optimizing the business portfolio.」

「Although we believe that structural reforms in our overseas businesses were largely completed by the end of the current fiscal year, we will continue to optimize businesses that are not generating returns commensurate with their assets.」

「Accordingly, after considering all options, we decided to dissolve the company in order to simplify the business and integrate the organization, thereby further improving productivity and efficiency.」

「The transfer was completed on 1 December 2023.」

「We have entered into an agreement to transfer all shares of Sonitech Co., Ltd. (hereinafter “Sonitech”), a consolidated subsidiary in the Housing Technology business segment, to SKY Holdings Co., Ltd., a special-purpose company wholly funded by NMC Fourth Investment Limited Partnership, for which Nippon Mirai Capital Co., Ltd. provides investment support services. The transfer is expected to be completed on 1 December 2023.」

「We decided to transfer the asset securitisation business of 株式会社LIXILリアルティ, a consolidated subsidiary in the Housing Technology business segment, through an absorption-type company split to トーセイ・アール株式会社, a subsidiary of TOSEI CORPORATION. The transfer of this asset securitisation business was expected to be completed on 1 September 2023.」

「During the current consolidated fiscal year, measures to simplify the organization and concentrate on core businesses were largely completed, substantially reducing risks that could cause significant fluctuations in performance.」

「Non-current assets decreased by ¥23.815 billion from the end of the previous consolidated fiscal year to ¥1.080226 trillion, mainly due to declines in various line items resulting from restrained capital expenditure and the sale of idle assets.」

「As described above, despite the continuing impact of COVID-19, our Group accelerated initiatives for transformation and structural reforms. Although we achieved significant profit growth and record-high profit for the cumulative first quarter of the current consolidated fiscal year, this was attributable to our ability to build a more agile, less vulnerable to changes in the external environment and more profitable corporate structure by improving productivity and operating efficiency, optimising the business portfolio and promoting an asset-light approach.」

「Continuing from the previous consolidated fiscal year, our Group transferred shares in subsidiaries, including Permasteelisa S.p.A. (September 2020) and 株式会社ＬＩＸＩＬビバ (November 2020).」

「At a meeting of our Board of Directors held on 24 November 2020, we decided to sell 100% of the issued shares of our consolidated subsidiary 株式会社川島織物セルコン by accepting its repurchase of treasury shares, and entered into an agreement concerning the share transfer on the same date. The share transfer was completed on 6 January 2021.」

「In addition to deciding to transfer LIXILビバ, we completed the sale of Permasteelisa in September 2020, and are continuing to strengthen the financial position in line with our strategy.」

「Specifically, the transfer of shares in Permasteelisa and ＬＩＸＩＬビバ is expected to significantly improve the balance sheet and further strengthen the financial position.」

「Our Group transferred shares in subsidiaries and associates, including 株式会社建デポ (June 2019), 株式会社シニアライフカンパニー (September 2019) and 株式会社ＬＩＸＩＬ鈴木シャッター (September 2019), and announced in May 2020, across fiscal years, its decision to sell Permasteelisa S.p.A.」

「Our Group is optimising its business portfolio across all areas to improve management efficiency and strengthen its financial position. This share transfer is consistent with our efforts to simplify the business structure and create further synergies and improve efficiency.」

「Our Group is optimising its business portfolio across all areas to improve management efficiency and strengthen its financial position. This share transfer is consistent with our efforts to simplify the business structure and create further synergies and improve efficiency.」

「Share transfer date 3 June 2019 Gain or loss on sale A gain on disposal of an interest in an associate of ¥10,977 million was recognised in the condensed quarterly consolidated statement of profit or loss.」

「At a meeting of our Executive Officers’ Committee held on 31 July 2018, we decided to transfer 100% of the issued shares of our consolidated subsidiary 株式会社ＬＩＸＩＬ鈴木シャッター to Sanwa Holdings Corporation and entered into a share transfer agreement on the same date.」

「We determined that it was reasonable to terminate this share transfer agreement. Based on the agreement of both the seller and buyer, the Board of Directors decided on 27 November 2018 to terminate the agreement, and the agreement was terminated on the same date.」

「At a meeting of our Executive Officers’ Committee held on 31 July 2018, we decided to transfer 100% of the issued shares of our consolidated subsidiary 株式会社ＬＩＸＩＬ鈴木シャッター to Sanwa Holdings Corporation and entered into a share transfer agreement on the same date.」

「With respect to this share transfer, we received notice from the Committee on Foreign Investment in the United States that approval could not be granted under the measures currently proposed by us and Grandland.」

「Decided to transfer all shares of 株式会社ＬＩＸＩＬ鈴木シャッター.」

「As part of an internal reorganisation aimed at further simplifying the business structure, strengthening governance and improving management efficiency, during the fiscal year we changed GROHE Group S.à r.l., ASD Holding Corp. and LIXIL INTERNATIONAL Pte. Ltd., which had previously been indirectly owned through LIXIL Corporation, into subsidiaries directly owned by us. We also absorbed GraceA株式会社 through a merger.」

「Our Group is continuously optimising its business portfolio to improve operating efficiency and strengthen its financial position. This share transfer is also consistent with our efforts to simplify the business structure and create synergies and improve efficiency globally.」

「At a meeting of our Board of Directors held on 21 August 2017, we decided to transfer 100% of the issued shares of Permasteelisa S.p.A., held by our wholly owned subsidiary LIXIL Corporation, to Grandland Holdings Group Limited, and entered into a share transfer agreement on the same date.」

「March 2017: Sold part of the shares of 株式会社日本住宅保証検査機構 and removed it from the scope of consolidation.」

「In the previous consolidated fiscal year, assets and directly related liabilities associated with a subsidiary of Permasteelisa S.p.A. included in the Building Technology business, which we had decided to sell because of declining profitability, were classified as held for sale. However, following changes in the economic environment resulting from the United Kingdom’s withdrawal from the EU, the importance of the subsidiary, which maintains certain customer relationships in the U.K. market, increased, and profitability came to be expected to improve as a result of organisational reforms. Accordingly, on 30 September 2016, we decided to change our policy from selling the subsidiary to continuing to hold it, and therefore discontinued its classification as held for sale.」

「We have steadily implemented measures based on the basic policies of our medium-term management VISION: business innovation in domestic growth businesses, transforming the overseas business into a global enterprise, and structural reform of existing domestic businesses.」

「The transfer was carried out based on our Group’s strategy of establishing an effective portfolio that secures higher profitability and growth potential.」