Achieving Competitive Costs and the HQ-FIT Program

「We will continue taking steps to fundamentally reshape our cost structure, particularly SG&A expenses, through the digitalisation of the business as a whole, including the use of AI.」

「Although business profit was affected by lower revenue and expenses recognized in connection with the ceramic siding business, price revisions and cost reductions offset these effects, leaving business profit nearly unchanged year on year at ¥12.257 billion, down 0.4%.」

「Current assets increased by ¥4.664 billion from the end of the previous fiscal year to ¥749.197 billion. This reflected increases in trade and other receivables due to seasonal factors and the effect of foreign currency translation resulting from further yen depreciation, despite a decline in inventories following policy-driven adjustments.」

「Business profit also rose sharply to ¥837.3 million, 2.7 times the year-earlier level. Although costs continued to be affected by persistently high materials and energy prices, profitability steadily improved as revenue growth from renovation products and gross-profit protection through price revisions took effect, sales of high-performance aluminum sash products grew, and the shift toward an asset-light production operation gained traction.」

「In the next fiscal year, following the resolution of recent supply chain issues, we will focus on improving inventory turnover days by reducing inventory levels to those at the end of the previous fiscal year.」

「To achieve sustainable profit growth, we will continue to promote timely price optimisation and greater efficiency in indirect costs.」

「Based on our current outlook, the results of various measures pursued for some time, including price revisions, supply chain strengthening, changes in sales policies and fixed-cost reductions, as well as the effects of recently easing declines in material prices, are expected to emerge in earnest from the second half of the fiscal year onward.」

「In production activities, we have reduced production space by manufacturing common components for interior, exterior and door products using general-purpose equipment, thereby creating production platforms. During the fiscal year, platformisation was also completed for sash products, and we expect this to improve the efficiency of invested capital.」

「Although business profit continued to be affected by higher material and transportation costs and difficulty procuring components due to the renewed spread of infections, strong demand centered on the European and U.S. markets in the Water Technology business, together with efforts to review selling prices in Japan and overseas and reduce selling, general and administrative expenses, lifted business profit 36.6% year on year to ¥61,751 million. As a result, the business profit margin improved by 1.4 percentage points to 5.7%, the gross profit margin improved by 1.0 percentage point to 34.8% and the selling, general and administrative expense ratio improved by 0.4 percentage points.」

「Operating profit increased substantially to ¥37.271 billion, 2.4 times the level of the same quarter of the previous year, driven by strong demand mainly in Western markets in the Water Technology business and further progress in structural reforms in the domestic business. As a result, the operating profit margin improved by 3.0 percentage points to 5.4%, while the gross profit margin improved by 2.1 percentage points to 35.1%. The SG&A ratio also improved by 0.9 percentage points.」

「Business profit reached a record ¥23,076 million for a first-quarter consolidated cumulative period, supported by strong markets in Europe and the United States in the Water Technology business, higher revenue from renovation products in Japan and lower selling, general and administrative expenses through improved productivity. Business profit increased by ¥25,709 million year on year. As a result, the business profit margin improved by 7.5 percentage points to 6.7%, the gross profit margin improved by 5.0 percentage points to 36.2% and the selling, general and administrative expense ratio improved by 2.5 percentage points.」

「In addition to ongoing efforts to improve gross margins in the domestic business, reductions in selling and general administrative expenses resulting from various initiatives to improve employee productivity and measures to contain expenses amid the COVID-19 pandemic offset the impact of lower revenue. As a result, operating profit increased to ¥57.288 billion, up 9.6% year on year.」

「The gross margin improved by 0.3 percentage points to 33.8%, owing to the effect of transaction price revisions pursued since last year and an improved product mix. SG&A expenses declined by approximately ¥27.5 billion year on year due to expense reduction measures implemented amid the COVID-19 pandemic and improved operating efficiency.」

「Operating profit declined by ¥18.646 billion year on year. Although the decline in gross profit resulting from lower revenue and lower capacity utilisation, as well as the impact of increased domestic demand before the consumption tax increase in the same quarter of the previous year, reduced gross profit, this was offset by substantial reductions in SG&A expenses, particularly advertising and logistics costs. As a result, operating profit returned to positive territory on a cumulative first-half basis but declined year on year.」

「Excluding the impact of one-time expenses, operating profit increased 17.7% year on year to ¥64.1 billion, reflecting improved business efficiency.」

「Operating profit increased 39.3% year on year. This reflected the effect of higher revenue from increased demand in the first half of the domestic business before the consumption tax increase and from price revisions, as well as cost improvement measures such as higher production efficiency in the Housing Technology business. Although the overseas business was affected by lower revenue, operating profit remained higher due to changes in the sales mix and the effect of cost reductions.」

「Business profit increased substantially to 2.5 times the year-earlier level. This was attributable to higher revenue in the domestic business and, in particular, improved production efficiency in the domestic Housing Technology business.」

「Business profit increased substantially to 2.5 times the year-earlier level. This was attributable to the benefit of higher revenue in the domestic business, as well as improved gross profit margins, particularly in the domestic Housing Technology business, and control of selling, general and administrative expenses in Japan and overseas.」

「We will pursue transformations including strengthening domestic channels, significantly improving productivity worldwide, and promoting digitalisation to create new customer experiences and B2B businesses.」

「In addition to continuing to reduce costs and contain selling, general and administrative expenses, operating profit margins improved in all segments except the Housing Technology business in the second quarter compared with the first quarter.」

「We will also improve productivity in indirect functions and pursue initiatives such as the “HQ-FIT Program,” which reallocates personnel to functions where they are needed, to improve cost efficiency.」

「To improve our balance sheet and margins, we will establish an efficient and flexible supply chain management framework and improve cost control by leveraging new technologies and infrastructure. We will also improve productivity in indirect functions and pursue initiatives such as the “HQ-FIT Program,” which reallocates personnel to functions where they are needed, to improve cost efficiency.」

「To improve our balance sheet and margins, we will establish an efficient and flexible supply chain management framework and improve cost control by leveraging new technologies and infrastructure. We will also improve productivity in indirect functions and pursue initiatives such as the “HQ-FIT Program,” which reallocates personnel to functions where they are needed, to improve cost efficiency.」