Promoting High-Margin Businesses and Strengthening R&D

「The amount spent on research and development activities across the group during the current interim consolidated accounting period was ¥324 million. There were no material changes in the status of the group's research and development activities during the current interim consolidated accounting period.」

「株式会社ミスミグループ本社との資本業務提携に基づく物流協業を開始し、特注品ビジネスへの特化に向けた営業・生産体制の見直しも着実に進めてまいりました。」

「The amount spent on R&D activities by our group as a whole during the current interim consolidated accounting period was ¥271 million. There were no material changes in the status of our group's R&D activities during the current interim consolidated accounting period.」

「Our group aims to sustainably enhance corporate value by improving customer satisfaction in terms of quality, delivery times and cost, and is also working to strengthen group-wide R&D capabilities and develop high-value-added products for global markets.」

「The amount spent on research and development activities across the group during the third quarter of the current consolidated cumulative period was ¥386 million. There were no material changes in the status of the group's research and development activities during the third quarter of the current consolidated cumulative period.」

「Against this backdrop, in its three-year medium-term management plan Value Creation 2024, which began in April 2022, the Group established its desired position as always being the “customer’s first choice,” with demand for automation and labor saving in manufacturing as a new growth engine. To address outstanding issues from the previous medium-term management plan and enhance corporate value, it identified “expansion of new and existing businesses,” “strengthening of the production system,” and “strengthening R&D” as its 3 key management priorities, while promoting “DX,” “financial strategy,” and “sustainability” as measures to strengthen the management foundation supporting these initiatives.」

「In VC2024, the company designated “expanding new and existing businesses,” “strengthening the production system” and “strengthening R&D” as its 3 key management priorities」

「Against this backdrop, under the medium-term management plan "Value Creation 2020Plus," which began in April 2020, our group is addressing four key management issues: "establishing a five-region sales structure," "strengthening sales capabilities with a customer-focused perspective," "optimizing the global production structure and strengthening R&D," and "work-style reform and human-resource development." We are promoting a shift to high-value-added businesses and cost reductions, while focusing on restoring deteriorating business performance.」

「Against this backdrop, under the medium-term management plan "Value Creation 2020Plus," which began in April 2020, our group is addressing four key management issues: "establishing a five-region sales structure," "strengthening sales capabilities with a customer-focused perspective," "optimizing the global production structure and strengthening R&D," and "work-style reform and human-resource development." We are promoting a shift to high-value-added businesses and cost reductions, while focusing on restoring deteriorating business performance.」

「Against this backdrop, under the medium-term management plan "Value Creation 2020Plus," which began in April 2020, our group is addressing four key management issues: "establishing a five-region sales structure," "strengthening sales capabilities with a customer-focused perspective," "optimizing the global production structure and strengthening R&D," and "work-style reform and human-resource development." We are generating new momentum and seeing tangible results across all of these issues.」

「Against this backdrop, the Group is addressing four key management priorities under the mid-term management plan “Value Creation 2020Plus,” which began in April 2020: “Establishing a five-region sales structure,” “Strengthening sales capabilities with a focus on customer needs,” “Optimizing the global production system and strengthening R&D,” and “Work-style reform and human resource development,” and has achieved results including the launch of new products aligned with customer needs.」

「Against this backdrop, the Group is addressing four key management priorities under the mid-term management plan “Value Creation 2020Plus,” which began in April 2020: “Establishing a five-region sales structure,” “Strengthening sales capabilities with a focus on customer needs,” “Optimizing the global production system and strengthening R&D,” and “Work-style reform and human resource development.” The Group is promoting a shift toward high-value-added businesses and cost reductions in an effort to put the Group back on a growth trajectory.」

「Against this backdrop, under the Medium-Term Management Plan “Value Creation 2020,” launched in April 2016, the Group has brought together its founding “Punch Spirit” and has been pursuing 4 key management priorities: “Establishing a five-region sales structure,” “Improving customer service,” “Promoting high-profitability businesses and strengthening R&D,” and “Work-style reform.” Various initiatives, including the commencement of operations at the US sales office, the start of semi-finished and finished product production at the Vietnam plant, and the Dalian plant expansion, are progressing steadily, but the challenging business environment has made achievement of the initial targets difficult.」

「Against this backdrop, the Group has been addressing four key management priorities to achieve the objectives of the mid-term management plan “Value Creation 2020,” which began in April 2016, by bringing together the founder’s spirit, “Punch Spirit”: “Establishing a five-region sales structure,” “Enhancing customer service,” “Promoting high-margin businesses and strengthening R&D,” and “Work-style reform.” Various initiatives, including the start of operations at the U.S. sales base, the start of semi-finished and finished product production at the Vietnam factory, and the expansion of the Dalian factory, are making steady progress.」

「Against this backdrop, the Group has been addressing four key management priorities to achieve the objectives of the mid-term management plan “Value Creation 2020,” which began in April 2016, by bringing together the founder’s spirit, “Punch Spirit”: “Establishing a five-region sales structure,” “Enhancing customer service,” “Promoting high-margin businesses and strengthening R&D,” and “Work-style reform.” Various initiatives, including the start of semi-finished and finished product production at the Vietnam factory, the start of operations at the U.S. sales base, and the expansion of the Dalian factory, are making steady progress.」

「Through the transfer of production to the Vietnam plant, we will further strengthen domestic plants around the production of custom products and optimize the Punch Group's overall production structure, aiming to achieve higher overall profitability through cost reductions and risk diversification. We also established the Development Headquarters in April 2019 to improve production technologies for custom products in Japan and for other purposes.」

「Against this backdrop, the Group is working toward achieving the objectives of the medium-term management plan "Value Creation 2020," which began in April 2016, by bringing together its founding spirit, the "Punch Spirit." The Group is addressing four key management priorities: establishing a five-region sales structure, enhancing customer service, promoting high-margin businesses and strengthening R&D, and promoting work-style reform. Various initiatives, including the start of semi-finished product production at the Vietnam plant, the launch of operations at the U.S. sales base and the expansion of the Dalian plant, are making steady progress.」

「Against this backdrop, the Group is working toward achieving the objectives of the medium-term management plan "Value Creation 2020," which began in April 2016, by bringing together its founding spirit, the "Punch Spirit." The Group is addressing four key management priorities: establishing a five-region sales structure, enhancing customer service, promoting high-margin businesses and strengthening R&D, and promoting work-style reform. Various initiatives, including the start of semi-finished product production at the Vietnam plant, the launch of operations at the U.S. sales base and the expansion of the Dalian plant, are making steady progress.」

「In terms of profit, although SG&A expenses increased due to depreciation and amortization on capital expenditure and R&D investment associated with the expansion of the digital engineering business, operating profit increased with higher sales and an improved cost of sales ratio resulting from higher factory utilization, reaching ¥714 million, up 2.0% year on year.」

「We will firmly establish the first phase of production at the Vietnam plant, involving semi-finished products, while steadily preparing for the launch of the second phase in fiscal 2019, involving finished products. Through this, we will optimize the production structure of our group and achieve higher overall profitability through cost reductions and risk diversification.」

「In terms of profit, although selling, general and administrative expenses increased due to capital investment, R&D investment and other expenses associated with the expansion of the reverse-engineering business, operating profit increased on higher sales and an improvement in the cost ratio resulting from higher plant utilisation. Operating profit was ¥2,225 million, up 58.3% year on year; ordinary profit was ¥2,182 million, up 62.8%; and profit for the quarter attributable to owners of the parent was ¥1,366 million, up 50.3%.」

「In terms of profit, although selling, general and administrative expenses increased due to capital investment and R&D investment associated with the expansion of the reverse engineering business, operating profit increased as a result of higher sales and improved the cost ratio due to higher plant utilization. Operating profit was ¥1,404 million, up 67.0% year on year; ordinary profit was ¥1,398 million, up 76.6%; and net profit for the quarter attributable to owners of the parent was ¥921 million, up 67.6%.」

「In Japan, home appliances remained weak, but automotive-related business grew substantially, while electronics components and semiconductors, as well as food and beverages, remained strong and helped lift sales above the year-earlier period. In China, automotive-related business and electronics components and semiconductors continued to perform steadily, and sales also exceeded the year-earlier period, helped by growth in newly developed high-value-added strategic products. In terms of profit, although SG&A expenses increased due to R&D investment and investment in human-resource development associated with the launch of Punch Academy, operating profit increased as a result of higher sales and improved cost ratios from increased factory utilization, reaching ¥701 million, up 111.7% year on year. Ordinary profit was ¥711 million, up 115.4%, and net income attributable to owners of the parent was ¥422 million, up 103.5%.」

「Although sales declined and the stronger yen had an impact, SG&A expenses also increased due to the start-up of the Vietnam plant and higher staffing and investment for the reverse engineering business. However, improved cost ratios at overseas group companies resulted in ¥1,990 million, up 0.2% year on year.」

「In China, strong automotive-related demand continued to drive performance, and the high-value-added strategic products newly being developed also grew. Sales were substantially higher than in the same period of the previous year on a local-currency basis, but fell below the previous year in yen terms due to the impact of foreign-exchange movements.」

「In China, automotive-related business continued to drive performance, while newly developed high-value-added strategic products also grew. As a result, sales significantly exceeded the year-earlier period on a local-currency basis, but fell below the year-earlier period in yen terms due to the impact of foreign-exchange movements.」

「Against this backdrop, in the first year of the medium-term management plan "Value Creation 2020," which began in April 2016, the Group is bringing together its founding spirit, the "Punch Spirit," which is part of the Group's DNA, and addressing four key management priorities: establishing a five-region sales structure, enhancing customer service, promoting high-margin businesses and strengthening R&D, and promoting work-style reform.」

「(3) Promoting high-profit businesses and strengthening R&D Optimizing the group production structure, reducing costs and diversifying risks through stronger R&D, and creating higher value added.」