Fundamental Transformation of the Air-Conditioning Business Under the Four-Year Medium-Term Management Plan “move.2025”

「We launched the medium-term management plan move.2027, which ends in the fiscal year ending March 2027, in the fiscal year ended March 2025 and are pursuing management that is conscious of the cost of capital and the share price.」

「The company has adopted management based on the cost of capital and is pursuing the following management strategies, targeting consolidated net sales of ¥63 billion, consolidated operating profit of ¥10 billion, ROE of at least 10%, and a PBR of at least 1x for the fiscal year ending March 2027.」

「Under these circumstances, the group launched the medium-term management plan “move.2027,” whose final year is the fiscal year ending March 2027, in the previous fiscal year and is pursuing management that takes the cost of capital and share price into account. The plan newly sets ROE, PBR, and other indicators as management targets in addition to the former targets of consolidated net sales and consolidated operating profit, and explicitly positions management based on the cost of capital as the foundation of business operations.」

「The group launched the medium-term management plan “move.2027,” whose final year is the fiscal year ending March 2027, in the current fiscal year. The plan explicitly positions management based on the cost of capital as the foundation of business operations and changes the target management indicators from the former focus on consolidated operating profit to ROE and other indicators reflecting an emphasis on the cost of capital and share price.」

「Under these circumstances, the group launched the medium-term management plan “move.2027,” whose final year is the fiscal year ending March 2027, in the current fiscal year. The plan explicitly positions management based on the cost of capital as the foundation of business operations, and changes the target management indicators from the former focus on consolidated operating profit to ROE and other indicators. The indicators, including ROE of at least 10% and a PBR of at least 1x, reflect an emphasis on the cost of capital and share price.」

「In light of the current business environment and other factors, the company has raised its consolidated net sales target for the fiscal year ending March 2027 under the new medium-term management plan “move.2027,” announced in November 2023, from ¥56 billion to ¥60 billion, and its consolidated operating profit target from ¥8.6 billion to ¥10 billion.」

「As the company was expected to achieve the targets of “move.2025,” whose final year is the fiscal year ending March 2025, one year ahead of schedule, it announced new targets and management policies under the new medium-term management plan “move.2027” in November 2023. Under the new plan, it aims to achieve consolidated net sales of ¥56 billion and consolidated operating profit of ¥8.6 billion in the fiscal year ending March 2027. To advance management based on the cost of capital, it also specified ROE of at least 10% and a PBR of at least 1x as management indicators.」

「Against this backdrop, the group formulated the new medium-term management plan “move.2027,” aimed at pursuing a new growth story and sophisticated management based on the cost of capital. Under the new plan, the group will use the business foundation being built through the “SIMA (SINKO Innovative Manufacturing of AHU)” project under the current medium-term management plan as its base, while pursuing further profitability improvements in existing markets and challenges in new markets. For details, please refer to the notice titled “Notice Regarding the Formulation of the Medium-Term Management Plan ‘move.2027’ (Fiscal Years Ending March 2025 to March 2027),” published on 8 November 2023.」

「In addition to addressing rising costs, including through sales price revisions, the Company advanced initiatives based on its medium-term management plan, move.2025, including the SIMA (SINKO Innovative Manufacturing of AHU) project aimed at moving away from labor-intensive operations, sales initiatives for products targeting 5 priority markets, including industrial and data center applications, profitability improvements in the air-conditioning installation business, where demand is strong, and profitability improvements in the China business.」

「As its medium- to long-term management strategy, the company aims to achieve consolidated net sales of ¥52 billion and consolidated operating profit of ¥7.5 billion in the fiscal year ending March 2025.」

「Under “move.2025,” the medium-term management plan targeting the fiscal year ending March 2025, the company has pursued product sales strategies for five priority markets, including large buildings and industrial air conditioning, promoted the “SIMA (SINKO Innovative Manufacturing of AHU)” project to advance digitalization, captured demand in the air-conditioning construction field, and pursued a sales strategy focused on profitability in the China business.」

「Under “move.2025,” the medium-term management plan targeting the fiscal year ending March 2025, the company has pursued product sales strategies for five priority markets, including office buildings and replacement projects, promoted digitalization through the “SIMA (SINKO Innovative Manufacturing of AHU)” project, improved profitability in the active air-conditioning construction market, and improved margins in the China business.」

「Under the medium-term management plan “move.2025,” the company has pursued the SIMA (SINKO Innovative Manufacturing of AHU) project aimed at improving productivity, sales initiatives targeting five priority markets, including large buildings and industrial applications, efforts to capture strong demand for air-conditioning construction and improve profitability, and a sales strategy focused on profitability in the China business.」

「As its medium- to long-term management strategy, the company aims to achieve consolidated net sales of ¥52 billion and consolidated operating profit of ¥7.5 billion in the fiscal year ending March 2025. Centered on the fundamental transformation of the air-conditioning business, it will promote the “SIMA (SINKO Innovative Manufacturing of AHU)” project to use digitalization to move away from a labor-intensive production system.」

「Against this backdrop, the Company worked to improve the long-term growth potential and profitability of the business by advancing the SIMA (SINKO Innovative Manufacturing of AHU) project to rebuild the operational platform through digitization and expanding its product lineup of heat-pump air-conditioning units.」

「Against this backdrop, under the medium-term management plan “move.2025,” which began this fiscal year, we advanced the SIMA (SINKO Innovative Manufacturing of AHU) project, including the implementation of artificial intelligence (AI) technology in the business and the development of a product database (BOM), and worked to strengthen our business platform over the medium to long term.」

「Against this backdrop, we formulated the four-year medium-term management plan “move.2025,” beginning in fiscal 2021. Centered on the fundamental transformation of the air-conditioning business, the plan advances the SIMA (SINKO Innovative Manufacturing of AHU) project, which uses digitalization to move away from a labor-intensive production system, thereby strengthening our business foundation. As key initiatives, we also aim to achieve further growth in heat-pump AHUs, the construction business, and the China business.」