Increase in operating profit driven by a significant improvement in the cost-of-sales ratio
First written in FY2016-Q2. 15 of 31 entries say "Worsened", first in FY2019. Latest entry: 2026-10-05.
Optoelectronics moved to the "Worse" side of this theme in 2023.
The whole theme swung hardest in 2022: 2 of 21 companies on the "Worse" side.
0 other companies' latest entry also says "Mitigated".
- FY2026-H1WorsenedAnnual report
「The main factors were an ¥11 million decline in selling, general and administrative expenses due to cost reductions and other measures, offset by an ¥87 million decline in gross profit due to higher raw material prices and other factors.」
Although selling, general and administrative expenses declined ¥11 million, the ¥87 million decline in gross profit due to higher raw material prices had a greater impact, causing the operating loss to widen. - 2026-04-03WorsenedEarnings
「Selling, general and administrative expenses decreased by ¥35 million due to cost reductions and other factors, while gross profit decreased by ¥95 million because of a decline in gross profit margins resulting from higher raw material prices, among other factors.」
Although selling, general and administrative expenses declined, the decrease in gross profit caused by higher raw material prices contributed to the widening operating loss. - FY2025AdvancedAnnual report
「Cost of sales was ¥4,289 million, up 11.1% year on year; gross profit was ¥2,483 million, unchanged year on year; and selling, general and administrative expenses were ¥2,737 million, down 9.2%.」
Gross profit was essentially unchanged, while selling, general and administrative expenses declined ¥277 million, contributing to a narrower operating loss. - FY2025-H1Operating loss narrowed on lower selling, general and administrative expenses, but gross profit declined because of higher raw material pricesAnnual report
「Operating loss was ¥88 million, compared with an operating loss of ¥221 million in the same period of the previous year. The main factors were a ¥31 million decline in gross profit due to higher raw material prices, partly offset by a ¥164 million reduction in selling, general and administrative expenses resulting from cost reductions.」
Gross profit declined ¥31 million because of higher raw material prices, while selling, general and administrative expenses declined ¥164 million through cost reductions, resulting in a narrower operating loss. - FY2024WorsenedAnnual report
「Cost of sales was ¥3,860 million, down 4.1% year on year; gross profit was ¥2,482 million, down 13.0%; and selling, general and administrative expenses were ¥3,014 million, down 9.1%.」
Although cost of sales and selling, general and administrative expenses declined, the decrease in gross profit was larger, causing the operating loss to widen from the previous fiscal year. - FY2024-Q2WorsenedAnnual report
「Operating loss was ¥221 million, compared with an operating loss of ¥53 million in the same period of the previous year. Ordinary loss was ¥285 million, compared with an ordinary loss of ¥123 million, and quarterly net loss attributable to owners of the parent was ¥320 million, compared with a quarterly net loss attributable to owners of the parent of ¥146 million. Although raw material prices remained high, the Company was unable to fully pass the increases through to selling prices because of price competition. As a result, the cost-of-sales ratio continued to rise and profit declined year on year.」
The cost-of-sales ratio continued to rise because raw material prices remained high and increases could not be fully passed through to selling prices, causing the operating, ordinary and net losses to all widen year on year. - FY2024-Q1WorsenedAnnual report
「Although the Company is working to bring selling prices into line, raw material prices for products remain high, and the cost-of-sales ratio continues to rise. In addition, selling, general and administrative expenses increased ¥26 million year on year due to the burden of litigation costs and other expenses. Furthermore, as the yen depreciated, the Company revalued its provision for litigation losses in foreign currency terms, resulting in a ¥44 million year-on-year increase in foreign exchange losses.」
Factors cited as worsening profitability included the higher cost-of-sales ratio resulting from persistently high raw material prices, the ¥26 million increase in selling, general and administrative expenses due to litigation costs and other expenses, and the ¥44 million increase in foreign exchange losses resulting from the foreign-currency revaluation of the provision for litigation losses. - FY2023WorsenedAnnual report
「In addition to the decline in revenue described above, selling, general and administrative expenses increased ¥626 million year on year because the involvement of U.S. attorneys increased in connection with court proceedings and the commencement of an appeal in the litigation with U.S.-based HONEYWELL.」
Selling, general and administrative expenses increased ¥626 million due to legal fees and other costs related to the court proceedings and appeal, causing operating income to turn into a loss. - FY2023-Q3WorsenedAnnual report
「The main factor was a ¥530 million increase in selling, general and administrative expenses due to a substantial increase in legal fees related to the litigation with HONEYWELL.」
Higher legal fees related to the litigation with HONEYWELL increased selling, general and administrative expenses by ¥530 million and was the main cause of the operating loss. - FY2023-Q2WorsenedAnnual report
「Operating loss was ¥53 million, compared with operating income of ¥297 million in the same period of the previous year. Ordinary loss was ¥123 million, compared with ordinary income of ¥209 million, and quarterly net loss attributable to owners of the parent was ¥146 million, compared with quarterly net income attributable to owners of the parent of ¥127 million. Selling, general and administrative expenses increased ¥286 million year on year, mainly because legal fees increased in connection with the litigation.」
Operating income, ordinary income and net income in the same period of the previous year turned into losses, while selling, general and administrative expenses increased ¥286 million owing to legal fees and other litigation-related costs. - FY2023-Q1WorsenedAnnual report
「Selling, general and administrative expenses increased ¥115 million year on year, mainly because legal fees increased as the litigation progressed. In addition, foreign exchange losses increased ¥28 million year on year, mainly owing to the depreciation of the yen.」
Higher legal fees related to the litigation and higher foreign exchange losses caused by yen depreciation were cited as factors behind the decline in operating and ordinary income. - FY2022WorsenedAnnual report
「In addition to the decline in revenue described above, difficulties in procuring raw materials, particularly semiconductor components, and higher prices caused the cost-of-sales ratio to rise rapidly across the Group. Selling, general and administrative expenses also increased ¥257 million year on year, resulting in a substantial decline in operating income.」
The factors affecting operating income shifted from the previous profit improvement driven by cost reductions to a higher cost-of-sales ratio due to difficulties in procuring raw materials and higher prices, together with a ¥257 million increase in selling, general and administrative expenses. - FY2022-Q3WorsenedAnnual report
「Operating income was ¥375 million, down 66.5% year on year; ordinary income was ¥223 million, down 79.6%; and quarterly net income attributable to owners of the parent was ¥149 million, down 82.7%. The main factor was a decline in product margins owing to higher prices for raw materials and other inputs.」
The decline in product margins due to higher raw material prices was newly identified as the main cause of the decline in profit. - FY2021MitigatedAnnual report
「In addition to the increase in revenue described above, the patent infringement lawsuit filed by U.S.-based HONEYWELL and its subsidiaries ended on 10 February 2021. The resulting substantial reduction in legal fees and other litigation costs was the main factor.」
The end of the patent litigation substantially reduced litigation costs and was a factor in the shift from an operating loss in the previous fiscal year to operating income. - FY2021-Q3MitigatedAnnual report
「In addition to the increase in revenue described above, the patent infringement lawsuit filed by U.S.-based HONEYWELL was settled on 10 February 2021, resulting in a substantial reduction in litigation costs, which was a major factor.」
The settlement of the patent litigation substantially reduced litigation costs and, together with higher revenue, contributed to improved profitability. - FY2021-Q2MitigatedAnnual report
「The main factor was the substantial reduction in litigation costs following the settlement on 10 February 2021 of the patent infringement lawsuit filed by U.S.-based HONEYWELL.」
The settlement of the patent litigation substantially reduced litigation costs and was cited as a factor in improved profitability. - FY2021-Q1MitigatedAnnual report
「In the previous fiscal year, the Company reported a loss because it incurred substantial legal fees and settlement costs in responding to the patent infringement lawsuit filed by U.S.-based HONEYWELL. The litigation was settled on 10 February 2021. Accordingly, during the first-quarter consolidated cumulative period under review, litigation-related costs declined year on year, while the increase in revenue described above also contributed to a substantial profit.」
The settlement of the patent litigation reduced litigation-related costs year on year and, together with higher revenue, contributed to improved profitability. - FY2020-Q3RestatedAnnual report
「The main factors were a ¥221 million year-on-year increase in selling, general and administrative expenses to cover the response to the patent infringement lawsuit filed by U.S.-based HONEYWELL on 31 May 2019, and a ¥981 million extraordinary loss incurred in the first quarter as a result of the obligation to pay a US$9 million settlement under a partial settlement agreement concluded with HONEYWELL on 7 February 2020 (U.S. time).」
The company continued to cite higher selling, general and administrative expenses related to the litigation and the extraordinary loss from the US$9 million settlement, which had already been incurred, as factors worsening profitability. - FY2020-Q2WorsenedAnnual report
「The main factors were a ¥221 million year-on-year increase in selling, general and administrative expenses to cover the response to the patent infringement lawsuit filed by U.S.-based HONEYWELL on 31 May 2019, and a ¥981 million extraordinary loss resulting from the obligation to pay a settlement of US$9 million under a partial settlement agreement concluded with HONEYWELL on 7 February 2020 (U.S. time).」
In addition to higher selling, general and administrative expenses related to the litigation, a ¥981 million extraordinary loss arose from the US$9 million settlement, contributing to the operating and net losses. - FY2020-Q1WorsenedAnnual report
「Operating loss was ¥241 million, compared with operating income of ¥273 million in the same period of the previous year, and ordinary loss was ¥255 million, compared with ordinary income of ¥268 million. The main factors were a substantial decline in margins due to downward price pressure and a ¥207 million year-on-year increase in selling, general and administrative expenses to cover the response to the patent infringement lawsuit filed by U.S.-based HONEYWELL on 31 May 2019.」
The results shifted from the previous profit improvement driven by reductions in cost of sales and selling, general and administrative expenses to an operating loss, owing to lower margins caused by lower prices and higher selling, general and administrative expenses related to the patent litigation. - FY2019Profit improvement weakened by lower prices and litigation-related costsAnnual report
「However, as described above, revenue declined, margins were compressed by lower selling prices, and the Company was sued for patent infringement by U.S.-based Honeywell on 31 May 2019. As litigation-related costs amounted to ¥392 million, profit declined substantially year on year.」
Unlike the profit improvement achieved through reductions in cost of sales and selling, general and administrative expenses through the previous fiscal year, operating income declined substantially this time because of lower revenue, lower selling prices and ¥392 million in patent litigation-related costs. - FY2019-Q3Profit growth despite higher litigation-related costsAnnual report
「As stated in the notice concerning the filing of litigation against the Company and the revision of the 2019 full-year earnings forecast released on 21 June 2019, selling, general and administrative expenses increased ¥49 million year on year due to litigation-related costs. However, profit increased as a result of the increase in profit in the first quarter.」
The company explained that, although selling, general and administrative expenses increased ¥49 million due to litigation-related costs this time, profit increased owing to the higher first-quarter profit, in addition to the previous improvement from reductions in cost of sales and selling, general and administrative expenses. - FY2019-Q2AdvancedAnnual report
「During the first six months of the fiscal year under review, in addition to the increase in revenue described above, the Company continued its efforts to reduce selling, general and administrative expenses, as it had in the first quarter. As a result, operating income was ¥483 million, up 301.0% year on year, ordinary income was ¥474 million, up 354.5%, and quarterly net income attributable to owners of the parent was ¥446 million, compared with ¥36 million in the same period of the previous year.」
As reductions in selling, general and administrative expenses continued, operating income increased 301.0% year on year and ordinary income increased 354.5%. - FY2019-Q1AdvancedAnnual report
「Operating income increased to ¥273 million, up 168.0% year on year, as a result of efforts to reduce cost of sales and selling, general and administrative expenses.」
Operating income increased 168.0% year on year as a result of efforts to reduce cost of sales and selling, general and administrative expenses. - FY2018AdvancedAnnual report
「As a result, cost of sales was ¥4,552 million, down 6.3% year on year, and gross profit was ¥2,996 million, up 38.1%. Selling, general and administrative expenses were ¥2,545 million, up 2.0%.」
The company proceeded with discontinuing sales and disposing of inventory of old products, reviewing selling prices, and reducing manufacturing costs for new products. As a result, cost of sales decreased 6.3% and gross profit increased 38.1%. - FY2016-Q3DroppedAnnual report
「In terms of profitability, although overseas revenue declined, the dollar-denominated shipping structure proved effective and enabled the Group to secure profits. In Japan, however, profit declined because expenses related to new product development increased.」
The substantial improvement in the cost ratio cited previously was not identified as a factor in the current results. Instead, the overseas dollar-denominated shipping structure and domestic new product development costs were cited as factors affecting profit. - FY2016-Q2First statedAnnual report
「Operating income increased to ¥389 million, up 63.5% year on year, owing to a substantial improvement in the cost ratio.」
The company explained that operating income increased 63.5% year on year, primarily due to a substantial improvement in the cost ratio.