Dependence on Overseas Sales and Regional Economic and Political Conditions

「Among overseas markets, North America posted substantial sales growth as sales of global sub-brands such as ATTESA and CITIZEN L expanded. In addition to the main department-store channel, travel retail sales performed well, while online sales, including the company’s own e-commerce business, also grew substantially.」

「Total overseas 266,964 77.0」

「The North American economy remained firm in terms of private consumption despite rising inflationary pressure, including from the pass-through of tariff costs to prices. In Europe, private consumption remained sluggish as manufacturing slowed with the full impact of US tariff policies emerging, despite stable income conditions. In Asia, the boost to consumption from China's subsidy policies and other measures weakened, while recovery in private consumption in other Asian regions lacked strength due to uncertainty over domestic and international political and economic conditions.」

「During the six months ended 30 September, private consumption in Japan remained weak as consumers became more inclined to economize due to higher prices. The North American economy remained firm as employment and income conditions improved alongside lower inflation. The European economy showed signs of recovery but lacked strength in some areas, and the recovery in private consumption remained gradual. In Asia, economic stagnation continued in China, while exports recovered in other parts of Asia, although recovery in private consumption varied by region.」

「Total overseas 224,864 74.6 230,084 73.6」

「In North America and Europe, private consumption remained firm, supported by expanding wage growth and rising employment despite growing concerns over an economic downturn due to inflation and higher interest rates. In Asia, China's economic recovery was slow after the resumption of economic activity, while recovery in other Asian regions remained gradual as exports and demand for capital investment lacked momentum.」

「During the six months ended 30 September, private consumption in Japan maintained an upward trend and continued to recover gradually as economic activity normalized. In North America and Europe, private consumption remained firm, supported by expanding wage growth and rising employment, despite growing concerns over an economic downturn due to inflation and higher interest rates. In Asia, the economic recovery in China was slow after the resumption of economic activity, while recovery in other Asian regions remained gradual as exports and demand for capital investment lacked momentum.」

「During the three months ended 30 June, private consumption in Japan maintained an upward trend and continued to recover gradually as economic activity normalized. In North America and Europe, private consumption remained firm, supported by expanding wage growth and rising employment, despite growing concerns over an economic downturn due to inflation and higher interest rates. In Asia, although an economic recovery in China was expected following the lifting of severe activity restrictions, consumption remained sluggish, while recovery in other Asian regions remained gradual as exports and demand for capital investment lacked momentum.」

「Overseas sales account for a high proportion of our group's product revenue, and our products are sold worldwide. Accordingly, economic and consumer trends in each region may affect the group's performance.」

「In North America and Europe, concerns over a recession increased as inflation accelerated and monetary tightening proceeded. In Asia, including China, recovery remained weak. Although China shifted away from its zero-COVID policy, its economy remained strongly stagnant, while recovery in other Asian regions remained weak due to the impact of sharply higher prices.」

「In North America and Europe, inflation accelerated, including due to soaring resource prices, and rapid monetary tightening in each country created downward pressure on economic activity, weakening the recovery. In Asia, private consumption in China fell due to activity restrictions associated with lockdowns, leaving the economy strongly stagnant, while recovery in other Asian regions remained weak due to the impact of sharply higher prices.」

「During the three months ended 30 June, private consumption in Japan showed signs of a gradual recovery as economic activity normalized. In North America and Europe, inflation accelerated, including due to soaring resource prices, and rapid monetary tightening in each country created downward pressure on economic activity, weakening the recovery. In Asia, private consumption in China fell due to severe activity restrictions and the economy remained strongly stagnant, while recovery in other Asian regions remained weak due to the impact of sharply higher prices.」

「Similarly, in North America and Europe, there were concerns over a decline in private consumption due to the renewed spread of COVID-19, but both regions generally maintained a recovery trend. In Asia, the Chinese market showed signs of an economic slowdown due to uncertainty over the outlook, while recovery also varied across other Asian regions depending on the extent to which infections were contained, leaving economic activity lacking momentum.」

「During the six months ended 30 September, the domestic economy recovered only gradually, as the prolonged impact of the spread of COVID-19, including the extension of the state of emergency, led to continued loss of inbound demand and sluggish domestic demand. In North America, despite concerns over the spread of variants and shortages of components, particularly semiconductors, consumer sentiment improved as vaccination progressed and economic activity resumed. The European economy also remained firm as activity restrictions were gradually eased. In Asia, the Chinese market continued to show signs of recovery despite concerns over an economic slowdown, while recovery varied across other Asian regions depending on the extent to which infections were contained.」

「During the three months ended 30 June, the domestic economy recovered only moderately, as the prolonged impact of the spread of COVID-19, including the reissuance of the state of emergency, led to continued loss of inbound demand and sluggish domestic demand. In North America, despite concerns over the spread of variants, consumer sentiment improved as vaccination progressed and economic activity resumed. The European economy also remained firm as activity restrictions were gradually eased. In Asia, the Chinese economy continued to recover, while recovery varied across other Asian regions depending on the extent to which infections were contained.」

「Against this backdrop, consolidated results for the nine months ended 31 December were revenue of ¥151.1 billion, down 32.8% year on year, and an operating loss of ¥6.0 billion, compared with operating profit of ¥11.2 billion in the same period of the previous year, resulting in lower revenue and profit.」

「During the six months ended 30 September, the domestic economy showed signs of recovery but declined sharply as inbound demand fell due to the spread of COVID-19 and consumer activity stagnated. In the US economy, exports and capital investment also fell substantially, while private consumption remained weak. Economic activity in Europe remained at a low level due to the impact of large-scale lockdowns. In Asia, although the Chinese market was expected to recover after reopening economic activity ahead of the rest of the world, the recovery in private consumption was slow, and other Asian regions also lacked momentum.」

「During the three months ended 30 June, the domestic economy declined sharply as inbound demand fell due to entry restrictions related to the spread of COVID-19 and consumer activity stagnated following the government's state of emergency declaration and requests for people to refrain from going out. In the US economy, the employment environment also deteriorated rapidly, while willingness to export and invest in capital equipment fell sharply. The European economy also declined rapidly amid large-scale lockdowns. In Asia, although a recovery in the Chinese market was expected, private consumption remained weak, and other Asian regions also lacked momentum.」

「Total overseas sales were ¥179,692 million, accounting for 64.5%, down from ¥213,189 million and 66.3% in the previous fiscal year.」

「Against this backdrop, for the 9-month cumulative period ended December 31, consolidated net sales were ¥224.9 billion, down 9.2% year on year, and operating profit was ¥11.2 billion, down 45.9%, resulting in lower sales and profit. Ordinary profit was ¥12.4 billion, down 46.6%, and profit attributable to owners of the parent was ¥7.0 billion, down 51.2%, with both also declining year on year.」

「Against this backdrop, for the 6-month cumulative period ended September 30, consolidated net sales were ¥144.4 billion, down 6.5% year on year, and operating profit was ¥5.7 billion, down 47.8%, resulting in lower sales and profit. Ordinary profit was ¥5.8 billion, down 55.1%, and profit attributable to owners of the parent was ¥3.5 billion, down 57.1%, with both also declining year on year.」

「In North America, both men's and women's products performed well in the core mid-priced market, but this was insufficient to offset further reorganization of physical stores and the downturn in the watch market. The European market also struggled, with consumer spending remaining sluggish amid rising political uncertainty, and both regions recorded lower revenue. In Asia, although some areas such as Hong Kong and Thailand remained firm, sales were sluggish due to uncertainty over China's economic outlook, resulting in lower revenue.」

「During the nine-month period ended [the current third quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「During the six-month period ended [the current second quarter], there were no newly arising business or other risks, nor any material changes to the business and other risks described in the Annual Securities Report for the prior fiscal year.」

「No new business or other risks arose during the first quarter of the current consolidated cumulative period. There were also no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「No new business or other risks arose during the cumulative third quarter under review. In addition, there have been no material changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「Against this backdrop, consolidated results for the six months ended 30 September showed revenue of ¥154.8 billion, down 11.2% year on year, and operating profit of ¥10.7 billion, down 28.4%, resulting in lower revenue and profit. In addition, due in part to foreign exchange losses caused by the yen's sharp appreciation, ordinary profit was ¥8.3 billion, down 47.1% year on year, and profit attributable to owners of the parent was ¥5.2 billion, down 48.4%.」

「The domestic market continued to show sluggish growth, affected by the stronger yen, falling share prices and lower inbound demand since the beginning of the year. The US economy also saw a temporary market slowdown, as economic conditions remained unstable following the rate hike in December last year and uncertainty surrounded the presidential election scheduled for the autumn. Although the European economy maintained a stable economic environment amid continued uncertainty over the outlook, concerns have arisen over the future impact of the UK's decision to leave the EU not only on European markets but also on the global economy and foreign exchange markets. Asian economies remained in difficult circumstances, with economic stagnation in China and the ASEAN region.」

「Overseas sales account for a high proportion of our group's product revenue, and our products are sold worldwide. Accordingly, economic and consumer trends in each region may affect the group's performance.」