Investment burden from new businesses and delayed monetization

「なお、資源・材料販売における大型案件の本格採用については、顧客側で生産計画の最終調整に入っています。」

「Resource and materials sales progressed steadily as the number of orders increased. However, 2 of the projects expected to proceed to full-scale adoption during the current fiscal year were postponed to the next fiscal year because of changes in the customers' production plans, resulting in performance below plan for the current fiscal year.」

「For customers expected to proceed with full-scale adoption, the Company is conducting sales activities to obtain their production and ordering plans. In addition, moves toward full-scale adoption have emerged in the sale of resources and materials.」

「The Company sold samples for a fee, and the range of industries conducting evaluations is expanding both in Japan and overseas. In the heat-dissipation materials field, some chemical-materials manufacturers among customers with a high likelihood of full-scale adoption have moved to the specification-confirmation phase after receiving favorable evaluation results. The Company sold samples in larger lots than before.」

「The Company sold samples for a fee and received favorable evaluation results on multiple projects. In some projects, the evaluation cycle became shorter, while some customers used a substantial quantity of material in a single evaluation. Additional orders and sample shipment volumes increased.」

「The Company sold samples for a fee and received favorable evaluation results on multiple projects. Additional orders and the volume of samples shipped per project increased.」

「In the consolidated fiscal year, the carrying amounts of assets showing a decline in profitability were reduced to their recoverable amounts, and the resulting reduction of ¥154.881 million was recorded as an impairment loss under extraordinary losses.」

「In these circumstances, we secured adoption of our material for use in semiconductor manufacturing equipment in the industrial sector. Although the volume of the adopted material remains small, CNF applications are expected not only in the aerospace and automotive-related markets but also in the industrial sector. Using this adoption as a foothold, we will promote horizontal sales expansion.」

「As a result of these initiatives, some customers progressed to the stage of final testing and scale-up testing. As a result, sales exceeded those in the same quarter of the previous year.」

「In addition, a chemical manufacturer that sells reagents and other products registered the Company's products and began selling them, creating more opportunities for researchers and developers in Japan and overseas to obtain the Company's products. As a result, sales exceeded those in the same quarter of the previous year.」

「The Company sold samples for a fee. As sample evaluations progressed, it began receiving strong inquiries, particularly from the aerospace, automotive and infrastructure industries. It also agreed to conclude a joint development agreement with a leading aerospace company and to extend a confidentiality agreement with a leading automotive company. The number of sample shipments to a broad range of industries in Japan and overseas increased, as did the number of customers considering multiple applications within a single company. As a result, sales exceeded those in the same quarter of the previous year, although they were below plan for the quarter.」

「The Company sold samples for a fee. Although sales were below plan, partly because some sales were pushed into the third-quarter accounting period due to changes in delivery formats and other factors, they exceeded sales in the same quarter of the previous year.」

「The Company sold samples for a fee. Although sales were below plan, they exceeded sales in the same quarter of the previous year. Several dozen customers are continuing their evaluations, and the number of customers newly beginning evaluations is increasing.」

「In the consolidated fiscal year, the Company recorded an impairment loss of ¥82.960 million. The recoverable amount was calculated based on value in use, which was determined to be zero.」

「The Nanomaterials business commercializes powdered carbon fiber. Although sales for mass production have yet to materialize, the track record of prototype evaluations is growing.」

「The Nanomaterials business commercializes powdered carbon fiber. Although paid sample shipments and inquiries from customers continued to increase, customer evaluations and verification processes remained at the evaluation stage, and there were no sales for mass production.」

「Although paid sample shipments and inquiries from individual customers continued to increase, the products remained at the evaluation stage in customers' assessment and verification processes, and there were no sales for mass production.」

「Although paid sample shipments and inquiries from individual customers increased, the products remained at the evaluation stage in customers' assessment and verification processes, and there were no sales for mass production.」

「If a new business that has been launched fails to progress as planned due to changes in market conditions, customer trends or other factors, the funds invested may not be recoverable, which may adversely affect the Group's operating performance.」

「The business environment changed due to various factors, including soaring advertising costs, and performance continued to stagnate. As results remained substantially below the initial budget, the Group transferred the WEB Business on 30 September 2018 while working to strengthen its management structure as part of its business restructuring efforts.」

「Following a renewed assessment of the recoverability of the WEB Business, a decline in profitability was identified, and an impairment loss of ¥129 million was recognized as an extraordinary loss.」

「However, sales fell short of plan because the delayed full-scale launch of operations during the second quarter of the fiscal year affected performance.」

「Although the Group proceeded in parallel with establishing its internal structure and transferring operations, the transfer of operations and integration of business systems took longer than expected, and the full-scale launch of operations required additional time, causing performance to fall short of plan.」

「The Group is pursuing new businesses with the aim of securing stable earnings and achieving sustainable corporate growth. Depending on their nature, these businesses may require expenditures on research and development, capital investment and securing personnel, and because a new business requires a certain period from launch until it generates stable earnings, it may adversely affect the Group's operating performance during that period.」

「We expanded sales of inspection equipment mainly in China and Southeast Asia. We actively exhibited at trade shows held in various regions of China and sought to acquire new customers, resulting in a substantial increase in the number of projects under inquiry. However, revenue fell short of plan because project sizes were reduced or projects were frozen, and because responding to customer requirements took longer, preventing sales from being completed.」

「We expanded sales of inspection equipment mainly in China and Southeast Asia. We actively exhibited at trade shows held in various regions of China and sought to acquire new customers, resulting in a substantial increase in the number of projects under inquiry. However, revenue fell short of plan because the order timing for many projects was pushed back to the third-quarter consolidated accounting period or later.」

「As a result, although revenue exceeded that of the previous quarter, the order timing for many projects that had been scheduled for receipt was pushed back to the third quarter of the fiscal year and beyond, causing revenue to fall short of plan.」

「Because a new business requires a certain period from launch until it generates stable earnings, it may adversely affect the Group's operating performance during that period.」