Transforming the business into one capable of generating stable profits under the new medium-term management plan

「The achievement of the numerical targets set out in this plan, namely consolidated net sales of ¥161.0 billion, operating profit of ¥16.5 billion, ROIC of 8% and ROE of 9%, is proving difficult because of a combination of factors, including (a) the withdrawal from the general-purpose exterior building materials business for the US housing market, (b) a substantial contraction in Japan's housing market, and (c) procurement risks and surging energy and raw material prices associated with heightened tensions in the Middle East.」

「In the First Medium-Term Management Plan described below (FY2024 to FY2026), the Group places particular importance on ROE, return on invested capital (ROIC) and the price-to-book ratio (PBR). It has set a target ROE of 9%, above the market's expected cost of equity, and a target ROIC of 8%, above the weighted average cost of capital (WACC), calculated by weighting the cost of equity and the cost of debt. During the previous medium-term plan, PBR remained below 1x, ranging from 0.8x to 0.9x, but the Group aims to maintain it consistently above 1x going forward.」

「As a management indicator, the Group places particular importance on return on equity (ROE). In addition to maximizing profits through expanded sales and cost reductions, the Group aims to optimize capital efficiency and has set a target of approximately 10% ROE under its Medium-Term Management Plan (April 2021 to March 2024). ROE was 7.8% in the consolidated fiscal year under review. In the fiscal year ending March 2024, the final year of the Medium-Term Management Plan, the Group is expected to fall below the plan's 10% target, owing not only to the shortfall against its profit target but also to an increase in net assets through higher foreign currency translation adjustment accounts resulting from the weaker yen.」

「As a management indicator, the Group places particular importance on return on equity (ROE). By maximizing profits through expanded sales, cost reductions and quality enhancements, among other measures, the Group has set a medium-term target of ROE of at least 12% under its Medium-Term Management Plan (April 2018 to March 2021). ROE was 9.1% in the consolidated fiscal year under review, reflecting lower revenue and profit due to the impact of COVID-19. Under the New Medium-Term Management Plan (April 2021 to March 2024), the Group has set a medium-term target of ROE of approximately 10%.」

「As a management indicator, the Group places particular importance on return on equity (ROE). By maximizing profits through expanded sales, cost reductions and quality enhancements, among other measures, the Group has set a medium-term target of ROE of at least 12% under its Medium-Term Management Plan (April 2018 to March 2021). ROE was 11.8% in the consolidated fiscal year under review.」

「As a management indicator, the Group places particular importance on return on equity (ROE). By maximizing profits through expanded sales, cost reductions and quality enhancements, among other measures, the Group set a medium-term target of ROE of at least 10% under its Medium-Term Management Plan (April 2015 to March 2018). ROE was 14.6% in the consolidated fiscal year under review, achieving the target. The Group will continue working to achieve sustainable growth and enhance corporate value over the medium to long term. It also plans to build an appropriate level of equity capital in order to maintain a sound financial position. Under the New Medium-Term Management Plan (April 2018 to March 2021), the Group has set a medium-term target of ROE of at least 12%.」

「As management indicators, the Group places particular importance on earnings per share (EPS) and return on equity (ROE). By maximizing profits through expanded sales, cost reductions and quality enhancements, among other measures, the Group has set medium-term targets of EPS of at least ¥150 and ROE of at least 10%. In the consolidated fiscal year under review, EPS was ¥259.52 and ROE was 14.3%, achieving both targets.」

「The Group will closely monitor political and economic developments and market changes in Japan and overseas. To overcome the medium- to long-term challenge of a shrinking detached-home market caused by declining birth rates, an aging population and population decline, we will actively address various issues under the New Medium-Term Management Plan (April 2015 to March 2018) and proceed with the transformation into a corporate structure capable of generating stable profits.」