Operational Efficiency

「In addition, efforts to improve security efficiency through the use of IT and to optimize resources within the group in response to labor shortages also contributed to improving profitability.」

「Purpose of the business combination: To improve management efficiency by centralizing business operations within the group and to make effective use of human capital in preparation for the Osaka-Kansai Expo, the Company decided to absorb and merge アムス・セキュリティサービス株式会社 (Osaka) and アムス・シークレットサービス株式会社.」

「Although labor costs increased due to the higher minimum wage and outsourcing costs remained elevated because of delays in bringing work in-house, collaboration with 東洋テック following the integration of the building maintenance subsidiaries also generated benefits. Revenue, excluding intersegment sales and transfers, was ¥7,367 million, an increase of ¥635 million, or 9.4%, from the same quarter of the previous fiscal year, while segment profit was ¥94 million, an increase of ¥69 million, or 278.3%.」

「Although expenses increased to a limited extent in connection with the integration of 2 cleaning subsidiaries, the expected integration benefits materialized, resulting in revenue, excluding intersegment sales and transfers, of ¥4,909 million, an increase of ¥516 million, or 11.8%, from the same quarter of the previous fiscal year, and segment profit of ¥61 million, an increase of ¥103 million from the same quarter of the previous fiscal year.」

「The 2 companies primarily engaged in cleaning services also improved profitability after negotiating price increases with customers in response to the minimum wage increase. As a result, the building management business recovered from its first-quarter loss and returned to profitability in the second quarter. It remained profitable in the cumulative third quarter, with revenue excluding intersegment internal revenue and transfers of ¥6,731 million, an increase of ¥63 million, or 0.9%, from the same period of the previous year, while segment profit was ¥25 million, a decrease of ¥224 million, or 90.0%, from the same period of the previous year.」

「Although the absorption-type merger of 4 subsidiaries in the first quarter resulted in a temporary increase in expenses, the performance of the building management companies improved, and revenue was ¥4,392 million, at the same level as in the same quarter of the previous year. Segment profit was a loss of ¥42 million due to the temporary increase in expenses from the absorption-type merger and the higher cost burden associated with the minimum wage increase.」

「While establishing the structure following the merger of 4 building maintenance subsidiaries, the group was unable to conduct sufficient sales promotion activities during the first quarter of the current fiscal year. As a result of fewer orders for spot construction and other projects, cancellations of cleaning-related services and fewer orders for COVID-19-related disinfection work, revenue declined by ¥29 million year on year to ¥2,121 million.」

「The purpose of the merger was to centrally manage and effectively use the skills, expertise and human resources held by each company, thereby further strengthening the building management business through the provision of higher value-added services.」

「As a result of higher revenue and cost controls, segment profit was ¥170 million, up 196.8% year on year.」

「The building management business performed well, and we also undertook cleaning and disinfection services at COVID-19 vaccination sites by generating further group synergies. Revenue was ¥2,150 million, up 11.6% year on year. Segment profit (operating profit) was ¥62 million, up 1,215.9% year on year, due to higher revenue and cost controls.」

「To address the impact of COVID-19 on recent business performance, we are working to improve profitability by restraining mid-career hiring through administrative efficiency improvements and more efficient deployment of head-office personnel.」

「To adapt flexibly to recent changes in the business environment, the group worked as one to thoroughly improve efficiency across operations and implement low-cost operations, while also developing new customers and identifying M&A opportunities.」

「As a result of efforts to expand margins and implement low-cost operations, segment profit (operating profit) was ¥110 million, up 12.5% year on year.」

「Although outsourcing expenses and personnel expenses increased, cost controls for property-related expenses and other costs took effect, and the high-margin real estate business also contributed. Operating profit increased 11.4% year on year to ¥430 million.」

「Although outsourcing expenses increased with higher revenue, cost controls for property-related expenses and personnel expenses, among others, took effect, while the high-margin real estate business also contributed. Operating profit was ¥215 million, up 28.5% year on year.」

「By further shifting administrative personnel to sales through operational efficiency improvements and merging Fuji Service Co., Ltd. and Osaka Building Service Co., Ltd., we strengthened the execution structure for large-scale building management projects, positioning the merged entity as the group’s core cleaning company.」

「As efficiency improvements and price-increase negotiations pursued by the group companies since the previous year took effect, segment profit (operating profit) was ¥98 million, compared with a segment loss (operating loss) of ¥45 million in the same quarter of the previous year.」

「In the building management business, stronger integrated sales capabilities, which have been pursued since the previous fiscal year, together with expense control, resulted in revenue, excluding intersegment sales and transfers, of ¥2,763 million, up 5.5% year on year. Segment profit, or operating profit, was ¥68 million, compared with a segment loss, or operating loss, of ¥37 million in the same quarter of the previous fiscal year, as cost-cutting measures implemented by the Group's companies since the previous fiscal year and negotiations for price increases proved effective.」

「In the security services business, revenue, excluding intersegment revenue or transfers, was ¥3,977 million, up 5.3% year on year, as mechanical security, security transport, facility security and ATM management services all performed steadily. As a result of continued efforts to improve efficiency across operations, segment profit (operating profit) was ¥132 million, up 33.8% year on year.」

「We will further improve operational efficiency and develop employees with broader skill sets as the new administrative system, T-LINK, enters full operation.」

「Although we worked to improve efficiency across operations, higher personnel and other expenses resulted in segment profit (operating profit) of ¥200 million, a decrease of ¥64 million, or 24.3%, year on year.」

「As a result of efforts to improve efficiency across operations, segment profit (operating profit) was ¥99 million, an increase of ¥9 million, or 10.6%, year on year.」

「(5) Improving operational efficiency」